A few years ago, a midsized manufacturer in the Midwest had a bold plan. They wanted to double their footprint, add a new production line and, over five years, bring on 25 new employees. Like many ambitious companies, they were nervous about the cost.
New buildings, new equipment, new hires — all of it added up to tens of millions in capital expenditures. Translation: Their CFO started stress-eating spreadsheets for lunch.
What they didn’t realize was that a significant portion of that investment could be offset by programs already sitting on the table, waiting for them to claim.
When they partnered with my incentives team, the results were dramatic. By aligning their expansion with state programs designed to attract jobs, they secured property tax abatements, job creation tax credits, R&D tax credits and even reimbursements for workforce training. In total, over 20% of their investment was recovered, not by their own checkbook, but by government incentives. Yes, the same government that usually can’t fix a pothole somehow had cash to fix their balance sheet. What’s more, the savings continued to accrue year after year.
This isn’t a one-off story. Across the country, state and local governments are competing fiercely to attract businesses or even existing business growth. Incentives once thought to be the exclusive domain of Fortune 50 companies are very much available to high-growth small and midsized firms. The key is knowing what the three-to-five-year plan is, where to look, how to negotiate and how to comply.
Available Advantage
These opportunities are not limited to any one industry. Manufacturing can include advanced materials, printing, pharma, logistics, distribution, health care, life sciences, data centers, food production, clean energy and technology firms, which can all benefit. Even software companies with distributed workforces can find programs that apply. Yes, even the pajama-wearing Zoom warriors can cash in.
The types of incentives vary, but they generally fall into three categories: tax relief, workforce development and infrastructure support.
Property and sales tax abatements, corporate income tax credits and payroll tax offsets are common. Workforce training grants and reimbursements can dramatically reduce the cost of bringing new talent up to speed and even alleviate supervisor strain. Infrastructure support, from roads to utilities to fast-track permitting, can eliminate delays and soften the blow of
up-front site development costs. Many of these incentives are statutory and not directly affected by federal budget changes.
The process doesn’t have to be burdensome. Our team took the playbooks that Fortune 10 companies were using and adapted them for smaller, fast-growing firms. We were then able to help clients align incentives with their growth plans, prepare filings, negotiate with government entities and secure contracts that guarantee benefits.
If the effort is set up as a pay-as-you-save model, there is no out-of-pocket cost up front. You simply share a portion of the savings you realize over time. Basically, if this were a dating app, you’d only pay after you found “the one.”
Initiative for Incentives
For CEOs and owners, the question isn’t whether incentives exist; it’s whether your company is poised to take advantage. A business planning to add 25 or more employees over the next five years and follow through on its capital investment plan could be in line for millions
in savings. For many firms, a 20%-plus reduction in capital expenditures can be the difference between a cautious expansion and a bold leap forward.
The manufacturer I mentioned earlier now looks back at their decision as a turning point. Not only did they secure millions in savings, but they also built stronger relationships with local officials, strengthened their workforce and freed up capital for innovation. The incentives didn’t just reduce costs, they accelerated growth. Imagine that: a government program that actually worked. Stop the presses.
If your company is preparing to expand, whether through new facilities, new hires or both, now is the time to explore what’s possible.
Incentive programs are competitive and time-sensitive. Those who act early often secure the
richest packages. The first step is building out the Compliance-Aligned Growth Blueprint, a structured outline that ensures your expansion plan is mapped against incentive requirements from Day 1. I help owners and CEOs take this first step pro bono.
Getting incentives equal to roughly 20% of your planned capital expenditures is not a fantasy. It’s a proven strategy that can change the trajectory of a business. The money is there. The question is whether you’ll claim it.
It’s like free donuts in the break room; grab one, or the intern will.
Mark Faust (513-621-8000, mark@em1990.com) works with owners, CEOs and sales managers who want to grow their businesses. You can schedule a free profit improvement session with Mark by visiting calendly.com/markfaust. Read more ideas from him here.
