Guide to Government ERP Funding in Canada
One of the biggest things small businesses take for granted when they are trying to get their feet off the ground is government funding for ERP. The Canadian Government offers dozens of federal and provincial funding programs that help ease the financial burden for small businesses, who in many cases don’t even know they exist. It’s very common for small businesses to find themselves between a rock and a hard place: they need an Enterprise Resource Planning (ERP) solution in order to grow, but they need to grow in order to be able to afford an ERP. Sound familiar?
This is where government funding for ERP comes into play. There are a variety of programs available that are designed to give you the help you need to break through to the next stage of growth, you just need to know what’s available to you.
Basic Criteria for many Canadian Funding Programs
Unfortunately, these funding programs aren’t available to all businesses. If only it were that easy! The majority of Canadian business grants and loans require that you meet the eligibility criteria, such as:
- Incorporated for a specific number of years;
- A specified number of employees;
- A mandate that you must manufacture or perform R&D in Canada;
- Being cash-flow positive for a specified period of time.
As you’ll discover with the grants we mention later, there are varying degrees of eligibility requirements so it’s important not to rule out funding for ERP implementation until you have researched all of the options available to you. Make sure to check eligibility criteria for all of the grants and funding you hope to apply for, as the criteria may deviate dramatically from one another.
Partner with ERP Experts
Finding a business management technology solution that can fit within your budget (even with the assistance of grants) only scrapes the surface of this decision. You also need to ensure that the solution you choose can accommodate your business goals and provide the features you need to thrive in your industry and continue to grow. Choosing and implementing an ERP isn’t as simple as buying and installing software. You will need to conduct a thorough analysis of your business processes to determine which modules you need, how they will be adopted, ways that your processes can be streamlined and more.
To achieve this it’s recommended to partner with an ERP expert that represents multiple solutions, so they can conduct a discovery into your business to make an educated recommendation for which solution is the best fit for your business. This process will also give you the opportunity to gain detailed insight into the different options you have available and explore the benefits they have to offer.
You’ll be pleased to know that this is where you can start to utilize grants which is another benefit of a Solutions Partner: they can help prepare some of the documents needed for grant applications, whether for the purchase of the solution or for the ongoing training.
Recommended Grants for ERP Projects
IRAP Accelerated Review Process (ARP) Canadian Business Grants for Costs Associated with Planning and Analysis
Determining which ERP is the best fit for your business is arguably one of the most important decisions your business will ever make. To subsidize the costs involved with selecting, designing and customizing an ERP you can utilize the IRAP grant, which provides $50k that can be put towards up to 80% of direct labour costs and 50% of sub-contractor fees.
The goal of this grant is to provide funding to ‘perform the technical research needed to solve an internal innovation challenge’*, which entails ERP funding. It is available Canada-wide and running from April 1st to March 31st annually. Unlike the basic eligibility outlined above, this grant only requires that you have been incorporated for a minimum of 2 years and that you can have between 1 and 500 employees.
Canada Small Business Financing Program
As a part of the Canada Small Business Financing Act, the CSBFP is a government-backed loan with low-interest rates. Small businesses can apply for up to $1M for business expansion activities, including the purchase of new software systems. Applications are accepted all year round. To be eligible, you must be a for-profit Canadian company with annual gross revenues <$10M.
Other Capital Investment and Technology Funding
Depending on where you are located, your size and your industry, there may be other forms of funding available to you that are specifically for organizations like yours. For example, agriculture companies can avail of 50% funding (up to $1M) through the Canadian Agricultural Strategic Priorities Program (CASPP). To see a full list of Capital Investment and Technology funding, check out Mentorworks’ listing.
Canadian Business Grants for Training and Hiring
There are a variety of Canadian Government funds dedicated to funding the hiring and training as well, which can be used to offset costs incurred during the design and implementation of your new ERP. The grants available may depend on your size, industry and in some cases location, so based on those factors you need to apply for the funding that is applicable to you. Examples of Canada-wide funding programs include the Canada Job Grant and Apprenticeship Job Creation Tax Credit.
ERP solutions are essential in helping businesses run smoothly and grow. As a small business, the urgency of implementing an ERP varies depending on the industry, but as soon as your tools and software begin to hinder business development it’s important to start considering implementing an ERP. While financial limitations are a common hurdle, government ERP funding is there to help you along the way.
*Source: www.mentorworks.ca
Learn more about ERP Funding Options in Canada
In this on-demand webcast, hear from Stephanie Sang, CEO of Granted, and The Answer Company’s CEO and Founder, Shawn Ostheimer, on the many ERP funding options available in Canada. There are many unique use cases and differences across industries that you can be aware of to increase the chances of obtaining funding for your ERP project.