Retail Ombudsman - what you need to know
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The Consumer Rights Act & Alternative Dispute Resolution Regulations 2015 came into effect in October 2015, affecting all retailers.
Under this new law, all retailers now have various obligations including a requirement to tell your customers of the existence of an authorised alternative dispute resolution ("ADR") scheme. ADR is there to help customers and retailers if there is a dispute over the supply of goods or services and you have been unable to settle it through negotiation.
Retailers do not have a legal requirement to sign up to an ADR scheme. Legally you only need to supply a customer with the information found here if the customer is unhappy with your efforts to resolve the issue.
However, in light of these changes to the law, retailers have reported being contacted by the Retail Ombudsman inviting them to join The Retail Ombudsman Scheme. Membership to an ADR scheme is voluntary, however, over 3000 businesses have signed up so far - although the majority of these are big brands. The Ombudsman suggests it could have some benefits to smaller retailers too, should they choose to join.
- Sending a message about customer service. Being able to advertise that you're a member of the voluntary ombudsman scheme says a lot about how seriously you take service, and the respect you have for your customers. It could be what makes a person decide to shop with you rather than another, seemingly less trustworthy provider.
- New EU rules will make dispute resolution a requirement. This year the Alternative Dispute Resolution (ADR) directive will come into force from the European Commission, making attempts to resolve retail disputes outside of the courts a retailer's responsibility. Firms signing up to the ombudsman scheme will automatically be compliant with these new rules.
- It saves time, money - and bad publicity. Persistent customer complaints can be handed to TRO for resolution, saving time, and hassle. Customers are also given the correct information about their rights from the outset, so shouldn't pursue pointless claims.
How much will it cost?
Charges for membership vary depending on the size of the business. Independent retailers with a single shop or website pay £100 a year for membership whilst business owners with two to five shop locations will be charged £200 per annum.