Small business owner

Small Business Customer Service in 2023: A Missed Opportunity?

Small businesses may be underestimating the importance of customer service.

The cost-of-living crisis means small businesses are facing a challenging time like no other. In fact, as of April 2023, half of consumers have cut their non-essential spending, which is impacting businesses of all sizes but is particularly concerning for smaller businesses which often have a smaller customer base to rely on.

But our latest research shows the disparity between what customers want from small businesses and what they’re actually offering.

Perhaps unsurprisingly, given their comparative restraints on resources, less than half of people (40%) said that they find small businesses resolve their complaints more quickly than larger businesses. However, only the same percentage of people said that they find that small businesses offer a more personalised service to customers.

Worryingly, just 39% of people said that small businesses seem to care more, 37% said that they believe small businesses are more likely to go the extra mile to resolve an issue, and less than a third (32%) said that they are more flexible when coming to an agreement on a problem.

60% of customers think large businesses offer higher quality customer service

The research also revealed the implications of substandard customer service with just only 28% of people would be more likely to leave a negative review for a large business than a small one following a negative customer service interaction, and around one in 10 (11%) would actually be more likely to leave a negative review for a small business in this instance.

Although 22% of people said they never leave negative reviews, the majority (41%) said they would be equally as likely to leave a negative review for both small and larger businesses following a poor customer service experience.

Want to get all the insights? Download the report for free here:

Reducing Costs

Martin Brown, Chief Commercial Officer at FM

While larger businesses typically have the advantage of greater resources to invest in their customer service, smaller businesses should – in theory – have their own advantage in being able to offer a more flexible, personalised service to their customers. The research shows that many are currently failing to do this, and may be experiencing negative consequences as a result.

The research really emphasises that small businesses cannot afford to rest on their laurels when it comes to customer service. Consumer expectations are increasing all the time, and it’s clear that there is a real risk of small businesses suffering from negative online reviews if they fail to meet those expectations.

What can really set a brand apart from its competitors is the way it treats and communicates with its customers. Excellent customer service is vital for every brand and, yet, at a time when it should be most prioritised, it’s falling short.

But outstanding customer service can be provided by businesses at both ends of the scale, but only if they view it as a priority and not an afterthought.