Turn Your SR&ED Claim into a Business Development Tool

How much new business did your SR&ED claim generate for your company in the past year?

If your answer is none, not enough or, worse yet, “What are you talking about?” then read on.

The fact is the annual review your company undertakes in preparation for its SR&ED claim can easily be transformed from a burden everyone wishes to avoid into an important and welcomed catalyst for growth.

I have received numerous queries from readers in response to my February 17, 2010 post on this subject. In the article, which I called “Your SR&ED Claim on Steroids,” I noted that the SR&ED claim process is a unique opportunity for a company to conduct a thorough review of its newly developed technical strengths and identify strategic opportunities for business growth.

In the current article, I will expand on this idea and give specific examples of how companies can get the most from the SR&ED claim process.

The Key Business Benefits
A key business benefit of a SR&ED review is that it forces you as company leaders to pause in your busy schedules and assess your organization’s technical activities and achievements of the previous year.

Frequently, this work has produced new inventions or solutions to technical problems that would find ready acceptance in the marketplace.

However, during our more than 15 years of specialization in SR&ED tax credit claims, we’ve lost count of the number of times that we’ve seen companies fail to capitalize on these opportunities.

The reasons vary, but the underlying cause is typically an inability to execute on the business side of the equation. This is particularly true for smaller, entrepreneurial firms, which are often short staffed and sometimes lack critical business development skills in areas such as product research, product development, marketing and sales.

At FRED Group, we complement our SR&ED services with a full-service business development consultancy. We work every day with senior company leaders to help them strategize, design and implement new business initiatives.

A fundamental recommendation we make to all our clients is that they put their annual SR&ED review – a process for which they should already have allocated time in their busy schedules – to maximum use.

A Two-Stage Process
How is this done? We see it as a two-stage process requiring both planning and commitment. The first stage includes a thorough evaluation of your business strengths and opportunities for improvement.

At FRED Group, our business development consultants perform this assessment at no cost to you. The work is conducted at the same time that we review your technical activities of the previous year as part of your SR&ED claim.

Through this process, we gain a deep X-Ray perspective into your organization, allowing us to identify strategic opportunities for you to build your business and grow.

Here are some the areas in which we can help you:

  • New product launches
    We help our clients to make informed decisions related to the launch of their new products and services. Our consultants can determine your competitive advantage, establish competitive pricing levels and develop high-performing marketing and distribution strategies.
  • Selling harder
    You may have an existing product that you wish to test launch in a new geographic market or against a different customer base. We can help you evaluate your sales department’s suitability for the job and determine whether it would be best to expand your internal capacity or contract the work out to a professional sales organization.
  • Business communications
    When it comes to sales and marketing materials, many companies fail to make themselves heard. Through our partner firms specializing in marketing, advertising and business communications, we can help you craft compelling messages about your products and ensure the messages reach your customers where and when it matters.
  • Capital market financing
    You may be planning to grow from within, acquire a competitor or improve a production process. Our equity financing partner can help you raise funds in the capital markets to finance your business goals. We tailor our equity financing and business consulting services to fit your exact needs.

The second stage of the process of using SR&ED to grow your company involves putting your business development plans into action.

Once again, your annual tax-credit claim provides the opportunity for growth. Through SR&ED, your company can get back 68 cents on every dollar you spend on scientific research and experimental development.

Think of all the ways you could reinvest this money in your business to generate growth.

We’re constantly amazed at the number of companies that under claim – or worse, fail to claim - for the money they have coming to them. While the claims process is complex and takes effort, a qualified SR&ED provider will minimize the burden on your company and ensure you get your maximum return.

With all that said, we return to our original question: How much new business did your SR&ED claim generate for your company in the past year?

To learn more about how you can put your SR&ED claim to work for you, visit Funding Research and Experimental Development Group Inc. (FRED Group for short) at fredgroup.ca.

Fred Hausmann is the founder and senior managing director of Funding Research and Experimental Development Group Inc., a business development and specialty tax service. FRED helps companies obtain the full amount of government funds and rebates, including SR&ED tax credits, they have coming to them. And then it helps them grow.

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According to some statistics, nearly 50% of businesses that are eligible for SR&ED refunds never even apply for them! Talk about leaving money on the table.

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