The advantages of R&D for SME businesses
Published 1 October 2020
Many SMEs neglect research and development (R&D) because they see it as something that only big businesses can do. This is a big mistake. Utilising R&D grants for small businesses is a great way for businesses of all sizes to gain an advantage over their competitors. Setting time and money aside to come up with new ideas can be hugely beneficial in the long run which is why R&D and small businesses go hand in hand. Here are six ways that R&D can help your business to thrive.
1. It gives your brand a USP
R&D is the key to developing innovative new products and services. Being the first business to offer a particular product will give you a temporary monopoly, allowing you to get a head start on competitors. This may lead to a permanent advantage if your idea generates new intellectual property for the company. Even if your idea is not revolutionary, R&D can help you to take your existing products in a new direction.
2. It boosts your income
A new product means a new income stream, so R&D is a great way to increase your profits. A company that focuses on R&D is also more likely to attract new investors who are keen to predict future trends.
3. It gives you access to funding opportunities
Although R&D can be expensive at first, it also opens up a number of funding opportunities. Companies who can prove that their R&D has a potentially positive impact can apply for government R&D grants for small businesses and EU innovation grants.
4. You are eligible for Tax Relief
As well as R&D grants for a small business, you can also claim R&D tax relief from the HMRC. This can take the form of a reduction in your annual bill or a one-off cash payment. Only some R&D expenditure is eligible for tax relief but the good news is that a project doesn’t have to succeed in order to be eligible.
This is why R&D and small businesses work so well for each other. If a project doesn’t need to take off and soar in order to be eligible for relief, you don’t need to worry about loss of investment.
5. It encourages collaboration
R&D is a great way to share knowledge and expertise with other businesses. By working together on R&D projects, companies can learn from one another in ways that benefit everyone.
6. It improves your reputation
Focusing on R&D is great for your brand image as it shows customers that you are modern and forward-thinking. Younger customers in particular will be drawn to a brand that stays at the cutting edge. Collaborating with trusted businesses and institutions on R&D projects is also a great way to improve your company’s reputation.
The advantages of R&D grants for small businesses
Here at Recoup Capital, we have a knowledgeable team of experts who can help to guide you through the advantages of R&D grants for small businesses. We know exactly how it can benefit you and what this means in terms of monetary value. Get in touch with us today and see how we can help you.
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