®

Better Business Bureau®

Start With Trust®

In Hawaii

BBB Annual Report

Dwight Kealoha Nancy DanielsChief Executive Officer ChairHawaii’s BBB BBB Board of Directors

Our VisionAn ethical marketplace wherebuyers and sellers can trusteach other.

Our MissionTo be the leader in advancingmarketplace trust.

Hawaii’s BBBAddress: 1132 Bishop St. #615

Honolulu, HI 96813

Website: hawaii.bbb.org

E-mail: info@hawaii.bbb.org

Phone: 808-536-69561-877-222-6551Neighbor Islands(toll free)

Fax: 808-628-3970

Nancy DanielsChair

Outrigger Enterprises Group

Thomas W. Dixon, Jr.1st Vice Chair

First Hawaiian Bank

Myles Murakami2nd Vice Chair

Atlas Insurance Agency

Rachel R. Shimamoto, CTCSecretary

Travel Ways, Inc.

Dwayne S. Takeno, CPATreasurer

PKF Pacific Hawaii LLP

Susan L. IngImmediate Past Chair

Bank of Hawaii

Michael HanThe Wedding Ring Shop

Fred BaduaServco Pacific, Inc.

Cleo BrownING Direct, Hawaii

Dave ErdmanPacRim Marketing

Group, Inc.

Jason HallKaiser FoundationHealth Plan, Inc.

Craig HamamotoKTA Super Stores

Easter SealsJohn Howell

Wayne KiriharaCentral Pacific Bank

Stan MasamitsuTony Group

Dawn Morais WebsterLoomis-ISC

Terry O’ReilleyAmerican Savings Bank

Kathy InkinenInkinen & Associates, Inc.

Margie SasakiHMSA

Bobby SenahaHawaii Business Magazine

Vic AngocoMatson Navigation Company

Ed ShinodaUnited Parcel Service

Scott WilliamsLex Brodies Tire Company

Garrett SullivanSullivan & Associates

Robert TanakaBob Tanaka, Inc. Realtors

Pamela TumpapMaui Chamber of Commerce

Sam YeeFinance Factors, Ltd.

Jim DavisHawaiian Airlines

Dwight KealohaChief Executive O!cer

HAWAII’S BBB BOARD OF DIRECTORS

O!cers Directors

HAWAII’S BBB STAFF

Kehau AbeController

Lisa NakaoDirector of Operations

Timothy CaminosDirector of Communications

Sherrie HillDirector of Recruitment & Retention

Nick Baca

Alesia Borja

Adam Espiritu

Margaret Hart

Mick Mckenzie

Jennifer Moretti

Elizabeth Ramos

Ronalyn Reyes

Lorie Sides

Troy Sonnenberg

Russell Subiono

Sandra Youkers

Start With Trust

Trust is a foundation for business and a key strategy. Earn a consumer’s trust and they are more likely not only to do business with you again but also refer you to others. But how do consumers know they can trust a business? The answer is quite simple—by knowing that every interaction is a moment of trust a"ording the business the opportunity to demonstrate consistent, honest behavior, to be responsible for results and actions and to be accountable.

At the BBB we see our value in our ability to deliver consumers to trustworthy businesses. Critical to this ability is BBB accreditation, which means “to designate o!cially as meeting all formal standards.” Eight standards summarize the important elements of creating and maintaining trust in business; that is, Accredited Businesses have agreed to build trust, advertise honestly, tell the truth, be transparent, honor promises, be responsive, safeguard privacy and embody integrity. According to research 84% of consumers believe that if BBB grants accreditation, it means that the company has met the high standards for trustworthiness.

Accreditation is even more meaningful given that the BBB is a neutral, nonprofit 501 (C) (6) organization. Over its 100 years, the BBB has developed a brand equity that centers on and is widely known for “trust.” It provides a meaningful halo e"ect for businesses aligned with the BBB.

Accreditation is an honor and has been earned by more than 2,600 businesses throughout Hawaii. They have contractually agreed to abide by BBB standards and are monitored for continual adherence. It raises the level of confidence consumers have in a business. So when you do business with a BBB Accredited Business, you know what you’re going to get.

Start WIth the BBB

A Warm Mahalo to our retiring board members. Hawaii’s BBB would like to thank Fred Badua, Jim Davis and John Howell for their time served and the

countless hours spent helping us be the leader in advancing marketplace trust.

BBB Accredited Businesses Hawaii’s 2012 BBB Torch Awards

BBB — Being Everywhere That Counts

Celebrating StandardsThe BBB Torch Awards program promotes trust in themarketplace and recognizes local businesses and publiccharities for their outstanding commitment to fair, honestand ethical marketplace practices. BBB Torch Awards areopen to all Hawaii businesses and 501(c)(3) public charities.

BBB to Begin Publishing Complaint Detail

Recent years have witnessed the rise of new media channels such as Facebook, YouTube, Google, and Twitter, which enable both businesses and consumers to take a more active role as market players and reach (and be reached by) almost everyone anywhere and anytime. BBB has taken advantage of this opportunity for growth through new adaptive strategies.

During FY12 businesses and consumers turned to Hawaii’s BBB website 587,387 times; approximately 1609 timers per day. This is a 37% increase over FY11. The increase in tra!c is due in large part to our external communication e"orts. Along with the Tweeting, Facebooking and Connecting on LinkedIn we have enhanced our You Tube page and plan on featuring original content on a variety of consumer and business related topics such how to file a complaint and How to become Accredited with Hawaii’s BBB.

Hawaii’s BBB has also reached out and connected with local media outlets to let the community know about marketplace scams, providing timely and season tips and promoting BBB events.

Last year Hawaii’s BBB was included in 472 local broadcasts, print media and syndicated online articles. The increased local visibility enables us to provide a frequent and consistent flow of marketplace information for those seeking it.

BBB will be 100 years old this October. In order to ensure that the trust value of our brand continues strong, BBB system started to annually re-evaluate all BBB Accredited Businesses as they come up for renewal. This ensures their continued compliance with the BBB standards. During the re-evaluation process, all BBB Accredited Businesses’ licensing status, advertising, government action and a!liation with other businesses are checked as well as reasoning for any rating changes for the local BBB Accredited Businesses and its headquarters in another state if applicable.

There were a few changes made to the 2012 Torch Awards. Hawaii’s BBB brought in a diverse group of speakers to talk about social media and how it impacts business. We also brought in a marketplace full of trustworthy local businesses to show o! their services and goods! Sponsors and speakers celebrate a successful event. Left to right: Matt Delany, Hawaii Human Resources; Olena Heu, KHON2; Emi Hart, YELP; Douglas Wood, Reed Smith; Elmer Guzman, Poke Stop; Scott Williams, Lex Brodies Tire Company. Other sponsors not in photo include Servco Foundation and ING Direct.

On May 2, 2012 Hawaii’s BBB Torch Awards Luncheon celebrated businesses applying BBB Standards For Trust in their operations and public charities with policies included in BBB Wise Giving Alliance Standards for Charity Accountability.

Hawaii’s 2012 BBB Torch Award recipients:

Hawaii’s BBB Torch Awards also honors individuals who have significantly advanced marketplace trust through demonstrated commitment to consumer advocacy, protection or education.

In 2012, the BBB Ka Mea O Kāko’o Award was presented to Jackie Choy and Theresa Kong-Kee of the Department of Commerce and Consumer A"airs. They were recognized for providing information and education to consumers on a multitude of topics such as financial literacy, information protection and consumer rights.

BBB accreditation is not required, however those nominated must be in good standing with Hawaii’s BBB.

BBB Business Evaluation

Top Complaints (previous year’s rank in parentheses)

Rank Type of Business Complaints Resolved

1. (3)

2. (1)

3. (2)

4. (2)

5. (–)

6. (7)

6. (–)

7. (4)

8. (5)

9. (–)

10. (8)

Toys – Retail

Auto Dealers – New Cars

Travel Clubs

Airlines

Auto Renting & Leasing

Auto Dealers – Used Cars

Resorts

Restaurants

Hotels

Jewelers – Retail

Banks

91

80

73

56

47

37

37

36

31

29

27

69.23%

100%

72.60%

100%

95.74%

94.59%

100%

66.67%

70.97%

82.76%

100%

Most Asked About BusinessesRank Type of Business Reviews Supplied

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

General Contractors

Roofing Contractors

Electricians

Travel Agencies & Bureau

Travel Clubs

Construction & Remodeling Services

Wedding Consultants

18,927

15,153

13,134

12,915

11,226

10,505

10,060

9,521

9,231

8,869

BBB Business ReviewsWith over 42,000 BBB Business or Charity Reviews available, Hawaii’s BBB helped consumers connect with trustworthy businesses and charities by supplying 604,401 reviews and 161,632 Accredited Business Lists. This is a 54% and 60% increase respectively from FY11. The chart below shows that people are doing a lot more research before making purchasing decisions.

In FY2012, Hawaii’s BBB welcomed 414 new BBB Accredited Businesses and retained 87% of established businesses.

In addition to the BBB Accredited Business lists available at our website, Hawaii’s BBB made it easier for consumers to find trustworthy businesses in Google search results with BBB’s Search Engine Solution (SES) program. Eleven participating industries were viewed 90,000 times more this past year compared to FY11.

During the upcoming year Hawaii’s BBB will join a growing list of BBBs throughout the country that o"er complaint

classified into twelve categories and only the type of each complaint was reported, along with basic information on how that complaint was closed. Soon, the actual text from consumer complaints will be included, as well as the initial business response, and any subsequent business/consumer correspondence in reportable complaints.

The BBB is making this change in response to feedback solicited from consumers over the last year. Research showed consumers were looking for more detailed information on the types of complaints companies receive and how those complaints were ultimately resolved. This change also gives companies more of a voice in the complaint process, allowing consumers to directly observe their response to customer issues.

By including this information in Business Reviews, we believe we will further encourage both consumers and businesses to put their best foot forward and continue to work in tandem to resolve disputes amicably.

While the number of service requests for complaint assistance remained steady over the years, we learned through survey that people valued complaint information most and wanted more details of them in BBB Business Reviews.

BBB Accredited Business by County

BBB Survey Result“What Information Do Consumers Find Most Valuable?”

Hawaii’s BBB Financial Overview

Revenues Expenses Net Income

2007 1504953.14 1457169.59 47783.55

2008 1516691.60 1399507.20 117184.38

2009 1379074.85 1395290.27 -16215.42

2010 1324898.90 1244600.00 80298.90

2011 1298763.00 1262459.00 36304.00

2012 1305592.85 1300173.78 5419.07

0

125

250

375

500

FY09 FY10 FY11 FY12

472398

254

106

CountyOahuKauaiMaui, Molokai, & LanaiHawaii Big IslandOutside of HI

Total1915

121325302

5

Complaint InformationLetter RatingAccreditationContact InformationLicensingGovernment Action

RevenueExpensesNet Income