The Better Business Bureau is a non-profit organization that grades companies based on their trustworthiness and performance.
Consumers can look up the BBB grade of a company they’re considering buying from or using to get an idea of the quality of their products or services and assess how trustworthy they are.
The BBB also provides a dispute and mediation service between businesses and consumers. Consumers can file a complaint against a particular business and the BBB will contact them to help resolve the dispute.
How BBB Grades Are Calculated
The Bureau assigns each company a letter grade from A+ to F based on factors including size of business, years of operation, transparency, how the business responds to complaints, and if there are any government actions against the company.
The grade a business receives may be updated when new information is added to its file.
Businesses may receive a bad rating if they don’t respond to customer complaints within a reasonable timescale or if they make mistakes.
It’s possible for businesses with a bad rating to have their grade reviewed by first resolving the issues and then sending proof and documentation of the resolution to the BBB.
Is BBB Grade Important?
The BBB website is one of the top 1,000 websites in the USA and consumers do look up the BBB grade of companies they’re considering buying from.
Having a bad grade can mean that consumers will not trust your business and may instead choose a competitor with a higher grade.
But an A or A+ grade does not necessarily indicate a trustworthy business.
BBB Accreditation & Controversy
Many think that the BBB is an official government organization but in fact it’s a private organization that operates primarily as a member organization for businesses.
Companies that do not provide data to the BBB may not receive a rating due to insufficient background information.
The BBB has received criticism because businesses that meet certain standards can become accredited by paying a fee. It’s been suggested that companies that pay the membership fee to achieve BBB accreditation receive higher ratings than those that don’t.
BBB fees range from just under $500 for one and two-person companies to over $3000 for companies with over 1,000 employees.
Accreditation gives you a listing in the BBB accredited business directory, a monthly email report about online business reputation and performance, a BBB business profile, and the opportunity to use the BBB seal in your marketing materials. This can give your business a competitive advantage and make it appear more trustworthy to consumers.
After you apply to the BBB they will review your business, review other sources of information such as advertising and reviews to check for trustworthiness, and may arrange an interview. This process usually takes a few weeks.
If your application is reviewed, your business will be listed as BBB-accredited once you have paid the fee.