Funding can be a major challenge for businesses that are looking to grow or diversify their offering. Patrick Black, our Food and AgriBusiness Executive, explores how LEADER funding can make a difference for rural businesses.
Launched in April 2021 the purpose of the LEADER Transitional programme is to bridge the gap between the 2014-2020 LEADER Programme and the commencement of the next EU Programme in 2023. LEADER sets out to support rural businesses seeking to reach new markets, expand, innovate and/or diversify in response to macro trends such as Covid-19 and Brexit. Alongside the wider fund, a specialised stream for food businesses is available under the LEADER Food Initiative.
The LEADER application process itself can be lengthy but the benefits for a rural business are significant.
For example, we recently worked with an ifac food business client, who was diversifying their product offering, to secure €120,000 in LEADER funding. While it was a detailed procedure, the funding has made a monumental difference to the business’ growth, helping to drive the business forward.
The level of funding available varies depending on the project and county in which a business is based but generally funding of up to 75%, to a maximum of €200,000, is available for capital works, consultancy or machinery upgrades.
In ifac, we are working closely with a number of businesses utilising LEADER funding to grow their rural businesses. The types of businesses vary from established food businesses looking to expand, to start-up farm diversification projects. Eligible businesses are those with an annual turnover of up to €10 million and employing fewer than 50 people.
In most counties LEADER funding is administered by a Local Community Development Committee (LCDC). Some LCDCs operate open calls, which means they will accept applications at any point throughout the duration of the programme. Others operate targeted calls, which means they will only accept applications during particular periods.
Having worked through the LEADER application process from initial engagement through to funding drawdown with several businesses, we have identified some key learnings to help with a successful application including:
1. Having a detailed business plan with a strategic focus, backed by strong financial projections will increase your chances of securing funding
2. Identify and engage with your LCDC early in the process and take their advice on board throughout
3. Managing all aspects of the application process can be tricky. Create a filing system that works for you. Track every email, quote, invoice, payment etc. in relation to the project as you go. This will be vital at the funding drawdown stage
4. Do not commence any work until you have been approved by the LCDC as it could put the funding in jeopardy
5. Invest time in completing your expression of interest form. Putting your best foot forward initially is key.
Broadly speaking the LEADER application process can be broken into eight steps:
1. Engage with your LCDC and build a relationship with your Rural Development Officer
2. Submit your expression of interest (EOI) form to your local LCDC providing an overview of your proposed project
3. If your EOI is successful, you will receive a letter of invitation to complete a full application
4. Complete the full application to include; a business plan, financial projections, application form, and the required procurement documents (e.g., quotes, requests for quotes, supplier details, etc.)
5. The application pack will then be presented to the LCDC for approval
6. Once approved, the business can commence with the project e.g., begin construction work, engage a consultant
7. Once the project has been completed by the selected suppliers, the business will need to pay the suppliers in full and keep a full record of all payments and invoices
8. LEADER will then evaluate the project and the business can reclaim up to 75% of the fees for the project.
If you are a rural business or a farmer with a farm diversification project in mind and would like to discuss funding, get in touch with your local ifac office.