One of the things DEVELOP LLC has been successful with is navigating the application process for manufacturing grants, manufacturing tax credits, and resources available to turnkey automation equipment. When a custom automated machine, robotic solution, or automated manufacturing line can cost six to seven figures, finding opportunities to draw on publicly available funds positions your turnkey machine design for more engineering possibilities, more functions, and more leverage for your future business growth.
Meeting manufacturing tax credit and manufacturing grant application requirements takes discipline, proactivity, and organization, but navigating these opportunities can be easier with the help of a seasoned automation integrator. Today we’re going to start with an introduction to the Wisconsin Economic Development Corporation, one of the best resources for Wisconsin businesses. We will show you tips on what to prepare for when applying for manufacturing award funds, starting with where to get started.
And if you’re not from Wisconsin, read til the end and we’ll show you how to find these resources across the United States.
The Wisconsin Economic Development Corporation: An Introduction
The Wisconsin Economic Development Corporation (WEDC) supports businesses with access to education and training, networking with a community of suppliers, lenders, and market allies, and a centralized information hub for resources, grants, and tax credits opportunities. An evolution of the former Wisconsin Department of Commerce, it was nationally recognized for its transparency in reporting economic development awards.
Their Wisconsin Business Programs page has a list of all the current major Wisconsin automation Grants, Tax Credits, and Loan opportunities available (feel free to explore). While the instructions are laid out on the site, we’ve summarized the best tips to position yourself for success on your manufacturing tax credit or manufacturing grant application. We’re using the WEDC as an example today but assume that any of these tips will be relevant to any application.
Tip #1 Acquire Early Intel, Apply Day 1
There are a lot of credentials, prep work, and commitments you must gather to start your application. If you can manage it, you want to apply on day one. Here’s why:
- Limited Funds- Most grants or tax credits have a funding limit. A $10,000,000 fund for manufacturing equipment might sound like a lot of money, but if they are portioning out that money in increments of $200,000, that’s only 50 businesses total.
- Limited Time- All manufacturing grant and manufacturing tax credit funds have an open and close date. And all funds will stipulate that applications become closed on a deadline OR when funds are out. It’s pretty typical for the maximum number of allocations to outstrip the announced close date in 2-6 months.
You can get ahead of the press releases in multiple ways:
- Scope Your Automation Project- The best asset you can have is a fully scoped, quoted, and ready to sign project early in the opportunity window since some grants have more applicants than funds. A manufacturing grant or automation tax credit application will expect a detailed project proposal that includes budget, timelines and descriptions of functions. Details like ROI figures, long term growth goals, and impact figures are impossible to calculate without an automation assessment. Gathering these figures, sifting through multiple potential projects, and determining the best project takes months by itself. Plan to have that work done by an automation integrator familiar with the requirements of manufacturing grants and manufacturing tax credits. Try out our Automation Assessment Questionaire to test your readiness, assess your needs, and build your strategy today. You can get expert help from the DEVELOP LLC team scoping your project.
- Yearly Programs- Anything can happen with funding, but there are programs that refresh their funds each year. Even if you don’t qualify, turn in your application too late, or get rejected this year, you can prepare for next year. These yearly programs provide consistent financial assistance to manufacturing businesses on a variety of levels. The WEDC Small Business Grant is a good example of a new grant for local organizers intended to get consistent funding and renewal with consistent application rules.
- Community Connections- This Wisconsin Automation Implementation Grant press release took place on June 21, 2024, but manufacturers with active involvement with WEDC, WMEP, the Wisconsin Center for Manufacturing & Productivity, WMC, and other manufacturing community organizations were alerted ahead of time about ballpark figures for fund availability, application dates, and basic requirements. Picking up the phone or sending an email to the WEDC to ask about upcoming programs is no problem; this organization wants to find businesses that qualify for these funds. You’re helping them by qualifying early, justifying that grant, and potentially offering justification for a larger fund or tax credit pool for next time.
Learn more about what to consider when automating your manufacturing.
Tip #2 Check Your Application Criteria
Each manufacturing grant or manufacturing tax credit has very specific limitations and specifications on who can apply. With the numerous financial documents you’ll need to gather, proposal outlines you’ll need to write, and attention to submission guidelines, you don’t want to find yourself spending that time and effort on an application your business is automatically disqualified for. You will be in competition with a lot of other applicants, guidelines are strictly followed, no one will make an exception for your business. Here are some common restrictions for manufacturing grant and manufacturing tax credit applications:
- Size- Especially with small business and entrepreneur programs, it’s not uncommon for the application rules to stipulate businesses have a full time employee metric, such as 25 fulltime employees or less to be considered a small business.
- Type of Business- It’s not uncommon for certain manufacturing grants and manufacturing tax credits to preemptively disqualify certain business types. See below for an example from the WEDC Business Development Tax Credit ineligibility guidelines:
“Businesses not eligible … include payday loan and title loan companies; telemarketing, other than inbound call centers; pawn shops; media outlets; retail; farms; primary care medical facilities; financial institutions; and businesses in the hospitality industry.”
- Sustained Presence- Most manufacturing grants and manufacturing tax credits specify a standard to prove business continuity. This might be a requirement for minimum years of operation, a minimum revenue benchmark, or employee growth percentage over a portion of years.
- Application- You can be the right size, score well on review criteria, but still miss the mark if you have the wrong application. The International Market Access Grant specifically earmarks for financial assistance for trade shows, marketing, export education, and consulting on international rules and regulations, but wouldn’t apply for things like the purchase of new manufacturing equipment.
- Applicant Investment- There is a lot of money out there for equipment, and there are a lot of offers and grant and tax credit proposals for figures like “up to $250,000”. But be careful to read the fine print to clarify whether there is an investment match requirement. You might want to buy a $250,000 piece of equipment, you might be applying for a grant that supplies up to $250,000, but the conditions of the grant may require you to put up at least $125,000 to receive $125,000.
- Repeat Award Limit- This is a good problem to have, but there are manufacturing grants and manufacturing tax credits that disqualify you from receiving separate or future program awards after you have successfully applied, satisfied the requirements, and executed the investment. The Qualified New Business Venture (QNBV) program for instance does outline limits and maximum awards allowed to a business depending on date of previous award and how many credits they have received since then.
Tip #3 Improve Your Score
You must do more than meet the minimum requirements for a manufacturing grant or manufacturing tax credit. When a grant or tax credit awarding board gets too many applicants for the amount of funds available, they prioritize the awards they dispense based on additional scoring criteria. We’d like to tell you the most common ways you can improve your score in your proposal. Even if you can’t meet every criterion, you can use them as benchmarks to pursue at a later date.
- Demonstrate a Realistic Proposal- The ideal proposal for a manufacturing tax credit or manufacturing grant has detailed descriptions of the equipment you need with realistic quotes. It’s ready to sign. You need it done and done right or you miss out. Flimsy proposals, or even a great proposal with one thin section invites questions, back and forth, and often falls to the bottom of the pile. There are plenty of quality applicants with complete proposals, an unscoped proposal was a waste of time and money from the beginning.
- Demonstrate Need- You need to make the case that you will not be able to pursue your expansion, acquisition, or new project without these additional funds from the manufacturing tax credit or manufacturing grant. If you had the ability to fund your new opportunity without an award, you need to be prepared to answer why they should choose your company beyond ‘I want free money.’
- Demonstrate Community- You are trying to benefit from the generosity of taxpayers, investors, government agencies, and volunteers when you apply for a manufacturing award. Providing opportunities for growth is important, but these manufacturing grants and manufacturing tax credits are also trying lay the groundwork for future industry leaders. They want to give manufacturing incentives to companies that demonstrate partnership, cooperation, and leadership in their community. They are investing in your potential to share their mission and want to create allies. Any groups, philanthropy, volunteer events, anything that shows your company contributes with what you already have signals you would do more if you were given more.
- Demonstrate Economic Impact- Demonstrate how those manufacturing incentives would contribute to the local economy beyond your business. Buying property for a new headquarters in an economically distressed area, developing a depressed rural area, laying out how many full time jobs the investment will create, or preparing comparative figures on how much higher the wages you would pay are than the federal minimum wage are all ways to make your business more attractive for manufacturing awards.
- Demonstrate DEI- Review your internal demographic information, prepare to answer questions about how your business contributes to Diversity, Equity, and Inclusion. These manufacturing awards are fundamentally about giving opportunities to people that would otherwise not have access to the resources they need. If award funds can go toward uplifting an underrepresented community, that’s a boon to your chances, and often businesses are contributing already in significant ways without realizing it. If you are already, you might as well get credit for it.
- Demonstrate Environmental Impact- If you can demonstrate that your manufacturing project will improve the work environment, clean an area of the local community, or significantly reduce waste in your production, those figures are an asset to your proposal.
- Demonstrate Repeatability- When your project succeeds, your award granting organization wants to celebrate it. They want examples. They want to guide new applicants to success. If you can demonstrate that your plan is applicable to other applicants, or that your project has the potential to be repeated with the same positive impacts to your growth, you’ve given your manufacturing award granting organization ammunition to position future businesses for success. A satisfied manufacturing award committee will happily share positive feedback about your business in a way that would have cost you thousands in marketing expenses. See how the WEDC gives a full case study about how the Business Development Tax Credit Program gave Diversified Manufacturing Corporation hundreds of thousands of dollars in manufacturing tax credits and incentives.
Tip #4 Prepare for Ongoing Requirements
Especially when a manufacturing award, manufacturing grant, or manufacturing tax credit goes above four figures, those funds might come with obligations after the approval. For instance, The Small Business Development Grant Program requires annual reports and a final report on deliverables and activities with periodic on-site audits. These requirements are always outlined in the award contract and so long as you follow the contract, you will be fine. Here’s what you should know about ongoing requirements:
- You Can Lose Your Award- Even if you are approved initially, if you don’t report or demonstrate results in the manner required by your manufacturing award contract you can be disqualified after the fact. In cases where the manufacturing incentives are dispensed in fractional gates, you may be cut off from additional funds. In some worst cases you may be asked to repay all distributed funds form the award.
- Be Aware of What You Promise- The award instructions will have specific guidelines on standards they need, but they will also audit how closely your project adheres to the description you provided for your project. Even if you meet the general manufacturing award reporting guidelines, you will also be expected stand by your claims. So be aware that winning the manufacturing incentives with promises you can’t keep will not only guarantee you won’t get the award, but you will also jeopardize future applications. Award committees have a long memory for team players and a long memory for unscrupulous applications.
- You Might Not Get it all at Once- Sometimes the dollar amount is the total amount of the manufacturing award portioned out in gated stages. You might need $250,000 from an award to buy equipment upfront; it may be paid out in $50,000 increments over five years. You’ll want to be certain of the award schedule.
- Requirements Subject to Change- There is usually a clause in award contracts allowing the review committee to impose additional requirements. Functionally this clause is in these contracts so the committee has room to support a manufacturing business under extenuating circumstances that might otherwise put them out of compliance. This is not exercised lightly, but it still represents freedom to change the expected qualities of performance needed to satisfy auditors. Remain vigilant through the process and take regular opportunities to review changes or updates to manufacturing incentives contract requirements.
You Can Afford Automated Manufacturing Too
Tax Credits, Grants, and Awards give you the funds you need to grow your business faster than you could on your own without surrendering control of your business. You don’t have to surrender ownership of your hard-won company to private equity or venture capitalists. You don’t have to turn to outside investors and sign away your ability to make decisions unilaterally. You don’t have to sign away a percentage of your profits away to someone who didn’t work to build your business. You didn’t found your business to answer other people. Stay in control. You may have to satisfy the requirements of a manufacturing grant, manufacturing tax credit, or manufacturing award, but you’re just doing the same process you already do when you market your products, satisfy your consumers, and pursue revenue.
DEVELOP LLC’s team of project managers, engineers, and manufacturing experts can provide you with the number one asset you need for a manufacturing incentives program application: a fully scoped, fully quoted automated machine or robotic solution. We can create the kind of Scope of Work document that manufacturing awards committees require for approval. Our team can guide manufacturing businesses to swift return on investment, sustainable growth, and dollars on the bottom line without manufacturing tax credits, manufacturing grants, or manufacturing incentives every day. Imagine the possibilities available to your project by working with us with the goal of qualifying for manufacturing awards.
Tell us more about your project, schedule a virtual meeting, or call (262)-622-6104 to find out how to build the foundation of your company on a turnkey automated machine. Even if you are not in Wisconsin, there are manufacturing incentive organizations across the United States very similar to the WEDC. Try visiting the Economic Development Directory! This site catalogues every economic development organization, government office, and manufacturing incentive granting organization by state across the US.
Take our free Automation Assessment Questionnaire and get an instant snapshot of your potential for automation. We match engineering expertise with manufacturing knowledge across the United States.
About the Author:
Matt Moseman leads as President of DEVELOP, with a strong foundation from the Milwaukee School of Engineering, where he earned both a Bachelor’s and a Master’s in New Product Management. Moseman’s career highlights include his pivotal role in founding NodeUDesign, innovating in automation hardware, and driving DEVELOP LLC to the forefront of industrial robotics with a focus on enhancing productivity and efficiency.