What Is The Better Business Bureau?

What is the Better Business Bureau?

The Better Business Bureau was created in 1912 and has become the authority on whether businesses are trustworthy and up to snuff. If you’re comparing different companies (like a new cellphone provider or plumber), then the Better Business Bureau is one of the venues you should visit first.

You can also check the Better Business Bureau if you want to investigate a new charity and find out whether or not it’s legitimate. But what is the Better Business Bureau?

How did it come up with its ratings system? We’ll tell you everything you need to know about the Better Business Bureau and answer the question “What is the Better Business Bureau” in this article.

  • To answer the question “What is the Better Business Bureau”, the Better Business Bureau strives to create what it calls “marketplace trust”. It does this by grading companies according to both their performance and trust, as well as serving as a mediator when customers have complaints or experience problems with a company.
  • The grades that the BBB hands out are based on more than 12 different factors, which include things like how the company has historically handled customer complaints and problems.
  • Although the Better Business Bureau has presented itself as an independent, non-biased mediator, some of its most vocal critics have voiced concerns that the fact that they receive money from certain businesses creates a conflict of influence that means the BBB isn’t capable of being completely unbiased.
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What is the Better Business Bureau?

The Better Business Bureau is a nonprofit organization made up of members all across North America who are focused on creating “marketplace trust”.

It does this in two ways: creating a ratings system that rates businesses according to things like its performance and trustworthiness, and also acting as a go-between for customer complaints and resolutions.

It also provides consumer education, and has developed many programs aimed to teach businesses about the best business practices.

It operates by collecting donations from corporations, and is then able to provide services to businesses and consumers for free. At no cost, you can peruse its website for businesses in a certain industry, or for a specific business.

Every business profile displays information like the number of years it’s been in business, its contact information, as well as its Better Business Bureau grade (which is an A-F letter grade), customer reviews and detailed information about complaints and resolutions.

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Accredited and non-accredited businesses

An “accredited company” is one that has chosen to “support the mission and vision of the BBB”. Of course, both accredited and nonaccredited businesses are listed on the BBB website, but accredited businesses can proudly display their accredidation status for marketing reasons.

A lot of the BBB’s revenue comes from accredited companies. These companies pay anywhere from a couple of hundred dollars for a company with a few employees, or $11,000 in the event of a company with thousands of employees.

The Better Business Bureau also charges businesses for the use of their accredidation seal on advertising online and in print, which provides them with more revenue.

These companies also have to maintain a “B” rating or better, continue to handle customer complaints in a suitable fashion, and providing truthful advertisements.

How the ratings work

Of course, if you’re here to learn “what is the better business bureau?”, then you’re probably wondering how the ratings system works. These days, many customers value the rating of the Better Business Bureau so much that it’s typically a major purchasing decision factor.

There are 13 different factors that are graded using a points system, which can be awarded or subtracted. The total possible score is 100.

Some major factors include things like the business industry, how many unresolved complaints the company has, any government actions that have been taken against the company, and whether they honor arbitration or mediation from the Better Business Bureau.

The number is then converted into a letter score, much like grades in school. A 97- 100 would be an A+ score, 94-96.99 would be an A, 90-93.99 would be an A-, and so on.

This letter grade was only adopted in 2009. In decades prior, it simply declared a business “satisfactory” or “unsatisfactory”. This letter grade system gives consumers more information about the business.

The BBB recommends that customers consider both their grade and other important factors when considering a business, and admits that the grade isn’t a foolproof method for determining how trustworthy a business is.

When learning “what is the Better Business Bureau”, it’s important to know that the BBB doesn’t actually endorse or recommend businesses. It simply grades the businesses and provides consumers with information on the businesses, which allows it to maintain an unbiased public appearance.

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Dispute resolution

While researching “what is the Better Business Bureau”, you should learn about the other half of the organization’s duties: dispute resolution.

It acts as a mediator to resolve conflicts between customers and businesses. Consumers can file a complaint against companies on the BBB website, or write a letter to a local Better Business Bureau center.

Any company that is accredited by the Better Business Bureau must satisfactorily respond to customer complaints to maintain its accredidation status. Nonaccredited companies aren’t held to this standard, but if they handle customer complaints well then it will boost their BBB rating, so that’s incentive to address these problems.

The business must respond to a customer complaint within 14 days. If the company doesn’t respond after the initial request, then the BBB will send another request. And the BBB will let the customers know whether or not the company responds to its requests.

A response from the business doesn’t always equal customer satisfaction. If the customer isn’t satisfied with the response, then they can ask the BBB to send another request. At this point the BBB can initiate arbitration or mediation to resolve the dispute.

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When closing out a customer complaint, the Better Business Bureau has the option to mark the complaint as resolved, unresolved, answered, unanswered, or unpursuable (this applies to cases where the business can’t be located by the Better Business Bureau).

Criticisms of the Better Business Bureau

While you’re researching “what is the better business bureau, it’s important to know what other people have to say about it. It’s easy to type “What is the Better Business Bureau” into Google and find a general definition, but you can’t form an educated opinion about the organization without knowing both the good and the bad.

The biggest criticism of the BBB is that it receives most of its revenue directly from the businesses that it reviews. In a perfect world, the fact that companies pay a membership fee shouldn’t affect their scores.

But in 2010 ABC’s 20/20 conducted an expose that concluded that businesses that paid membership fees were more likely to receive A grades than those that didn’t.

In 2015, CNN found that around 100 businesses that were awarded high ratings from the Better Business Bureau were experiencing significant government regulatory actions against them.

It seems to be aware of these criticisms and acknowledge them, though.

On its website it explains that the “Better Business Bureau does not routinely check required competency licensing and government actions for businesses that do not seek BBB accreditation, although in some cases BBB learns of these matters through its marketplace research.”

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FAQs about what is the Better Business Bureau

What is the Better Business Bureau?

The Better Business Bureau is a nonprofit organization that provides consumers with information about businesses using a letter grading system designed to indicate the company’s overall performance and trustworthiness. It also helps customers to resolve disputes with companies through mediation.

Can Better Business Bureau help me?

If you’re searching “what is the Better Business Bureau” in an attempt to find out whether this organization can help you, the answer is that it probably can if you’re experiencing a problem with a business, or if you’re a business looking to improve the public perception of your brand.

What does the Better Business Bureau do?

Along with “what is the Better Business Bureau”, many people want to know what it does. The Better Business Bureau provides consumers with a letter grade review of businesses that indicates their trustworthiness and their overall performance, as well as serving as a mediator in customer/business disputes.

How do I contact the Better Business Bureau?

Once you’re learned “what is the Better Business Bureau”, and you’ve decided that they can help you, you can contact them at 800-222-8754 or file a complaint here.

How do I check a company with the Better Business Bureau?

Now that you know more about “what is the Better Business Bureau”, you probably want to know how to check a company for their rating. The good news is that it’s pretty simple to search a business with the Better Business Bureau. You can simply search a business’s or charity’s name and it’s location (if you know it) on their website. You can also browse different search categories that are currently popular, which may help you in your search endeavor. You can find the Better Business Bureau directory search here.

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March 12, 2023
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