09/ 26/ 2007
by Beth Gaudio
How to make difficult customers happy--without risking a lawsuit
As a small-business owner, chances are you have dealt with a disgruntled customer. Even if the situation was not your fault, you probably took steps to fix the problem and ensure that the customer was satisfied.
But could you imagine a customer suing you for millions of dollars simply because they were unhappy with the service you provided? Jin and Soo Chung, owners of a Washington, D.C.-based dry cleaner, never imagined this situation either until local lawyer Roy L. Pearson sued them for $54 million for losing a pair of his pants. Though Pearson lost his case and received no award, he has appealed the decision.
Pearson claimed that a sign at the Chung's business promising “satisfaction guaranteed” and “same-day service” amounted to false advertising—and he sued to make sure the Chungs would never again lose a pair of pants.
Fortunately, customers like Pearson are extremely rare. But it raises the question among many small-business owners: What are my legal obligations to make sure my customers are satisfied? The simple answer is that there are none. You may, however, want to avoid vague claims that some creative customers might construe as a policy, which could land you in small-claims court or worse, facing a major suit. Here are three tips for avoiding potential hassles with clients over your customer-satisfaction policy.
1. Maintain a clear customer-satisfaction policy
It's a good idea to have a simple, clear policy so your customers will know what to expect when they have a complaint. If you keep the promise behind the policy, you will likely have satisfied customers who will return in the future.
Therefore, rather than simply promising "satisfaction guaranteed," your policy should clearly indicate what customers will receive if they are not satisfied. For instance, you might word it like this: “We guarantee your satisfaction, or you will receive a full refund of the purchase price”; or “we are happy to exchange any merchandise returned within 30 days of purchase for a store credit equal to the purchase price.” By clearly stating what the customer can expect before the item is purchased, your customer is more likely to be satisfied with the return or refund process.
2. Keep your policy positive
Your policy should make customers feel like they will be in control of the situation if there is a problem with the purchase. Customers should know the situations in which they may be granted a refund or other rights. By giving them control, they will feel comfortable doing business with you.
If your return policy is to allow for a full refund within 90 days of the purchase of the product or service, do not say, “Customers must return merchandise within 90 days in order to qualify for a refund.” Instead, say, "Our company is pleased to provide a full refund for all merchandise returned within 90 days."
3. Resolve any problem promptly
Regardless of the policy you have, your customer won't be satisfied with how you resolve the problem unless you act promptly. A quick resolution demonstrates to your customers that you appreciate their patronage and are genuinely sorry for any problem they encountered with your product or service. By further showing your commitment to customers, they are more likely to return.
Of course, if you run into customers like Pearson, there isn't a lot you can do to please them. An NFIB member from Fresno, Calif., who also runs a dry-cleaning business, advises directing customers with truly unrealistic expectations elsewhere. But your best option is to be as pleasant as possible and hope that when difficult customers leave your store you will never hear from them again.
Beth Gaudio is senior executive counsel with the NFIB Legal Foundation. This article is intended to provide general information for reference only and should not be considered legal advice.
NFIB.com
For more guidance from the NFIB Legal Foundation on creating legally sound policies for your business, visit www.NFIB.com/legal.
