“It has been worse than 2008.”

These are tough times for entrepreneurs in the UK economy and commercial insurance broker Simon Lancaster reckons it is harder now than it was in the global financial crisis of 2008.

A reminder of fickle business.

Every Monday morning, Lancaster walks up the steps to the  headquarters at the elegant Kays Building in the City of Worcester. The building not only a landmark in the  city, but also  a reminder, in bricks-and-mortar, of how fickle business can be for an entrepreneur.

These are the offices, built in 1907, that were once the headquarters of the famous Kays catalogue that sold mail order clothes to every corner of the UK. It was born in 1889 and at its peak employed 6,000 people in the city, before the credit card killed it in 2007.

“Great business one day, the next day it is gone.”  

Lancaster was one of millions of its customers.        

“We used to get the catalogues to flick through at Christmas; where are those catalogues now?” he says.

“Great business one day and the next day it’s gone. All you can do is move with the times as best you can, but it is crazy.”

It is a reality check that has helped sustain Lancaster’s 22-year-old commercial insurance broker business. It started with nothing, but now turns over £30 million-a-year.  

“That light bulb moment.” 

SJL Insurance Services arranges insurance cover for everything from  threats from pirates on the Indian Ocean pirates to hotel fires.   

It was a business born of an epiphany in a back garden. Lancaster had worked in a couple of insurance companies, but was made redundant at the age of 23. He sat in his parents’ garden in Fernhill Heath, a village on the outskirts of Worcester, to wonder what on earth to do next.

“Then, that light bulb moment. I ran inside, got a pen and started to scribble,” he says . These jottings were the genesis of his own insurance brokerage.

“I wanted to frame the cheque, but I needed the money!”

“I had a whip round to buy a computer, desk and chair, and was open for business in my parents’ spare room!”

It took many, many, months for the phone to ring with his first deal.

“It was insuring a commercial property in Stoke-on-Trent. When I got the cheque, I wanted to frame it, but I needed the money!”         

Nearly 23 years on, Lancaster has 100,000 customers, and employs around 800 people in offices in Worcester, Bristol and London, with revenue growing 10% this year and last year.

Pirates kidnap and ransom.

The business is Lloyds of London registered so he has customers in Africa and Asia. It  includes hotels in Cape Verde, an island off West Africa, and tankers in the Indian Ocean, insured against attacks by pirates.

“People working in the Middle East are insured for kidnap and ransom; negotiating with the kidnappers and paying the ransom and all that. We are just brokers, the insurance company does that, but we set up the insurance contract that deals with that.”

“It has been worse than 2008.”

Yet Lancaster sees this year as one of the worst he has ever seen in business .

“Inflation spiral, the cost of retaining and recruiting good staff that is probably about 90 % of our business. As that goes up, you have to make sure the income keeps going up higher than that, really. On the other hand you have got customers feeling the pinch. We have got businesses, trying to cut costs and maybe cutting back insurance to the minimum or going bust,” he says.

“I think the last three years have been worse than 2008.”

“I want to keep growing.”

Lancaster has battened down the hatches as he moves the business forward. He believes the economy, still recovering from COVID-19, is suffering more deeply and for a lot longer than it did in 2008. Yet, he looks to the future with hope.   

“Touch wood, I am still pretty young. I started at 23, I am  45 now, I have a few years left yet. So, just ambitious to keep growing it and developing it really. It is a bit of a boring answer, really, but yeah,” he says.

“The world changes and they no longer have a business.”  

“I think the scary thing about that is I give myself peace of mind, touch wood, that insurance has been around for hundreds of years from Lloyds of London, ‘til now, and people will always need insurance. But you look at other industries and they have got fantastic businesses, you know, Nokia with their phones and Kodak with their films. And then almost, through no fault of their own, the world changes and they no longer have a business,” he says.

This is where we came in on the steps of Kays- the multi-million pound mail-order giant for 118-years – that is now remembered merely as the name of a building.