How Better Business Bureaus Work

By: Dave Roos
Better Business Bureaus handle consumer complaints. See mo­re business and corporation pictures.
©iStockphotoPeter Finney

­You go down to the local hom­e and garden store to buy a new lawnmower and the salesman talks you into a four-wheel-drive riding mower with a money-back guarantee. When the blade falls off a month later, you take the faulty mower back and ask for a refund. The salesman says you must have heard him wrong. The store doesn't offer money-back guarantees. "Maybe you should get a new hearing aid," he jokes. Should you call the Better Business Bureau (BBB)?

When asked whom they would contact if they had a problem with a major purchase, 40 percent of Americans said the Better Business Bureau [source: Marable]. In fact, more American consumers are familiar with the BBB, a private nonprofit organization, than with government regulatory agencies like the Federal Trade Commission -- 81 percent to 61 percent [source: Parmar].


For more than 75 years, Better Business Bureaus have kept tabs on the trustworthiness of businesses and charities. Consumers consult BBB reliability reports, now completely online, a whopping 54 million times a year [source: Western Pennsylvania Better Business Bureau]. And nearly a million American and Canadian consumers file complaints through their local BBB annually to get help when things didn't go quite right in a goods or services transaction -- like the scenario with the shoddy lawnmower.

­BBBs trace their roots to a wave of false advertising scandals in the United States at the turn of the 20th century. Advertising agencies, trying to clear the name of their profession, established local vigilance committees, self-governing trade organizations charged with identifying a­nd correcting misleading ads. In 1912, advertisers formed the first national vigilance committee, which later changed its name to National Better Business Bureau [source: Wansley].

Today there are 128 regional Better Business Bureaus in the United States and Canada. A total of 400,000 North American businesses are accredited by the BBB, proudly displaying the BBB torch insignia in their windows [source: Council of Better Business Bureaus].

Let's find out how a business becomes a member of BBB, how the bureau handles consumer complaints and some of the biggest complaints against the BBB itself.