Scottish Community Foundation Research into support for rural

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					             Research into support
              for rural businesses



                       Commissioned by the
                  Scottish Community Foundation

The Scottish Community Foundation is a registered charity that provides services to
make charitable giving easy, tax-efficient and cost effective. Our in-depth
knowledge of the charitable sector means we can help clients make intelligent
awards that have a real and lasting impact. The Scottish Community Foundation
takes pride in being Scotland’s expert in charitable giving.




                                   January 2011
Foreword
                         The challenges of employment generation in the villages and small towns
                         of the Scottish Highlands are longstanding. There are no quick solutions
                         and it is not simply a matter of throwing money at the problem.
                         Remoteness, seasonality and the small size of local markets all conspire
                         to make life difficult for local businesses - as increasingly do regulation,
                         compliance and planning. Highland entrepreneurs tend to be middle-
                         aged and their businesses in many cases unattractive or unviable for
                         their increasingly well-educated children. The collapse of the Western
                         world’s financial system in 2007-8, and its aftermath of unreformed,
                         even larger, less responsive, banks have made matters worse. The
                         funding and support provided by the Moidart Trust has become even
                         more important as a result.

It would be inappropriate to draw conclusions about job or wealth creation, or about the
constraints on such activities, from the small number of cases on which this research is based.
But it would be equally inappropriate to dismiss the possibility that the ‘microcredit’ provided
by the Moidart Trust may have far-reaching effects on some parts of the Highlands. The
timescale for impact is necessarily long, and the definition of impact unfashionably broad. The
concept of displacement needs to be approached with caution - in a small market the
displacement of a moribund incumbent may be socially desirable, the impact on the local
housing market of a village store moving to year-round trading may be considerable, and the
additional visitors attracted by a new tourist venture may make existing ventures viable. Such
effects are hard to establish, do not accrue to the bottom line of the new or expanded venture
and don’t help repay its loans.

As a resident of Wester Ross, a lapsed policy-maker and an economist, I welcome this modest
contribution to our understanding of job and venture creation in remote communities. The
Moidart Trust’s initiative chimes with my perception of the process of development in the
Highlands. I hope it will be replicated and extended.


                                                                                    Frank Kirwan


                                                                                 12 January 2011




About Frank Kirwan
Frank Kirwan’s background is in strategy development and change management. He has
worked at Board level in the private and public sectors in the UK and US and spent several
years in academia. He was successively Director of Strategy for the Royal Bank of Scotland
Group and Director, UK Retail Banking. He is active as a non-executive director, primarily in
the finance and technology sectors. He is a visiting professor at the University of Edinburgh
Business School. He was the founding vice-chair of the Scottish Charity Regulator (OSCR); and
is a former Treasurer and Chair of the Audit Committee of Oxfam (GB), and of the Accounts
Commission for Scotland.




Image courtesy of www.rbge.org.uk
Contents
Introduction ................................................................................................................. 4
Research aims and methods ........................................................................................... 5
Case study - Isle of Skye Bakery Company ....................................................................... 6


A review of the policy and strategic context used by the public sector to support rural
enterprise .................................................................................................................. 7
Public Funding .............................................................................................................. 7
Strategic Goals ............................................................................................................. 7
Peripheral and Fragile Areas ........................................................................................... 8
Sectors........................................................................................................................ 9
A public sector perspective on the use of Enterprise Grants ................................................. 9


A review of how independent funding is being used to stimulate local enterprise and
promote rural regeneration ...................................................................................... 10
Programme Strategy ................................................................................................... 10
Summary of businesses supported by Moidart grants ....................................................... 11
Case study - Wild West Foods Ltd ................................................................................. 16
Lessons from the Moidart Enterprise Grants .................................................................... 14
Reasons for seeking enterprise grant funding .................................................................. 16
How has Moidart funding helped? .................................................................................. 16


Appendix 1: Types of support available through the public sector ..................................... 18
Appendix 2: Summaries of the local impact of Moidart funding......................................... 20
Appendix 3: Press release for the Moidart Trust Seminar................................................. 24




 Report written by
 Roddy Ferguson and Angus Ferguson




    Scottish Community Foundation research into support for rural businesses                                       Page 3
Introduction
                      This report was commissioned by the Scottish Community Foundation –
                      Scotland’s expert in charitable giving. The timing coincides with a greater
                      interest in directing private philanthropy to support emerging rural
                      businesses.


                      Philanthropists have always sought to bring about change by addressing
                      specific social issues with imagination and passion. This is currently being
reflected in Scotland by the work being done by charitable trusts including the Moidart Trust,
SJ Noble Trust and Kilfinan Trust. This report examines the approach undertaken by the
Moidart Trust, a private trust administered by the Scottish Community Foundation.


Moidart’s aim is quite simple: to improve the quality of life in rural parts of Scotland.
Traditionally, the use of charitable funds has served an important part in sustaining and
enhancing the social fabric of a community through supporting the work of outstanding
charities and community groups. A new trend is to use these funds to breathe life into a
community by supporting commercial enterprises to provide sustainable employment
opportunities and a more vibrant local economy.


This report begins with an overview of the role of the public sector, which has for many years
led on the regeneration of rural economies and provided enterprise funding in the form of
grants and loans. Specifically, it focuses on the agencies operating in the north west of
Scotland, the area that is targeted by the Moidart Trust. The report includes responses to a
survey of staff working in these agencies, which makes interesting and though-provoking
reading.


The report provides a detailed examination of the work of the Moidart Trust in funding rural
enterprises at a time when public sector grant assistance is both reducing and being targeted
on specific sectors. It also provides a detailed account of the 12 enterprises that have been
selected for support by the Moidart Trust to date.


This report is produced as the Moidart Trust - an exciting new venture in philanthropy – begins
to gather momentum. It will undoubtedly be revisited in the years to come.




Giles Ruck


Chief Executive
Scottish Community Foundation



   Scottish Community Foundation research into support for rural businesses             Page 4
Research aims and methods
This report aims to examine rural enterprise support within the current economic context of
the Highlands and Islands. This aim will be addressed using description of the current context
for public sector support to stimulating rural enterprise in the Highlands and Islands followed
by an examination of the impact of using independent funding to stimulate local enterprise and
promote rural regeneration.

During the period October to December 2010, three key activities were undertaken to examine
the context for providing support to report and rural enterprises:

1. A web-based document review of the key public sector support agencies in the area
2. A survey of a sample of staff at Highlands and Islands Enterprise and Highland Opportunity
   Limited
3. A survey of businesses supported by Moidart enterprise grants between December 2008 and
   December 2010.

The findings of these have been combined to inform the summaries which follow.




   Scottish Community Foundation research into support for rural businesses          Page 5
 CASE STUDY
 Isle
 Of
 Skye
 Baking
 Company




L
      iza and Barry Hawthorne started the                 develop a way to produce quality frozen par
      Isle of Skye Baking Company in 2007                 baked goods for distribution further-a-field.
      when they moved to the island with a
new baby; a few possessions and a dream                   With their £10,000 Moidart grant, the Liz
of establishing a sustainable business. Four              and Barry invested in a blast chiller, freezer
years later, the company has received a                   cabinet, vacuum sealer and second
series     of  food   award    nominations;               turbofan oven which were installed at their
developed a growing number of loyal retail                new HQ, Portree’s refurbished old woollen
and wholesale customers; grown to three                   mill. The increased space at the mill has
staff; moved to larger premises and it’s                  given the company a retail space to
seen its turn over increase from £10,000 at               capitalise on passing trade.
the end of their first trading year to an
anticipated £45,000 by 31 March 2011.                     Gradually, the couple’s vision of growing a
                                                          commercially viable business to provide
With their combined backgrounds in food,                  sustainable local employment is becoming a
art  and    hospitality  and    a   shared                reality. By 2012 they hope to open an art
determination to grow a local business that               gallery to exhibit work by local artists and
could be an asset to the Portree                          craftspeople in the upstairs of the mill.
community, Liza and Barry started baking.
                                                          Isle of Skye Baking Company has achieved
With a bank loan and some initial support                 considerable success in a relatively short
from HIE, the bakery began producing                      time. It’s developed a respected reputation
shortbread and oatcakes primarily for                     as a bakery specialising in artisan breads,
wholesale distribution to independent                     cakes and pastry both locally and
retailers across the Highlands, Aberdeen                  nationally. Support from Moidart came at a
and Glasgow whose business they secured                   critical time and enabled the business to
through targeted marketing. In response to                lever additional funds from Highland
local demand, it also started producing                   Opportunity, a commercial lender and HIE.
artisan breads, cakes, pastries and home                  The grant allowed the bakery to increase
made preserves – using local ingredients                  production and immediately create three
where possible – which sold through local                 employment opportunities. In 2012 a
shops, markets and fortnightly home                       further three positions will be created by
deliveries.                                               the growing business.

By the end of 2008 the company was                        Cofounder of the Isle of Skye Baking
reaching capacity in its 22 square metre                  Company, Liz Hawthorne, said: “The
kitchen. It needed larger premises and                    psychological support of achieving the grant
more specialist equipment to increase                     was worth as much as the money. The
production to meet the demand, and to                     recognition gave us the confidence to
                                                          pursue our aspirations.”




   Scottish Community Foundation research into support for rural businesses                   Page 6
A review of the policy and                                 (e.g. Business Gateway) was available in
                                                           their area. 5 In Skye & Lochalsh and
strategic context used by                                  Lochaber, Skye & Wester Ross, private
                                                           sector support was also available. In Skye
the public sector to support                               & Lochalsh and Sutherland, voluntary
rural enterprise                                           sector support (e.g. PSYBT) was also
                                                           available.
Over the past two year the economic
climate has meant that banks have been
less likely to offer loans to start up or                  Strategic Goals
expand small businesses. The other                         While regional public funding stems from
conventional support for business start ups                both national and European streams, all
and small businesses which are looking to                  funds are targeted at overlapping goals: job
expand has been public sector development                  creation;     infrastructure  development;
agencies and these also face pressures due                 community growth; and environmental
to the economic recession. In order to                     sustainability.    However,  the   strategic
understand the context in which the                        emphasis and type of projects receiving
Moidart enterprise grants have operated it                 support varies.
is helpful to first look at the support
available through these more established                   The ERDF programme targets strategic,
routes. This section sets out the current                  high impact projects and seeks to improve
strategic priorities for public sector support             the competitiveness of identified key
designed to stimulate rural enterprise in the              sectors: renewable energy; tourism and
Highlands and Islands. It incorporates                     culture-based industries; food and drink 6 ;
information from relevant policy documents                 forestry 7 ; other energy-related industries,
and websites, and from key individuals                     particularly activities in the supply and
working in this area who responded to a                    technical support of nuclear
Rural    Economic      Development      Survey             decommissioning (though decommissioning
(REDS).                                                    itself is not an eligible activity); and
                                                           life/health (and other) sciences.

Public Funding                                             Three interlocking objectives inform funding
Public funding to stimulate rural business                 decisions:
and enterprise in the Highlands and Islands                  Enhancing business competitiveness,
flows from national and European streams                     commercialisation and innovation e.g.
through a number of channels:                                through encouraging greater utilisation
   ERDF Structural Funds Operational                         of research or existing technological
   Development Programme 2007-13                             resources
   Highlands and Islands Enterprise 1                        Enhancing key drivers of regional and
   Highland Opportunity Limited 2                            sectoral sustainable growth e.g. through
   Highland Council 3                                        promotion of core research and training
                                                             sector in the region
European funds for the Highlands and                         supporting sustainable growth in fragile
Islands equate to €22.5 million per                          and peripheral communities e.g. through
annum. 4    National  public   expenditure                   transport and IT infrastructure
(excluding EU contribution) on economic                      development (as discussed in following
development generally is €956.8 million                      section).
and the HIE annual budget for enterprise
support and wider economic development is                  5
                                                             Participants covered the areas of Skye & Lochalsh;
€180 million per annum. All respondents to                 Sutherland; Lochaber, Skye & Wester Ross;
REDS indicated that public sector support                  representing a combined population of approximately
                                                           74,000.
                                                           6
                                                             The Scottish Rural Development Programme will be
1                                                          responsible for developing new products in the Food
  www.hie.co.uk/support-for-business/default.html
2                                                          and Drink industry but other projects in this sector
  www.highland-opportunity.com/
3                                                          (including commercial exploitation of new products)
  www.highland.gov.uk/yourcouncil/economy.htm
4                                                          will be eligible for ERDF funding.
  ERDF Structural Funds Operational Development
                                                           7
Programme 2007-2013. It is important to note that            The Scottish Rural Development Programme will be
this could be the last major European funding              responsible for developing new products in the
programme for the region – therefore activities            Forestry industry but other projects in this sector
supported through Structural Funds should have             (including commercial exploitation of new products)
potential to benefit the region beyond 2015.               will be eligible for ERDF funding.

    Scottish Community Foundation research into support for rural businesses                         Page 7
HIE focus on working with larger                          intended for young people, particularly from
businesses and social enterprises on a                    disadvantaged circumstances, aged 18-25
longer term relationship. Most support to                 (30 if disabled) to start or grow their own
small   businesses    (advice,   assistance,              businesses.
grants) is through Business Gateway
though smaller businesses can receive HIE                 Respondents to REDS identified that most
grant assistance, on a one-off basis, if they             benefit would be attained from enterprise
are within one of HIE’s identified “fragile               grants if targeted at:
areas” (discussed below). 8 Customers with                   Self-help     community      groups   with
growth      potential   or    acknowledged                   properly       constituted     frameworks,
importance in the region are matched with                    because they have a wider scope that
a locally-based HIE account manager to                       will benefit the greater community.
build a positive relationship working                        Geographical          communities       or
towards high growth. Growth plan support                     communities of interest that could
includes: specialist advice, sectoral and                    provide services for which there would
market intelligence, business networks,                      be diverse opportunities for income
leadership development, signposting to                       streams e.g. service level agreements
other public functions, and possible grant                   with public agencies, entrepreneurial
assistance.                                                  initiatives     and      private    sector
                                                             partnerships.
Highland Council aims to promote                             Fragile communities (discussed below).
sustainable business growth, including
more local business and social enterprises                Peripheral and Fragile Areas
through the development of Business                       European, national and regional agendas all
Gateway, and, guided by the priorities of                 recognise   the    added    importance  of
the     Scottish    Government     Economic               nurturing and strengthening rural business
Strategy, it places emphasis on developing                and enterprise in peripheral and fragile
Highland tourism as the most significant                  locations. Again, the strategic emphasis
industry in partnership with the business                 and targeting of funds varies.
sector, VisitScotland, EventScotland and
HIE. This focuses on Gaelic, green tourism,               The focus of the third objective in the ERDF
events and activities. In relation to this, it            programme is supporting “sustainable
is    also     developing   the     transport             growth     in    fragile   and     peripheral
infrastructure of the region. Highland                    communities.” This emphasises Transport
Council have produced plans for Highland,                 and IT infrastructures as critical to
Coastal and Aquaculture development to                    achieving the objective. These two priorities
enhance conditions for balanced and                       are also highlighted by Highland Council in
sustainable economic growth for Highland                  its 34 point economic plan. 9 Highland
communities.                                              Council is working with the Scottish
                                                          Government, HIE and the private sector to
Highland Opportunity Limited (HOL)                        promote the provision and use of high
helps new start and existing businesses.                  speed broadband services for businesses
HOL’s European Business Services offer                    and communities.
information on doing business and making
trade connections in the European Union,                  The HIE Growing fragile communities 10
technology transfer and public contract                   programme recognises the importance of a
opportunities. It is the North of Scotland’s              whole community approach in the most
link to 80 centres in the European                        rural and remote areas of the Highlands
Enterprise Network. HOL also provides                     and Islands, where even the smallest
flexible business space, meeting rooms,                   intervention by businesses and social
conference and training rooms in a range of               enterprises can have a major impact on
locations across the Highlands.                           economic activity and growth. Building on

HOL is also the agent for The Prince’s
Scottish Youth Business Trust (PSYBT)
in the Highland area. This provides loans                 9
                                                            www.highland.gov.uk/yourcouncil/economy.htm
                                                          10
                                                             Map of HIE fragile areas available via
                                                          www.hie.co.uk/support-for-communities/growing-
8                                                         fragile-communities/
  Email communication 21/12/2010. Lindsay Simpson,
HIE – Lochaber, Skye and Wester Ross.

   Scottish Community Foundation research into support for rural businesses                       Page 8
the successes of LEADER 11 and Initiative at                   In Skye & Lochaber, some sectors are
the Edge regeneration schemes, HIE                             excluded from gaining assistance by
(working with local authorities and other                      Local Economic Development Strategy
public   agencies)   have    introduced    a                   priorities. Supporting excluded groups
programme to support the future of over 40                     could help change the direction of small
communities in the most fragile rural areas.                   businesses in excluded industries e.g.
HIE provides funding for groups to employ                      fishing – rather than compulsory break-
a local development officer and offers                         up of a fishing boat, allow the sale of it
additional support from its own staff. The                     into another sector where it cannot fish
programme aims to build community                              but may be able to support aquaculture
confidence and deliver specific projects to                    or be converted to provide ferry support
increase income levels, population retention                   to remote communities.
and growth, and enhance infrastructure to
provide better local services. Ideally,                     A public sector perspective on the
communities should generate income to                       use of Enterprise Grants
sustain this process for themselves in the
                                                            REDS identified a number of criteria which
future.
                                                            could be used to select businesses for
                                                            enterprise       grants. All respondents
Respondents to REDS identified fragile
                                                            emphasised the importance of a strong and
communities as a primary target for
                                                            viable business plan. In some cases this
enterprise grants – particularly where there
                                                            was linked to applicants’ ability to
is significant rural deprivation and youth
                                                            demonstrate that subsequent to a grant
depopulation: “Grants would help to
                                                            award, the business would be sustained
address both the actual and perceived
                                                            and developed through loans and/or
geographic disadvantage in accessing
                                                            reinvestment of profits. The growth
support and markets.”
                                                            potential of projects was another key
                                                            criteria identified.
Sectors
All regional agencies (HIE, Highland                        Many respondents also mentioned the
Council, HOL) are influenced by the Scottish                importance    of   community      impact  –
Government Economic Strategy which                          including employment opportunities. Grants
promotes national key sectors:                              should be targeted at community initiatives
   Energy (with particular emphasis on                      that move institutions towards being
   renewables)                                              sustainable and demonstrate an awareness
   food and drink                                           of social and environmental issues and the
   life sciences                                            ethics    of   sustainable     development.
   financial and business services                          Displacement was also considered an
   tourism                                                  important consideration in this regard.
   creative industries
                                                            REDS indicated that key performance
Respondents to REDS identified the                          indicators could be used to track the impact
business sectors which they thought would                   of enterprise grants. The development and
benefit most from enterprise grants as:                     retention of employment opportunities
  In Sutherland, Retail and primary sector                  would be a key measure as would
  micro-businesses as these are normally                    measuring the impact on local population
  excluded from mainstream agency                           levels, especially in peripheral and fragile
  support.                                                  locations, through recording levels of
  Within Lochaber, Skye and Wester Ross,                    inward migration and retention of young
  Tourism and Food & Drink are                              people. In the medium and longer term,
  highlighted as the most relevant sectors                  recording growth, turnover and profit
  with many small businesses. Energy and                    alongside the longevity of supported
  Universities are also key to the area, but                businesses could help assess grant impact.
  are driven by larger companies.                           Tracking the amount of professional
                                                            assistance that they used and the number
11                                                          of agency staff that were required to
  LEADER is part of the Scotland Rural Development
Programme (SRDP). The aim of LEADER is to increase          administer each grant may also be
the capacity of local rural community and business          valuable.
networks to build knowledge and skills, and encourage
innovation and co-operation in order to tackle local
development objectives.

     Scottish Community Foundation research into support for rural businesses                  Page 9
REDS also indicated a degree of caution
when looking at this area of support:
                                                          A review of how
                                                          independent funding is
“The management culture of grant
awarding institutions and their staffing                  being used to stimulate
needs careful consideration. Currently the                local enterprise and
amount of dithering, angst and avoidance
of decision making and responsibility is                  promote rural regeneration
mind blowing. The ‘development industry’
has developed into a mature bureaucracy
that is increasingly self-serving and                     Programme Strategy
obsessed with its own internal management                 The stated aim of The Moidart Enterprise
systems. Consideration should be given to                 Programme is to ‘enhance prosperity and
developing assistance packages that are                   promote thriving communities in North
part grant and part soft loan for new                     West Scotland by supporting sustainable
business start ups and expansions. The                    local    enterprises    and     employment
processes required for loan administration,               opportunities’. The Moidart Trust was
taken from private sector banking best                    established in January 2008 by Angus and
practice, would be helpful in developing the              Michie MacDonald as a separate, ring-
model.”                                                   fenced charitable fund within the Scottish
                                                          Community Foundation. The Trust focused
“There is a serious problem if enterprise                 primarily on supporting projects in the
development is grant led. Some of the most                north-west of Scotland offering funding to
successful businesses I have experienced                  charity and community-led initiatives, a
take the view that they will not apply for                national sports body and to small rural
grants.”                                                  businesses; a small sum was used to
                                                          support charitable projects based outside of
“Different businesses have different optimal              the UK. Annually, the owners of the fund
sizes and sometimes expansion can destroy                 budgeted to spend approximately £100K.
them e.g. arts and craft businesses,
restaurants, personal service businesses.                 However, the MacDonald’s real interest was
Diversification may be an option but only if              about providing support to businesses that
the business case has been made; there is                 could    create   local  employment    and
clear operational fit with the existing                   encourage people to remain in these often
business; productivity and profitability                  remote, rural and fragile communities. In
increases and a risk analysis of likelihood               supporting businesses, the Moidart Trust is
versus impact and mitigation has been                     seeking to emulate the work of the SJ
carried out.”                                             Noble Trust, an independent trust which
                                                          since 2003 has been funding rural
                                                          businesses in Argyll, west Scotland. The
                                                          Moidart Trust enterprise grants would fund
                                                          projects north of area covered by the SJ
                                                          Noble Trust, broadly covering the area of
                                                          Scotland administered by Highland &
                                                          Islands Council and Comhairle nan Eilean
                                                          Siar (Western Isles Council). In its first
                                                          three years, the Moidart Trust contributed
                                                          £80,000 towards the work of SJ Noble
                                                          Trust, with a further £56,000 awarded to
                                                          businesses in the north-west of Scotland
                                                          through the Moidart Enterprise Programme.
                                                          This latter sum was used to leverage
                                                          £23,000 from the Scottish Community
 Scoraig Sea Taxi                                         Foundation, bringing the total disbursed to
                                                          private enterprise to £159,000.
 West Ross




   Scottish Community Foundation research into support for rural businesses                Page 10
The programme is designed to facilitate the               with a track record of success and selected
following outcomes:                                       professional advisers. A pilot seminar in
    An increase in sustainable employment                 2010 attended by 40 grantees from the
    opportunities being offered by small                  Moidart and SJ Noble Trusts created a
    businesses in North West Scotland.                    network of peers, some of whom remain
    The spread of enterprises that are                    connected to share experiences and
    optimising local assets, resources and                learning. A second seminar is being held in
    services and enhancing local supply                   March 2011.
    chains and income streams.
    An improvement in the social and                      Monitoring
    environmental benefits achieved as a                  The     Scottish  Community      Foundation
    result of a greater number or scale of                monitors     each   funded    project   with
    enterprise becoming established in North              telephone interviews 12, 24 and 36 months
    West Scotland.                                        after an award is made, producing a short
                                                          report on each. Depending on available
Awards of between £2,000 and £10,000 are                  funding, and learning gained from the initial
made, and awarded on a competitive basis.                 grants awarded, an independent evaluation
The programme is promoted to small                        of the programme may be commissioned,
businesses throughout north west Scotland                 possibly in 2011 or 2012. The evaluation
via agencies and networks including                       will consider the economic impact of the
Highland Opportunity Limited, Business                    direct and indirect financial and non-
Gateway, HIE, CBI Scotland and the                        financial investment made in the region.
Federation of Small Businesses and local                  Case studies highlighting good practice
Chambers of Commerce. Applicants use a                    would also be produced and shared with
standard form which is submitted with                     key stakeholders in the private and public
supporting      documents    (e.g.   annual               sector.
accounts, business plan, written quotations
for     equipment,    etc).  The    Scottish              Summary of businesses supported by
Community        Foundation   conducts     a
telephone interview with the applicant and                Moidart grants
produces a short report for Angus                         Over the past two years a total of twelve
MacDonald to use to a) contact the                        businesses have been supported by Moidart
applicant and discuss their proposal, either              enterprise grants. The types of activities
by telephone or in person; and b) to                      which the grants are used to support
determine which applicant is to be funded.                include:
Proposals are favoured where:                                Market research or feasibility studies to
    local materials goods and services are                   research the development of a business
    used.                                                    or explore, test and develop activity that
    new income is drawn into north west                      sensitively exploits the area’s tourist
    Scotland through the sale of goods and                   potential or a niche business area.
    services to customers who are normally                   Commissioning expertise to assist in
    based outside the area.                                  creating a business and/or marketing
    income is kept within north west                         plan.
    Scotland through developing of a new                     Start up costs for a well researched new
    product or service.                                      business (e.g.: dry wall finishing &
    there is clear evidence that a new or                    plastering, building, saw milling, sea
    expanded enterprise will not displace                    tours etc).
    economic activity in another part of the                 Equipping a newly established business.
    north west.                                              Supporting an established business to
                                                             expand its premises such as a craft
                                                             workshop,     boatyard    site  or   local
Non-financial Support for Applicants                         restaurant.
A condition of every award is that                           Investing in marketing materials for a
applicants agree to attend an annual                         business seeking to grow or expand.
training and networking seminar organised                    Purchasing new capital equipment that
jointly with SJ Noble Trust. The seminar                     will boost the businesses income
aims to cover key business issues in the                     opportunities.
context of operating in a rural, seasonal
economy and delivered by entrepreneurs



   Scottish Community Foundation research into support for rural businesses                 Page 11
Figure 1: Location of the businesses supported by Moidart Enterprise Grants 2008-2010

The businesses which have benefited from Moidart Enterprise Grants are located throughout
North West Scotland as indicated on the map shown in figure 1. A summary of the businesses
is given in Table 1 below while further details of the nature of these businesses and the impact
of the grants are included in Appendix 2.




   Scottish Community Foundation research into support for rural businesses          Page 12
Table 1: Summary of Moidart Enterprise Grants (December 2008 – December 2010)

Business                 Award       Purpose
The Achiltibuie          £6,100      To assist with costs of purchasing and erecting storage shed,
Garden Ltd                           purchase of shrubs, fencing material, varieties of apple trees
Ullapool                             and gardening tools.
Scoraig Sea Taxi         £6,450      To upgrade the licensed boat that runs between the mainland
Dundonnell                           and the Scoraig Peninsula.
Wild West Foods          £8,000      To contribute to costs of building work to join and extend two
Isle of Lewis                        business units and purchase ancillary equipment to kit the
HS2 9JF                              extension out.
Wild Rose Escapes        £2,100      To help with set up of new business including purchase of
Ullapool                             laptop, installation of BT line and marketing.
Rockhopper       Sea     £10,000     To contribute to securing a permanent site for the business.
Kayaking
Fort William
Live Native Ltd          £7,895      To purchase the branded packaging required for nine new
Kyleakin                             HomeSpa products, secure a part-time sales position and
Isle of Skye                         support costs to increase PR activity.
Loch Shiel Cruises       £5,303      To upgrade the propeller drive shaft system and awning and
Lochailort                           help sustainability of the business.
Ardnamurchan             £6,000      To support costs with marketing involving attendance at two
Charters Ltd                         major trade fairs in London and Glasgow.
Argyll
Isle of Skye Baking      £10,000     To purchase four specific pieces of equipment that will enable
Company                              business to expand.
Portree
Atlantic Resources       £7,800      To purchase a picking conveyor that will improve current
Development                          processes of seaweed collection and sorting prior to
South Uist                           distribution.
1st      Landscaping     £4,800      To assist with purchase of various equipment to enable
Solutions Ltd                        growing commercial side of the business to develop more
Stornoway                            efficiently.
Black          House     £6,000      To create a part-time administrative position this will enable
Creative                             the Director to concentrate on building the company’s
Isle of Lewis                        portfolio and generating further business.




Achiltibuie
Garden

Ullapool




   Scottish Community Foundation research into support for rural businesses             Page 13
   CASE STUDY



W
              ild West Foods Ltd operates an                  By 2004, Richard was confident about a
              EU approved meat packaging                      growing market and a total of £120,000
              plant in Uig on the west coast of               was invested in the business through a
the Isle of Lewis. It brands and packages                     mixed package of loans, HIE support and
imported beef jerky, and is now by far the                    personal funds. This enabled him to:
UK’s number one jerky brand and its                             lease and adapt premises
popularity     has          spread      to    Europe   and      install an automated packaging line
beyond.      Since         it   merged       with   another     purchase packaging and stock to target
company, Wild West has seen its sales                           increasingly large accounts.
rocket from £120,000 to over £3M per
annum      over       the       past    three
                                                                              Trade     continued       growing
years.
                                                                              through steady sales to a
                                                                              range           of       wholesale
Originally from Wales, company                                                customers in the UK and
owner         Richard                  Davies                                 emerging             markets      in
developed         a        passion          and                               mainland Europe. By 2008
commitment            to        set    up     a                               the business was offering 10
business that could support his                                               people     part-time         flexible
growing      family             and    create                                 employment,            which       is
sustainable                     employment                                    valuable in Uig where many
opportunities         in        the    fragile                                adults have several part-
communities           he        felt   drawn                                  time or seasonal jobs.
towards.

                                                              But growth was constrained by the size and
Richard had his first taste of beef jerky in                  arrangement of the premises. Wild West
1997 when he was introduced to it by a                        Foods applied to the Moidart Trust for
fishing guest from the USA. He loved the                      funding and received a grant of £8,000 to
taste, but found it was virtually impossible                  join and extend its two business units and
to buy in the UK. Inspired, Richard spent                     purchase ancillary equipment to kit the
several years researching the product and                     extension out. The grant helped to secure
the possibility of bringing it to the UK. He                  £8,000   from   the     local    Council’s     small
then started trading by testing the market                    business loan scheme to help make up the
with one product sold via the internet, and                   additional building costs. This gave the
Wild West Foods was born. That guest from                     bank confidence to loan a further £21,000.
the USA is still a close friend of Richard’s
and constantly reminds him of the flash of
inspiration he provided!




   Scottish Community Foundation research into support for rural businesses                           Page 14
The business subsequently received a food                 networking opportunities that have come
safety   certificate     which    helped   secure         alongside it. Last year Richard attended a
orders from a leading UK supermarket                      seminar run by the Trust which, he says,
which    increased     turnover     by   £100,000         was seminal to his decision to respond
alone.                                                    positively to the merger offer and focussed
                                                          his ambition.

It was anticipated that the grant would
enable the business to double production,                 “The seminar was a revelation to my way of
create storage space and open up access                   thinking,” he continued. “Being so remote I
for supplying UK supermarkets.                            rarely get to speak with any other business
                                                          owners. This isolation is a problem. If you
                                                          are surrounded by success it makes it
In fact, the
                                                          easier to succeed but when you battle with
grant has
                                                          a feeling of being alone it can be a struggle
helped the
                                                          where confidence can be thinned. It is a
business to
                                                          key issue in remote areas of Scotland.
achieve that
                                                          There is no gathering of minds on a regular
and much more
                                                          basis.   By    gathering   many   small   rural
by giving
                                                          businesses together in an informal setting
Richard the
                                                          and by delivering inspiring advisory talks on
confidence to
                                                          key issues for business Angus and his team
move towards a higher turnover and merge
                                                          filled a massive gap in the learning curve of
with another jerky business that is
                                                          every developing business.”
anticipating a turnover of over £4M.


                                                          Richard is honest, ambitious, driven and
With the Moidart Trust’s help, the Wild West
                                                          utterly determined to make a living for
brand has jumped up a level. Business
                                                          himself and others on the island of Lewis.
owner, Richard Davies, said: “The Trust’s
                                                          These are precisely the characteristics and
show of faith in our comparatively small
                                                          attributes that the Moidart Trust seeks out
enterprise was also a massive boost to our
                                                          in the businesses it supports to help ensure
confidence.”
                                                          business and communities in remote, rural
                                                          northwest Scotland can survive and thrive.
Richard is also keen to point out that it’s
not only the funding that has been so
valuable,    but   the   support,    advice   and




   Scottish Community Foundation research into support for rural businesses                  Page 15
Lessons from the Moidart Enterprise                           Two had secured additional grant
Grants                                                        funding to match Moidart funding or
                                                              cover 25% of total costs.
Eight of the businesses which had had
                                                          Five businesses had applied for public
received     Moidart    Enterprise   Grants
                                                          funding and four of these had been
(representing a variety of sectors from
                                                          successful. Total public funding obtained
tourism to retail and food and drink) took
                                                          was £88,550. One company (Scoraig Sea
part in a survey which looked at the impact
                                                          Taxi) had also obtained additional private
of the grants in supporting remote and
                                                          funding of £6,450. Another company (Wild
rural businesses. The results demonstrate
                                                          Rose Escapes) is currently looking into a
that Moidart funding was predominantly
                                                          rural priorities grant from SRDP and some
used to expand and develop existing
                                                          Arts Council funding for craft workshops,
businesses, although in a few cases it
                                                          but notes that “there is currently very
assisted with start-up cost for new
                                                          little funding out there for small
companies. The findings show that the
                                                          businesses.”
Moidart funding provided early momentum
to expansion plans and was often a first
                                                          Seven businesses indicated that they were
step in gaining other sources of support for
                                                          bringing new income into the area through
further development. They also indicate
                                                          the sale of goods and services to customers
that    the    joint  Scottish   Community
                                                          normally based outside the region, and five
Foundation/Moidart seminars and the
                                                          of them stated that Moidart funding had
interest shown by Angus Macdonald proved
                                                          helped to create knock-on effects for other
an invaluable source of information and
                                                          businesses in the area.
inspiration to many of the businesses.

                                                          Enterprise grants helped secure and
Reasons for seeking enterprise grant
                                                          increase local employment
funding                                                   Seven businesses used local produce,
The most common reason for seeking                        materials or labour and all employed local
Moidart funding was the need to purchase                  staff or trainees. In total Moidart funding
new capital equipment in order to boost                   had resulted in the creation of three full-
income opportunities for an established                   time jobs and five part-time jobs, with the
business. The other most common reasons                   short-term potential for further job creation
for seeking funding were to expand the                    in one further business which will only
premises of an established business or to                 become fully operational in March 2011.
meet the cost of marketing materials to
expand an established business. This
                                                          Enterprise grants have       helped    some
suggests     that    Moidart   funding    was
predominantly      sought    by   established
                                                          businesses to expand
companies      looking   to   expand     their            There is quantitative evidence that Moidart
business. The enterprise grants were not                  funding has made an important impact on
used for pre-trading activities such as                   the recipient businesses in terms of giving
feasibility studies, market research or to                early momentum to expansion plans. Wild
commission expertise on a business or                     West Foods indicate that their sales have
marketing plan.                                           tripled following the building work kick-
                                                          started by Moidart funding. By merging
                                                          with another company since, sales have
How has Moidart funding                                   increased from £120,000 per annum to
                                                          £3million per annum over the past three
helped?                                                   years. Similarly, Rockhopper Sea Kayaking
                                                          received initial backing from Moidart for
Enterprise grants helped          to   lever    in        their expansion ideas, and subsequently
additional funding                                        gained support from HIE and a HOL loan.
Six businesses indicated that Moidart
funding had helped them to secure                         Moidart Trust Seminars were highly valued
additional funding from other sources.                    by local businesses
   Four had received bank loans totalling                 Businesses reported that - primarily
   £58,800.                                               through HIE - they were able to access
   Three had received loans from other                    advice and support in areas such as
   sources (council or HOL) totalling                     knowledge sharing, business planning,
   £53,000.                                               networking, mentoring, financial planning

   Scottish Community Foundation research into support for rural businesses                 Page 16
and accounting. However, those which had                  had attended had “changed my whole view
received enterprise grants also stressed the              on business and gave me a new found
importance of the practical support and                   optimism… Angus’ team at the seminar
inspiration they received from the Scottish               made me open my eyes to what I had and
Community      Foundation     and    Moidart              how to grow better and more efficiently.
seminar and from Angus Macdonald. One                     The grant, though small in current sales
respondent to the survey stated                           standards gave us the bump up needed at
                                                          the time to start a chain of events going
“Angus Macdonald made the process                         and    we    have   far   outstripped     my
worthwhile with his support and genuine                   expectations… the place is busy at last after
interest in the business helped inspire us to             seven years of struggling prior to the belief
get on with it.”                                          shown in us by the Moidart grant award…
                                                          the incentive to succeed has helped push
Another  stated   that   the    Scottish                  me harder.”
Community Foundation/Moidart seminar he




   Angus Macdonald and local business owners at the Scottish Community
   Foundation and Moidart Trust Seminar in Oban – March 2010.




   Scottish Community Foundation research into support for rural businesses                 Page 17
Appendix 1: Types of support available through the public
sector

Financial                                                   £50,000 - £250,000 only considered
                                                            where there is a sound security over a
                                                            business asset as well as a compelling
HIE consider applications for funding                       case for economic development in the
(grants, loans and direct investment) from                  Highlands. The repayment period is up
account-managed         businesses,  social                 to seven years depending on loan size.
enterprises and communities and identified                  HOL loans are intended to be part of a
transformational projects. HIE look to                      finance package which makes business
support projects which accelerate private                   starts or growth happen where otherwise
sector led business investment, which                       they/it might not. Exceptionally, equity
target wealth creation through increased                    investment may be considered where
employment and enhanced quality of jobs,                    there are high growth prospects and a
and which improve productivity and                          clear investment exit route.
efficient use of resources.
                                                            Community       Enterprise   Loan     Fund
  HIE grants should always be the last                      supports     non     profit    distributing
  resort after all other avenues explored.                  community based enterprises in the
  Financial assistance in grant form will be                Highlands e.g. a society, club, trust or
  at minimum level possible to let project                  company which does not pay dividend or
  proceed.                                                  surplus to owners but reinvests in
  HIE loans (can be instead of, or in                       business. Loans up to £50,000 are
  addition to, a grant). Again should be a                  available at 5 – 9% interest depending
  last resort source of funding, and will be                on risk and provision of security. Loans
  made on commercial terms using                            in excess of £50,000 may be considered
  equivalent terms and conditions as                        directly or syndicated with Social
  private sector borrowing from e.g.                        Investment Scotland. The repayment
  banks. HIE required to take best                          period is up to seven years.
  available security available and will tailor
  repayment requirements to capabilities                    Business Start-Up Grants. 12 All new
  of the business.                                          businesses in the Highlands can apply.
  HIE direct investment (can be considered                  This Rural Development Grant Project is
  alongside both grant and loan funding).                   funded by the Highland Council Business
  HIE buy shares on same commercial                         Gateway service and the Highland
  terms as private investors. Again this                    LEADER 2007-2013 Programme. The
  should be last resort, and only if private                grant is intended to help new small
  investment falls short of full amount                     businesses to set up in the Highlands
  required. HIE look to buy ordinary voting                 through supporting initial start up costs
  shares with the amount capped at 20%                      (purchase      of   capital    equipment,
  of the equity. HIE will look to make any                  marketing, purchase of software or
  preference shares they buy redeemable                     licenses, or other one-off costs – but not
  so that they can be converted into                        working capital, wage subsidy or debt
  ordinary voting shares as an exit                         repayment). It meets three quarters of
  strategy.                                                 the cost of essential expenditure with
                                                            applicant providing remaining quarter.
HOL provides funding through loans, grants                  Grants made entirely at discretion of
and     (in   exceptional  cases)    direct                 HOL. Businesses can have any legal
investment.                                                 structure and operate in any sector or
   The Opportunity Fund offers loans to                     geography within the Highland Council
   new and growing businesses in the                        area but must be a genuine start up –
   Highland Council area at interest rates
   lower than commercial bank rates –
   currently 5% on outstanding amounts.
   Priority is given to loans of £1000 -                 12
                                                            Conditions apply to grants, including producing a
   £50,000 (can be unsecured where there                 satisfactory business plan, undertaking compulsory
   is a strong business plan). Loans of                  training courses and agreeing to further contact with
                                                         Business Gateway to measure business success.

  Scottish Community Foundation research into support for rural businesses                         Page 18
  not an acquisition or management buy                    HOL     provides    online    support; local
  out/in.                                                 workshops; training; impartial advice; and
                                                          specialist advisory services.
PSYBT Loans are available up to £10,000
at a fixed interest of 4% up to 5 years. In               PSYBT loans come with prior business
some cases PSYBT also offers grants up to                 advice, a business management package
£1000.                                                    and   a    specified level of aftercare
                                                          counselling.

Practical                                                 All respondents to REDS indicated that
                                                          support towards Network / Knowledge
                                                          Sharing; Business Planning; Financial
HIE     work     with   business     support              Planning and Accounting were already
organisations and academic institutes.                    available from other sources in their areas.
Through these, businesses can access                      Mentoring was also available in most areas.
programmes, schemes, workshops, courses                   13
                                                               Some respondents indicated that
and    events    designed    to    stimulate              additional support was available in their
entrepreneurship        and         business              area via training events from Business
development. For example, the                             Gateway and specialist sectoral support.
Going Global mentoring programme offers
ambitious businesses in the HI the                        However, REDS identified that a number of
opportunity to work with development                      types of support were not currently
experts from MIT (Massachusetts Institute                 available in some areas:
of Technology) to grow and expand into                       Formal     aftercare     for  non-PSYBT
global markets. HIE also work with Scottish                  businesses.
Development      International    to    help                 Assistance for employment.
businesses in the HI to develop their                        Assistance for training.
international trade by offering a range of                   Staff placements in similar organisations
support services for businesses entering
new markets for the first time or looking to
expand overseas trade.




                                                          13
                                                             Not reported as available in Lochaber, Skye and
                                                          Wester Ross

   Scottish Community Foundation research into support for rural businesses                         Page 19
Appendix 2: Summaries of the local impact of Moidart funding

The Achiltibuie Garden Ltd                                Ardnamurchan as a destination and
(www.thehydroponicum.com) is based in                     increase awareness of other businesses in
Ullapool and was awarded a Moidart                        the area. More specifically it was used for
enterprise grant of £6,100. The business is               the materials and logistics of promote the
based on Hydroponics - the practice of                    business at the Holiday and Travel
growing plants without soil. Sales are being              exhibition in Glasgow. Although the
developed through a website as well as                    numbers of those attending the show were
through a visitor centre and garden. The                  low due to the economic climate, the
grant contributed to the development of the               business did take £1,600 of additional
garden area of the centre including                       bookings at the show and raised the profile
purchase and erection of storage shed,                    the company.
purchase of shrubs now being tested in
different growth areas, fencing material,                 Although the marketing event did not
varieties of apple trees and gardening tools.             provide as big a return on investment as
The business reported turnover of £9,213                  anticipated, it did increase the capacity,
with a deficit of £17,624, due primarily to               knowledge and experience of the business
initial onsite developments. The business                 in marketing and this will help improve the
plan outlines planned growth of the                       targeting   and    resourcing    of  future
business projecting a turnover of £153,086                marketing.
in 2012-13 with a profit of £24,290.
                                                          The grant was used to promote other local
The grant has helped to secure £18,590 in                 businesses and resources at the show
further funding from the Crofting Counties                including Resipole Studios, Tobermory
Agricultural Grant Scheme and the Scottish                Distillery, Ardnamurchan Tourist
Rural        Development        Programme.                Association, Sunart Oakwood Initiative,
Development of the garden has allowed                     Rockhopper Kayaks, Tobermory Lifeboat
business to highlight it as an attraction                 station, M.C.A.
within their business plan as separate
income stream. The grant contributed to
company resilience and has opened up                      Wild Rose Escapes
volunteering opportunities for community.

Two other local businesses have benefited
directly from the grant services (local
sawmill, local tradesman) as have other                   (www.wildrose-escapes.co.uk) is based in
Highland businesses from slightly further                 Ullapool and was awarded a Moidart
afield (nursery in Poolewe). It has wider                 enterprise grant of £2,100. This is a new
links to other local businesses selling                   start business which organises bespoke
produce through local shops and providing                 small group holidays involving activities
salad and vegetables for the local Michelin               such as dry stone walling, wild food
starred hotel.                                            foraging, yoga, kayaking – all lead by local
                                                          experts. Catering is an important element,
                                                          and while the holidays include some visits
Ardnamurchan Charters LTD                                 to local restaurants and cafes, Rosie and
(www.west-scotland-marine.com) is based                   her partner cook most meals using local
in Acharacle, Argyll and was awarded a                    produce. The grant was a significant boost
Moidart enterprise grant of £6,000. The                   during the first year – supporting costs for
family run business which consists of: self-              a laptop, telephone line and internet
drive small boat hire; self catering                      connection, a marketing campaign and
accommodation; a community passenger                      initial stationery costs. To break even in the
ferry service; a charter boat; and                        first year required securing bookings for
management of the island of Carna. It                     four holidays, each with eight customers.
employs five full time staff and two part                 During the first season, five holidays were
time staff.                                               run (26 customers in total). Two walking
                                                          weekends        were      organised    (seven
The grant was used to increase marketing                  customers) and various workshop events
of the business, increase awareness of                    were held for holiday makers and local

   Scottish Community Foundation research into support for rural businesses                  Page 20
residents. First year turnover was £11,000                retailers within the UK and Europe. The
with a loss of £3,900. In addition to                     Moidart grant came at a critical time, when
developing a portfolio of holiday options,                the credit crunch reduced the amount
marketing      activity  involved    website              banks were willing to loan the company in
development, local and national press                     order to purchase their premises from HIE
releases, flyers & promotional cards, joining             in order to expand them. Moidart backing
a number of travel websites and exhibiting                was important in securing a sufficient bank
at a stand at Earls Court holiday show in                 loan. An additional £8,000 loan was
London. Further publicity came via inclusion              secured from the council small business
in a CBBC programme ‘Gimme a Break’ and                   scheme. The annual turnover of the
a Guardian journalist has been secured to                 business has more than doubled, from
experience a Wild Rose holiday. With                      consistently    £120,000    to    £250,000.
increased profile and continued cost                      Increased capacity has allowed expansion
effective marketing the aim is to break                   of sales to Germany, Belgium and Czech
even in Year 2. By using local expertise to               Republic. Hours of part-time staff have
lead activities, Wild Rose Escapes provides               been increased – with six now working on a
employment opportunities to a wide pool of                regular basis.
self-employed local residents – yoga
teacher, ornithologist, mountain guide.                                          Loch Shiel Cruises is
Increased numbers of holidaymakers also                                          based in Lochgailort
benefit other local businesses.                                                  and was awarded a
                                                                                 Moidart     enterprise
Scoraig Sea Taxi is based in Scoraig, West                                       grant    of   £5,303.
Ross and was awarded a Moidart enterprise                                        Loch Shiel Cruises
grant of £6,450 towards the purchase of an                                       operates the only
upgraded boat, with increased passenger                   guided pleasure cruises and boat charters
capacity, which provides a critical service               on Loch Shiel between Glenfinnan and
between the mainland and the remote                       Acharacle. The business has grown steadily
peninsula community of Scoraig. The                       since its establishment in 1998 and now
Moidart grant provided 15% of total                       has about 2,500 customers each year,
purchase costs – the rest part financed by                about 10% of whom are returning. The
HIE, HOL and the owner’s own capital.                     Moidart grant was used to replace and
While there were teething problems with                   upgrade the propeller drive shaft system
the design, weight and power of the new                   and awning on the boat – improving both
boat, which resulted in delays for                        the safety and comfort of passengers. The
manufacturer repairs, the new boat has                    owner is a member of the Scottish Tourist
meant faster, drier and safer crossings for               Board and Loch Shiel Cruises was awarded
increased     numbers      of    passengers.              3 star rating (very good) from Visit
Improved access has been appreciated by                   Scotland’s quality assurance scheme. By
elderly users. Income/Profit increased from               encouraging visitors to come to the area
£16,117/£11,736         in    2007-8       to             and increase their length of stay, Loch Shiel
£24,424/£16,456 in 2008-9. The boat                       Cruises helps other businesses in the area.
provides additional employment to three,                  It also plays a role in educating locals,
RYA-trained relief skippers. The boat assists             including schools and interest groups, and
a new business on Scoraig that provides                   visitors to the culture and history of the
weekly    retreats    to   an   international             area. It acts as a platform for budding
customer base. It is used by school pupils,               young traditional musicians in working with
health professionals, local authority and                 the Feis movement.
postal services as well as the local
population.                                                                   Live Native
                                                                             (www.livenative.com) is
Wild West Foods                                                              based on the Isle of
(www.wildwestjerky.co.uk) is based in Uig                                    Skye and was awarded
and was awarded a Moidart enterprise                                         a Moidart enterprise
grant of £8,000 to carry out building work                                   grant of £7,895. Live
to join and extend two business units and                                    Native produces hand-
purchase ancillary equipment to kit out the                                  made cosmetics using
extension unit. Wild West Foods imports,                  organic,   raw,     fairly-traded   aroma-
brands, packages and markets beef jerky to                therapeutic ingredients which it sells to


   Scottish Community Foundation research into support for rural businesses                 Page 21
spas, retailers and directly via the internet             increased production of both bread and
(own site and internet suppliers). It is a                biscuits, and the anticipated development
‘raw Skin Food’ company targeting the top                 of new product ranges. The company has
end of the ‘natural’ cosmetics market. The                now begun to supply breads to hotels. One
Moidart grant was used for a part-time                    additional part-time position has been
employee (£1,512), increase PR (£900),                    created with potential for two more next
the remainder being used for packing -                    year. Moidart funding provided a stable
cosmetic boxes (£3,195), labels (£1,350)                  base from which to apply to HIE for
and booklet inserts (£938) for a range of                 additional funds (application in progress)
new products. Funding has helped to launch                and to HILINKS for a R&D grant. Isle of
the Live Native spa treatments in Slovenia                Skye Baking Company works closely with
and in a new spa in Richmond (Senshi                      local growers, in particular one croft which
Beauty), and a sales strategy is progressing              supplies eggs, potatoes and salads. They
in France. Live Native have been invited to               work with Isle of Skye Brewery for all off-
advertise one of their products (Pure Natal)              island deliveries. Started in 2007, the
in Mum+One magazine, an NHS endorsed                      business broke even by year two of trading
health guide for mums distributed via                     and has an annual turnover of £26,466.
midwives. The company started trading in                  Par-baked bread, one of the products
2008. The directors invested £14,000 and                  developed as a result of Moidart funding is
secured grants and loans from HIE and                     projected to generate an income flow of
HOL. Turnover in first year was £4,483 with               £8,300 in 2010; £16,000 in 2011; and
an overall loss of £10,784. Turnover in year              £20,000 in 2012.
2 was £21,586. Year 3 turnover is projected
to reach £45,000 and at least break even.
They use an Inverness based courier
company      and    Scottish-based   printing
companies for packaging.                                  Black House Creative is based in Orinsay
                                                          on the Isle of Lewis and was awarded a
Isle of Skye Baking Company                               Moidart enterprise grant of £6,000. This is
(www.isobakingco.co.uk) is located in                     a design company working across a range
Portree on the Isle of Skye and was                       of    media    including   websites,    logos,
awarded a Moidart enterprise grant of                     advertising campaigns, brand development
£10,000. The business has two main                        and brochures. In the first year work has
income streams:                                           been generated from a range of local and
1. Production of shortbread hearts and                    national businesses and charitable trusts
   oatcakes which they package and                        including Harris Tweed Authority, Live
   wholesale to independent retailers in the              Hebrides, Jackson Greens, Miavig Mussels
   Highlands, Aberdeen and Glasgow                        Ltd, the West Harris Trust and the BBC. The
2. Making quality baked produce which is                  Moidart Funding provides 65% of the cost
   traded locally through farmers’ market                 for the creation of a part-time administrator
   and a year round delivery service that                 position, the remaining funding coming
   the company operates in partnership                    from the company itself. This frees-up the
   with two other local food producers                    Director’s time to work on the creative side
   specialising in meat and preserves.                    of the business, build the company portfolio
The Moidart grant was used to purchase a                  and generate further business. The funding
freezer; blast chiller; vacuum packer and                 covers an initial six month trial period, after
portable oven. This has resulted in                       which it is anticipated that the company will
                                                          be in a position to fully fund and develop
                                                          the post. Turnover in the first year (June
                                                          2009-March 2010) was £20,653. Projected
                                                          turnover for year 2 (based on booking
                                                          received by October 2010) is £85,000 with
                                                          Gross/Operating Profit of £7,595/£3,373.




   Scottish Community Foundation research into support for rural businesses                   Page 22
Atlantic Resources Development is based                   in the purchase of the larger equipment
in Orosay on South Uist and was awarded a                 necessary to develop the commercial work,
Moidart enterprise grant of £7,800. This is               including a galvanised trailer. To date, the
a new company that emerged out of the                     equipment for commercial work has been
recently dissolved Orosay Net Station Ltd.                hired at a cost of £300 per month. Business
Atlantic Resources Development exploits                   has grown rapidly, employing three people
the fact that Scotland’s shores host around               by April 2010 and a fourth in January 2011.
20% of Europe’s seaweed biomass, and                      An additional two part-time posts will be
potentially 400,000 tonnes of kelp are                    created in April 2011. First year turnover
washed onto Uist’s Western beaches over                   was £45,000 and projected turnover for the
the winter months each year. The company                  second year is £90,000 with profit of
collects Kelp, dries it on frames before                  £10,000 to 15,000.
milling and packing it for distribution within
a growing European market for organically                 Rockhopper Sea Kayaking is based in
grown      natural   foods      from    clean             Corpach, Fort William and was awarded a
environments. The Moidart award covers                    Moidart enterprise grant of £10,000. The
the cost of a picking conveyor which                      business was established as a limited
mechanically assists the sorting of the kelp,             liability partnership in 2004 and provides
increasing the speed and productivity of the              guided sea kayak trips around the shores
business. A three year contract, worth                    and lochs of Lochaber, a coastal area
£300,000 annually, has been secured with                  claimed to be one of the best areas for sea
a French company to provide 15,000                        kayaking in the UK. The Moidart award will
tonnes of dry seaweed.                                    help to secure new premises which will
                                                          allow expansion of the business, provide
1st Landscaping Solutions is based in                     secure storage for all equipment, and act as
Shulishader Point, Stornoway and was                      a meeting point, drying room and provide
awarded a Moidart enterprise grant of                     showers for all customers. Operating from
£2,500. Established as a sole trader                      their previous site, annual turnover was
landscaping business in April 2009, growth                £76,000 and profit was £36,000. The
led to registration as a limited company in               business attracts tourists to the area and
July 2010. Covers both domestic gardens                   new premises are likely to result in
(140    regular    domestic    clients) and               seasonal employment for at least two other
commercial maintenance work (contracts                    people. HIE have indicated that they could
with Tesco, Co-op, Harris Tweed, Scottish                 assist with funding 25% of renovation costs
Salmon Company). Was invited to tender                    at the new site.
for landscaping contract for new Inverness
Campus site and has other commercial
interest from companies in Fort William,
Oban and Skye. The Moidart award assists




   Scottish Community Foundation research into support for rural businesses                Page 23
Appendix 3: Press release for the Moidart Trust Seminar




Monday 29 March 2010


ENTREPRENEURS GATHER IN OBAN FOR MOIDART TRUST SEMINAR
Forty entrepreneurs from across Argyle and the Highlands gathered for the first

Moidart Trust Seminar at Lochnell Castle on Tuesday 23 March. The seminar focused

on growing sustainable businesses across the Highlands to ensure its future as a

viable and prosperous place to live and work.



Angus Macdonald, founder of the Moidart Trust, said: “We’re aiming to build connections and

links between businesses so people can help each other and create a hub of success. There are

too few role models in the area and we need to change that. We want to encourage people to

be ambitious and think big. We have to challenge the ‘it won’t work here’ mentality.”



Attendees, primarily from the tourism, marine and food sectors, were offered practical tips on

developing their businesses. The keynote speakers included Jon Benson, founder and CEO of

eFinancialcareers.com, who spoke about harnessing the power of the internet to develop

business. Virginia Sumsion, marketing manager of Loch Fyne Oysters, gave an insight into the

growth of Loch Fyne into a successful global business.



Richard Davies, owner of Wild West Foods in the remote west coast of Lewis, said: “I drank in

every word said. It was fantastic to meet like minded people and have the chance to share our

experiences.”



Ends




   Scottish Community Foundation research into support for rural businesses             Page 24

				
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