I wrote in the last blog about the direct financial costs of KTPs and how these are variable dependent on the size or type of project and the % contribution expected from different types of partner organisation.
These aren’t the only costs that need to be considered when developing a project. Within the application these are called Additional Business Investments and Resources. The funders, Innovate UK, want to be convinced that any application has the full support of the business partner and that they are prepared to invest to exploit the results of the KTP.
We don’t claim against these costs, they aren’t part of the official budget, but they demonstrate ambition and an understanding of what is required to deliver the project.
Some of the common additional costs include:
Salary Top-Up – we can claim a maximum of £58k p.a. for associate salaries. This includes University on-costs (pensions, NI) so in reality this is a salary of around £40k p.a. to the Associate. Depending on the sector and geographical location of the role this may or may not be sufficient to attract the right person to apply for the job and deliver an exceptional project. If the employment market requires the salary to be higher this can be topped up, but this top-up is 100% payable by the business partner, including University on-costs.
Management Supervision – we quantify the time and type of supervision the business partner will give the Associate and commit to the project over it’s duration. This is usually worked out as a % of a salary. For example, the person supervising the Associate will commit 20% of their time (1 day a week) over 2 years on a project and has a salary of £50,000. £50,000 x 20% = £10,000 x 2 years = £20,000.
Other staff costs – we’d also try to identify any other relevant staff costs. For example, the Associate may need to spend a considerable amount of time training specific team members in the project’s outputs. This could be for technical, sales, or management teams. This ensures the knowledge generated in the project is embedded in the business.
Capital equipment / consumables – do you need to buy anything specific to deliver the project that doesn’t fall into the small consumables budget for KTP? This could be equipment, vehicles, hardware that will allow the project to succeed.
I always encourage the companies I work with to also consider the sales and marketing costs they could incur to actually get whatever is being created in the project into a state of commercial readiness. How are they going to start making money out of a new product or service without telling existing and new customers about it? This could include costs for marketing materials, advertising campaigns and promotional videos.
These costs aren’t audited or assessed as they occur both during and after the project. What we are trying to create is a positive narrative behind the project proposal. Be creative in your thinking about these costs and it starts to paint a very positive picture for the assessors. If you submit an application that says the business is contributing nothing else financially to the project this will not look good – assessors will query Value For Money and the partner’s true belief in the project.