Reading time: 6 minutes

The law requires that you deal with customer complaints. In addition to that, however, having a fair and effective complaints policy will show customers that you are open to their feedback. This will generate goodwill for your business and aid in reputation and growth. It can be useful to have guidelines that staff can follow for handling complaints, and this means you can provide the same level of service across the board. Make sure to tailor your complaints process to suit your business and the kind of customer relationship you want to foster. This article will outline the legal requirements for responding to customer complaints and provide a basic process structure.

Dealing With Customer Complaints

Handling customer complaints can be tricky, especially if the issues at hand are serious. As a provider of goods and services, you need to uphold certain consumer guarantees. These guarantees are the bare minimum of what you should provide and inform how you deal with facilitating remedies for disgruntled customers. Note that you cannot:

  • refuse to handle a customer complaint;
  • delay dealing with the complaint; or 
  • fail to handle the complaint at all.

If you fail to deal with consumer complaints, you are not upholding your obligations under consumer law. Because of this, customers can complain to the Commerce Commission. Dealing with an investigation can be costly for your business, especially if you are a small startup.

Things to Cover in Your Complaints Process

Across all stages of dealing with customer complaints, make sure that you and your staff remain polite and professional. You do not have to provide a remedy for every customer issue, but you should investigate every problem. Ensure that you give your staff the tools to deal with complaints and support them when you need to.

Provide a clear way for customers to report issues or submit complaints. You could do this by:

  • setting up a helpline;
  • keeping physical feedback forms in your stores; or
  • providing a complaint submission page on your website. 

When handling customer complaints, you should:

  1. respond;
  2. investigate;
  3. resolve; and
  4. move forward.

Respond

Be sure to respond to customer complaints as soon as possible, especially if they complain on a public forum or social media. When responding to customer complaints on social media, if the customer has a specific issue, you can:

  • thank them for their feedback;
  • apologise for the inconvenience;
  • promise to investigate the matter; and
  • offer to deal with the issue through private or offline channels.

It is a good idea to have senior staff members deal with customer complaints and assign someone to deal with each complaint as they come in. Make sure the customer knows who this person is as well.

Investigate

The next step is to investigate the customer’s problem. Do not offer to provide a remedy immediately, but do let the customer know that you are looking into the issue. Be sure to get important information from the customer, such as:

  • the background details of the problem, including its nature and potential causes;
  • their contact details;
  • the date of sale; and
  • the date that the problem began or occurred.

If the customer complains about a faulty product, be sure to get details of how they handled the product and whether they followed instructions correctly. They could have caused the problem themselves through product misuse.

From there, investigate the issue. Depending on its nature, this could include:

  • asking the customer to send you the product so that you can confirm the fault;
  • check with staff about the issue if appropriate, and getting their side of the story; or
  • checking relevant CCTV footage.

Resolve

Once you are satisfied that the complaint is valid, do what you need to do to set it right. Customers are entitled to a remedy (such as a replacement, repair, or refund) for:

  • faulty or damaged products;
  • substandard services;
  • late or damaged delivered goods; and
  • being overcharged if there was not an already set price.

Be even-handed with the remedies you give, and check that any remedy you offer satisfies your legal requirements as a consumer goods provider. Note that you do not have to provide remedies if the customer has:

  • changed their mind;
  • deliberately or accidentally damaged the product;
  • not followed instructions of use (such as washing instructions); or
  • gone somewhere else to resolve the issue before coming to you.

Discuss potential remedies with the customer and keep them updated throughout the process. If you decide that you will not give them a remedy (and you are not legally required to) then be clear about your reasons. 

Move Forward

Look at customer complaints as a chance to improve your business, and to identify wider areas in your business that you need to fix. Ask customers who complain for feedback on how you handled their issue, and use it to make your complaints process more effective. 

Key Takeaways

Having an effective complaints process for your New Zealand business is imperative for maintaining good customer relations and identifying areas in your business that you may need to develop. If you would like more information or help with drafting a complaints policy for your business that complies with your consumer obligations, contact LegalVision’s New Zealand regulatory and compliance lawyers on 0800 005 570 or fill out the form on this page.

Frequently Asked Questions

What is a complaints policy?

A complaints policy or process describes how staff at your business should deal with complaints. It outlines the proper channels to go through, who to contact and how they should respond to customers.

How should I deal with customer complaints?

Be as courteous and professional as possible. Apologise for the inconvenience and promise to look into the matter further. You cannot avoid or delay in dealing with customer complaints, so make sure you investigate as promptly as possible.

Do I need a formal complaints policy?

It may be a good idea to have a structured system that employees can follow when dealing with customer complaints. This means they can handle difficult customers more confidently, and you can control your business’ response to customer complaints.

Do I have to give unhappy customers a remedy for their complaint?

You cannot refuse to deal with a complaint. But, if the law does not require you to give a customer a remedy for their issue (as you do when it is a faulty product or substandard service), then you do not have to. You may decide to anyway, to generate customer goodwill. Be clear about your reasoning for any decision you make.

About LegalVision: LegalVision is a tech-driven, full-service commercial law firm that uses technology to deliver a faster, better quality and more cost-effective client experience.

The majority of our clients are LVConnect members. By becoming a member, you can stay ahead of legal issues while staying on top of costs. From just $119 per week, get all your contracts sorted, trade marks registered and questions answered by experienced business lawyers.

Learn more about LVConnect

Need Legal Help? Get a Free Fixed-Fee Quote

If you would like to receive a free fixed-fee quote or get in touch with our team, fill out the form below.

  • 2019 Top 25 Startups - LinkedIn 2019 Top 25 Startups - LinkedIn
  • 2020 Excellence in Technology & Innovation – Finalist – Australasian Law Awards 2020 Excellence in Technology & Innovation Finalist – Australasian Law Awards
  • 2020 Employer of Choice – Winner – Australasian Lawyer 2020 Employer of Choice Winner – Australasian Lawyer
  • 2020 Fastest Growing Law Firm - Financial Times APAC 500 2020 Fastest Growing Law Firm - Financial Times APAC 500
  • 2020 Law Firm of the Year Finalist - Australasian Law Awards 2020 Law Firm of the Year Finalist - Australasian Law Awards
  • Most Innovative Law Firm - 2019 Australasian Lawyer 2019 Most Innovative Firm - Australasian Lawyer