I want to utilize EU funds for business development – what do I need to know?

Sense ConsultingMay 9, 2017.

Entrepreneurs are most active when EU funds are in question. The path from project idea to application to EU funds is a long-term process, and for the successful implementation there are six most important elements: clarity, awareness, readiness, depth, patience and adaptation. In 2017, numerous tenders were announced for agricultural entrepreneurs, for investment in production, energy efficiency, development and innovation and for internationalization and certification of business.

Entrepreneurs are those who are the most active when EU funds are concerned, therefore they contribute to better statistics on withdrawal of EU funds. Although there are currently not enough open tenders, once tenders are published, interested applicants and projects are not lacking. Most often, there are a lot more projects than the resources available and in the application process timely and quality preparation is the key to success. From the idea to the realization of entrepreneurial projects funded from EU funds, there are 6 most important elements:

  1. Clarity – Whether you are an entrepreneur who is planning to open a business and engage in business challenges or have been successful in managing business for years and would like to use the opportunities of EU funds, it is essential to identify what your specific needs are in accordance with the business plan. What is the goal of the project, what do I want to achieve, what resources are needed? What activities are needed to achieve the goal? In what timeframe do I want to achieve the goal? How flexible am I? Regarding the uncertainty of the outcome, the priority should be the development and cost-effectiveness of the project, while the EU funds should be the “icing on the cake” or “impulse” for faster growth.

Awareness – The path from project idea to the application to EU funds is often a perennial process. Information on open and announced EU tenders is available on the central page www.strukturnifondovi.hr as well as on numerous portals. For more precise information, contact specialized consultants or competent institutions. In the complex network of EU operational programs, thematic goals, priorities and measures, it is very likely that there is a concrete tender in which your project will fit in the foreseeable future.

  1. Readiness – When it comes to EU funds, there are no simple projects. There are only complex and less complex projects. Less complex projects are typically smaller projects (up to one million HRK) that consist of the procurement of less-valuable equipment or “soft” activities involving education, fairs, market analysis and similar.

Complex projects involve multi-million value projects, which include the construction and purchase of equipment of higher value and entail on obtaining a valid building permit and detailed analysis and feasibility studies. Preparation often requires the engagement of constructors, architects, environmental experts, technologists, lawyers and EU fund advisors, one to two years before the application. In the preparation phase, it is crucial to devote special importance to project funding, as the range of co-financing ranges between 25%-85%, depending on the purpose of the tender and the size of the enterprise.

  1. Depth – Again, EU funds system is a complex, bureaucratic system. Rules and procedures have been set up to ensure transparency and equality of the procedure. Even the smallest misunderstanding of the terms of the tender, an outdated document, or lack of signatures and stamps, may result in the declination of the application and loss of multi-million entitlements. The professional support of a specialized and experienced team of consultants is a prerequisite for success, especially when complex projects are involved.
  2. Patience – Assuming the tender is published and the application is successfully submitted, it is important to be patient which entrepreneurs may find difficult to do, however, the idea of attractive subsidy raises the level of tolerance. Applications are often evaluated much slower than anticipated in the tender, especially if a lot of applications were received. Evaluations typically last 6-12 months, and sometimes even longer. If you have decided to start with the investment, regardless of the financing decision and potential risk takeover, the EU funds system allows you to do so.
  3. Adaptation – Once the funds are approved, entrepreneurs should be aware that EU funds are EU taxpayers’ means and that implementation of projects implies adaptation to rules pertaining to public bodies. For construction as well as for procurement of equipment and services, it is necessary to conduct public procurement procedures which also requires additional investment in own capacities or the involvement of external support consultants.

Despite numerous challenges following the grant process, entrepreneurs who receive EU funds will sooner execute their business goals and most importantly, become more competitive on domestic and foreign market. For success, it is necessary to invest time and engage experts with specific knowledge and experience in order for the investment to multiply. In 2017, there are numerous EU tenders announced for Croatian entrepreneurs, and with the application of the above mentioned 6 elements, the chance to successfully exploit the opportunities offered by the EU funds and gain the competitive advantage will be increased.

Below is presented an overview of the currently open tenders announced for the year 2017.

Author: Dragana Raić, Director for EU projects