Business guide to alternative dispute resolution launched as consumer complaints rise Jul 9, 2019Views: 145
The UK economy is supported by a backbone of small businesses. This has always been the case culturally, with the image of the plucky shopkeeper and self-made entrepreneur a mainstay of British identity, but it is also true statistically. Indeed, 99% of all private sector businesses are classed as small/medium enterprises, accounting for 60% of all private sector employment and 52% of all private sector turnover in the UK. However, with Brexit uncertainty looming and the prospect of another recession stifling consumer spending, the future is not looking bright for this iconic sector.
Unfortunately, this is compounded by a change in consumer attitudes; driven by our online-focused society, consumers are becoming increasingly litigious, with some estimates gauging that up to three percent of ecommerce transactions generate a dispute. In this context, businesses need to be savvy; fighting your corner might feel like the right approach, but it can be costly, stressful and time-consuming. Alternative dispute resolution (ADR) offers a different approach, helping parties to settle their difference amicably and to mutual satisfaction. In recognition of the importance of ADR to businesses, small retailers in particular, Business Companion – a free online resource produced by the Chartered Trading Standards Institute (CTSI) – has recently launched a Business in Focus guidein partnership with the department for Business, Energy and Industrial Strategy (BEIS) to help sole traders and limited companies in all sectors understand the relevant rules and regulations.
The guide begins with an introduction to the concept of ADR, clarifying that it is a process for resolving disputes between consumers and traders that doesn’t involve going to court, using a neutral third party to reach an agreement quickly. It also covers some of the advantages of ADR, including cost savings, and the fact that courts will often insist on parties trying ADR before a case will be heard. ADR can also generate goodwill from a previously negative consumer, and can help businesses avoid appearing negatively in the press or through word of mouth.
Practical considerations are also covered, including the differences between mediation, conciliation and arbitration as types of ADR, and the criteria that third parties have to meet, which should give disputing parties confidence in the fairness of the process. The guide then explores the requirements for traders, covering internal processes and communication requirements, with useful case studies to illustrate the stages.
Finally, there is a breakdown of the online dispute resolution platform, including details of the CTSI helpline, which businesses should ensure they are aware of. This platform allows consumer to log details of a dispute, and serves as a mechanism for communication between the consumer, trader and ADR body in a dispute. If the UK’s small businesses are to survive the coming turbulence, a sense of pragmatic solutions to commons problems is a must-have; ADR fits this box, offering forward-thinking traders a calm, low-impact way to deal with potentially sticky dispute situations.
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