Better Business Bureau; Is it worth another look

Better Business Bureau Fraudulent Sales Practices

Have any other small businesses had a problem with the BBB and there sales practices? We have for quite some time. Our franchisees, (our company is a mobile car wash franchise company) are required to join the local Chambers of Commerce as part of their franchise when one exists in their exclusive territory. But as soon as they do the BBB calls up and says;

“We have been getting a lot of calls about your service, but we did not know what to tell those customers who inquired about you with The BBB?” Then the pitch goes on…for about $300 plus dollars you will receive….

Our franchisees join the chamber prior to the commencement of their business while their mobile car wash service trucks are being built to get to know the communities they will be serving. Inver ably they will get the call from the BBB from the new member directory from the chamber of commerce before any advertising goes out, so in fact no one had ever called the BBB at all. This has happened to our franchisees in Carson City, NV; Palm Desert, CA; Agoura Hills, CA; Camarillo, CA; Sacramento, CA and Houston, TX. I realize that this is “telemarketing fraud” and I am concerned. I am told that many of the 128 BBBs across the country pay their salespeople either all or part commission. So perhaps this is an individual problem, yet their sales people have done this. I personally have had it happen five times to me as the franchisees signed up at the Chamber of Commerce in various cities and they did not have phones yet, so they called me at Corporate. As a franchisor I am responsible for any verbiage of any sales person given during a sale, shouldn’t the BBB also be liable for these falsehoods?

I contacted the Washington D.C. head office of the BBB and they denied that any such incident has ever occurred and referred me to the fact that they are a 90-year old organization. Maybe, but as it stands today they are breaking the law. This has occurred five times in sales calls to me personally from BBB representatives. I also contacted the Los Angeles BBB and was told that yes their sales people often use Chamber of Commerce lists of new members as well as look up names of anyone who has had a complaint filed against them. I was told of this off the record, yet I am using this information too. In other words they use the list of companies who had customers call in whether it was a valid complaint or not as a sales tool. Interesting since accounting firms cannot also be consultants these days. The hypocrisy of the BBB is a little unnerving and of course unethical if not out right fraudulent in my opinion. I was told at the L.A. office that “MOST COMPANIES” join the BBB. Impossible since there are over 1.6 million businesses throughout the greater LA, Orange County, Riverside, San Fernando Valley area and most could only be over 51%. This is an exaggeration by any stretch. This would mean they would have a minimum of 800,001 business members, when in fact they have less than one tenth that number in all of Southern California. Yet these same BBB offices take complaints about franchising and on many of their web sites tell buyers to be aware of exaggerations;

http://www.bbb.org/library/fran.asp .

This is quite appalling and shows that both franchisors and franchisee attorneys should stand up and take notice; but this is not just a franchise business issue, it is a small business issue. All small business people are subjected to this and maybe harassed. Chambers of Commerce across this country signup their new members with public trust, yet this is being abused by another organization the BBB. I was also told today by this sales person in Los Angeles that 9 out of 10 calls coming into the BBB were consumers looking for references of businesses for service or products. This is also an exaggeration and a falsehood (lie). If you call any BBB the answering machine usually states; “If you would like to make a complaint press 1…” There is no mention of getting a reference and certainly few incoming calls result in new business for its business members. One of the benefits you receive is instant credibility from the consumer, yet the organization issuing the stamp of approval lacks credibility and ethics of it’s own.

Also of grave concern is the fact that even if you join the BBB and appear in the BBB phone book they produce in some markets, if you are disreputable you are still in print for the remainder of the year. And therefore we have the BBB promoting disreputable businesses for as much as 12 months. If someone files a complaint against your company whether real or imaginary (trying to get free stuff) you must settle the said complaint before you can renew, once again extortion.

I feel these sales techniques are fraudulent and disreputable. I am also concerned with the “Boomerang” closing techniques when the BBB sales person gets a negative response to join. “We will not be able to tell the people who call us that you are a reputable company.” Implying that the consumer will assume the opposite, that you are disreputable company. This in itself maybe good for BBB sales, but it is an extortion technique. I have heard this extortion technique myself many times and phrased many different ways all-leading to the same tactic. Asking small companies to fork over $300 plus dollars is unnecessary and they will receive little if any benefit for their BBB membership. Perhaps the plaque displayed may be of value to customers in a store, but the way in which they attempt to sell it is dishonest.

The BBB works closely with the FTC and after contacting the BBB to make a complaint they told me I was wrong, and that I did not know what I was talking about and that the BBB would never do such a thing? Which is also a falsehood since I have experienced it first hand. When I told them that I might have to contact the FTC in this matter, they said go-ahead knowing their strength in alliance with the government

The BBB preys on small businesses of all types as well as franchised businesses for membership using these techniques. We called the FTC as well and they would not take the complaint. Perhaps this is because they work with the BBB in secretly using entrapment techniques to get franchisors to make unsubstantiated earnings claims. The FTC has also worked with the BBB to catch franchisees of various systems in consumer fraud such as automobile repair, advertising claims and telemarketing techniques. So for this reason the FTC will not do anything about this issue.

The BBB is above the law. They often lie to prospective members to make sales, meanwhile attack franchisors using entrapment techniques from the inside while preying upon franchisees to prove self worth in conjunction with other agencies in the media and also use extortion tactics to make money for membership fees. Imagine the money they have extracted from all the franchise systems of this country. Just imagine the number of small businesses who are struggling right now to make payroll as cash flow has lessened due to economic forces beyond their control. Over 10% of all Americans own some type of small business and can be subjected to these terrorizing and extortion sales tactics. Most franchisors have many franchisees that are members of the BBB; this costs franchisees each year and cuts into the profits of the franchised units. We have put this line of text in our franchise agreement:

5.1 You may not join the Better Business Bureau as a business member as part this franchise with us.

I am very serious about this issue, having been lied to by BBB representatives for the last five years and today when I called to see if things had changed. I was hung up on by the BBB in Washington D.C. when I called to discuss this issue. The FTC will not do anything about it for fear of losing a partner. If the FTC will not look into this, why do we need an FTC or a BBB?

I have received several emails from concerned business people, for instance, Bob writes: “That’s really interesting, isn’t it? One government bureaucracy is using what
is “supposed” to be a free-market entity to do the dirty work that they
themselves don’t have the Constitutional backing to do in the first place.
Then, by not holding the BBB accountable for its fraudulent practices, it is
basically saying to them, “you are a brother government agency – one of us -,
free to terrorize whomever you want”. “I always thought that the BBB was basically a private organization that served as a watchdog, with a membership of businesses that could self-police. Apparently, I was wrong.”

This is a nationwide problem not just a few rouge sales people in one part of the country or one of the BBBs 128 locations. In Atlanta Mr. Lee writes: “It’s not just with franchises…. We get calls at our company stores in Atlanta, NYC, Chicago, and Birmingham with the exact same sales pitch “blah blah …we’ve been getting a lot of calls about your company from your prospects, and we don’t know what to tell them because you’re not listed with us..” “It seems like a total scam. I often feel stongarmed by them. Do you mind if I share your email with our attorney?”

Other people are also concerned with these issues, iCop Founder writes: “You certainly don’t need to convince me! I know first hand that everything you’re reported here is true. I have personally received the exact same treatment from the BBB in California. I had to threaten to sue them to get them to stop calling with the threats and harassment. A few years ago, when I had a complaint about one of their big name “sponsors” who ripped me off to the tune of several hundred dollars, the only response from the BBB was, “They said they didn’t so it.” This in spite of the fact that I had sent them undeniable proof! What is wrong with THIS picture?!” “Unfortunately, I have no idea that anything can ever be done about it. They are protected by the government – as you have already found out. I did write a series of articles on it a couple of years ago. Maybe it’s time to rerun them! Apparently, the only thing we can do is educate people and warn them.
Pretty much like the Mafia making you pay for protection under threat, eh? But then when Quest is listed as one of their corporate sponsors, you have to know something’s very wrong! Sorry we can’t be more help but it’s way too big a scam for iCop! When a government supported company like the BBB acts like nothing more than thugs, it’s hard to be surprised at situations like Enron and Worldcom.”

But that is not all the smallest of small business also have been harassed, Greg Spunk writes about this from San Diego and an office now in Phoenix: “We have not joined the BBB in either the Phoenix or San Diego locations for similar reasons. You just verified what I already felt was happening. They are of no value to us and we have not missed them.”

In Pittsburg a small manufacturer writes in to us and says: “The same thing to me. “someone is calling about your business and we aren’t able to tell them anything since you aren’t a member…. It was $465 dollars to join, and they called and called and called. I declined since I didn’t see the point.”

We received this from Albuquerque, NM from the proprietor of a small automotive business who wanted her husbands company to remain anonymous; “It happened here for 6 months, same speil, We have been getting calls for your business etc. Finally I told them that I was not interested and to stop calling or I would call Santa Fe and talk to the DA. Susie”

I received this email from one of our own franchisees;

“The BBB has called us and even after telling them I was too busy to make an appointment (after several calls), they dropped in when I wasn’t home and told Gino I had made an appointment. NOT TRUE. What’s up with them, I told them we were too new to join yet, we had to watch our cash flow. What’s up with them?”

Franchisees coming into the market and/or having been laid off need to watch every penny they spend, if the BBB uses forceful tactics, then they are of detriment to the success of a new franchisee that is on a budget to get their businesses going. Then they show up at a personal residence without an appointment? The sales people are so aggressive and hound small businesses. What happened to privacy? Is the BBB resorting to new tactics after the recent telemarketing law became effective? The BBB was told by our franchise that they were not interested after several calls, so they show up at their house? I am sorry but isn’t this pushing it a little, general harassment? Yet no one will enforce these issues.

If any other Small Business Person, Chamber of Commerce, SBA office, SBDC or franchisor are having this problem, I would sure like to know. Yes we are busy too, but that does not mean we can allow this injustice to continue. This is unacceptable behavior and the BBB should be disgorged of these ill-gotten gains. These monies should be rightfully returned to the businesses and the FTC should not get a dime since they are in cahoots with the BBB and are allowing this to continue for years on end. The FTC and the BBB should stop throwing stones at franchisors and their franchisee team members.

How to Leverage Your Home Based Business in 3 Easy Steps

Everyone has specific things that we want to do or have or perhaps be. Perhaps leverage your home based business could be of interest for you. There’s a great deal of curiosity about how to do less work and completely leverage the home based business online. There is much helpful info available on that if you are interested. If you want to learn how to leverage the work involved in starting your own home based business then this short article can assist you. To boost your understanding, read on.

Discover how to use a home business system to get the work and prospecting done in 3 easy steps!

The 1st step you will have to take is to find a complete home based business internet system. This will be crucial because it will save you time and money in the long run. You will need to avoid getting all the tools and resources in different places on the internet. Finish this step promptly, correctly and completely. This is really important. It it’s not done right, for whatever reason, then you can not leverage the work involved to build a Downline and providing training for your home business Members.

The 2nd step will be having a System can be used and copied by all members online. Items that you should avoid here are a prospecting system, Auto Responder and advertising tools and resources that will help you to build a successful online business. And you will probably also want to avoid having to do the work on your own and need to train your Downline by yourself.

The 3rd step is Find Quality Members, who are willing to use the System Effectively. This will be significant because you need to leverage and build a home business that will then grow with the never ending home business members. The most important thing to avoid is to do it all on your own and build the home business by yourself.

Just go through the steps as specified and you ought to have no issues with how to leverage your home based business easily, rapidly and well. Just stick to the stages in order, for the reasons as explained, while carefully avoiding the traps, problems and potential mistakes mentioned. Then enjoy the fruits and great things about having leverage your home based business that you will have earned by your time and effort.

Discover the way to to leverage the time and work in the home business industry at my really simple home based business website at http://choose-the-right-team.com.

10 Tips to Make a Family Business Better Than a Quoted Business

Four weaknesses family businesses are prone to, be aware of these and avoid the worst effects:

Conflicts of interest

The family owners have the power to pursue their own objectives and desires. These may not always coincide with the best business interests of the company.In a publicly owned company the pressure from shareholders and the organisational structure should ensure this doesn’t happen to any significant degree. Of course you may still find the company sponsoring the CEO’s favourite sport or even team!

Poor profit discipline

A family business can be inclined to focus on product quality, on having the best equipment, on building a sales empire, or some other ‘non profit’ oriented strategy.

A comparison between small companies and their publicly owned counterparts indicated that the family businesses had lower profit margins, typically half what the publicly owned companies made. Partly this will be a consequence of the different motivators. Public companies are motivated to report growing profits, family owned businesses are more conservative, for competitive and tax reasons they can be less enthusiastic to recognise profits. Nevertheless, there is food for thought on profitability.

Inflexible marketing

When opportunity presents itself, a family business can be reluctant to embrace it, if it requires investment, particularly if that means equity investment and the things that go along with that, dilution and outsiders becoming involved in the business.

The family firm can become ‘engrained’ in a particular fashion or phase and not always recognise the need to continually change and move with the times.

This does not apply to all family businesses, but where a family run business fails it is more often due to poor marketing rather than a problem with production or operations. Once market position is lost, it is slow and difficult to win back. It is highly unusual for the management team that lost the ground in the first place to be capable of winning it back.

Excessive nepotism

Nepotism is the promotion of relatives on the basis of family rather than merit. Weighing against this are the forces of the marketplace. Any company which promotes incompetent people on the basis of family relationships will soon start to suffer at the hands of the competition. The non-family managers can burdened with carrying their incompetent colleagues and of course their opportunities for advancement are restricted. Faced with this combination they are more likely to become disillusioned and leave. So this policy can lead to the firm losing some of its most valuable employees, jeopardising its long term survival.

Six advantages that family businesses have, build on these strengths

Personal sacrifice

The tradition in many family companies is to put the company first, to take dividends only if there is surplus cash and to take a pride in working for the family business. Companies with this ethos can keep going through hard times which would force any other company out of business. An extreme example of this is Weyerhaeuser which incurred an incredible 40 years of losses whilst growing into an industrial giant.In times of recession family businesses can pull together. Family members know it’s their own business they are tightening their belts for. They will give up salary, time and status in order to help the company through a rocky patch. In difficult times family businesses have fewer uncertainties.Family members reporting to one another, confiding in one another growing the business together with the same goals, that is the advantage of a family business.

Valuable reputation

A family’s reputation can sometimes have a beneficial influence on community relations, banks may be influenced by past relations with the family.Family members have ‘star quality’. Customers don’t want to talk to a nameless faceless person. Everyone feels better talking to the person that runs the show. The guy who’s name is over the shop. How convenient then if there are 3, 6 or even a dozen or more people in the organisation sharing just that name! The experience of dealing with a family member can be just as reassuring as dealing with the managing director.There are plenty of big businesses out there portraying an image that says ‘We are bigger, we are more businesslike’. The family business can take a different approach. One that says ‘We are the owners, we care about you and we’ll make sure you’re taken care of’ a lot of people will buy because they like the family approach.Family tradition, pride and responsibility can contribute to the business’ long term success. The family name can become synonymous with quality.

Employee loyalty

Family involvement and management can avoid the problem of excessive turnover in management employees. In other words the family tie is likely to keep the manager in the business. If a non family manager finds a job that suits him better he will leave. If he joins a competitor or even worse decides to set up on his own, this creates a major threat to the business. The small business often relies upon its own techniques or innovations or on providing a faster service and on personal relationships. The departing manager can often take this ‘inside’ information with dire consequences for his former employer.In contrast the combination of family pressure, loyalty and expectation of future advancement tie the family member into the business.

The larger family companies often find it helpful to have family members involved in employee relations.

United shareholders and managers

Quoted companies often have ’employee share option schemes’ because it is seen as beneficial to have employees who are also partial owners of the business. In a family business this is almost always present. This mutuality creates a focus on long term performance rather than short term profit. For instance an investment in research and development. There is greater flexibility more leeway to try something different. The flexibility might not always result in the best decisions being made.There might also be an additional advantage of greater secrecy, they are better able to keep the competition guessing.

Better teamwork

Family business members don’t have to second guess the motives of their co managers or partners. They rarely need to worry about a family member ‘jumping ship’ to work for the competition. Junior family members can speak their mind without the fear they would otherwise have of being fired. The family team can argue over strategy or operations even when one member has their history, heart and soul invested with one particular option. Relatives can do that because they know one another and trust one another. With a non family member it’s much easier to harbour a grudge or allow personal conflicts to build up.

Stability

Many family businesses shy away from projecting their family image, they believe it makes them appear less professional. Other family businesses have found it pays dividends to portray their family background. It shows they are in business for the long term. They will provide continuity for both customers and employees. They don’t need to worry about next quarters profit figures, they can focus on five years time. Running any business is hard work. Managers who’s motives and ethos are understood at home are more likely to be at ease with their work , less stressed about their work – life balance. Building a business with people you care about can be infinitely more satisfying than building a business with people who don’t share the same connection.