Enterprise Development Grant (EDG): Complete Guide For Singapore Businesses To Transform And Internationalise

This article was first published on 15 October 2020 and has been updated with the latest information from the Budget 2021 announcement. The enhanced maximum 80% support level on the Enterprise Development Grant (EDG) has been extended 31 March 2022 (from 30 September 2021). 

Introduced in 2018, the Enterprise Development Grant (EDG) is designed to provide support for SMEs to build internal capabilities and transform and grow overseas. Ultimately, the projects supported under the grant should help Singapore businesses grow as well as compete locally and in overseas markets.

In March 2019, the grant was merged with the Inclusive Growth Programme, which was run by NTUC’s Employment and Employability Institute (e2i). Today, the Enterprise Development Grant is managed by Enterprise Singapore (ESG).

How Much Funding Does The Enterprise Development Grant (EDG) Cover?

The Enterprise Development Grant (EDG) typically funds up to 70% of qualifying costs for SMEs, and up to 50% of qualifying costs for non-SMEs. 

In response to the COVID-19-led downturn, the maximum support level was raised to 80% in 2020. During the Budget 2021 announcement, this maximum support level will be extended to 31 March 2022 (from 30 September 2021).

Read Also: Singapore Budget 2021: 10 Things Business Owners Need To Know

Maximum funding support level will revert to 70% thereafter. In May 2019, it was also announced that unionised companies and e2i partners under the Labour Movement are eligible to tap on an additional 10% funding, if they work with unions to train workers as jobs transform. 

The Enterprise Development Grant typically funds “qualifying project costs such as third-party consultancy fees, software and equipment, and internal manpower cost”. 

The Enterprise Development Grant provides support for diverse projects which can be grouped under 3 main pillars – 1) Core Capabilities, 2) Innovation and Productivity and 3) Market Access.

#1 Core Capabilities

Under this pillar, the Enterprise Development Grant supports Singapore companies embarking on projects to prepare for growth and transformation by strengthening their business foundations in 5 areas:

  1. Strategic Brand & Marketing Development
  2. Business Strategy Development
  3. Human Capital Development
  4. Service Excellence
  5. Financial Management

These projects could include:

#i Strategic Brand & Marketing Development

Project may address any of these areas:

  • Development of effective brand strategy that appeals to targeted consumers and offers differentiated proposition from the competition
  • Assessment of a brand’s financial value and identification of brand levers
  • Development of a strategic plan to optimise marketing resources and improve customer communications
#ii Business Strategy Development

Project may address any of these areas:

  • Formulation of growth strategies to capitalise on opportunities and enhance competitiveness
  • Analysis of the impact of tariffs and International Trade Agreements, and the development of strategies to optimise business performance
  • Development of strategies and processes to protect and monetise intellectual property assets as well as optimise R&D operations 
#iii Human capital development

Project may address any of these areas:

  • Compensation & Benefits
  • Employee Engagement & Communication
  • Employee Value Proposition
  • HR Management
  • International Mobility
  • Job Redesign
  • Learning & Development
  • Manpower Planning
  • Organisation Culture
  • Performance Management
  • Recruitment & Selection
  • Talent Management & Succession Planning
#iv Service excellence

Project may address any of these areas:

  • Customer Diagnostics: Diagnosis and gap analysis of customer needs to improve service levels and drive customer-centric behaviour
  • Service Innovation: Adoption of advanced customer research, analytics and service process redesign to enhance customer experience
#v Financial management

Projects may address any of these areas:

  • Development of plans to optimise financing, investment, and risk management
  • Identification of business risk exposure, and development of proper risk management processes and controls
  • Formation of international corporate structures to minimise tax liabilities

2. Innovation & productivity

Projects under this pillar should enable Singapore businesses to explore new growth areas, transform their existing business model or invest in technology to enhance productivity or efficiency.

These projects could include reviewing and redesigning workflow. Companies can also use “automation and technologies to make routine tasks more efficient”.

Applicable Enterprise Development Grant projects under this pillar should fall in 3 areas:

#i Product development

Scope of work can cover:

  • Assessment of market viability.
  • Evaluation of potential demand and user understanding.
  • Development of product roadmap and proposed functionalities for the product.
  • Demonstration of market validation.
  • Development of commercialisation plan.
  • Review of IP considerations.
  • Development of prototype and small batch production, where relevant.
#ii Process redesign

Scope of work can cover:

  • Review and streamline of workflow and processes to reduce or remove redundant processes
  • Explore the use of technology to automate processes
  • Review and/or development of performance measures
  • Development of tracking and measurement system
  • Development of detailed roadmap of actions for further improvement
#iii Automation

Scope of work can cover:

  • Adoption / development of sophisticated hardware and/or software solutions
  • Development of solutions that involve purchase of machinery and integration of systems
  • Training of staff to deploy solutions

3. Market Access

These projects support Singapore companies that are willing and ready to expand into overseas markets. The EDG can be used to offset some of the costs of overseas expansion in 4 areas:

#i Pilot project and test bedding

Scope of work covers:

  • Demonstration of product / solution viability and establishment of a track record to scale in new markets
  • The product should be new and must not be generating any revenue at the point of grant application.
#ii Overseas marketing presence

You must:

  • Use the grant for marketing and/ or business development.
  • Meet the New Market Criteria (NMC), which is defined as a new city where the company has not had sales in excess of S$100,000 in any one year for the past three years.
  • Post at least one Singaporean or Permanent Resident to be based in the market to conduct marketing and/ or business development work.

According to the Enterprise Singapore (ESG) website, “Overseas Marketing Presence” will be removed from EDG and instead be supported under the Market Readiness Assistance (MRA) grant.

#ii Mergers and acquisitions

Project may address any of these areas:

  • Development of M&A strategies that compliments and supports overall growth
  • Feasibility study, for example a competitive scan or target search
  • Evaluation of target during company acquisition. This can include legal, financial or tax due diligence work
  • Estimation of a company’s current value
  • Development of change management plan for post-merger entity to integrate people, processes and culture
#iii Standards adoption

Scope of work covers:

  • Assessment and adoption of relevant standards for business growth

What is not covered under this pillar:

  • Cost of annual surveillance or recertification of current standards which the company is already certified to
  • Standards referred to in local regulatory acts
  • Product testing and validation of existing or off-the-shelf products
  • Basic standards such as ISO 9001, ISO 14001,OHSAS 18001, SS 506, and ISO 45001

How Is EDG Different From The Productivity Solutions Grant (PSG) And The Market Readiness Assistance Grant (MRA)? 

The Productivity Solutions Grant (PSG) and the Market Readiness Assistance (MRA) grant are separate schemes with different intents. The PSG supports companies looking to adopt specific productivity solutions or equipment, while the MRA supports companies who wish to take their first step into overseas markets. Since the areas of support have been pre-specified, the purpose of the PSG and MRA is largely to facilitate ease of adoption.

Also read: Guide To Understanding The Productivity Solutions Grant (PSG)

The Enterprise Development Grant (EDG) is a tool to support the growth and transformation needs of companies. Companies would need to submit individual project proposals with details on their business plans and project outcomes for evaluation.

How To Apply For The Enterprise Development Grant (EDG)?

To qualify for the EDG, you need to:

  • Be a business entity registered and operating in Singapore
  • Have a minimum of 30% local shareholding
  • Be in a financially viable position to start and complete the project

From 1 April 2020, all EDG applications should include commitments to “worker outcomes” as part of the qualifying requirements. Examples of worker outcomes can include wage increments, job creation, job re-design, or training for existing staff. 

Applications will be assessed by Enterprise Singapore based on project scope, project outcomes and competency of service provider.

In addition, eligible employers can qualify for additional subsidies under the SkillsFuture Enterprise Credits (SFEC)scheme.

Also read: SkillsFuture Enterprise Credit (SFEC): A One-Off $10,000 Grant For Companies To Transform Their Business And Upskill Employees

To apply for the EDG, follow these pre-applicationapplication and claims steps.

Deadline For Completing An EDG Funded Project 

Most projects undertaken by companies should be completed within 12 to 18 months upon successful grant application. However, projects under the Overseas Marketing Presence (OMP) category must be completed within 12 months.

You are advised to keep the project timeline to a reasonable duration, to ensure the outcomes remain relevant in a rapidly changing economic environment.

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