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Better Business Bureau (BBB) complaints and accreditation: What you need to know
Ever wonder what goes into Better Business Bureau accreditation and how it handles complaints? If so, you're not alone.
With a legacy of more than 100 years, the Better Business Bureau (BBB) is the go-to watchdog for evaluating businesses and charities. The nonprofit organization maintains a massive database of accredited and non-accredited businesses, providing ratings based on several factors. The goal is to give consumers an objective resource to assess a company's reputation and, hopefully, avoid bad ones.
When researching an organization or service, you've likely seen the BBB seal on a company's website or advertising. Businesses seek BBB accreditation because it's a simple, important way to signal to consumers that they are trustworthy. It's an even better sign if the company maintains a good rating with the organization.
But what goes into BBB ratings? And how does the organization handle complaints from customers? Here's everything you need to know.
What is BBB accreditation?
A BBB-accredited company agrees to abide by a set of accreditation standards BBB says are "attributes of a better business." These include honesty in advertising, transparency, and responsiveness to complaints, among others. Accredited companies must maintain these standards or risk losing accreditation. To police this, BBB requires companies to respond promptly to inquiries and show documentation where necessary, particularly when a review is triggered via complaints.
In addition to abiding by BBB's standards, companies must pay a fee to become accredited. This fee varies by business size and geographic location, so it's not the same flat fee for all organizations. The fees are then used to fund BBB's operations.
How are BBB's letter grades determined?
Both accredited and non-accredited businesses listed by BBB can have ratings. To maintain accreditation, businesses must maintain a B rating or higher. Seven major factors go into scores for ratings, with each adding or subtracting points from a 100-point scale that's mapped to letter grades, according to BBB's rating overview. Those factors include:
Business complaint history with BBB
Type of business
Time in business
Transparent business practices
Failure to honor commitments to BBB
Licensing and government actions known to BBB
Advertising issues known to BBB
Perhaps the most important factor in a BBB grade is how a company handles complaints, with the emphasis being on responding to them promptly, Melanie McGovern, director of public relations and social media for the International Association of Better Business Bureaus (IABBB), told Yahoo Local. IABBB is a network hub for BBBs in the U.S. and Canada.
"If a company answers or resolves complaints, their letter grade stays the same because they're upholding the BBB standards of being responsive, which is the number one standard of trust," McGovern told us. "At the end of the day, we're looking to get that resolution for the consumer and the business."
When comparing companies that have different ratings, it's important to read the complaints listed on the business' BBB profile, McGovern said. "A lot of times when a rating falls, it is because of a volume of complaints. We always encourage [consumers] to look at the complaints and to see if and how the company responded."
The number of complaints required to trigger a rating change depends on a company's size. "If it's a national company that has 50 complaints, that's not so much of an alarm bell as a local, small company that has 50 complaints," McGovern said.
How are BBB complaints handled?
For all companies, each complaint initiates a process through which BBB acts as a mediator between the company and the consumer. Typically, McGovern said, the process can take up to 30 days and it's handled by a person from BBB the entire time.
"There are 94 Better Business Bureaus [BBBs] across North America, and each of those BBBs has a team of people who just work on complaints, so a human is always interacting with the complaint and the business to make sure [it's] going in a timely fashion," McGovern said. "If we keep getting the same complaint about a company from multiple consumers, then we will look into the company [and] will send them correspondences asking them to clear up the pattern."
If a business doesn't clear up a pattern of complaints, BBB lowers that company's letter grade or puts custom language on its profile to warn the public about the potential problem, McGovern said.
Complaints live on a company's profile for three years. If they're resolved, they're marked as such, but they aren't removed before the three years are up. This allows customers to view how a company has responded to previous complaints while not punishing a company that may have undergone major changes since older complaints were filed.
"You could have an experience with a company in 2019, and that company could have all new management, all new workers, and cleaned up their profile in that time," McGovern added. "So it's always important to keep checking our website for the most current information."
Do customer reviews impact BBB ratings?
BBB profiles can include customer reviews. These review ratings are out of five stars, and they're separate from BBB letter grades and accreditation. That means you could find a company with three out of five stars among reviews, but an A+ rating. This is intentional, McGovern said.
"If you look at the ratings overview and how the elements work together, a customer review is a customer's opinion of their interaction with a company; it's not based on any facts," McGovern explained. "So it's because it's an opinion, it doesn't factor into the company's letter grade."
BBB says it goes further than many other review sites to ensure its reviews are genuine. The organization doesn't allow anonymous reviews, for example, and it requires reviewers to confirm their email addresses, phone numbers and names. It then verifies the interaction occurred with the proper business and allows it to respond. Reviewers can continue to submit comments on their reviews.
Is it bad if a company is not BBB accredited?
No. Companies that choose not to pay for accreditation are not somehow worse than those that do, and it isn't a perfect system. However, BBB acts as a neutral third party to help resolve issues with accredited companies and hold them accountable for disputes.
Why should you care about BBB accreditation?
Ultimately, BBB accreditation means a company is held to a different standard than non-accredited companies.
"[Consumers] should care because it means that company took that extra step to show consumers that they're a trustworthy business," McGovern said.
BBB accreditation is only one data point to consider when researching organizations. Referrals from friends and family still drive a lot of business for companies of all sizes for a reason, and they can be an important component when picking the right company for you. Also, take reviews and recommendations from a variety of sources into account before making a final decision.
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