Shoddy service is a sure-fire way to cost your SME money, with Australi-an businesses coughing up an estimated $122 billion annually by collectively upsetting their customers.
Apart from a loss of revenue, lousy customer service has adverse side effects in other areas of business. Not only do you lose customers and money, but you also run the risk of losing quality employees. When your SME has a customer service problem, often your capable workers are forced to pick up the pieces left behind by the weaker links in the chain. Even loyal personnel can grow tired of the extra work and look elsewhere for employment.
Haemorrhaging customers also forces you to find new buyers, members or subscribers to keep the business afloat. Depending on who you talk to, it is between five and 25 times more expensive to obtain a new customer than it is to retain existing business. Rusted-on customers tend to purchase more frequently and spend more money with your SME.
It’s a new battleground
With these risks in mind, Anne Nalder, chief executive of the Small Business Association of Australia, says that handling a customer complaint appropriately is essential for the success of every business and its brand. “Although we know that a customer is not always right, they must be treated like they are always right,” she says.
For starters, SMEs must have a customer complaints policy formed within the broader risk management policy, says Nalder. The complaints policy should include the types of complaints a business could face and how objections are handled and by whom. “This advice applies to even the smallest of businesses who do not employ staff to the largest,” she says.
Apart from the traditional channels such as phone, email and letters, SME owners need to be aware that the battleground for complaints has changed and consumers can exploit public forums such as social media to vent their anger or frustration.
Customer complaints can range from poor service to no service, botched refunds, faulty goods, poor workmanship or even membership or subscription failures, says Nalder. Ultimately, the type of complaints will depend on your business, industry, customer base and many other factors, according to digital marketing expert Mitch McCormick.
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