BBB Services Nationwide Surged in 2003; Businesses Ranked by Inquiries and Complaints

Arlington, VA., May 4, 2004 -- The nation's Better Business Bureaus (BBBs) today reported that services provided to consumers and businesses in 2003 surged to 52.9 million, up 27 percent from the 41.5 million instances of service provided in 2002. All told, BBBs in the U.S. and Canada logged 56 million instances of service in 2003. [For more detailed information about the combined North America data, refer to the "BBB International Data" press release posted in the Council Newsroom section of www.bbb.org.]

"BBBs provide an invaluable service to today's marketplace. Consumers and businesses have come to rely on our millions of reliability reports to select reputable businesses here and in Canada and to avoid companies that are the subject of too many complaints," said Ken Hunter, president and CEO of the Council of Better Business Bureaus (CBBB). "With the growth in e-commerce and cross-country shopping, BBBs are needed more today than ever before."

Pre-purchase Information: Pre-buying inquiries in the United States increased to 48.8 million in 2003, up nearly 28 percent from 38.2 million in 2002. These requests included 30.8 million BBB reliability reports on businesses located in the U.S. - member companies as well as businesses that are not BBB members but that have generated inquiries or complaints from the public.

Other pre-purchase inquiries included 4.6 million instances of shoppers checking for confirmation that an online merchant participated in BBBOnLine Reliability and Privacy programs, up 28 percent from 3.6 million in 2002, and 13.5 million requests for general information on shopping wisely and avoiding questionable promotions, up 40 percent from 9.6 million such requests in 2002.

"When it's time to spend your hard-earned money on a product or service, it's time to check with the Better Business Bureau. Our information and services are available 24-7 to assist you at the time you want to make your purchasing decision," Hunter said.

Complaints: U.S. BBBs processed 773,042 complaints in 2003, a 23.5 percent jump in the 626,081 complaints processed in 2002.

"The growing complaint volume doesn't necessarily indicate a decline in service by the business community; it's more a reflection of the increased reliance on the BBB system and the tremendous effort BBB staff persons devote to helping resolve disputes that arise in the marketplace," Hunter said.

In another 964,666 instances, BBBs in the U.S. assisted the public by providing complaint counseling or referrals to appropriate agencies or organizations. The BBB AUTO LINE program, which assists car buyers with warranty-related disputes, handled an additional 30,987 complaints.

The BBB's online complaint form, which is accessible through the www.bbb.org Web site, makes it easy for consumers to seek assistance in resolving disputes with businesses in the U.S. or Canada. This use of technology also permits BBBs to provide businesses with a speedier means to be responsive to customers and quickly address issues that are causing dissatisfaction.

Information on Charitable Organizations: BBBs not only offer information on the reliability of specific businesses, they also provide information to those interested in checking out charitable organizations.

"Just as we help consumers to be savvy shoppers, BBBs encourage members of the public to be discerning donors," said the CBBB president.

The BBB Wise Giving Alliance produces reports on national charities that are available at www.give.org. In 2003, the public accessed national charity reports on the give.org Web site 2.19 million times, an increase of nearly 78 percent over the1.23 million charity report requests in 2002.

Advertising Review: Since its founding, the BBB has worked for "truth in advertising," asking businesses to voluntarily change or halt advertising or selling claims that appear to be false, misleading or deceptive, or that cannot be substantiated. In 2003, BBB advertising review experts at the national and local levels reviewed 7,535 advertisements.

Businesses Ranked by Inquiries and Complaints: The CBBB released its Top Ten, a listing of business categories that generated the most requests for reliability reports from U.S. BBBs, and that accounted for the most complaints processed by BBBs in the U.S. in 2003.

Top 10 Most-Asked-About Businesses
Mortgage and escrow companies topped the list of businesses that are most frequently checked out with the BBB. Inquiries about such offers totaled 1.04 million in 2003. Ranking second in number of reports requested was work-at-home promotions, with 1.02 million report requests, and the third most-asked-about business was roofing and guttering contractors, with 953,406 reports requested in 2003.

Mortgage and escrow companies surpassed last year's top ranked work-at-home promotions, with inquiries soaring to more than one million. The mortgage business also recorded the greatest increase in report requests over the prior year, with inquiries increasing by 57.9 percent over 2002 inquiries.

"This increase in activity isn't surprising given the number of persons who bought new homes or refinanced existing mortgages in 2003. It's gratifying to know that so many people checked with the BBB first, before selecting a mortgage lender," Hunter said.

Inquiries about home remodeling contractors also experienced a 57 percent increase, with report requests on such businesses increasing from 400,486 to 629,694.

Work-at-home promotions ranked second in 2003, with 990,919 inquiries to BBBs. Rounding out the top 3 most-asked-about businesses was roofing and guttering contractors, with 912,384 inquiries.

The types of businesses ranking fourth through nine did not vary much from the prior year, except for tenth-ranked plumbing contractors. In 2002, that type of business ranked 15 with 232,176 reports requested. Plumbing company inquiries grew to 315,642 in 2003, pushing the plumbing contractor category to the Top 10 list.

Although BBBs fielded more requests for reports on Internet services in 2003 than 2002 (275,397 in 2003 compared to 270,280 the prior year), the business category dropped off the Top 10 most-asked-about list.

Other noteworthy changes from the prior year perhaps were a reflection of the uncertain economy and unemployment rates in 2003. Credit counseling and management services and credit-debt consolidation services, which ranked #25 and #18 respectively in 2002, both moved up significantly on the most-asked-about rankings. In 2003, there were 294,901 requests for reports on credit counseling and management services, up 88.5 percent from the 156,459 reports requested in 2002, moving that type of business to #11 in ranking. Another 292,218 reports were requested on credit-debt consolidation services, up 37 percent from the 212,875 requested in 2002, placing that business category #12 on the list of most-asked-about businesses in 2003.

The top three most-complained about businesses did not change much from 2002. Automobile dealers moved from second place to first place, with a 10.4 percent increase in complaints. Although the number of complaints against cell phones dropped by 14.5 percent from 2002, the category continued to rank high in terms of complaints, placing the business second in number of complaints processed in 2003. The number of cell phone complaints processed by U.S. BBBs in 2003 totaled 18,323, down from the 21,534 in 2002, but considerably more than the 5,928 complaints processed in 2001.

[NOTE: Following release of last year's data, the CBBB conducted a review of BBB wireless industry complaints in an attempt to determine why complaints concerning mobile and cell phone equipment/suppliers/services had risen so rapidly in recent years. CBBB's findings regarding the root causes of customer dissatisfaction are discussed in the press release entitled "BBB Analysis of Cell Phone Complaints Reveals Root Causes of Customer Dissatisfaction," posted in the Newsroom at www.bbb.org.]

Credit card companies stayed at #3 and Internet services remained at #4 in terms of complaints processed.

Credit collection agencies jumped from #9 to #5, with complaints increasing 33 percent to 13,347. Mortgage and escrow company complaints also surged, pushing that business category from #17 in 2002, to #6 in 2003. Complaints against mortgage companies increased 82 percent from 7,038 to 12,779.

"This is not surprising," Hunter said. "When there's a sudden growth in volume of business within a particular industry, as there has been with new mortgage and refinance loans, there is typically a commensurate increase in complaints."

Telephone companies, in general, improved their complaint ranking over the prior year. In 2003, phone companies generated 11,197 complaints, down 5 percent from the 11,770 complaints processed by BBBs in 2002. So too did mail order and catalog business and the cable and satellite TV industries, which dropped off the Top 10 list to rank #15 and #17 respectively in 2003. Complaints about mail order and catalog businesses dropped from 10,884 in 2002 to 8,427 in 2003, a decrease of 23 percent. Cable and satellite TV complaints fell to 8,132 complaints in 2003, a 13 percent decrease from the 9,354 complaints processed in 2002.

# # #

The BBB System's 2003 Annual Inquiry and Complaint Summaries offer data on 1,104 business categories, which are ranked by number of BBB reports requested and complaints processed by BBBs. Three statistical summaries were published this year: a U.S. publication, Canadian publication and a publication with U.S.& Canadian data; all are available online at www.dr.bbb.org/DRresults/.