Why Complaints Are Important to Your Business

Updated on August 31, 2017
JohnPLyons profile image

John has been a professional social and commercial photographer since 2004. He's also a Qualified Business Mentor. He's a "Brain For Hire."

Few business advisors encourage a mindful response to people who complain about your services; in fact few advisors ever prepare you to receive any complaints. Yet complaints are a natural part of any business. There will always be a time when something goes wrong with a client order, for whatever reason, and the client complains because they are not happy with your service.

You should have already thought through the risk of something going wrong, in the risk assessment of your product or services.

What you do when you receive a complaint and how you react will define the quality of your customer relations as a business.

Failing to Prepare in Business, is like the Business is Preparing to Fail!

Salutary words to remember for any new business.

How Prepared Are You?

Have you a defined and written down Procedure for handling Customer Complaints?

See results

Complainers Can Shout All About You


This can be very damaging.

The last thing you want is for a dissatisfied client to shout out to everyone around them and to their "sphere of influence" about just how bad you are at providing your specific product or service. Remember, you don't know who they know. They might be talking to your competitors about how bad you are, or even your other clients!

The problems with this type of complainer are that:

1. You don't even know it's happening and

2. You can't control any fall-out from the complainer, again because you don't know it's happening.

People Can Telephone You to Complain


This is not quite as bad as the people who shout about you.

However, people phoning you to complain can be hard to handle if they've caught you off-guard, or if you're not aware of all the details surrounding the reason for their calling you.

If somebody calls you when you're out of the office, or working with another client, it can be hard to give them your full attention to be able to deal with their complaint. If they are angry or making demands upon your business, it can be difficult to make clearly thought out decisions when you haven't been able to prepare for their phone-call.

Thus, although you have more control than when somebody is moaning about you behind your back, the situation is still not ideal as you can still lose control of the situation. In the worst case a badly handled phone-call can actually inflame the complainer.

Get it in Writing


If you're going to get a complaint, this is the best way to receive it. Letters (or emails) tend to have a better construction and contain more details that you can check-out and verify, than phone-calls. Also your window-of-opportunity in which to respond in an effective and timely manner is not as pressured as in a phone-call.

Other advantages of written complaints is that they usually have a clearly identified sender and expect a response from you, thus giving you an opportunity to interact with somebody interested in your business.

They may also be accepted as evidence in courts of law (please check the validity of this statement, with a suitably qualified legal representative before proceeding with any action, as laws and circumstances changes depending upon where you are in the world and the individual merits of your case).

A Complaints Policy

It is important that you have a clearly defined and written down policy for how you are to handle complaints. Your Policy needs to take into account how you might receive the complaint i.e. (1) from a third party source after somebody has spoken about you behind your back (2) a random, unexpected phone-call (3) in writing.

For each method of receipt you need to have a standard method of addressing it, whether this may be to defend your position, accept something has gone wrong, manage fall-out or make amends. Your method of replying does not mean than every reply will be identical. This would be a mistake and could be seen by your clients that you do not care for their individual circumstances.

Your standardised method may include:

1. A system of record keeping, so that all actions relating to the complaint are stored, reviewed and may be acted upon in an appropriate and timely manner.

2. A system by which complaints may be investigated for validity, perhaps by somebody not directly involved in the subject of the complaint to ensure an element of neutrality in the investigation.

3. Various options you consider appropriate responses to various complaints. Not every complainer will want, or expect, their money back and as a business you must never get into the habit of giving money away. For any business, there are always alternatives to giving refunds, which may not cost you as much and should be considered/offered if at all possible. Of course, there are situations where a refund would be expected (again this is dependent upon your local laws).

4. A system of expected timings i.e. if your policy says you will resolve all complaints to the customer's satisfaction within 28 days then make sure you do! Likewise, if you have received a formal complaint you should at least formally acknowledge the receipt of the complaint as soon as practically possible. This is simple courtesy and goes a long way, in many cases, to establishing or improving communication with a client, who is not happy with you.

If you have a written and well thought out policy for resolving complaints, then make sure you follow it. Many problems are made worse and in many industries, my ignoring well written management systems that already exist to solve these very problems or issues.

Review, Review, Review


Review, at least once a year. There's no point having a policy if it's out of date. For example, having a complaints policy that is so old, it does does not acknowledge or include digital methods of communications (emails, Facebook and messaging systems) but only considers letters that are posted as valid complaints.

When you write any policy, write into it an expected date at which it will be reviewed and amended as necessary. This is usually once a year but there are times when it might need to be sooner. It can also be to your advantage to keep a record of when, what and how you review or amend documents in your business, if your policies are ever subject to being challenged by a third party or, in this scenario, by a complainant.

Why you should be Happy to Receive a Complaint.


Complaints are valuable business commodities.

Though getting a great testimonial or praise of your business makes you feel wonderful and worthwhile it doesn't greatly benefit your business. However, receiving a complaint and then engaging with the complainant and resolving the issue does great things for your business. A complaint tells you where you are going wrong, or where you are not fully achieving your client expectations, and gives you the opportunity to further improve your output. In some respects complaints may be considered "the highest form of praise" as they can have a massively positive impact on your business.

Converting Your Complainers


A complainer can become your next best client.

It sounds crazy but I have heard this from so many of the businesses I've talked to (and it's happened in my own too). Who could ever think that a person who is angry or nasty with you could ever become a great client? The thing to remember, is that this person has an active interest in your business, which is the sole result you hope for from all the money you spend on marketing. However, this person isn't costing out of your marketing budget and they actively want to talk to you or about you. Your job as a business owner is to turn the conversation around from negativity to positivity for your product or service and thus how you handle the complaint becomes especially important. If you enter into a complaint process, thinking of the complainant as your potential next best client, you will instantly treat them with a higher respect and courtesy.

At the beginning of the complaint process the complainant is upset with you and doesn't trust you. However, if by the positive manner you handle the complaint you can be seen to be professional, you may then also become trustworthy and likeable again.

I have written an article on the value of "Know - Like - Trust" in business, perhaps you'd like to go and read it HERE

Encourage Complaints as an Open and Transparent Process

Now that you understand why having a complaint-process is important and also the value of a complainant to potentially become your "next best client", perhaps you will understand why so many large businesses have an easily accessible complaints process. Many websites and documentary "Terms and Conditions of Business" given out to potential clients at the quotation stage, contain a reference to the Complaints Procedure if the client is not "entirely happy". Likewise there are entire industries that promote third party "review" systems, that allow clients to review the product/service of a particular business. Although these systems primarily are used to promote the positive aspects of the business they are also an excellent way of catching complaints and thus are ways to improve a product or service.

The Impact of a Badly Handled Complaint

I'm not going to mention the name of the business, as that wouldn't be fair, but I will say I am an active reviewer for the website "TripAdvisor" and I want to share some statistics with you, sent to me recently by TripAdvisor admin.

  • I am a Level 37 Restaurant Expert
  • I am a Level 13 Hotel Expert
  • I have written 175 Reviews and
  • am read by over 95,000 people
  • 121 people have declared my reviews "helpful"
  • 20 of these were for just ONE review.

That one review, that many thousands of people have read and 20 have put their stamp of approval to, was a review of pure complaint against a very expensive hotel and restaurant. The detail of what happened is not important.

However, I complained, using TripAdvisor as a third party review site. The hotel management were clearly angry to have received my complaint and their publlished response indicated this. That was a serious mistake. By exhibiting their anger, they actually enhanced the content of my complaint. Their response was personally unpleasant about me and I had the option to delete their response as "inappropriate behaviour" but, knowing how complaint psychology works, I chose to keep it.

It is my belief that their response to this complaint has caused them a loss of business and a loss of esteem. Personally, I will never return and will tell everybody I meet, why I won't. This was a very badly handled complaint and it's effects could be far reaching for the business.

Poor management of complaints can be far reaching moving out from the original source, like ripples on water. As Shakespeare suggested in his play "Julius Caesar", people often forget the good things somebody has done but they never forget the bad things and talk about these for years after the person has gone.

Always, always treat complainants with respect and thank them for giving you the opportunity to talk to them (and ultimately improve your business).

"Your Next Complainant could become Your Next Best Client"

Business Words of Wisdom

Get That Procedure Written Down Today



Now hopefully you understand

  • The different types and impacts of complaints
  • The value of having a written procedure
  • The importance of following and updating your procedure
  • What the procedure should include
  • The positive value of complaints
  • How to convert complainers to clients, "Know-Like-Trust"
  • Promoting reviews & complaints
  • The impact of poor-complaint management

Questions & Answers

    © 2017 John Lyons


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      • JohnPLyons profile imageAUTHOR

        John Lyons 

        16 months ago from UK & USA

        Thanks Eric! You may enjoy some of my other postings, most are based on "new start-up...trials & many tribulations".

        Please feel free to put me in contact with your daughter if you think I can help.

        I'm writing an article just now, specific to the needs of a group I've encountered on social media.

        Cheers & Thanks again!


      • Ericdierker profile image

        Eric Dierker 

        16 months ago from Spring Valley, CA. U.S.A.

        This is very well done. The whole time reading it reminded me of the last restructuring of a publicly held corp. All of this applied to stock and warrant holders.

        My wife is in design and sales -- somehow she just does this like second nature. As a matter of fact she was building out some office space for me and the way she handled "issues" led to love her and a decade and a half later we are still married.

        I agree with Dora. As a matter of fact I sent it to my daughter who is starting a new business.

      • JohnPLyons profile imageAUTHOR

        John Lyons 

        17 months ago from UK & USA

        Thanks Dora! Having spoken to many businesses here and abroad over the past few years "complaint management" has been over-looked in the past but not anymore. With the rise in SEO value of third party "Review" sites, the necessity to take complaints very seriously has shot forth into the forefront of modern business psychology. Though I still smile when I get yet another helpful vote on TripAdvisor. I live in hope that that business manager has learnt a lesson from the appalling manner in which he treated me! Thanks for your very positive comments, they are much appreciated! Kind Regards, John.

      • MsDora profile image

        Dora Weithers 

        17 months ago from The Caribbean

        You make good sense! This could be a reference guide for business owners who care.


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