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Money 'grows' in car washes – Taking advantage of funding available for business start-ups

If you would like to apply for funding for your business start-up, there are many different ways to do so. However, there is no money if you don't put in the effort. For loans, you often need guarantees, and for low-cost financing, you need to be able to prove that you have given careful thought to your car wash business.

These subsidies for business start-ups are available

You can apply for start-up funding or funding provided by the federal states. The latter varies from state to state. The KfW offers favourable loans, and if you are entitled to unemployment benefit, you may receive grants to set up a business which you are not required to repay if you submit a justified application. The latter is the start-up grant which can be awarded by the Employment Agency. 

Subsidy for business start-ups from the employment office

To be eligible for the start-up grant, you must still be entitled to unemployment benefit for at least 150 days. Setting up your own business becomes your main occupation and your way out of unemployment at the same time. In addition, an authorised body must certify that your personal requirements and business model have a chance of success. However, the final decision on awarding the grant still lies with your employment agency.

If your application is approved, you will initially receive an allowance for six months equal to your last unemployment benefit plus 300 euros. After these six months, an extension for another nine months is possible if you can prove that you are self-employed in your main occupation. When operating your own car wash this point should not be a problem.

State support for business start-ups through grants

The government rarely gives money away without checking exactly what it is used for. The nationwide support for young entrepreneurs, the "Promotion of entrepreneurial know-how through management consultancy", therefore provides support for expenditure on business consulting. There are corresponding programmes from the federal states for start-ups. You can find out what these can be in the Förderdatenbank für Bund, Länder und EU. Here you can enter details about your place of residence and your business and see which funding programmes are suitable in your particular case.

Go self-employed: Funding through loans

Naturally, it would be nice to start your self-employment with grants that you do not have to pay back. However, as a car wash business is not an innovative start-up, for example from the field of digitalisation or IT, the chances of this happening look relatively slim. Start-up loans on the other hand can be obtained – either from the KfW or within the framework of the funding programmes by federal state also from your house bank. 

However, in order to get a loan, you need to prepare carefully. You should be able to draw up a precise business plan and show how much capital you have. Alternatively, you can also offer securities such as a property. If you have neither capital nor securities, you can provide a guarantor who will guarantee the loan if necessary. 

Even if the loans in the funding programmes are very cheap and you actually gain a financial advantage from the low interest rates, the credit institutions want to make sure that they get their money back. It is therefore important that you convince them. Prepare a professional business plan. You probably won't be able to do it on your own if you have never done it before. This is where the business consultancy funding of the federal states come into play again. With the help of a professional business consultant, you can create a convincing business plan, and thanks to the funding, you will not pay all their fees out of your own pocket. 

Small amount of start-up assistance: microloans

If you only need a relatively small amount of money to get your car wash up and running, microloans are an option. These range up to a sum of 20,000 euros, but can also be smaller. Without a well-structured business plan, however, it is not worth applying for the microloan. 

Summary: Applying for funding requires preparation

There is no funding for business start-ups where you do not have to do some careful preparation.  In any case, you need to think about how much you will earn, the current market situation in the industry and in your region, how many potential customers there are and what your outgoings will be. But with a subsidised business consultant you will be able to master this task!

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