Subscribe for Our Latest Resources
"*" indicates required fields
The Federal Government is investing $14 million in a centre for emerging Australian-made solutions to energy and emissions challenges. The Powering Australia Industry Growth Centre (PAIGC) aims to grow Australia’s renewables technologies industry and establish Australia as a leader in renewable energy. It will achieve this through:
Supporting locally developed and manufactured technologies, including batteries, that will help transform the nation into a renewable energy superpower, the plan is focused on creating jobs, cutting power bills and reducing emissions.
The new PAIGC will:
The program will run for 4 years until the 2026-27 financial year and Australian industry organisations, research institutions and partnerships with expertise in renewable technology are encouraged to apply for support.
The closing date for grant applications is June 19th 2023 at 5 pm AEST.
More details, including eligibility criteria, can be found on the Powering Australia Industry Growth Centre website.
Please contact the team at MGI if you have any questions or require further information.
The Federal Government has indicated that they are very keen to support innovative businesses. There are a number of funding options available by way of government grants for businesses that can meet the Government qualification requirements.
If your company has been “experimenting” to try and solve a problem in your business for which there was previously no useable solution you may be eligible to claim those activities under the Research & Development (“ R &D”) Tax Incentive. If you believe your company may qualify you need to register with AusIndustry. That body will determine if your process meets their innovation requirements and, if you are successful, will provide you with a registration number that is then incorporated into your company’s income tax return where you make your claim for the Tax Incentive. There is a separate round of incentives each financial year. Registration is undertaken in the months following the end of the year during which you incurred the costs. Therefore you need to first incur the costs and then seek the incentive after the end of the financial year.
For the 2017 financial year the rates of assistance under the R&D Tax Incentive are 43.5 per cent for eligible entities with a turnover under $20 million per annum and not controlled by a tax exempt entity and 38.5 per cent for all other eligible entities.
The incentive is obtained either as a refund of cash in circumstances where the company has no taxable income or as a rebate of tax where the company does have taxable income.
The R & D Incentive is complex and you should seek advice to assist you to make the appropriate claim. You should be particularly aware that the applicant for grants must be a company.
The Federal Government also operates an Entrepreneurs Programme that provides assistance to innovative businesses. Of particular interest is the Accelerating Commercialisation Grants, which is a merit based programme that encourages and assists small and medium businesses, entrepreneurs and researchers to commercialise novel products, processes and services.
This grant provides up to 50% of expenditure to a maximum of $1 million and includes access to an expert network as well as access to promotional opportunities. More details can be found at https://www.business.gov.au/assistance/accelerating-commercialisation.
A recent addition to assistance available is taxation incentives for investment Innovation Companies. Unlike the R & D Tax Incentives, this scheme is available to persons who invest in companies that qualify. The system is designed to encourage high net worth taxpayers who qualify as “sophisticated investors” to investment in innovative businesses.
The incentives include a 20% non-refundable carry-forward tax offset on investment in eligible companies, capped at $200,000 per investor, per year and a 10 year capital gains tax exemption for qualifying investments held for at least twelve months. For further details of this scheme refer to http://www.innovation.gov.au/page/tax-incentives-investors
You should also be aware that there is also a raft of incentives and assistance available from the various State Governments around Australia. Your local MGI firm will be able to provide you with more specific details.
In a recent article, Planning to Take Control of the Family Business, I talked about the reluctance of family and privately owned business to plan. I opined that “time pressures” and “not knowing where to start” were two of the main reasons for this reluctance.
However, I believe there is another, very important, reason for not planning – basically, a lack of desire. Or, in other words, not enough discontent with the status quo. If the business owner is “content” with the way things are, why plan, why change?
So, how do you assess whether the business owner is “content” and therefore whether there is a desire to plan and a desire for change?
I use a simple model to assess the change potential of any business using the formula:
D x V x P = Change Potential
So, what do D, V and P stand for?
The “D” stands for dissatisfaction or the extent to which you are unhappy with the current position of the business. It is the “why” – why change?
The “V” stands for Vision and represents the extent to which the business has a clear, documented vision which is shared with the key stakeholders. The vision provides the direction. It is the “what” – change to what?
The “P” stands for Plan and represents the extent to which the business has a clear, documented and communicated plan with time and date actions (i.e. who has to do what by when). It is the “how” – how will we achieve our vision?
I then ask my clients to provide a score from 1 to 10 (with 1 being low and 10 being high) for each of D, V and P. What is interesting is that sometimes there is considerable variance in these scores between the various stakeholders, particularly between key employees and the owner of the business. This in itself opens up a worthwhile discussion.
So for example, if they have a documented plan but it is not communicated to key stakeholders and/or it doesn’t have time oriented actions attached to it, then you might rate the “P” as say a 4 or 5. Similarly, if the owner of the business has a vision for the business that is in their head and is not communicated to their team, then you might rate the “V” as say a 3 or 4.
However, in my view the level of the “D” is extremely important in determining the change potential of a business and therefore the likelihood of success in implementing the plan. This determines the level of motivation the stakeholders have to change and therefore the level of motivation to plan for something different – the “fire in the belly” if you like.
If there is a low “D” and all stakeholders are content with the way things are going, why would they be motivated to change? In addition, many people fear change particularly when it is imposed upon them.
Mathematically, then if the scores to the “D”, “V” and “P” are say:
5 x 4 x 3 then the product is 60. Given that the maximum possible score (10 x 10 x 10) is 1000, then to get a percentage simply divide the calculated number by 10. Therefore, in this example, the likelihood of the business implementing change and improving itself is only 6% – a very low likelihood.
However, if for example the scores were a high level of dissatisfaction with the status quo (say 9), the owner has a clear, documented and communicated vision (say 8) and there is a written action plan as to who has to do what by when (say 8), then the likelihood of the business implementing the plan and achieving the vision is much higher (9 x 8 x 8 = 57.6%).
As a final point, if the level of ‘Dissatisfaction’ of the owner is very low or does not exist, (e.g. zero), then any number multiplied by zero equals zero. Therefore, if “D” is zero so too is the change potential, or impetus to change, of the business even if there is a clear documented vision and a detailed action plan. There has to be a desire for change.
The challenge then is to convince the stakeholders of the need for change and that remaining as they are is not an option.
If you would like to find out more about applying this model in your own business or any other aspect of business planning, please feel free to contact me or take advantage of our free Business Development Consultation.
Enter your details to access the guide
Select your desired option below to share a direct link to this page.
Your friends or family will thank you later.