Invoice Insurnace

The Context

Working at Simply Business, a price comparison website for microbusinesses to buy business insurance.
The insurance product team were interested in invoice insurance due to its popularity in Europe and third-party research indicating that cash flow was a problem for many micro and small business in the UK. To date, invoice insurance wasn’t popular in the UK, and they wanted to see if it was a viable product in our market.

The Research Question

Do micro SME owners in the UK see invoice insurance as a potential solution to cash flow problems?

The Method

Qualitative, exploratory interviews with micro SME owners to get a better understanding of their invoicing procedures, what cash flow problems mean to them, and how they currently manage cashflow problems. It also included a concept test for a potential invoice insurance solution.

The participants

Micro small business owners who agreed that they had experienced cash flow problems that impeded the functioning of their business within the last six months.

The Findings

Interestingly, people who agreed they’d had impactful cashflow problems couldn’t actually articulate any impact. Most said it was a nuisance that their books didn’t balance. Many talked about a lack of professionalism from clients or a feeling of unfairness.

Because the problem with cash flow was not actually a practical one - they were still able to operate their business as expected - they didn’t see invoice insurance as a solution. They also did not react favourably to the terms of the insurance concept.

The Result

The initial response from stakeholders was that we had recruited the wrong participants who didn’t meet the profile. I pushed back and suggested that self-reporting a problem with cash flow may indicate more of a feeling of a problem than an actual problem, and that this may also have been reflected in the statistics they cited to determine that this was a large market.

I re-recruited research participants with more specific screening questions. Though these businesses did have practical cash flow problems, they still didn't feel like the proposed insurance terms would have helped solve their problems. When the insurance partner wasn't willing to revise terms, the product was not persued, and the team was able to work on higher-impact new products.