Why Customer Complaints Are the Best Business Tools

Last Updated Apr 5, 2011 12:45 PM EDT

By Linda Stanfield, CEO, Approved Plumbing, Phoenix, Ariz.
I've been in the plumbing business for 26 years, but I really consider myself to be in the people business. The question we try to answer is, "How do we make our customers happy?" Our plumbing services are a vehicle for us to do that.

My husband and I own three separate plumbing companies: Stampede Plumbing, a residential plumbing service; Approved Plumbing, a commercial service; and a Benjamin Franklin Plumbing franchise. Combined, the companies have 16 employees and bring in $2 million in annual revenue.

With all the plumbing jobs we've done, we've gotten a number of customer complaints over the years. It's par for the course for any plumbing company. Initially, I would brush them off -- but I eventually realized that by listening and truly responding to every complaint, I could learn how to improve my business.

Customer complaints
We deal with all kinds of customers, and they're not always familiar with the work that plumbers do. I try to head off complaints by training my employees to adapt their explanations to the level of detail the customer wants, among other policies like keeping their hours flexible and avoiding tracking dirt into a customer's house. But no matter what you do, you can't please everyone.

In most cases customers complain because they think the price was too high or the plumber did something improperly. In the beginning, I was very defensive. For instance, I recently received a call from a customer claiming that by turning off his water, we'd broken his dishwasher. In the old days, I would have told him that that wasn't possible, and moved on. But today, my approach is dramatically different: I listened to his concerns, explained the work that our plumber had done, and then offered him a refund.

A new outlook
The change came about five years ago, around the time when my mother passed away. Mourning her loss made me realize that human relationships should always take priority over business. Ever since then, I've made customer service my number one concern. If we have a dissatisfied customer, I want to change his mind -- even if we still lose him as a future customer.

To start with, I decided to do a "happy call" with customers after every single job. I want to know as soon as possible if a customer has concerns, rather than give him a week or two to stew over something he's worried about.

And if we do get a complaint -- whether on that call or in an online forum -- I'll take steps to investigate the situation and address the problem. Sometimes that means a full refund; other times I'll send a customer flowers or a certificate for dinner. Most of all, though, my goal is to make sure that the customer feels like he's been listened to.

Putting our money where our mouth is
We recently received a comment on our Facebook wall from a customer who believed we had overcharged him. Moreover, he thought the plumber we sent didn't have the necessary expertise to do the job. He'd read a booklet suggesting the job should be done another way, and was upset that the plumber had put a hole in the drywall when doing his repairs.

These are big concerns, so the first thing I did was look into the job in question and talk to the plumber about the situation so I had a good grasp of what had happened. Then I called the customer and listened to his side of the story.

I told him I would refund him whatever he thought was fair. Then I went one step further by having the plumber go back out to his house with our lead plumber, so that they could review the problem face-to-face.

Our lead plumber discussed the situation with the client, and told him why the booklet's solution wouldn't work in this case. We reviewed exactly why we'd put the hole in his wall, and paid for the drywall repair. We also gave him a 50% refund.

After that, the customer left another message on our Facebook wall, commending us for our approach to customer service. "You have to hand it to owners who stand behind their work," he wrote.

Why we do it
I'm always willing to refund customers if they're unhappy, even in cases where we've done nothing wrong. I've had other plumbers ask me how we can afford to take that approach. My answer to them is "How can you afford not to?" Even though it costs us money to make refunds, I can't say it hurts our business. Making sure that our customers walk away happy is good for our bottom line: We now receive more than 2,000 referrals a year from satisfied customers.

I look at our customer complaints as a business tool, just like my financial reports. Complaints can help tell you if you've got the right employees and the right processes. Paying close attention and making every effort to resolve issues with customers has helped me build a better company.

Linda Stanfield and her husband Chris have been in the plumbing business for 26 years. She also serves as a coach to help other new business owners learn management skills.
-- As told to Kathryn Hawkins

Read More: