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Handling Customer Claims (Part 2)

Listen, listen, and listen some more—and then respond immediately

SAN FRANCISCO — Despite the generally low claim rates in the fabricare industry, customer claims seem to be one of the favorite topics of discussion for cleaners, thereby capturing a disproportionate share of business-focused conversations. Everyone has a horror story about their most outrageous customer demand or their most expensive customer claim.

THE EARLIEST SOLUTION IS ALMOST ALWAYS THE LEAST EXPENSIVE

Retailers have found repeatedly that the earlier a claim is addressed, the less expensive it is to arrive at a satisfactory solution for the customer and the company.

The longer the customer has to wait for an accommodation, the more “valuable” both the item and their time become in their minds. They also have additional time to tell their story outside the company and get more feedback and suggestions from friends and family as to what is “fair.”

Additional external input will only work against you, so settle early as a form of self-defense. Get the issue resolved so you can retain the customer and so you can move on to more important projects.

ALWAYS THEIR “FAVORITE”

The longer the delay of resolution, the more precious, sentimental and valued the item becomes. The damaged blouse becomes their favorite blouse or the tablecloth becomes an irreplaceable, priceless heirloom with incalculable sentimental value.

“Ninety-five percent of complaining customers will do business with you again if you resolve the complaint instantly,” according to Lee Resource Inc.

EDUCATE YOUR TEAM

Active listening is an acquired skill that can be greatly enhanced with training and practice. The normal human reaction to criticism is defensiveness, which leads to escalation of a problem if the customer is interrupted in their explanation of the claim issues.

Training your team to actively and empathetically listen until the customer has finished talking will improve the customer satisfaction and retention rate as well as reduce the cost of addressing claims.

Practice and role playing will demonstrate to your sales people the improved outcomes when they control the situation calmly and let the customer agitation diffuse.

Educating them on the statistics will also show the importance and value of empathetic listening.

According to Michael Leboeuf, in How to Win Customers and Keep Them for Life, of the customers who leave a business: “68% quit because of indifferent attitude towards the customer by the staff.”

Of those customers who leave, only “14% are dissatisfied with the product. 9% leave because of competitive reasons.”

Active listening will reverse the customers’ impression of indifference projected by the staff.

EMPOWER YOUR TEAM

Many owners are concerned that if the sales team has the authority to address customer claims on the spot that they will “give away the store.” In fact, historical data shows that employees are likely to be much more protective of the company and your funds than you are.

Statistics show that a manager or an owner with the facts of the claim in hand will be far more generous to the customer than the customer sales representative would be in handling a claim. You will generally have to encourage them toward a higher-value solution.

Since the customer will be happy with less on an immediate resolution, and since the sales rep is likely to offer less if given the immediate authority, it is to the company’s advantage to empower the team to settle claims immediately.

To work up to a comfort level with this process, you may want to ease into this system by authorizing a maximum amount to resolve a claim immediately. For example, if you set that limit at $50, it will always cost you less than getting involved yourself because your lost time alone will be worth more than that $50. You will also retain more customers because their concerns were addressed by the person they first encountered.

The customer’s confidence in your counter staff will be enhanced because they see that the team with whom they interact regularly also has knowledge and authority. The staff’s self-confidence will also improve, and members will be more comfortable and competent in dealing with unhappy customers themselves instead of passing the problems up the line of management. 

Check back Thursday for the conclusion!

Have a question or comment? E-mail our editor Dave Davis at [email protected].