About a year after Jeremiah and Harmony Wright launched All In One Home Solutions in Roanoke, Va., they applied to become accredited by the Better Business Bureau (BBB) of Western Virginia.
For home improvement companies, a relationship with one of the 112 BBB branches in North America is seen as strategically vital. Home improvement companies are frequently active in the BBB, more so than any other kind of business. That’s because BBBs play a large role in a homeowner’s pre-project research. Warren King, president of the BBB of Western Pennsylvania, says that 40% of the service’s activity involves some kind of contractor, and of the 9,000 complaints processed by the Western Pennsylvania BBB last year, 18% were construction-related.
For the Wrights and other company owners, it’s all about the credibility that BBB affiliation brings to the marketing and sales process. In 2013 more consumers contacted BBBs seeking information on roofing contractors (3,369,820) and general contractors (2,726,662) than any other type of business. Homeowners looking for a contractor turn to the BBB because, says Warren Clark, president of the upstate New York BBB, “the public trusts us.” And homeowners turn to the BBB more often when it comes to home improvement projects because they’re high-ticket purchases, viewed as an investment.
But while the BBB has been around for more than a century, it has faced some serious competition from online review sites over the past few years. Some homeowners researching roof or window replacement will turn to high-profile sites such as Angie’s List, Google, or Yelp to find out what kind of experience others in the area have had with contractors. As a result, Angie’s List and similar sites have developed into a significant lead-generation component in the marketing plan of many home improvement companies.
What the BBB offers, by comparison, is a letter-grade ranking of local companies from A+ through F based on a list of 16 separate criteria. Only a few years ago, the information it provided did not include reviews but simply whether or not the company met the BBB’s standards, and the number of complaints lodged against it. “Our job,” Clark says, “is distinctly designed as a neutral third party trying to bring trust to the marketplace.” In that role, the organization goes much further than online review sites.
In August, the BBB of upstate New York issued a warning to Buffalo-area consumers about America’s Windows & More, a window replacement company. According to a story in the East Niagara Post, consumers from Lockport to Java Center claimed that America’s Windows & More took their deposits and either never showed up to do the work, or did shoddy or insufficient work. Similarly, in June the New Jersey BBB revoked the accreditation of window replacement contractor Dream House Windows after 69 complaints had been filed against the company over a three-year period. Its owner, Firas Emachah, was later charged with three counts of theft by deception and four counts of passing bad checks.
When a storm rained golf-ball-size hail on parts of Pittsburgh two years ago, the BBB of Western Pennsylvania issued warnings to area homeowners about storm-chasers. “We had people coming from Oklahoma and Texas, knocking on doors, saying we can get you insurance money,” says Ken Moeslein, long active in the home improvement business and a 12-year board member of the Western Pennsylvania BBB. “They caught on to it fast.”
According to King, 75 out-of-state companies applied for membership in the Western Pennsylvania BBB in the aftermath of the storm. Few were considered, as the BBB chapter requires members to be registered as contractors, as per a 2009 Pennsylvania law governing corporations.
Facts vs. Opinions
Vetting companies via the accreditation process is one function of the BBB, and dues via accreditation—i.e., membership—generate a bulk of the revenue for local BBB chapters, which operate as non-profits under IRS classification 501 (c)(6).
The BBB’s standard accredidation process and the fact that its ratings are available to the public at no charge are just a couple of the ways that the organization continues to be relevant to consumers. Angie’s List serves roughly 2 million dues-paying members, but makes its reviews available only to those members, not the broad public. Both Yelp and Angie List grade a business—Angie with a letter grade, Yelp with a numeral—but in both cases grades are based on customer reviews. And reviews, as Clark points out, are not a checklist of standards but rather a compilation of unvetted opinions. One of the BBB’s standards is how long the business has operated. So for instance, the BBB of Western Virginia rates All In One Home Solutions in Roanoke an A-, not because the Wrights have ever had a complaint but because the company is relatively new.
Complaints vs. Complaints Resolved
Individual BBBs began experimenting with online reviews on a case-by-case basis in 2004. As of today, according to King, 40 local BBBs offer the reviews function. But the relatively recent emergence of the BBB’s online review platform points to yet another significant difference between the organization and online review sites.
With sites like Angie’s List, consumers are limited to venting in online reviews, without knowing whether or not their complaint will have any actual impact on the business in question. With the BBB, consumers are also required to file formal complaint in writing. When these complaints happen, the recipient of the grievance is notified, the complaints are investigated, and the company is given an opportunity to resolve the situation. “I thought they were fair and straightforward,” says Gary Kearns, vice president of Kearns Brothers, a Detroit-area home improvement contractor about the few times that his company, a long-time member of the Southeast Michigan BBB, was notified of a customer complaint. “They allow both sides of the story and they don’t broadcast it," he says. "They keep it in-house.”
If complaints are not resolved—with BBB members a resolution takes place nearly 100% of the time—the BBB will expel member companies. The BBB also routinely refuses membership to companies that don’t meet its standards. So far this year, the Western Pennsylvania BBB has denied full accreditation to 112 companies, 28 of them involved in construction. Five were denied membership because they weren’t registered as contractors in the state of Pennsylvania, as required. According to King, his organization has revoked the membership of 15 companies so far this year, four of them construction companies. Of the four, two had unresolved complaints against them and two had not renewed their state contractor registration as required.
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