BICS myths: 7 things manufacturers are getting wrong
Since the British Industrial Competitiveness Scheme (BICS) was announced, we've spoken to lots of manufacturers trying to understand what the scheme means for their business.
Along the way, we've noticed a number of recurring misunderstandings about eligibility and the application process which could see businesses rule themselves out before carrying out a proper assessment.
Here are seven of the most common myths to be aware of.
Myth 1: "We're a manufacturer, so we'll automatically qualify."
Unfortunately, it isn't that straightforward.
Eligibility will depend on several factors, including your SIC codes, the products you manufacture, associated HS codes and how electricity is used on site.
Simply being a manufacturer doesn't guarantee eligibility.
Myth 2: "We didn't qualify for EII, so we won't qualify for BICS."
BICS is a completely separate scheme with different eligibility criteria to the Energy Intensive Industries (EII) scheme.
Many businesses that were previously ineligible for EII could still qualify for BICS, so it's worth carrying out a fresh assessment rather than relying on historic decisions.
Myth 3: "We don't export, so HS codes don't apply to us."
Not true.
HS codes are used to classify products, not businesses. Even if every product you manufacture is sold within the UK, those products will still fall within commodity classifications.
If your products align with eligible HS codes, exporting isn't a requirement.
Myth 4: "We've never reviewed our SIC codes, but they'll be fine."
Many companies registered their SIC codes years ago and have evolved significantly since then.
New products, acquisitions, diversification and operational changes can all mean the activities listed at Companies House no longer accurately reflect the business.
Reviewing your SIC codes now is a sensible step ahead of the application window.
Myth 5: "We've got plenty of time."
The initial application window is expected to run for just two months. If supporting evidence, energy data and operational information are required, businesses that wait until October may find themselves under unnecessary pressure.
Preparation is likely to be the key to a smooth application.
Myth 6: "The process will be simple."
While we're still waiting for detailed guidance, previous schemes have shown that gathering evidence, validating information and working with suppliers can all take longer than expected.
Starting early gives businesses the best chance of avoiding delays.
Myth 7: "It's not worth looking into."
For many manufacturers, the potential savings could be significant.
Depending on electricity consumption and eligibility, BICS could reduce ongoing electricity costs while also providing access to a backdated payment for eligible periods.
For businesses with high electricity consumption, that makes spending a little time understanding the scheme a worthwhile exercise.
Take the time to understand where your business stands.
Before deciding whether BICS is relevant, it's worth reviewing your SIC codes, understanding the products you manufacture and familiarising yourself with the latest eligibility guidance. That way, you'll be in a much stronger position when the application window opens.
Our Guide to BICS and on-demand webinar are available to help manufacturers understand the scheme and prepare for the application process.