ABSTRACT:
Restaurant service industry is becoming more important in generating income in many countries at present. In this paper we use diferent factors that have a greater influence on customer satisfaction are employees performance, price, food quality and physical environment and we select fast food restaurant named FRIED CHICKS. Through simple random sampling a sample of 200 questionnaires is taken from youth in the DHAKA city of BANGLADESH. The correlation and regression method is used to measure the relationship of customer satisfaction with these factors. The results show that customer satisfaction has a positive relationship with employee performance, food quality and physical environment and a negative relationship with price. So these factors play an important role in customer satisfaction.
KEY WORDS:
Employee performance, food quality, physical environment, price, customer satisfaction.
INTRODUCTION:
In todays world, service industry is dominating the business world. Now service Industry is largest growing area of business in developing countries. During the past few decades customer satisfaction have become major areas of attention to researchers. Improve service leads to greater satisfaction and ultimately increase profitability. There must be different strategies that can be used by restaurants owners in order to attract and retain customers and to gain a sustained competitive advantage. The restaurant business is one of the service-oriented businesses, which is very popular in BANGLADESH as well. There are various factors that relates to the customer satisfaction in a restaurant industry. We take 4 factors that are most important in customer satisfaction study that is employee performance, food quality, physical environment and price. We have selected FRIEDCHICKS. Restaurant that provides food items with unique taste and at low prices and in a comfortable environment. Restaurant is place where people can eat and drink and make themselves related and entertained due to a comfortable environment. The groups of people, which are dealing with the customers, are known as the internal customers (employees) and these internal customers should be satisfied in order to delight the external customers, which ultimately increase the profit of the restaurant. In our study this restaurant is satisfying the customers by providing high quality of food at low prices in comfortable environment. Hence the aim of this study was to find out that how employee performance, price, food quality and physical environment are related with customer satisfaction in restaurant industry of BANGLADESH.
LITRATURE REVIEW:
Over the past few decades, the concept of customer satisfaction has attracted the attention of researchers. Although mostly, used as a business performance & consumer choice indicator (Lou and Homburg, 2007) there are different views as to what this multi dimensional concept mean. Some researchers have conceptualize this concept as an emotional response to an evaluative process (Oliver, 1997). This has been observed since decades that the business world has been dominated by services. Now a days service industry is largest, rapidly growing and more profitable industry in the developing countries due to the reason of cross culture encounterships of business and worldwide company cultures. The only industry which even survives in recession is the restaurant industry. The result for restaurant industry to boom is, people dont have to cook and can eat out. Now days, people have meal outside not only on planned occasions even more as an afterthought (Mogelonsky, 1998). One study shows that delivering high quality services and increasing customer satisfaction are widely known as key factors boosting the performances of companies in the restaurant industry (Barsky & Labagh, 1992; Le Blanc, 1992,; Le Blanc et al.,1996; Stevens et al., 1995, Opermann, 1998). Restaurants with best service quality will leads to greater profitability (Oh & Parks,1997). During the dining experience, customers are affected by a various mechanic clues, as shown by research in environmental psychology and marketing. Physical environment have a strong effect on peoples cognition, emotions, and behavior (Mehrabian and Russell 1974; Spangenberg, Crowley and Henderson 1996). Another research shows that environment can influence feelings that encourage people to remain in or to leave the environment. (Mehrabian and Russell 1974). Bitner (1992) had presented a model for understanding how the physical surroundings of a service organization may impact individual satisfaction. The dimensions include variables such as noise, music, lighting and temperature, layout which includes the arrangement of furniture and equipment etc. The physical environment (Wall and Berry, 2007) can affect customers physical comfort. On the contrary, Boon et al., (2007) found that physical environment have no effect on customer physical comfort. The restaurant industry of BANGLADESH has become more competitive due to high quality services and it has a direct impact on profitability and success that is why many local fast food restaurants are competing with international fast food chains and restaurants. In BANGLADESH these restaurants provide quality services at affordable prices (Siddiqi, 2007). Service researchers tends to measure the relationships among service quality and customer satisfaction (e.g. Dabholkar et al 2000; Kueh & Voon, 2007; Qin and Prybutok, 2008; Zeithaml et al, 1996). Service quality perceived by customer is found to be positively related to loyalty. Other researchers (e.g. Dabholkar et al. 2000; Brady and Robertson, 2001; Tam, 2004) found that customer satisfaction intervene the effect of service quality on behavioral intentions. The role of food quality is also considered as one of the major determinant of customer satisfaction. foodquality of food can be helpful to satisfy and retain the youth customers who enjoy eating tasteful food. There are many youth customers who prefer hot and spicy food available in fast food restaurants. Researchers have found that the quality of menu items affects customer`s intention to dine at the restaurant (e.g.Qu, 1997; Kivela et al, 2000; Soriano, 2002; Zopiatis and Pribic, 2007). Pricing is another factor that has been studied in relation to customer satisfaction. Furthermore, post-purchase intentions were more strongly influenced by perceived value (Tam, 2004). Qin and Prybutok (2008) also investigated the role of price/value in determining customer satisfaction for fast food restaurants but did not fnd it to be of significance. But for the youth who are not economically strong may find that price is important to attract them to restaurants.
In figure 2 we have shown the relationship between customer satisfaction and employee performance, food quality, price, environment.
DEPENDANT VARIABLE:
Customer Satisfaction
INDEPENDANT VARIABLES:
Employee performance,
Food quality,
Price,
Environment
PROBLEM DEFINITION:
1: Can customer satisfaction depend upon the employee performance, food quality, price and physical environment in restaurant industry?
2: To what extent customer satisfaction can be influenced by employee performance, food quality, price and physical environment in restaurant industry?
Variables of Study:
Customer satisfaction can be measured with the help of these following actors:
1: Employees performance
2: Food quality
3: Physical environment
4: Price
- Employees Performance:
Performance criteria are standards for employee behavior at work. This criteria contains much more than how an employee does the work. Employees are rated on how well they do their jobs compared with a set of standards determined by the employer.
By Marcia Moore, M.S.S.W., Based in Dallas, Texas, Marcia Moore has been writing business/related materials since
Her articles have appeared in the Journal of Clinical Social Work
and various corporate newsletters.Price:
Price in terms of value in the sense of desirability, estimation, subjective value (including cases in which value is merely said to be rejected in some degree by price, or is merely in the background of the thought). (Frank A Fetter published by American Economic Association Vol.2, No.4, (Dec. 1912), PP, 783-813)
- Food Quality:
The total sum of products features that ascribe its suitability to meet all expressed and implied consumers needs as determined by the products conditions of use and its purpose. Quality also incorporates the products defectives and its impacts on environment. Jouzas Ruzevicious, Jurate Sauciuniene, Quality models and systems and their influence to the business, 2006 m, Nr2 (11).
- Physical Environment:
Which environs and surrounds; surrounding conditions, influences or forces, by which living forms are influenced and modified in their growth and development.
Heidarzadeh Hanzaee, a review of the role of utilitarian values on customer satisfaction and behavioral intentions, Interdisciplinary journal of Research in business,Vol. 1(5), May 2011, PP (34-45).
OBJECTIVES OF THE STUDY:
To explore the relationship exist among these factors, employee performance, food quality, price, physical environment and customer satisfaction with the help of literature review. To understand this relationship we have investigate through data collection from youth in a restaurant named FRIED CHICKS. To access our findings we use different data analysis techniques such as reliability, descriptive and inferential statistics, and correlation and regression analysis. To evaluate and interpret our finding by accepting or rejecting the hypothesis we have developed on the basis of results we have collected through data analysis techniques. To conclude that there exist a relationship between customer satisfaction and employees performance, food quality, price, physical environment.
RESEARCH DESIGN
In order to get a sense of whether employee performance, price,food quality and physical environment highly influence the customer satisfaction, we used different technique discussed later
in detail. We have adopted the structured questionnaire from the article “CUSTOMER SATISFACTION IN RESTAURANT INDUSTRY: AND EXAMINATION OF THE TRANSACTION - SPECFIC MODEL” because it contains all those questions that we are intended to investigate.
Subject:
Restaurant industry In our analysis we focus on the fast food restaurant named
FRIED CHICKS. Our data collection is confined to Dhaka city.
Sample:
We have used probability sampling technique. Our target population was youth. The youth customers who had visited restaurant were invited to answer the structured questionnaires. The sample respondents were selected using SIMPLE RANDOM SAMPLING.
The key characteristics were gender, age and education. Youths are customers who aged from 15 – 24 yearsold. The total number of questionnaires was 200 and only
172 were usable. We measured our variables such as employee performance, quality of food, price, physical environment using the 5 - point Likert Scale (1 = Strongly Disagree, 5 = Strongly Agree) in the structured questionnaire. We have also used DICHOTOMOUS SCALE to measure customer satisfaction (1 = Yes, 2 = No).
Reliability of the factor:
The Cronbach’s alpha reliability coefficients of the five independent and dependent variable were obtained. Our result is near to .80. Thus the internal consistency reliability of the measures use in this study can be considered to be good. Overall reliability coefficient
Alpha = .781.
Employee’s performance (six items)
Alpha = .879.
Food Quality (three items)
Alpha = .816.
For price (two items)
Alpha = .643.
For physical environments (two items)
Alpha = .716.
For customer satisfaction (four items)
Alpha = .830.
The characteristics of the respondents who participated in the survey are shown in table 1.
DATA ANALYSIS AND FINDINGS:
We applied Descriptive analysis to understand and describe our behavioral data. Reliability analysis (Cronbach`s alpha coefficients for measures and internal consistency method for items using item-to-total correlations) and multiple regressions were done on the respective measures to understand the goodness of measures, relative importance and relationships. We have calculated correlation analysis to understand the relationship among the dependent and independent factors.
By using the SPSS v16, we applied different test on a data and now we will proceed to discuss the results of these analysis and their interpretations. The results indicate that the Cronbach’s alpha of five dependent and independent variables is .781. Cronbach’s alpha for four independent variables and range from .648 to .87 and for dependent variable it is .830.
Frequency Distribution:
The frequency distribution of demographic information and all factors included in our study are shown in tables that are attached in annexure.
Correlation Analysis:
The pearson Correlation is appropriate for interval and ratio scaled variables and our independent variables are measured by using ratio scale. It`s important to note that no correlation exceeded .59 except PRICE variable, so it shows that there exists negative relationship between price and customer satisfaction.
Regression Analysis:
We have applied Regression Analysis to test our hypothesis. The first table in output lists independent variable that are the entered into regression models, and R(.494) is the correlation of 4 independent with dependent variable.
In the MODEL SUMMARY table, the R Squire .245 is shown which the explained variances. The ANOVA table shows that the F value of 64 is significant. The next table titled “COEFFICIENTS” helps us to see which variable influences most the customer satisfaction. The BETA value under STANDARDISED COEFFICIENTS, we see that highest number in the beta is -.368 for quality of food which means that this is the most important factor that measures the customer satisfaction. All in all we can say that we accept "H1, H2, H3, H4 because there exists relationship among these factors as stated in hypothesis.
INTERPRETATIONS:
The main purpose of this study on fast food restaurants in BANGLADESHwas to identify and understand the relative importance of 4 factors that influence the customer satisfaction. Overall we found that food quality played a critical role in determining the youth satisfaction. After applying different techniques on our data, we find that our results are consistent with literature review. It means that employee performance, food quality and physical environment have positive and strong relationship with customer satisfaction and negative relationship among the price and customer satisfaction.
LIMITATIONS:
The data was collected only from the city of DHAKA due to shortage of time and money. However findings may be totally different if data would be collected from other cities. The data was only collected from youth due to the shortage of time and not from other age groups. It may provide entirely different findings. numbers of variables are limited in our study. There are many other variables that have a strong impact on customer satisfaction for example culture, words of mouth referral, variety of food items, employee recognition techniques etc. We have just focused on single local restaurant. Findings may be totally different if data would be collected from other local and international restaurants.
FUTURE IMPLICATIONS:
In our study we have focused on four factors but there are many other factors that influence customer satisfaction. As we can see that we only measured the impact of physical environment on customer satisfaction in narrow sense by asking just 2 questions. There are many other elements that are helpful to describe impact of environment on customer satisfaction e.g. decor, noise, location etc. Readers should see that the conclusions are based on the study of one industry i.e. restaurants and one company within that industry. Replication of the research in other restaurants or service sectors is needed to extend the generalizability of the findings. Also employee performance recognition techniques have vital role in making customer`s satisfied. So this factor should be taken into consideration.
CONCLUSION
The purpose of this study on fast food restaurants in BANGLADESH was to identify and understand the relative importance of four determinants of customer satisfaction and loyalty, namely, employee performance, food quality, price and physical environment. Overall it was found that food quality and environment played acritical role in determining the youth satisfaction and loyalty. The results indicated that customers were generally satisfied with the restaurants and the key determinants on their satisfaction and loyalty were food quality, environment and employee performance. The former was found to be the most important in restaurant investigated. However the impact of price on customer satisfaction was found to be relatively smaller.