CHAPTER 1

INTRODUCTION

1.1 BACKGROUND OF STUDY

According to (Merriam and Webster,1951) fast food is a term given to food that can be prepared
and served very quickly. In the other word, it is a product with a low preparation, low production time
and designed for ready availability. For the examples burger, pizza, fried chicken, and hamburger. Fast
food restaurant also known as Quick Service Restaurant (QSRs) and Food Away From Home (FAFH).
The fast food restaurants in Malaysia have a good service quality which is quickly service rather
than others restaurant and that can be their advantages and make customer satisfy to choose that
restaurant as their place to buy the food. Besides that, there are also have another factor that affect
customer satisfaction other than service quality such as product quality, physical environment, words of
mouth and etc.
In foodservice industry like a fast food , service quality played an important role because
simultaneously affected customer satisfaction, Linder (1961) first noted the role of quality as a
determinant of the direction of trade. As a profit organization, profit is an objective in their operation.
Here, quality are crucial because it will give direction to the company whether profit or loss.
According to ( Bastos and Gallego,2008), customer service quality directly affects satisfaction
and satisfaction directly affects the positive behavior intentions. At here, starting from the high of
customer service quality, it will create a positive behavior like a loyalty. Based on (Guiltinan 1997), he
believed that satisfied customers are more likely to be repeat and even be more loyal customer.
Meanwhile, in any business their target is to make a loyalty customer because it have a good effect to
company such as can create profit and be a free and strong marketing tools, good word of mouth about
the product or service.
However, the relationship between satisfaction and loyalty changes over time( Mittal 1999). That
mean, one company or service facilities need to think about the long range investment and do not rely
only the current situation because the preference of consumer also can change depend on the many
factor such as income, age, health and environment.
According (Oliever,1981;Brady and Robertson,2001;Lovelock,Patterson and Walker,2001)
conceptualize customer satisfaction as an individual feeling of pleasure or disappointment resulting from
comparing a product perceived performance (or outcome) in relation to his /her expectation. Basically,
customer will compare the service or product they received with the their expectation. Customer will
satisfy when their perceived service or product exceed expectation and will feel not satisfy when their
service or product do not meet with their expectation and also will feel zero disconfirmation.( Menon
and Dube, 2000) stated zero confirmation or simple confirmation occur when performance just meet
expectation.


1.2 PROBLEM STATEMENT

This research study is about the impact of service quality at fast food restaurant toward customer
satisfaction in Malaysia. Nowadays, because of a few factors such as fast and convenience service that are
provided in fast food restaurants, many people take this as a choice whether take it as a home meal
replacement or just take a meal at that service restaurant. Because of this trend and situation, the impact of
the service quality are important toward customer satisfaction because the good service quality will make a
customer satisfy, meanwhile bad service quality will make customer dissatisfy. Besides that, there are also
have another factors or variable that may affect customer satisfaction such as product quality, physical
environment, words of mouth and etc. So, they also need to know what the another factors make them
satisfy and will influence their perception of satisfaction or they will make mistake because only thought the
service quality the only one can make them satisfy.

However, service quality or known as SERVQUAL are not stand alone in order to make customer
satisfy. It have another component factor which can affect service quality towards customer satisfaction on
fast food restaurant in Malaysia, which are customer expectations and customer perceptions. This can affect
the strength or weakness of service quality toward customer satisfaction and also can change or modified the
level of customer satisfaction.

In addition, the scale operationalize service quality is by calculating the difference between customer
expectations and perceptions, evaluating both in relation to the 22 items that represent five service quality
dimensions known as tangibles, reliability, responsiveness, assurance and empathy. Lastly, the
service quality will positively effect customer satisfaction on fast food restaurant in Malaysia. So, we can
conclude that fast food restaurant in Malaysia are not depend merely on service quality toward customer
satisfaction, but it also have another component factor which can affect service quality towards customer
satisfaction on fast food restaurant in Malaysia.






1.3 PURPOSE OF THE STUDY
The purpose of this study is to evaluate the impact of service quality towards customer satisfaction on
fast food restaurants in Malaysia.

1.4 RESEARCH OBJECTIVES
1. To analyze the factors which can affect the service quality towards customer satisfaction on fast
food restaurants in Malaysia.
2. To analyze customer expectations and customer perceptions on fast food restaurant in Malaysia.
3. To analyze positively affect service quality towards customer satisfaction on fast food restaurant
in Malaysia.

1.5 RESEARCH QUESTIONS
1. What are the factors which can affect the service quality towards customer satisfaction on fast
food restaurant in Malaysia?
2. What customer expectations and customer perceptions on fast food restaurant in Malaysia?
3. Do service quality will positively affect customer satisfaction on fast food restaurant in
Malaysia?

















1.6 THEORETICAL FRAMEWORK





1.7 SIGNIFICANCE OF THE STUDY

This study provides the understanding of the impact of service quality towards customer
satisfaction on fast food restaurant in Malaysia. It include on identifying the factors which can affect the
service quality towards customer satisfaction, analyze customer expectations and customer perceptions
of service quality, and positively affect service quality towards customer satisfaction on fast food
restaurant in Malaysia. This study focused on the service quality dimension of customer perception
include tangibility, reliability, responsiveness, assurance and empathy. The SERVQUAL instrument was
subsequently applied to measure the impact of service quality that affected towards customer satisfaction
in the foodservice industry. This study can be used in the foodservice industry especially for fast food
restaurant to assists employers and employees by providing SERVQUAL dimension to measure the
relationship between service quality and customer satisfaction. The employers and employees may know
and recognize the factors which can affect the service quality towards customer satisfaction, the
customer expectations and customer perceptions of service quality and positively affect service quality
towards customer satisfaction.
In addition, this study also provides benefits to employers and employees of a fast food
restaurant because some of employers and employees may not know whether customers are satisfied or
Customer
Satisfaction
Service Quality
(SERVQUAL)

1. Tangibles
2. Reliability
3. Responsiveness
4. Assurance
5. Empathy
Dependent Variable (DV)
Independent Variables (IV)
not with the service provided. This study can help them and ultimately can improve the performance of a
fast food restaurant.


1.7.1 To Researcher
It serves as a foundation of knowledge, as to learn and understand on how the impact of service
quality affect customer satisfaction on fast food restaurant in Malaysia.


1.7.2 To Food Service Management
It will provide information on how SERVQUAL effect to customer satisfaction in the
foodservice industry. This information can be used especially for fast food restaurant to assists
employers and employees by providing SERVQUAL dimension to measure the relationship between
service quality and customer satisfaction.

1.7.3 Universitys Perspective

As students majoring in Foodservice management under faculty of Hotel and Tourism
management in UiTM, we are positive that our research on this study will be beneficial to other students,
especially for those who are majoring in the same course as we are. We are doing our best to conduct
this research so that it can help students in some ways with their assignments and other projects when
they surfing into the internet to look for our study journal. We are also hoping that the lecturers of UiTM
can use our research as reference when delivering the lectures so that the students can grasps more
knowledge in their subjects.

1.7.3 Countrys Perspective

By doing this study, we may analyze the factors which can affect the service quality towards
customer satisfaction on fast food restaurants in Malaysia. It is not only applied on fast food restaurant,
but also on all foodservice industry in Malaysia. Service quality not only affecting customer satisfaction
on fast food restaurant, but also can affect customer satisfaction in other industry sectors such as
retailing, medical and etc. Lastly, this study can help us and ultimately can improve the performance of
service quality to make customer more satisfied.


1.8 Definition of Terms
For easier understanding of the study, certain terms are used in this study were defines as follows:
i. Service quality as the degree and direction of discrepancy between the consumers perceptions
and expectations (Parasuraman, 1988).
ii. Customer satisfaction a personal feeling of either pleasure or disappointment resulting from
the evaluation of services provided by an organization to an individual in relation to expectations.
iii. Tangibles physical facilities, equipment, and appearance of personnel.
iv. Reliability ability to perform the promised service dependably and accurately.
v. Responsiveness knowledge and courtesy of employees and their ability to inspire trust and
confidence.
vi. Empathy caring, the individualized attention the firm provides its customers.

CHAPTER 2
LITERATURE REVIEW

2.0 Introduction
In this chapter, we will present the overview of the evaluation regarding the topic that was
selected from previous research that has been conducted for the similar reason. It contains the studies of
the impact of service quality towards customer satisfaction, the factors which can affect the service
quality, customer expectations and customer perceptions and positively affect service quality towards
customer satisfaction.

2.1 Fast Food
Fast foods are quickly prepared, reasonably priced, and readily available alternatives to home
cooked food. The free dictionary has defined fast food as inexpensive food, such as hamburgers and
fried chicken, prepared and served quickly. According to Goyal and Singh (2007), fast food is the
worlds fastest growing food type and it is quick, reasonably priced and readily available alternatives to
home cooked food. While convenient and saves for busy lifestyles. Based on Data Monitor (2005)
defined fast food as food and drinks for immediate consumption either on the premises or for
consumption elsewhere. Fast food restaurant also known as Quick Service Restaurant (QSRs) and Food
Away From Home (FAFH).


2.2 Customer Satisfaction

Customer satisfaction is a personal feeling of either pleasure or disappointment resulting from the
evaluation of services provided by an organization to an individual in relation to expectations. According
to (Oliever,1981;Brady and Robertson,2001;Lovelock,Patterson and Walker,2001) conceptualize
customer satisfaction as an individual feeling of pleasure or disappointment resulting from comparing a
product perceived performance (or outcome) in relation to his /her expectation. Basically, customer will
compare the service or product they received with the their expectation. Customer will satisfy when
their perceived service or product exceed expectation and will feel not satisfy when their service or
product do not meet with their expectation and also will feel zero disconfirmation.( Menon and Dube,
2000) stated zero confirmation or simple confirmation occur when performance just meet expectation.
In order to make customer satisfy, we need to consider about the service staff. Service staff refer
to the service employee in the service setting (Ryu and Jang, 2008). In fast food operation, the attitude
and personality of staff are important because it can influence customer in many factors such as
customer emotion whether happy or unhappy. Usually, if the employee have a high skill level and
interesting personality, they can serve customer more fast and can make customer happy at the same
time rather than low skill level and bad personality. According to Tomb and McCollKennedy (2003),
they claim that service staff are related with to the desired social density, which affect customers
affective and cognitive responses as well as their repurchase intentions.
However, customer satisfaction are different between each others. Webster (1989) and Pitt et
(1992) claim that certain groups of customers may differ in their perception of provided services.
Because of that problem, marketing strategy are needed with a proper customer behavior or attitude and
supported by Gilmour (1977) , Webster (1989) and Pitt (1992), they said there are advantages for
marketers in understanding customer behavior.


2.3 Service Quality

The definitions of service quality vary only in wording but typically involve determining whether
perceived service delivery meets, exceeds or fails to meet customer expectations. According to
Parasuraman, Zeithaml and Berry (1985) defined service quality as an evaluation that results from
comparing the firms performance with the customers general expectations of how the industry should
perform. Parasuraman et al. further noted that customers perceptions of service quality and their
ensuring level of satisfaction are functions of the cumulative evaluation of the outcome of all service
encounters that they experience within the business establishment as cite in (Sundram, Jurowski &
Webster, 1997).
In foodservice industry like a fast food , service quality played an important role because
simultaneously affected customer satisfaction, Linder (1961) first noted the role of quality as a
determinant of the direction of trade. As a profit organization, profit is an objective in their operation.
Here, quality are crucial because it will give direction to the company whether profit or loss.
According to ( Bastos and Gallego,2008), customer service quality directly affects
satisfaction and satisfaction directly affects the positive behavior intentions. At here, starting from the
high of customer service quality, it will create a positive behavior like a loyalty. Based on (Guiltinan
1997), he believed that satisfied customers are more likely to be repeat and even be more loyal customer.
Meanwhile, in any business their target is to make a loyalty customer because it have a good effect to
company such as can create profit and be a free and strong marketing tools, good word of mouth about
the product or service. However, the relationship between satisfaction and loyalty changes over time (
Mittal 1999). That mean, one company or service facilities need to think about the long range investment
and do not rely only the current situation because the preference of consumer also can change depend on
the many factor such as income, age, health and environment.
Service quality is linked to the concepts of perceptions and expectations accordingly to
(Parasuraman et al., 1985, 1988; Lewis and Mitchell, 1990). Customers perceptions of service quality
result from a comparison of their before service expectations with their actual service experience.
Whereas, according to (Vzquez et al., 2001). Based on the perspective, Parasuraman et al. developed a
scale for measuring service quality which is mostly popular known as SERVQUAL.
According Ducker (1991) service quality is as what the customer gets out and is willing to pay
for rather than what the supplier (of the service) puts in. Whereas, service quality is often
conceptualized as the comparison of service expectations with actual performance perceptions based on
(Bloemer, Ruyter et al, 1999; Kara, Lonial et al, 2005). Service science literature often relies on
SERVQUAL as an instrument to measure quality of service provided.
In addition, service quality is reflected in a consumers evaluative perception of an encountered
service by (Cronin & Taylor, 1994). They suggested that there are problems inherent in the use of the
disconfirmation paradigm to measure service quality. Particularly, they consider that if service quality is
to be considered similar to an attitude, as proposed by Parasuraman, Zeithaml, and Berry (1985), its
operationalization could be better represented by an attitude-based conceptualization. According to
Zeithaml and Bitner (2000) suggested that consumers judge the quality of the services based on their
perceptions of the technical outcome provided, the process by which the outcome is delivered, and the
quality of the physical surroundings where the service is delivered. Good execution on these aspects
would result in highly perceived service quality for the company.


2.4 Customer expectations and customer perceptions of service quality

SERVQUAL has two components which are customer expectations and customer perceptions.
Customer expectations are those that the customer expects as should be and can be type of services.
Service offered varies with providers and the amount of variation that customers can tolerate is known as
Tolerance.
Customer perceptions is one of the major determinants of customer perceptions of service
quality. According to (Lee & Ulgado, 1997) it is assumed that consumers consider various dimensions of
a service to reach their overall judgment of service quality. SERVQUAL consists of 22 items measuring
customers expectations and another 22 items measuring their perceptions that represent five service
quality dimensions known as tangibles, reliability, responsiveness, assurance and empathy.


2.5 Variables that affect service quality towards customer satisfaction

2.5.1 SERVPERF model
According to Audrey (2003), the development of the SERVPERF model is aimed at providing an
alternative method of measuring perceived service quality and significance of the relationships
between service quality, customer satisfaction. This model consisted of five dimensions which
are:

1) Tangibles
Tangibles is physical facilities, equipment, and appearance of personnel. According to
Yuksel (2001), tangibles is with the condition of physical aspects of the fast food restaurants
(FFRs), more specifically the physical environment of the FFRs, the equipment used to
provide services and the FFRs products consumed by the customers. Other than that, it also
referred to the presentation of the facilities physical layout such as clean environment with a
nice decoration of the place and the convenience offered to the customer as stated by
Subhash, Ashok, and Soon (2000).

2) Reliability
Reliability means ability to perform the promised service dependably and accurately. Besides
that, reliability also is the FFRs regularity and consistency in performing services and the
degree to which it inspires confidence and trust in customers. In operational terms, this
means keeping promises, trustworthiness in transactions and the efficiency of the recovery
process if anything goes wrong by Yuksel (2001).

3) Responsiveness
Responsiveness is the willingness to help customers and provide prompt service. According
to Parasuraman et al. (1985), Zeithaml, Parasuraman, and Berry (1990) and Fetus, Maxwell,
and Godwin (2006) responsiveness is defined as willingness and readiness to help customers
and provide prompt service.

4) Assurance
Assurance means the knowledge and courtesy of employees and their ability to inspire trust
and confidence the firm provides to its customers. It also includes three main elements which
are (i) Courtesy: politeness, respect, consideration, and friendliness of contact personnel; (ii)
Credibility: trustworthiness, believability, and honesty of the service provider as well as; and
(iii) Security: freedom from danger, risk, or doubt by Parasuraman et al. (1985), Zeithaml et
al. (1990), Fetus et al. (2006).

5) Empathy
This term means caring, individualized attention the firm provides to its customers. There are
several components in this dimension which are (i) Access: approachability and ease of
contact; (ii) Communication: keeping customers informed in languages they can understand
and also listening to them; and (iii) Understanding Customers: making the effort to know
customers and their needs based on Parasuraman et al. (1985), Zeithaml et al. (1990), ang
Hyung (2006).


2.5.2 DINESERV

DINESERV for restaurants was developed by Stevens, Knutson and Patton (1995). Prior
research suggests that not all service quality elements within tools such as SERVQUAL and
DINESERV are able to predict a consumers overall service quality perceptions or (OSQ) as
stated by Oliva, Oliver and MacMillan (1992). So, it is important to identify the importance of
service quality and its dimensions in determining overall service quality (OSQ), as perceived by
customers. In the context of the fast food industry, it appears likely that service quality
dimensions from DINESERV will positively effect overall service quality (OSQ) perceptions by
Malaysian consumers.
According to Shemwell, Yavas and Bilgin (1998), it is generally accepted that a positive
relationship exists between service quality and customer satisfaction. Whereas with proposals of
a causal link from customer satisfaction to service quality based on Bitner (1990), service quality
to customer satisfaction stated by several researchers (Bolton and Drew, 1991; Spreng and
Mackoy, 1996; Parasuraman, Zeithaml and Berry, 1994). While suggestions that directionality
varies according to the service situation be based (Dabholkar, 1995) and even that there is no
relationship under particular circumstances by Parasuraman, Zeithaml and Berry (1985). Such
contention within the literature has cause to repeated calls for futher examination of this
relationship according to (Rust and Oliver, 1994; Anderson and Fornell, 1994). In the case of fast
food, however, it seems likely that high service quality will lead to increased satisfaction for
consumers.