When it comes to deciding whether investing in R&D would be beneficial for your business, the answer is always yes. The benefits of investing in R&D are endless, and it is a great way to stay ahead of your competition and to even bring game-changing products into the market. The idea of R&D can often seem overwhelming, or not necessary for businesses that are not as innovative in nature as a pharmaceuticals company for example, but by developing any new products or services you are widening your chances of successfully breaking into the industry with power.
So, what are the main benefits of investing in R&D for your business?
Investing in R&D will lead to long-term benefits rather than short & quick profits, through investing in innovative products and services, your business can have a positive impact on the wider economy. Research and development can also generate new and enhanced revenue streams by allowing you to emerge into new niche markets through research and advancements in knowledge that will attract investors.
Businesses can also get grants and funding to tackle R&D project costs as it can be expensive at first, but beneficial for the future of the business. There are tax relief schemes and grants which aim to reward businesses for their innovative projects, as it is taken into consideration that R&D often includes a lot of risk-taking which can be expensive at times.
On a global level, many countries’ governments tend to push R&D growth as they understand the way that it goes hand-in-hand with economic growth. Sectors that invest in R&D tend to develop and provide more beneficial outcomes for people across the world, which is why the Government tends to have schemes in place to reward this. UK businesses can gain tax relief through the R&D Tax Credits scheme, it can give businesses a well-needed non-repayable cash injection as a reward for innovative projects as it is projected that every £1 spent on public R&D generates approximately £7 of net economic benefit to the UK and delivers £1.40 of private investment.
Product development and Service Improvements
Investing in R&D can help your business to improve it’s products and services, which will increase efficiency and productivity while cutting production costs. Finding new and improved processes or better ways to deliver services/products will increase market participation, helping your business to stay ahead of market trends and to perform in a way that rivals cannot. Lower marginal costs and increased marginal productivity can result in your businesses discovering ground-breaking findings, examples of this would be new processes within machinery, computing technology, and pharmaceuticals.
It is extremely easy for businesses to become complacent with what they are offering to their customers, believing that they are already profitable and that research and development would not benefit them in any way, but with consumer expectations growing every single day, this is often not the case. New services and products tend to benefit society as a whole, such as life-saving or life-improving medicines or technology that allows people to extend their knowledge with the tap of a mobile phone screen have been an outstanding benefit to humankind, and these are just a few examples of how everyone reaps the benefits of R&D.
Investing in R&D will make you stand out against your competition, with a strong competitive advantage it is extremely easy to gain market leadership. It can also allow your business to gain intellectual property and patents which can become highly valuable and even provide a secondary source of income. Patents are a great unique selling point and will lead to your business gaining more trust and credibility, your innovative projects will lead to unique products and services that may not be on the market yet, and product differentiation will mean that your business is developing in ways that your competitors cannot.
The biggest household names and market leaders all have the largest budgets for research and development, and with this comes a huge advancement against their competition as they are constantly innovating and finding the newest and best ways to increase their customer satisfaction in new ways. By providing industry-leading knowledge and insights it will allow you to collaborate with other businesses, universities, colleges and other academia. This will allow your business to build stronger connections and share resources, benefitting both you and them. An innovative business is also more likely to have a competitive advantage when it comes to employing new talent, a business that is highly innovative is more likely to attract higher-quality candidates who have a lot of new ideas and knowledge to bring to your business which will benefit you more in the long run.
The reputation of your business will be greatly boosted through R&D investment, this is because advancements in market participation and trend-matching keep your brand interesting and sought after by consumers. When your projects are aiming to improve customer satisfaction, this will increase customer loyalty as your brand will be constantly evolving, therefore increasing trust.
R&D projects are also a very strong form of marketing collateral, if your business is proving to the global markets that you are trying to penetrate that you are bringing in new, ground-breaking products and services then your business will be more attractive not only to customers seeking out services within the industry but also to investors. Through using your R&D projects for strong marketing campaigns, you will be giving yourself a huge advertising advantage over others within your industry.
To conclude, the benefits of investing in r&d can allow your business to elevate to new heights, taking risks that sometimes have no absolute outcome can seem daunting or too risky, but without research and development it would be difficult for businesses to penetrate the market, and for overall innovation to progress globally.