BBB Scam Alert: Business promotion and coaching scams
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Starting a business is a dream for many people. But it’s no walk in the park. It takes hard work and dedication. And even then, the odds are slim that your business will last longer than ten years.
According to Fundera.com, 20% of small businesses fail in their first year. After five years, only one out of two remain. And only 30% make it past their 10th year in business.
Many small business owners realize they need all the help they can get. Hiring a business coach and a company to promote your business can be a smart move. However, there are lots of business promotion and coaching scams out there and getting played by one of them could cost you thousands of dollars and plunge you into debt.
How the scam works
Scammers approach small business owners, promising they can help them exponentially grow their business through business promotion and coaching services.
They often claim that the owner will recoup his “small investment” in no time. They’ll say their fees only amount to a fraction of the additional income the business will generate as a result of using their services.
The scammers provide very little, if any, value, simply sharing information that’s readily available on the internet for free. Once they’re paid, they disappear.
Here is what the Federal Trade Commission (FTC) says about business promotion and coaching scams:
“Some scammers sell bogus business coaching and internet promotion services. Using fake testimonials, videos, seminar presentations, and telemarketing calls, the scammers falsely promise amazing results and exclusive market research for people who pay their fees. They also may lure you in with low initial costs, only to ask for thousands of dollars later. In reality, the scammers leave budding entrepreneurs without the help they sought and with thousands of dollars of debt.”
How to avoid business promotion and coaching scams
Spotting a business promotion and coaching scam can be difficult. One doesn’t need any formal qualifications or certifications in order to call oneself a business coach.
However, there are things you can do to avoid falling victim to this type of scam:
Do your research
- Google the name of the company together with words like “review” or “scam” to find potential complaints.
- Check with your state attorney general if they have received any complaints.
- Search BBB.org to find out if the company is BBB Accredited or if any complaints have been lodged against them.
- Look at their social media posts and read the comments.
If you can’t find any complaints, it doesn’t necessarily mean that the company is legitimate. But complaints can alert you to potential problems.
Ask questions
A qualified, ethical coach or consultant should be able to answer these questions:
- How are you going to promote my business?
- How many years of business experience do you have?
- When did you start coaching businesses?
- How many clients have you coached?
- Where can I find testimonials from previous clients?
- May I contact some of your previous clients for a reference?
- What qualifications and experience do you have?
- Have you worked with another client in my industry?
- What areas of my business can you help me with?
- What guarantee can you give me that my business will grow with your help?
- What if I am not satisfied with your services? Can I get a refund?
If they’re reluctant to answer your questions or unwilling to provide you with requested information, it’s a red flag.
In addition, never allow a business promotion and coaching company to pressure you into signing a contract and do not pay them upfront.
If you’re a victim of a business promotion or coaching scam or come across one, report it to the following organizations:
- The FBI’s Internet Crime Complaint Center – ic3.gov/Home/FileComplaint
- Federal Trade Commission – ReportFraud.ftc.gov
- BBB Scam Tracker – bbb.org/scamtracker
The Better Business Bureau has resources to help consumers and businesses. You can report a scam (whether you’ve lost money or not), file a complaint against a business, and leave a review of a business you’ve used.
Still Need Assistance?
Contact Your Local BBB
Your local Better Business Bureau can assist you with finding businesses you can trust. Start With Trust®.
Additional Resources
Central Ohio BBB Business Podcast