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Retailers face soaring cost of poor customer service

The number of complaints made in the retail sector leapt by 30% to 2 million in 2016, new research has shown, amid a warning that the cost of poor customer service is rising.

More than a quarter of consumers (28%) spent less with a company or took their business elsewhere in 2016 because the customer service was poor, costing UK businesses £37bn, research by Ombudsman Services shows.

Almost four in five consumers say they would be unlikely to return to shop again with a brand, retailer or other company if they felt a complaint they had submitted was handled badly.

It said the retail, banking and transport sectors are most likely to lose money as a result of poor service, as consumers find it easier to vote with their feet against a shop or bank, compared with changing gas or broadband suppliers.

Retail was the most complained-about sector in 2016 (24% of reports), followed by the telecoms industry (13%) and the energy sector (10%).

Ombudsman Services, which provides independent dispute resolution for a range of sectors, surveyed almost 2,500 people across the UK.

Overall, the number of complaints against UK firms increased by 3 million last year, reaching a total of 55 million.

Lewis Shand Smith, chief ombudsman at Ombudsman Services, said: “This research shows that much more needs to be done to make the customer ‘king’ from a customer service point of view.

“The problem is that 63% of consumers feel disillusioned and feel resigned to poor service, and no longer trust businesses to do the right thing.”

Readers' comments (1)

  • Music to Amazon's ears.

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