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Poor customer service could cost UK plc £850bn

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UK plc could be missing out on close to £850bn in sales because of poor customer service, according to a new study.

The survey, carried out for multichannel retailer Best Buy UK, found that some 85% of consumers would go out of their way to shop somewhere with better service. The research suggests that businesses with poor service could therefore be missing out on their share of trade from those consumers – representing 85%, or £847bn, of the £995,832 spent each year with the UK’s service sector, according to ONS figures.

Some 71% of the 2,022 adults quizzed for the research, said that they would pay more for good customer service, while 71% said they wanted helpful and knowledgeable staff available when they go shopping.

Restaurants (62%) and hotels (45%) were the most likely to have satisfied customers, the survey found. It also found that while most people did not want to be approached while shopping, a significant minority, at 23%, would like to be offered help within the first five minutes.

Steve Jensen, managing director of Best Buy UK, said: “To thrive you’ve got to give customers the service they demand and deserve. We as customers shouldn’t have to put a price on good service. Unfortunately people perceive they have to pay more for what we believe should be a given. Every company is missing out on crucial sales if they don’t make customer service the focus of their business.”

Jo Causon, chief executive of the Institute of Customer Service, said: “It is only companies that make great customer service a priority in store and in the boardroom too that will find success. Every business has to ensure that employees are given the right training particularly on those softer people skills to ensure they’re in the best position to deliver a positive customer experience. You have to fight for every customer now and keep them coming back or your competition will get there first.”

Our view: You may look at these figures and think there are some rather grand assumptions in the maths used to put a figure on the sales businesses may be missing out on as a result of poor customer service. Because of course most people haven’t generally gone elsewhere or paid more for poor customer service. If that was the case, then as a population we’d have much better customer service and places offering poor service simply wouldn’t be in business. You may argue that it’s like taxes: many more people say they’d pay more taxes to fund services they want than go on to vote for them.

However this research does make a valid point that retailers must consider for the future, since it’s clear that consumer choices are now widening thanks to the growth of the internet. Already businesses with an emphasis on good customer service are seeing faster growth in a multichannel world where the customer really can feel like a king. Soon, if not already, those businesses offering poor service will be beginning to feel it in their pockets.

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