Is it possible to apply for grants for an online shop?

Running your own business often requires a lot of money. Especially in the initial phase, when the company is just starting out. Many entrepreneurs decide to take advantage of funding, thanks to which they gain start-up capital. What is the situation on the e-commerce market? Are online shop owners also eligible for subsidies?

Setting up and running an online shop involves fewer costs than a traditional shop. Nevertheless, its development requires a constant financial input. Therefore, an attractive option seems to be the possibility of using a subsidies from the Employment Office . Unfortunately, they are not available to everyone.

Since 2016, the law does not allow entrepreneurs to receipt of a grant from the PUP exclusively for the online shop. An alternative solution is to acquire subsidies for opening a stationary shop for which the online shop will be a kind of extension of the offer. Simply put, only those who own (or plan to own) a shop in the traditional form can apply for the subsidy.

Complementing the stationary shop

While it might seem that the inability to apply for a subsidy from the Employment Office for an online shop is a major handicap, very many entrepreneurs decide to take the opportunity to acquire it precisely for a stationary shop. Thus, they decide to open two shops, with e-commerce complementing its traditional counterpart.

Such a procedure, if we take into account the funding received, becomes very profitable. First and foremost, it allows the retailer to acquire many more customers than a sole proprietorship would. Opening an e-shop is also an opportunity to promote the brand on the Internet, as well as to increase sales of the offered products.

Who can apply for grants?

An applicant for an online shop grant from the Job Centre must meet several necessary conditions:

• must be in possession of a certificate of unemployment,
• must not have been in business for a minimum of 12 months prior to the application,
• cannot study on a daily basis (part-time studies are not a problem),
• may not reapply for a grant or submit an application for a grant in parallel to another office,
• funding will not be given to a person who has refused employment, a vocational course or a traineeship without justification in the past 12 months,
• Also, anyone who has committed an economic crime (i.e. fraud) within the last 2 years cannot apply.

Once the documents have been completed, it is necessary to go to the Employment Office and submit the relevant application. The applicant should include information such as the amount of the subsidy applied for (which cannot be higher than 600% of the average salary) and details of how and for what the funds will be distributed.

European funds - funding without a stationary shop

As opposed to funding from the Job Centre, subsidies from European Funds do not require a stationary shop. Their main task is to develop and strengthen the economic competitiveness of European Union countries. What determines the granting of funding is usually a good and original business plan. The amount of support from the European Funds is up to PLN 600,000.

However, there are limitations here too. Indeed, the purpose of the European Funds is to equalise the economic level in all Member States and minimise unemployment. Therefore, the awarding of grants from the FE is usually closely linked to ongoing EU programmes.

The submission process is similar to that of applying for a grant from the Job Centre. With the exception that it is compulsory to include a prepared business plan.

PFR programmes, crowdfunding platforms or credit?

As with the European Funds, PFR programmes are designed to support innovative business ideas. They therefore represent a great opportunity for people developing their business in the e-commerce sector. The programmes of the Polish Development Fund operate on a non-governmental organisation basis, offering support mainly to start-ups.

Those who cannot, or for some reason do not want to, apply for grants always have the option of using one of the crowdfunding platforms. These are places where you can create a fundraiser yourself to start or grow your business. However, this form of fundraising requires a great deal of commitment and a creative presentation of the business plan. It is also very time-consuming, as the contribution of money depends solely on the willingness of donors. It is more of an option for those with a service or product to offer that is innovative enough that people will be willing to put up the money to see it on the market.

The ultimate solution for any entrepreneur is a loan. Although it is a popular form of raising finance for a business start-up, getting a loan will also be very difficult for a newly established online shop - usually the creditworthiness is close to zero at the beginning. Therefore, it is advisable to use other forms of financing for the business.