Phil Thompson, head of BPIF Business, explains how good mediation practice can help you save a fortune should a dispute with a customer arise.Disputes between printer and customer are growing according to the BPIF, the vast majority relating to perceived quality issues. It hardly needs saying that settling such disputes through the courts can be costly, the legal fees generated by such a route sometimes higher than the value of the job in question. And of course the cost to your business doesn’t end there – there’s the wider ranging impact such as damaged relationships and reputation etc.
So is mediation a real alternative to the court process? The BPIF thinks so and provides a dispute resolution service, making it well placed to talk best practice.
A very big advantage of entering mediation is that in most instances a good relationship that previously existed between printer and customer can be retained within the mediation framework. At the association technical specialists have experience in providing a range of support, depending on the needs of the company and the circumstances of any dispute. Often the process starts with a short report providing an unbiased expert view and enabling a company to analyse the situation and hence the risks in proceeding or defending a claim. Also included can be an independent onsite inspection of products, equipment procedures and processes employed and/or random testing. Often this is sufficient to provide a means of resolving a dispute. If further services are needed, expert reports can be prepared that could be used as evidence in court should mediation fail.
The good news though, is that mediation succeeds in about 80% of cases, so it’s always a worthwhile starting point, and means you only have to movie on to court action should all reasonable efforts fail.
Here are some pointers on reducing the likelihood and pain of dispute.
Bad debt or bad job?
It has been reported that bad debts are not chased historically until they have reached the 90-day mark. It is only after this time that the financial controller contacts the customer to demand payment. If there’s a quality issue, then the earlier you are able to go back to the customer and discuss this the better as you will have time to be able to respond to the concerns and try and alleviate any potential dispute situation. On the other hand, if it’s not a quality issue and the customer is just delaying payment, then you are able to act with the confidence that this late payment is just that.
If you are trying to develop real relationships with clients, having a proper feedback system really can prevent disputes before they start. Early detection of dissatisfaction will enable you to address issues, or at least discuss them, before patience is lost you’re in dispute territory.
Measuring the process
By implementing clear processes from the initial sale all the way through production and the final delivery of the product, you will be able to measure each step. This allows you to record where quality issues etc. arise. If this is done correctly, you will be able to highlight problem areas and correct them accordingly, heading off potential dispute.
Know your customer’s finances
There is very effective credit checking software available now so it is well worth using it. Finding out about the credit history of the customer will give you at least an inclination of what you are dealing with from a financial perspective.
Get impartial advice
If your company is facing a situation that is heading for dispute, get some industry specific advice about mediation straight up. Be aware that if you go to a solicitor you may well be offered mediation services, but it will be after proceedings have been issued and will be solicitor driven which can be as expensive as going through court driven legal process!
Mediators are required to go through hearings on an impartial basis and they are trained by the under court jurisdiction and appointed through legal bodies such as the Academy of Experts. Getting someone who is totally independent on both sides will enable both to talk freely without fear of prejudice about the issues.
The cost of the service is shared between the two disputing parties and can be held in a neutral location. The settlement negotiated by the mediator is successful in more about 80% of cases where a dispute is pending. This service is just as effective for small jobs as with larger jobs and can often be completed in a short amount of time of a few days or less.