Complaint Handling - An Advantage for Businesses

Released on: December 5, 2007, 11:46 am

Press Release Author: Better Business Bureau of Eastern North Carolina

Industry: Retail

Press Release Summary: BBB Offers Advice to Businesses on Earning Customer Trust
during the holiday season.

Press Release Body: RALEIGH, N.C. (December 3, 2007)- For many businesses, the
holiday season provides a windfall of customers and profits, and in some cases
accounts for a substantial portion of annual operating income. With seasonal
customers comes an increase in complaints, and the simple fact is that some
businesses drive profits right back out the door because they do not have an
effective complaint handling system.

Industry estimates say that generally businesses receive complaints from only about
five percent of dissatisfied customers. About 95 percent of customers simply will
not complain, but more importantly, about 90 percent of this group will never use
the business again. Equally alarming for businesses is that typical dissatisfied
customers will mention the problem to about eight friends, acquaintances and family

"Businesses operating in tough markets with small margins are constantly searching
for points of competitive advantage and effective complaint handling can be a key
differentiator," said Beverly Baskin, president and CEO of the BBB serving Eastern
North Carolina. "A complaint offers a superb opportunity to transform an unhappy
customer into a loyal customer, who may even help you win new business by
word-of-mouth advertising."

The recent BBB/Gallup Trust in Business Index survey found that after prices, the
most common factors affecting consumer's trust in businesses were principally
service-related - the exact space where a well-managed complaint handling system can
provide an edge over competition. Survey respondents were asked to consider what one
company, large or small, that they regularly deal with in everyday life, do they
trust the most - and what does that company do to earn their trust.

Consumers were also asked what one business or company they regularly deal with in
their everyday life, large or small, they trust the least - and what does that
company do to not earn their trust.

BBB recommends businesses review customer relations policies on a regular basis, and
advises that complaint handling processes must make it easy for customers to
complain and empower employees to deal with complaints promptly. The following
procedures are essential:

Screening and Logging - The date the problem occurred, a description of the problem,
and any other pertinent information should be recorded.

Investigating - Along with information from the customer, gather more facts by
researching in-house records, requesting receipts and inspecting the product.

Acknowledging - Let the customer know that the matter is receiving attention and
provide a realistic estimate for how long it will take to resolve the issue.

Formulating a Solution - Important criteria to consider include warranty
obligations; customer expectations; cost versus benefit of alternative solutions;
fairness of your decision; and your ability to carry out the solution.

Responding - Any response should be clear, appropriate and specific to the
customer's complaint. Avoid form letters and technical jargon. Explaining a decision
can preserve a customer\'s goodwill, even if a different result was desired.

Following-up - Contact the customer following your response to verify whether or not
the matter has been resolved satisfactorily. If the customer is unhappy, you can
refer the matter for third party dispute resolution (to BBB for example).
Effective complaint handling is a value-added service that is appreciated,
remembered and talked about by consumers. To turn this year's holiday season patrons
into year-round customers, BBB strongly encourages businesses to develop a strong
complaint handling process.

For more time-tested and trustworthy advice on business practices, visit

About the BBB of Eastern North Carolina:
The Better Business Bureau of Eastern North Carolina is a 501 (c)(6) not-for-profit
corporation serving 33 counties in Eastern North Carolina. The organization is
funded primarily by membership dues from more than 3,200 local business and
professional firms. The BBB promotes integrity, consumer confidence and business
ethics through business self-regulation in the local marketplace. Services provided
by the BBB include, reports on companies and charitable organizations, general
monitoring of advertising in the marketplace, dispute resolution services, and
consumer/business education programs. All services are provided at no cost to the
public, with the occasional exception of mediation and arbitration. Visit

Web Site:

Contact Details: Tel: 919-277-4200
Fax: 919-277-4221 | Start With Trust

BBB of Eastern North Carolina
5540 Munford Rd., Suite 130
Raleigh, NC 27612

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