Simply Paid solves cash flow problems, but entrepreneurs aren’t buying

A product that offers a solution doesn’t automatically equal sales. You first have to convince customers they have a problem.

But educating the marketplace before you sell requires a long-term play – and plenty of investment. It’s something few small businesses can afford.

This is the conundrum faced by entrepreneur and former corporate credit manager Ian Fearon. His new service, SimplyPaid, solves a critical problem that sinks many small businesses — managing cash flow, collections, and receivables without an onsite credit manager.

“No matter what product or service you provide, if you don’t get paid on time, you put your company at risk,” he says.

But SimplyPaid isn’t selling.

Built as Software as a Service (SaaS), SimplyPaid is an internet-based solution that does not require installation. It’s fully automated and works by delivering a series of timely reports revealing which customers are past due or over their credit limit – and automatically asking why they aren’t paying.

SimplyPaid also provides options for contacting customers regarding outstanding invoices, and accesses customer master files in off-the-shelf office accounting packages such as QuickBooks and Simply Accounting for easy integration with existing software.

With a point-and-click set-up process, the typical user can be running in an hour or so, mitigating the need for potentially expensive IT help.

Building such intuitive software wasn’t cheap – the money came from Fearon’s own pocket and the coffers of his consulting business, Onsite Credit Group.

“From kitchen table idea to finished product, I’ve invested $15,000 on programming fees, and a year of my time – worth approximately $100,000,” he says.

Fearon didn’t spend that cash lightly. With 30 years experience as a corporate credit manager for large companies, including Phillip Morris, Motorola and Hitachi, he has a deep understanding of the issue SimplyPaid solves. He’s also the author of Paid: A Guide To Credit And Collections for Canadian Business Owners, and, in 2008, he left the corporate world to coach small businesses about credit. In other words, he’s confident in his understanding of the tool’s target market.

It was this understanding that led him to notice a hole in the marketplace; businesses with less than 25 people often lack an onsite credit manager to oversee receivables.

“Receivables occur when a company sells products or services on credit terms,” explains Fearon. “If a business owner doesn’t manage those receivables, he or she can put the company at risk.”

Because these companies are so small, business owners develop personal relationships with customers and feel awkward or uncomfortable asking for cash when payments are due. And, depending on the size of a debt, owners may be hesitant to press hard for fear of losing customers – if they’re even aware that accounts are going unpaid.

“Asking for money is not what the business owner does well,” says Fearon, who developed his software to solve this problem and ensure owners know when debts are past-due.

“My biggest challenge is reaching out to my target audience – small and medium-sized business owners,” says Fearon.

SimplyPaid starts at $39.95 per month, and is a unique service in the marketplace. Fearon says indirect competitors, such as supply-chain management software called AvantGard, do exist, but none are specifically tailored to small businesses.

“For the cost of a cup of coffee a day, you can manage your receivables,” he says, adding the product can improve cash flow by up to 30 per cent, and remove the hassle of making collections calls.

Despite these advantages, the company – launched in June 2012 – has yet to secure any subscribers. Marketing efforts to date have included email, telemarketing and cold-calling campaigns. Fearon has also launched a blog and promotes the software through the Brampton Board of Trade. He’s personally spending 20 to 30 hours a week on the phone, networking, or working on other marketing efforts.

These efforts may never translate into sales.

“Traditional marketing approaches are ineffective for selling new concepts,” says Jeremy Miller, a Marketing Consultant with Toronto-based advisory firm StickyBranding.com. He says companies are inherently resistant to new approaches.

“Change is difficult,” he says. “The onus is on the brand to educate the market, and mitigate buying risk.”

To remove those purchase worries, Fearon is considering offering a 90-day trial version of his service.

“I’m reluctant to do it” he says, “but I may have to so business owners can experience all of the benefits offered by SimplyPaid.”

Despite the challenges, Fearon remains committed.

“I will never give up on this project. I’m absolutely convinced there is a market for this product,” he asserts. “I’ve built a better mousetrap, now how do I tell the mice where the cheese is?”