If you are a small business owner, you know how difficult it can be to get the financial backing to successfully run and grow a business. Finding sufficient funds to take your business to the next level is the hardest part of owning a small business enterprise.
While some entrepreneurs have the resources to bootstrap their business, the vast majority of people look for some type of outside funding to help with startup costs, operations support, or expansion opportunities.
Some entrepreneurs turn to family and friends for an infusion of cash. Others try for a private or government-subsidized bank loan or, when all else fails, even max out their credit cards. In rare circumstances, a small business owner can convince an angel investor or venture capitalist to provide much-needed funds.
Many small business owners are unaware of the vast opportunities that exist for obtaining public and private grant money. Grants are ideal because they are free money in the sense that you don't have to pay back any of the funds you receive from the federal government, state governments, and private corporations under their respective grant programs.
While most government grants have stringent eligibility requirements, there are a number of corporate grants that are open to any small business that piques the company's branding and innovation interests. The FedEx Small Business Grant Contest is one of these grant programs that is worth looking into.
This article covers what you need to know to participate - and possibly even win - the FedEx Small Business Grant Contest.
What Is the FedEx Small Business Grant?
Each year, FedEx awards 12 U.S. businesses grant money, business services, and additional prizes. In 2021, the ninth year of the contest, FedEx awarded a total of $250,000 in prize packages broken down this way:
- One grand-prize winner received $50,000 cash, $7,500 in FedEx Office print and business services, and a search engine optimization (SEO) website audit with recommendations for improvement (valued at between $2,500 and $5,000).
- One 2nd-place prize winner received $30,000 cash, $5,000 in FedEx Office print and business services, and a website optimization audit with recommendations to improve conversion (valued at approximately $1,500).
- Ten 3rd-place prize winners received $15,000 cash, $1,000 in FedEx Office print and business services, and a website audit with recommendations for enhancements (valued at $50).
In addition to these prizes, the 12 winning businesses also received:
- An invitation to a virtual meeting with high-level FedEx executives
- A 30-minute consultation with a FedEx representative
- A $300 FedEx rewards voucher redeemable through the My FedEx Rewards catalog
- A copy of the Dictionary of International Trade (a $45 value) and access to an international shipping webinar (valued at $55)
The 2021 contest included, for the first time, an award for the top 100 finalists in the competition. Each received coaching from a small business lender, mentor matching with a small business expert from the non-profit group SCORE, free admission to the ICIC National Conference, and free access to three ICIC webinars.
Who Is the FedEx Small Business Grant for?
The FedEx small business grant is designed to champion and support U.S.-based small businesses. To be an acceptable entrant for the grant contest, the official rules state that your business must:
- Be a U.S.-based for-profit small business with no more than 99 employees
- Have been in operation for at least six months
- Have a need for shipping services
- Have a valid nine-digit FedEx shipping account number
- Be a business in good standing, including not being under bankruptcy protection or having any judicial liens or attachments in force
How to Apply to the FedEx Small Business Grant
The FedEx small business grant is a contest judged in part by the public and in part by FedEx officials. Rather than other grant programs that require a lot of intricate background information and the meeting of threshold metrics, the FedEx grant program relies on factors like whether your business has robust shipping needs or requires print services, as well as what type of brand ambassador you will be for FedEx.
Applying for the FedEx Small Business Grant
The grant award contest is typically announced during the first quarter of each year and is open for just three weeks. Applicants are instructed to visit the contest webpage to enter their information, including:
- Their business name, location, website URL, and FedEx shipping account number
- A short profile about their business
- Up to four photos of their business or products and logo
- An optional short "elevator pitch" video
To give you an idea of how quickly the contest moves, the 2021 entry period opened on Feb. 16 and closed on March 9, 2021. A public voting period lasted just two weeks, and winners were chosen and announced on May 10. The entire process, from beginning to end, took less than three months.
How the FedEx Small Business Grant Award Winners Are Selected
After the entry period ends, the public is invited to visit the contest page and vote to narrow down the applicant pool - which typically contains thousands of entries - to the top 100. FedEx judges then choose the top 12 winners by looking at the following:
- How clear, compelling, and engaging the applicant's essay and videos were
- How much of a social presence the business has to develop a brand voice
- How easy the company's website is to navigate
- Degree of innovation or uniqueness
- Level of sustainability or environmentally friendly aspects to the business
- Positive community impact
- Brand alignment with the FedEx brand
- Suitability of the business owner to act as a brand ambassador for FedEx and a mentor to other small business owners
The FedEx judges select the 12 FedEx small business grant contest winners and then choose the grand-prize winner and 2nd-place winner.
Of the 10 3rd-place prize winners, one is selected as the Entrepreneur Choice Award winner. This is an honor bestowed by the FedEx Entrepreneur Advisory Board, which is composed, in part, of former FedEx small business grant winners.
Receiving and Managing the FedEx Small Business Grant
Grant winners are notified via email and announced on the FedEx grant awards page, www.fedex.com/grantcontest. While FedEx offers mentoring and guidance for the use of its in-kind awards of printing and small business center services, you'll be on your own when it comes to how to use the cash grant portion of the award to your best advantage.
Some business owners choose to expand their operations into new national or international markets. Others, like 2020 contest winner Access Trax, used the winnings and website analytics and mentoring support provided by FedEx to kick-start an online marketing strategy to better reach e-commerce consumers.
As you determine how best to spend your grant award, be mindful of the need for a dependable small business accounting system to help you properly manage and account for your cash and in-kind winnings.
There might be tax consequences to both the cash and business service awards you receive, as well other accounting-related issues that come with a private business-to-business grant or award.
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Notice to the Reader
The content within this article is meant to be used as general guidelines and may not apply to your specific situation. Always consult with a professional accountant to ensure you're meeting accounting standards with respect to the handling of grant awards or contest winnings.