CARY — Carolina Farmhouse is facing a crisis that could affect the 2-year-old custom furniture companys reputation for years.
Owners Kelly and Sam Utt-Grubb are dealing with a number of small business challenges that include managing customer complaints online and with the Better Business Bureau.
Since 2012, the BBB, a nonprofit organization that helps resolve disputes between businesses and consumers, has received 11 consumer complaints about Carolina Farmhouse and has since revoked the business accreditation and lowered its grade to an F.
Toby Barfield, president and CEO of the BBB of Eastern North Carolina, said that if a company is in business long enough, an online BBB complaint is inevitable. The business response, however, is key, Barfield and others said.
The BBB assigns businesses grades that range from A+ to F, and the grades are based on 16 elements, ranging from the type of business and how long it has been open, to unanswered and unresolved consumer complaints, Barfield said.
Grades from the BBB change over time and can improve if business owners take action to resolve issues as they come up.
Kelly Utt-Grubb was overwhelmed by customers email inquiries about their orders, and she was slow in responding to some of the BBB complaints, she said.
One of the worst sins that a business can do is to ignore a complaint filed with the BBB, Barfield said. That impacts their grade probably more than anything else.
Barfield said small business owners should respond in a very quick and fair way and offer an alternative or a fair resolution.
They should treat the consumer exactly how they like to be treated, Barfield said.
Be proactive with clients
Jeremy Sisk, president of Xperience4Higher, a full-service marketing and consulting firm in Durham that focuses on small businesses, said managing online and BBB complaints starts at the front end of the deal.
Small business owners, he said, have to manage customer expectations, particularly with higher-end purchases and especially if they take money from the person.
Small business owners have to understand and manage the deals scope, budget and schedule, and the customer has to be informed when any aspect of the deal changes, Sisk said.
Responding to complaints in a timely and effective manner within 30 days is key, Sisk said. Small business owners should search for their business and phone number online monthly to see what people are saying about their company.
If a business owner doesnt respond to a complaint, they risk the customer going away upset and sharing their bad experience with others. On the extreme end, the customer could get infuriated enough to start a campaign against the business, Sisk said.
Whether they are in the right or not, the power of free information allows any individual to express their thoughts on any manner they see fit, Sisk said.
Dos and donts
Kelly Utt-Grubb initially responded to the BBB complaints against Carolina Farmhouse by sharing business and personal challenges about family health issues, but learned quickly that that was the wrong approach, she said.
We were just trying to be transparent, Kelly Utt-Grubb said.
The response to the complaint should acknowledge the issue and offer some sort of resolution. A small business owners personal challenges should not be included in dialogue that could be used against them in court, Sisk said.
No one that is purchasing from you should have to care what is going on in your personal life, Sisk said.
A resolution could be as simple as providing a refund, reducing a charge, or throwing in something free. It may also include settling the customers complaint, but ultimately ending the business relationship to save future frustration.
Sometimes it is appropriate to fire a customer, Sisk said. No matter what you do they are not going to be happy.
BBB gets an earful
Consumer BBB inquiries jumped 20 percent to 124.5 million in 2012, compared to 103 million in 2011, according to the BBB. Complaints against businesses also increased 6 percent to 984,721 in 2012. The BBB of Eastern North Carolina received 2 million inquiries and received 8,687 business complaints in 2012.
According to the BBB, retail furniture is among the top 10 complaints that the organization receives. Of the 14,003 complaints relating to retail furniture, 78.7 percent were resolved.
To handle complaints, the BBB initially follows a conciliation process of working with the business owner and the consumer towards a solution, Barfield said. After two unsuccessful rounds, the organization offers a mediation or arbitration process that could take two weeks to 30 days.
With Carolina Farmhouses 11 BBB complaints, which Barfield describes as pretty significant for a business that size over a short period of time, six were resolved with BBB assistance. Carolina Farmhouse made a good-faith effort to resolve two of the complaints, but the customers werent satisfied. Two other complaints werent resolved, and Kelly Utt-Grubb responded to a Feb. 25 complaint on Friday, she said.
Barfield said that if a business grade has dropped, it will increase over time as the business responds to complaints appropriately and executes other best business practices.
Just conducting business in an honest and ethical manner with customers at the forefront of your mind, Barfield said.
A business failure to respond to BBB surveys could also influence a grade because the BBB may be missing a phone number or not realize the company is doubling its business, which might explain the related increase in complaints, Barfield said.
Kelly Utt-Grubb said the business has made various changes to address its pains, including bringing on new craftsmen, adjusting their business systems, and focusing on tables, which are faster and easier projects to manage than other custom pieces.
The changes could potentially help Carolina Farmhouses BBB rating.
It certainly has been a setback, said Kelly Utt-Grubb. But much of (running a small business) is perseverance.