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【BUD Fund Application Guide】Get Up to $7 Million Fund
Attention SMEs and e-commerce businesses! Expanding into mainland China and international markets is no longer a dream, thanks to the government’s “BUD Fund.”
BUD Fund offers up to HK$7 million in cumulative funding to help you promote your brand, upgrade equipment, register trademarks, and more, all at a low cost for higher returns. Here’s how the BUD Fund can help you expand your business into larger markets.
Table of contents
The Objective of the BUD Fund
“BUD Fund” stands for the Dedicated Fund on Branding, Upgrading, and Domestic Sales. It aims to encourage SMEs to explore markets in Mainland China and the ASEAN region. By focusing on the following 3 key areas, it helps Hong Kong businesses enhance their overall competitiveness:
- Brand Development: Increase your brand’s visibility, uniqueness, and value, making it instantly recognizable to customers.
- Upgrading and Transformation: Use the latest technology to improve efficiency, enhance product quality, and boost purchase and repurchase rates.
- Market Expansion: Gradually introduce your products to China and international markets, including participating in global exhibitions and advertising campaigns.
Why You Should Apply for BUD Fund
BUD Benefit 1: Expand Domestic and International Markets
- Utilize BUD funding to enter mainland China and international markets, opening new business opportunities.
BUD Benefit 2: Additional Funding
- Receive up to HK$7 million in cumulative funding to meet various business needs, from team expansion and brand promotion to purchasing production machinery and hiring external auditors.
BUD Benefit 3: Brand Building
- Stand out in the market through brand promotion and website/app development.
BUD Benefit 4: Easy Application Process
- The latest 2023/24 Policy Address introduces the “BUD Special Fund – Easy Application,” speeding up the approval process to within 30 working days.
BUD Benefit 5: Boost Revenue at Low Cost
- Promotional activities and product/service quality upgrades help attract new customers, significantly increasing sales.
2 Main Categories of BUD Fund
The “BUD Special Fund” covers two main categories:
Mainland Program | ASEAN Program |
Focuses on helping enterprises explore the Mainland China market. | Aims to assist businesses in entering ASEAN markets, including below countries:
|
BUD Funding Amount
Generation Application | Easy Application |
Funding ratio is 1:1 (50% government subsidy, 50% company contribution) | |
Maximum cumulative funding cap is HK$7 million | |
Up to HK$1 million funding per project | Maximum of HK$100,000 per application |
Companies can be approved for up to 70 projects, with multiple projects running simultaneously (must be completed within 2 years) | Companies can be approved for up to 70 projects, with multiple projects running simultaneously (must be completed within 1 year) |
Approval time is approximately 60 working days | Approval time is approximately 30 working days |
BUD Funding Disbursement Methods
Method 1: Initial Disbursement | Method 2: No Initial Disbursement | |
Initial Disbursement | Get up to 75% of the preliminarily approved funding amount | Not applicable |
Mid-term Disbursement | Not applicable | Get up to 50% of the total approved amount, depending on project progress and actual expenditure |
Final Disbursement | Get the remaining balance of the approved funding | Get the remaining balance of the approved funding |
Project Duration | Must be completed within 2 years | Projects running over 18 months but not exceeding 24 months. |
* “Easy Application” project does not have an initial disbursement. | ||
BUD Funding Scope - Popular Funding Categories
The BUD Special Fund covers a wide range of areas, primarily including the following:
BUD Funding Scope 1: Brand Promotion
Exhibitions: Funding for direct expenses related to participating in mainland China and international exhibitions or trade fairs.
Advertising and Promotion: Covers online advertising, spokesperson fees, copyright purchases, and influencer (KOL) marketing expenses (funding cap: up to 50% of the total project cost per application).
Promotional Material Production: Design and production of promotional materials such as flyers, brochures, and posters.
Product Sample Production/Purchase: Funding for producing or purchasing product samples or models for development or display (funding cap: up to 30% of the total project cost per application).
BUD Funding Scope 2: Upgrading and Transformation
Website and E-commerce Platforms: Establishing or optimizing company websites, e-commerce platforms, and online store systems (funding cap: up to HK$100,000 per application for website optimization).
App Development: Developing business-related mobile applications (funding cap: up to 50% of the total project cost per application).
New Technology and Equipment: Procuring new technology and equipment to enhance business efficiency (funding cap: up to 70% of the total project cost per application).
BUD Funding Scope 3: Establishing New Business Units
Operational Expenses: Includes business registration, leasing, renovation, and daily expenses such as utilities (funding cap: up to 20% of the total project cost per application).
BUD Funding Scope 4: Hiring Talent
New Personnel: Expenses for hiring project-related talent and setting up related business units (funding cap: up to 50% of the total project cost per application).
BUD Funding Scope 5: Travel and Accommodation Expenses
Related Travel: Covers travel and accommodation expenses for project-related activities between Hong Kong and Mainland China or FTA regions (funding cap: up to 20% of the total project cost per application).
BUD Funding Scope 6: Testing/Certification Registration
Quality Verification: Support for expenses related to product testing, certification, or registration in Hong Kong, Mainland China, or FTA regions.
BUD Funding Scope 7: Applying for Product Patents/Trademark Registration
Patents and Trademarks: Applying for patents, trademarks, design patents, utility patents, or copyright protection (funding cap: up to HK$600,000 per enterprise).
BUD Funding Scope 8: Financial Auditing
External Auditing: Funding for external financial auditing fees (full funding, up to HK$10,000 per application, counted towards the enterprise’s funding cap).
For detailed BUD funding scope: Official Website – Funding Scope
BUD Fund Application Eligibility
BUD Eligibility 1: Registered non-listed enterprises in Hong Kong.
BUD Eligibility 2: Substantial business operations in Hong Kong, not accepting shell companies or businesses primarily operating overseas. Required documents include:
Employee records
Financial reports
Business transaction and operation records
BUD Eligibility 3: Projects must involve brand development, upgrading and transformation, or market expansion (applicable to all industries).
BUD Fund Application - Project Plan Writing Guide
A comprehensive and convincing plan is key to a successful BUD application. Here’s a step-by-step guide:
1. Define Your Project Goals
Describe your project’s specific goals and how it will enhance brand value and competitiveness, creating benefits.
2. Detail Your Brand Promotion/Upgrading Strategy
Specify your market promotion and brand promotion methods, including:
Target Audience: Detailed description of your target market.
Market Needs: Explain how your products/services meet specific needs.
Promotion Channels: Use platforms like Instagram, Google, Amazon, eBay, Alibaba, etc.
Promotion Activity Planning: Establish a clear execution timeline.
Expected Outcomes: Set sales targets and predict the impact on sales growth.
3. Expected Results
List measurable goals for evaluating potential benefits.
4. Budget Allocation
Detail the budget allocation, ensuring each expense is reasonable and compliant with BUD regulations.
5. Project Timeline
Provide a clear timeline and key milestones, including expected outcomes and schedules.
BUD Fund Application Process
1. Online Application Submission
Fill out the online application form on the official website with company details, project content, objectives, methods, timeline, budget, and expected benefits.
2. Submit Supporting Documents
Include copies of:
Valid Business Registration Certificate
Identity documents of major shareholders (holding 30% or more)
Proof of substantial business operations in Hong Kong
Direct investment-related documents for Mainland China business, if applicable
3. Approval and Progress Inquiry
Wait for approval, check progress online. Typically completed within 60 working days after receiving all documents.
4. Sign Disbursement Agreement
Initial Disbursement Agreement: Open a dedicated bank account for project funds management.
No Initial Disbursement: No need for a dedicated bank account; projects can start the day after submission.
5. Begin Approved Projects
6. Submit Progress Reports and Annual Audited Accounts
7. Apply for Mid-term Disbursement (if applicable)
8. Complete Project
9. Submit Final Project Report and Audited Accounts
10. Claim Final Disbursement
For detailed BUD Fund application process: BUD Fund Official Website – Application Process
Popular Export Businesses Supported by BUD Fund
Consumer Electronics and Technology: Smart home appliances, agricultural drones, home and industrial robots.
Fashion and Apparel: Popular in Asia, especially Mainland China, with potential in Southeast Asia for industrial sewing machines.
Jewelry and High-end Watches: Known globally for quality and craftsmanship.
Beauty and Personal Care: High demand in APAC for innovative, high-quality cosmetics and care products.
Green Sustainable Products: Growing international demand driven by environmental awareness.
Home Goods: Coffee machines, beauty devices, storage solutions.
BUD Fund Application - Important Notes
Project Timing: BUD funding cannot be used for already started projects, but it can be applied to new, independent parts of ongoing projects.
Sales Licenses: Required for sales-related projects.
Brand Registration: Required for creating new brands or promoting existing ones.
Promotion Relevance: Hong Kong promotional activities must be directly related to Mainland or FTA market business.
Project Duration: General projects must be completed within 2 years, “Easy Application” projects within 1 year.
Conclusion: Why Apply for the BUD Special Fund?
If you run an e-commerce business or want to digitize and expand your traditional business into mainland China and international markets, the “BUD Special Fund” offers a valuable opportunity. It helps reduce market promotion and operational costs, open new markets, and increase profitability. With funding up to HK$7 million, businesses can aggressively implement development strategies.
The 2023/24 government budget proposal introduces the “Easy Application” policy, simplifying the application process and speeding up approval, making it easier for SMEs to obtain funding for business growth. In summary, the BUD Special Fund provides financial support and paves the way for innovation and expansion.
For detailed BUD application information: Official Website
Do you have more questions about the “BUD Special Fund”? Or want to learn more about how to leverage BUD funding to grow your business? Contact us at Rovertech IT Consulting now! We are well-versed in the BUD application process and government regulations, and we can craft digital transformation and mainland China/ international promotion strategies tailored for you to help increase your ROI and revenue.
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