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 acquaintances.

“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 Kim States, BBB President. “A complaint offers a superb opportunity to transform an unhappy customer into a loyal customer, one who may even end up helping you win new business.”

Better Business Bureau of Southern Arizona 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:

Documenting – 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).