Professional Documents
Culture Documents
by
Jahangir M. Kabir
Wilmington University
February 2016
Factors Affecting Customer Satisfaction at a Fast Food Hamburger Chain:
by
Jahangir M. Kabir
I certify that I have read this dissertation and that in my opinion it meets the academic
Signed ____________________________________________________________
Signed ____________________________________________________________
Signed ____________________________________________________________
To Wilmington University, the DBA Program, and particularly Cohort 13 for your
To my Dissertation Committee
Table of Contents
CHAPTER 1 ....................................................................................................................... 1
BACKGROUND ................................................................................................................ 1
Limitations .................................................................................................................... 20
Summary ....................................................................................................................... 21
CHAPTER 2 ..................................................................................................................... 23
Satisfaction.................................................................................................................... 30
Loyalty .......................................................................................................................... 31
Convenience. ............................................................................................................. 64
Summary ....................................................................................................................... 79
CHAPTER 3 ..................................................................................................................... 81
METHODOLOGY ........................................................................................................... 81
Validity ......................................................................................................................... 91
Reliability...................................................................................................................... 91
Assumptions.................................................................................................................. 96
Summary ....................................................................................................................... 97
CHAPTER 4 ..................................................................................................................... 98
RESULTS ......................................................................................................................... 98
Race......................................................................................................................... 116
Income..................................................................................................................... 121
List of Tables
Tables
8. Satisfaction Model—Coefficients………………………………………………111
10. ANOVA—Race………………………………………………………………...118
14. ANOVA—Income……………………………………………………………...122
17. ANOVA—Age….……………………………………………………………...126
List of Figures
Figure
Abstract
In this study of a regional fast food hamburger chain (subject hamburger chain), the
price and value, order accuracy, and speed of service are explored. Data for this
quantitative cross-sectional study was collected from 1,042 customers at the subject
hamburger chain. The results show that there is a statistically significant relationship
between customer satisfaction and each of the independent variables. The results also
income, age, marital status, and geographic location while there are no statistically
significant differences in satisfaction based on gender, time of visit, and service delivery
satisfaction and loyalty. Regression analysis reveals that order accuracy, speed of service,
food quality, price and value are the most important predictors of satisfaction at the
subject hamburger chain. As a result of the findings, the subject hamburger chain should
focus on filling orders correctly, serve customers with speed, maintain food quality, and
keep the price competitive to have positive impact on satisfaction. Satisfaction and
an increase in loyalty.
facing technology, price and value, order accuracy, speed of service, fast food, quick
CHAPTER 1
BACKGROUND
The restaurant industry in the United States is large and touches nearly every
American household with its products and services (Andaleeb & Conway, 2006).
According to the National Restaurant Association (NRA, 2015), restaurant industry sales
are expected to reach a record high in 2015 of $709.2 billion, over 14 million employees,
and one million locations, the second largest private employment sector in the United
States. Additionally, the NRA projects that the United States’ restaurant industry is
expected to create 1.7 million new jobs over the next 10 years, with the total employment
reaching 15.7 million by 2025 (NRA, 2015). Because of its considerable size and impact,
the restaurant industry in terms of customer satisfaction is explored in the current study.
There are several classifications of restaurants in the United States based on the
services and products offered. Generally, restaurants fall into four categories: fine dining,
casual dining, fast casual, and quick service or fast food. Fine dining restaurants are often
categorized as destination restaurants that charge above median price for meals and
provide attentive service focused on a high level dining experience for customers (Arora,
2012). Casual dining restaurants grew in popularity during the 1980s and became one of
the most common type of establishments in the restaurant industry (Rivera, DiPietro,
Murphy, & Muller, 2008). This category promotes quick meals and good service at a cost
less expensive than fine dining in a family friendly atmosphere (Arora, 2012). Fast casual
restaurants have a similar structure to quick service restaurants, but with a focus on
higher quality of food options and an atmosphere similar to the casual dining segment
(Ryu, Han, & Jang, 2010). Quick service restaurants are also known as fast food as they
2
2012). The focus of the current research is the fast food industry. In order to understand
the fast food industry today, one has to look at the history of its development.
The fast food industry influences many aspects of our society from pop culture to
politics to dietary trends and has a rich, colorful history (Aronica, 2014). Long before
White Castle, McDonald’s, Burger King, or KFC, there was Horn and Hardart’s coin-
operated automats serving hot and fresh meals with speed and efficiency; Horn and
Hardart’s quickly grew to become the world’s largest restaurant chain and created the
foundation for modern fast food chains (Klein, 2012). During the 1950s, the automats
struggled as high inflation pushed commodity prices higher and higher (Klein, 2012). The
coin-operated machines were no longer efficient or practical, quality declined, and the
fast food chains, such as White Castle, Burger King and McDonald’s, hatched by the
The pursuit of the American dream was the inspiration for the rise of the fast food
industry here in the United States. Aronica (2014) also stated that the founders of the
most successful fast food chains, such as White Castle, McDonald’s, Burger King,
Wendy’s, Taco Bell, KFC, Popeye’s, Subway, Dunkin’ Donut, Sonic Drive-In,
Domino’s, Arby’s, Pizza Hut and Chick-fil-A, built these mega empires based on the
pursuit of the American dream and, in the process, changed the way Americans eat and
dine forever. Even though the idea of fast food came in the 1920s with the opening of
White Castle restaurants, the massive expansion in the scale of the industry came in the
1950s with the advent of America’s love for cars, the development of major new
3
interstate highways, and the expansion of suburban communities (Afzal, Nafees, & Khan,
2014).
1921, was the first quick service restaurant chain in the United States, it was McDonald’s
that started the fast food revolution. The novel and efficient system developed by Ray
Kroc, the new owner of McDonald’s, in the 1950s inspired many entrepreneurs to open
restaurants, namely Keith J. Kramer and Matthew Burns, founders of Burger King in
1953; Carl Karcher, founder of Carl's Jr. in 1941; Glen Bell, founder of Taco Bell in
1954; and James Collins, the founder of Kentucky Fried Chicken in 1952 (Aronica,
2014). Thus, while White Castle started the modern fast food revolution in the United
Sates, it was McDonald’s that pushed it to the next level, which eventually became a
within the industry. For most of its history, the quick service restaurant industry in the
United States has been characterized by rapid and dependable growth, but, more recently,
the growth has slowed and some analysts believe that the growth of the fast food industry
has peaked due to market saturation (Patton, 2014). As patronage levels off, quick service
restaurants must evolve to compete in a take-share market as they fight with each other
for market shares ("Future of LSR: Fast-food & Fast-casual Restaurants," 2015).
intense competition within the group. According to the NRA study, quick service
restaurant operators say competition is most intense within their own segment, and 88%
of the quick service restaurant operators say competing with other quick service
4
Additionally, fast food faces competition from the other segments of the
restaurant industry, most notably from the rapidly growing fast casual segments and
grocery stores. The fast casual restaurants continue to outpace the quick-service operators
(Green, 2011). Fast food restaurants are competing not only with other fast food
restaurants but also with many quick casual and casual dining restaurants, such as Baja
Fresh, Chili’s, Outback Steak House, and increasingly present ready-to-eat meals
available in most grocery stores (Ottenbacher & Harrington, 2009). Dominant fast food
brands such as McDonald’s, Subway, and Starbucks are facing a challenge by the leading
fast casual restaurants—the fast casual segment experienced an 8% rise in guest count,
whereas it was flat at quick service restaurants (Team, 2014). Team (2014) also
McDonald’s, the sales leader in the quick service restaurant segment, was diminishing by
1.3% in 2012 and 2013 whereas for a successful fast casual restaurant such as Chipotle,
The hamburger chain, which is under study in the current study, is no exception
and is facing competition from fast casual restaurants, grocery stores, and other fast food
chains. The environment in which the chain operates is fiercely competitive. The subject
restaurant chain in this study is a regional fast food hamburger chain with operations in
the Midwest and the East Coast. Through the remainder of the study, the studied
hamburger chain will be referred to as the subject hamburger chain. Currently, it is faced
with years of decline in transactions and just a modest sales increase. It is important to
5
note that the minimal sales increase was mainly due to price increase rather than an
deal with the declining market share consists of delivery of products and services which
will satisfy customers and, thereby, lead to the success and growth of the industry
(Mamalis, 2009). Over the years, many researchers have examined the impact of
significant contributor. The rapid growth in the service industry has increased consumer
primary indicator to measure corporate operational performance (Hsieh & Yeh, 2015). As
a result, customer satisfaction is important for the subject hamburger chain just as it is
important in any other organization. The current study will explore many aspects of
customer satisfaction at the subject hamburger chain and make a set of recommendations
So, what is customer satisfaction? Customer satisfaction has been defined as the
service (Gundersen & Heide, 1996). However, the design and implementation of a
subject hamburger chain first determine how customers perceive its products and services
(Mamalis, 2009). Over the years, many researchers (Arora, 2012; Dube, Linganiso, &
Ottenbacher, Staggs, & Powell, 2012; Sumaedi & Yarmen, 2015; Swimberghe &
6
Wooldridge, 2014; Wu, 2013) studied numerous variables of customer satisfaction in the
fast food industry to understand, explain, and predict customer satisfaction. The future
growth of the subject hamburger chain will depend on its ability to understand those
variables and the ways in which they affect satisfaction presents a unique opportunity to
identify the factors that influence customer satisfaction at the subject hamburger chain.
satisfaction factors at the subject hamburger chain is important for its effective
management.
not that good. Even though 95% of consumers said that customer satisfaction is an
important consideration in making restaurant related choices (NRA, 2014), quick service
Quick Service Restaurant Benchmark Study, only 47.57% of customers are satisfied with
their visits within the segment. The lowest is the hamburger chain with 42% while the
highest is 52% for the sandwich chain ("Study: Burger chains dominate in quick service
restaurant industry," 2013). It is important to note that the studied chain is a hamburgers
chain. The same Emphatica study also found that the likelihood of a return visit increases
from 20% to 81% when customers report a higher level of satisfaction, and this
significant change in customer satisfaction for a quick service restaurant can mean the
difference between stagnancy and growth ("Study: Burger chains dominate in quick
Similar statistics were cited 20 years ago by Stevens, Knutson, and Patton (1995).
7
According to Stevens et al., 91% of a restaurant's dissatisfied customers will never come
back, and they will tell 8-10 others about their negative experience. Thus, measuring
customer satisfaction is important for the subject hamburger chain, which conducts
customer satisfaction surveys based on a few high level variables that include order
accuracy, drive-thru performance, price and value, service, friendliness, speed of service,
and interior cleanliness. It, however, ignores the attributes that contribute to each of those
high level variables. Also, satisfaction surveys at the subject hamburger chain do not
(Facebook, Twitter and Instagram), online ordering, smart phone app, order conformation
board, digital menu board, and convenience in terms of hour of operation, location,
parking availability, and ease of access. So, there is a clear need to conduct an in-depth
No in-depth customer satisfaction study has been done at the subject hamburger
chain, and a review of the current literature showed that, in the quick service restaurant
industry, there are gaps in the analysis of customer satisfaction—satisfaction in the terms
technology, price and value, order accuracy, and speed of service. The current study will
fill the void, adding to the knowledge in the field by considering factors that were not
stagnancy and growth for the subject hamburger chain. The significance of this study to
8
the decision makers at the subject hamburger chain is that they will understand which
satisfaction is important for strategic planning and allocating scarce resources. It is also
important for tactical day-to-day operations of each restaurant belonging to the subject
hamburger chain, as it will give guidance to the frontline managers by helping them focus
The subject hamburger chain is faced with years of decline in customer visits and
modest sales increase. It has been facing fierce competition from other fast food chains,
fast casual chains, and grocery stores. On top of this, food cost, labor cost, and other
fixed and variable expenses are rising while customers with limited discretionary income
allocated toward food away from home are demanding more in terms of service quality,
value, order accuracy, and speed of service. One of the best ways to deal with declining
market share is to understand the factors attributable to customer satisfaction. The subject
hamburger chain does not conduct comprehensive studies to understand the factors
affecting customer satisfaction. Thus, the subject hamburger chain is facing ferocious
The main purpose of the current empirical study is to identify and quantify the
most important factors influencing customer satisfaction at the subject hamburger chain.
It will analyze a large number of variables, such as service quality, food quality, physical
9
and speed of service. The second purpose of the study is to explore whether or not there
are any statistically significant differences among demographic variables of race, gender,
income, age, marital status, service delivery methods (dine in, drive-thru and take out),
time of visits (breakfast, lunch, dinner and late night), and geographic locations on
customer satisfaction at the subject hamburger chain. The third and final purpose of the
study is to determine the relationship between customer satisfaction and customer loyalty
This framework of the current study will answer three specific research questions
hamburger chain. Eight independent variables will be considered – service quality, food
price and value, and speed of service. Eight hypotheses related to eight independent
customer satisfaction at the subject hamburger chain? Race, gender, income, age, marital
status, service delivery method, time of visit, and geographic region will be analyzed and
loyalty related? The current study will explore the relationship between customer
12
Conceptual Model
Transaction specific model is a good fit to answer the research questions and test
the related hypotheses. Teas (1993) introduced the transaction specific model and later
Parasuramon, Zeithaml, and Berry (1994) expanded the model, explaining overall
customer satisfaction in terms of service quality, product quality, and price. Using this
model, Andaleeb and Conway (2006) emphasized that the products and service offering
for the quick service restaurant can be viewed as a mixture of services and products; as a
result, customers are likely to consider specific aspects of the transaction. The current
study attempts to explain customer satisfaction at the subject hamburger chain by basing
it on variables that affect specific aspects of products and services that are offered at the
his or her experience with, and reactions to, a particular product transaction, episode, or
service encounter (Olsen & Johnson, 2003). Advantages of this model include its ability
allows companies to better track changes in performance that result from internal changes
13
transaction specific model, which will examine the impacts of service quality, food
order accuracy, and speed of service on customer satisfaction. The model will also
attempt to determine the impacts of demographic variables of race, gender, income, age,
marital status, service delivery methods (dine in, drive-thru and take out), time of visits
(breakfast, lunch, dinner and late night), and geographic locations on satisfaction. Finally,
the model will examine the relationship between customer satisfaction and customer
loyalty. The model assumes that service quality, food quality, physical environment,
convenience, customer-facing technology, price and value, order accuracy, and speed of
service impact customer satisfaction at the subject hamburger chain. The model also
subject hamburger chain. Finally, the conceptual model assumes that there is a
loyalty at the subject hamburger chain. This conceptual model developed in this study is
being named as Kabir Satisfaction Model for the Quick Service Restaurant (KSM for
QSR). Figure 1 depicts the ‘KSM for QSR’ that is based on the transaction specific
model.
14
Figure 1. Kabir Satisfaction Model for Quick Service Restaurant (KSM for QSR)
answer the research questions and test the related hypotheses in the present study.
According to the ‘KSM for QSR’, Hypotheses 1-8 for research question one will explore
Hypothesis 1 for research question two will explore the differences in satisfaction at the
research question three will explore the relationship between customer satisfaction and
Many unique terms explain the current study and the ‘KSM for QSR’ model. The
definitions provided in this section should help the readers to understand those terms in
the context of the current study exploring customer satisfaction at the subject hamburger
chain:
Casual dining restaurant. Casual dining restaurants charge less than fine dining
restaurants with a focus on faster service than fine dining and less attention to ambiance.
They grew in popularity during the 1980s, becoming one of the most common types in
the restaurant industry (Rivera et al., 2008). Casual dining restaurants are those that may
have one of the following characteristics: do not recommend or take reservations, focus
on quick order and service, use no tablecloths, and are less expensive than fine dining
(Arora, 2012). Chili’s, Red Lobster, Ruby Tuesday’s, and Olive Garden fit into this
a restaurant that is well suited to his or her needs. Easy access, location, hours of
operation, parking facility, and transportation are some factors that can make a restaurant
Restaurant Industry Forecast, 72% of consumers consider convenience and 65% consider
easy parking when choosing a quick service restaurant. Small conveniences can make a
satisfaction, and the principal aspects of convenience are store location, parking,
16
QSR’ model refers to those customer-facing technologies that contribute to the overall
experience of customers, such as smart phone apps, online ordering, Wi-Fi connection,
social media (Facebook, Twitter, and Instagram), etc. According to the NRA 2014
Restaurant Industry Forecast, 21% of adults consider technology when choosing a quick
increased volume and revenue, and improved service and food quality (Kimes, 2008). In
measure to represent it, customer loyalty has grown in importance as the key to many
firms’ financial performance and survival (N. S. Terblanche & Boshoff, 2010) because
customer satisfaction has strong impact on customer loyalty in restaurant settings (Arora,
2012; Haghighi et al., 2012; Oliver, 1999; Swimberghe & Wooldridge, 2014). Many
researchers have found the relationship between customer satisfaction and customer
a positive one as well. Thus, if the satisfaction goes up at a restaurant, the loyalty goes up
as well.
Fast casual restaurant. Fast casual restaurants fall between fast food and casual
dining restaurants, focusing on better quality of food than quick service restaurant and
17
faster service than casual dining. Fast casual restaurants have a similar structure to quick
service restaurants but with a focus on higher quality foods and an atmosphere similar to
casual dining restaurants (Ryu et al., 2010). The price structure at the fast casual is also
higher than the fast food restaurant segment. Restaurants that typically fit in this category
include Panera Bread, Chipotle, Panda Express, Zaxby’s, and Five Guys (Green, 2011).
Fine dining restaurant. Fine dining restaurants focus on the details of customer
service, high quality food, and interior design to make a visit memorable at a high price
point. Fine dining includes restaurants with characteristics such as a destination restaurant
that recommends reservations, use table cloths, has generally an above median price
range, and has staff that is attentive to the customer’s dining experience to ensure the
highest level of satisfaction and overall experience (Arora, 2012). Uncle Ben’s Steak
Food quality. Food quality in the current study refers to the quality
characteristics of the food, such as taste, temperature, food safety, healthy menu options,
etc. Food quality is an important factor of customer satisfaction and loyalty in the fast
food restaurant industry (Haghighi et al., 2012; Harrington et al., 2012; H. S. Kim, Joung,
Yuan, Wu, & Chen, 2009; Sumaedi & Yarmen, 2015; Susskind & Chan, 2000).
According to the National Restaurant Association (2014), 65% of adults consider healthy
menu option when choosing a quick service restaurant. Food quality has many
from the same restaurant. A strong commitment to repurchase a product or service in the
18
future is a rebuy of the same brand or brand series, despite the potential or actual
environmental effects or marketing efforts by the rivals for changing the customer’s
buying behavior (Oliver, 1999). The basis of customer loyalty is that customers want to
recreate good memories. If they feel good about their experience, they will come back,
and if they feel really good, they will tell others to eat at the same restaurant (Knutson,
1988). A customer is loyal to a business when he or she returns to the organization for
repeat purchases, shares positive experiences with friends and family, and recommends
Order accuracy. Order accuracy refers to filling the orders accurately. Receiving
the order as placed is an important factor of customer experience in the fast food
restaurant industry (Bienstock, Mentzer, & Bird, 1997; Mentzer, Flint, & Hult, 2001). A
missing item from an order annoys customers, and restaurants ought to pay attention to
important factor of customer satisfaction in the fast food restaurant industry; thus,
restaurants should pay attention to design, color, and proper layout of tables and chairs
(Haghighi et al., 2012; Susskind & Chan, 2000). According to NRA (2014), 60% of
consumers consider whether the restaurant is children and family friendly while 54%
consider décor and atmosphere of the restaurant to be important for satisfaction. Paying
attention to specific details, such as cleanliness (Knutson, 1998) and smell (Hosseini,
Jayashree, & Malarvizhi, 2014), is also important for the restaurant industry. Thus, an
of customers.
Price and value. Price refers to the amount paid for the food while value is the
estimated monetary worth of the service and products. Value is the total perceived benefit
fast food restaurant industry, and it denotes the total value that is paid by a customer for a
product or service (Haghighi et al., 2012). According to the NRA (2014), 85% of adults
Quick service restaurant or fast food. The fast food segment, which is the focus
of the current study, strives for quick and convenient food at the lowest price point. Fast
food restaurants are those that provide quick food, reasonable price, self-service, and
quick turnaround (Arora, 2012). During the 1960s when the fast food restaurant industry
was being introduced, efficiency and timeliness became the primary driving factors of the
business (Rivera et al., 2008). Restaurants that are often included in this category include
McDonald’s, Wendy’s, Taco Bell, KFC, White Castle, and Starbucks (Arora, 2012).
with, and reactions to, a particular product transaction, episode, or service encounter
customer satisfaction in the fast food restaurant industry (Andaleeb & Conway, 2006;
Haghighi et al., 2012; Susskind & Chan, 2000). Service quality is described as the
Berry, 1988). According to the NRA (2014), 87% of adults consider good service when
20
are important in making customers happy. Intensifying competition and other market
forces led many services and retail businesses, including fast food restaurants, to seek
profitable ways to differentiate them, and one such strategy is the delivery of high service
Speed of service. Speed of service refers to the time that a fast food restaurant
takes to serve customers. Typically, the clock starts when customers arrive at the
restaurant, and the clock stops when customers receive the food. Customers do not like to
wait more than 30 seconds in line to pay for their food as they consider this to be a waste
of time, and time spent waiting always seems four times longer than it really is (Knutson,
1988). Speed of service is connected to repeat visits at fast food restaurants (Choi &
Limitations
As stated earlier, fine dining, casual dining, fast casual, and fast food are all
component parts of the restaurant industry. The current study examines customer
satisfaction factors at only one fast food hamburger chain and ignores the other types of
restaurants. Since the subject hamburger chain is in operation only in the East Coast and
the Midwest, the study ignores the rest of the United States and, more importantly, the
worldwide fast food market. On top of this, the subject hamburger chain has restricted
data collection to only 4 weeks due to operational issues and possible interferences with
The survey was concluded only via Internet, and, thus, it ignores the customers
who lack access to the Internet. If the survey was available in hardcopy and via phone, it
would have been more inclusive, and the results could have been more generalized.
Besides, the population may not be adequately represented because certain age and
and ignores the hedonic aspects as investigated by Arora (2012). Arora (2012) found a
strong correlation of emotion and sensual delight to customer satisfaction. Kesten (1997)
and Richardson, Shepard, and Elliman (1994) indicated that faith and ethnicity can
contribute to food choices and the consequent satisfaction that food service users
experience. The current study does not consider the impacts of emotion, sensual delight,
religion and ethnicity as suggested by Arora, and Kesten and Richardson et al.
The researcher of the current study has been working in the fast food industry for
the past 25 years. Although it may be considered a strength, there might be a chance of
bias, especially when something was against his belief. It is also important to mention
that he has been working for the subject hamburger chain for the past 25 years.
Summary
whole, followed by an overview of the quick service restaurant industry and, finally, has
come to focus on the subject hamburger chain addressing the challenges it is facing. It
has identified the dependent and independent variables. The dependent variable is
customer satisfaction and customer loyalty, and there are eight independent variables—
22
technology, price and value, order accuracy, and speed of service. Each of the eight
independent variables except speed of service has multiple attributes. The three research
questions and 10 related hypotheses have also been discussed. All terms have been
defined. Finally, Chapter 1 has reviewed the purpose, significance, and limitation of the
study along with the problem statement and the declaration of potential bias.
Chapter 2 will examine the fast food restaurant industry in general, the
independent and dependent variables, and the ‘KSM for QSR’ model in detail. It will
provide an extensive review of the literature from 2000 to 2015 that are specifically
relevant to customer satisfaction in the restaurant industry to show the prevailing gap in
the literature.
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CHAPTER 2
LITERATURE REVIEW
which is based on the transaction specific model, research questions, related hypotheses,
the dependent variable of customer satisfaction, and the independent variables of service
price and value, order accuracy, and speed of service. Now, Chapter 2, the literature
review, investigates the existing knowledge related to these concepts and the ‘KSM for
QSR’ model. A literature review is a written summary of journal articles, books, and
other documents that describe the past and present information on a subject matter
(Creswel, 2008). Thus, this chapter will review customer satisfaction related empirical
studies conducted across different segments of the restaurant industry. This study is
The first research question asks, Which variables, related to dining at the subject
hamburger chain, significantly influence customer satisfaction? The “KSM for QSR’
the subject hamburger chain. Eight variables and eight hypotheses are being considered
to answer this question. The second question asks, Which demographic variables
Demographic variables of race, gender, income, age, marital status, service delivery
method, time of visit, and geographic location will be explored. One hypothesis will be
tested to answer this question. And the final question asks, To what extent are customer
satisfaction and customer loyalty related? The “KSM for QSR’ model will explore the
24
relationship between customer satisfaction and customer loyalty at the subject hamburger
chain.
satisfaction and its independent variables, based on existing literature, and establish the
need to further research this relationship at the subject hamburger chain. Chapter 2 will
also examine the relationship between satisfaction and loyalty in the restaurant industry
to establish the need to test this relationship at the subject hamburger chain, which is
serving as the setting for this study. In order to achieve these goals, searches are carried
out for journal articles, research documents, dissertations, trade journal articles, and peer
reviewed journal articles to gather information in the context of the restaurant industry
related to the ‘KSM for QSR’ model, research questions, hypotheses, dependent
variables, and independent variables. Then, the articles were examined in order to
identify the variables that have an impact on customer satisfaction in the restaurant
environment and that explored the relationship between customer satisfaction and
customer loyalty.
Online library and Internet searches through Google Scholar and Google. The online
databases at Wilmington University that served as the backbone of the searches are Ebsco
Host, Academic Search Premier, Business Source Complete, Sage Journals Online,
Springer Link, and WorldCat. These searches were limited to peer reviewed journal
articles, theses, and dissertations. Google Scholar was used to locate scholarly articles
while Google was used to locate industry journals, business periodicals and other relevant
sources. The key words used in these searches were customer satisfaction model,
25
between satisfaction and loyalty, restaurant industry, fine dining, casual dining, fast food,
To answer the research questions and test the hypotheses, the transaction specific
model is being used because it relates to the research questions much deeper than others.
Thus, it is important to understand the rationale behind this decision. To have this
in this study. A comparison of these models makes the case for the transaction specific
customer satisfaction in service and retail environment. Parasuraman et al. (1988) defined
satisfaction in this model as the difference between the expectation of the customer and
perception of the actual service. The authors in this model used a 22-item instrument to
(1988) defined reliability as the ability to perform the promised service dependably and
customers. Responsiveness was referred to the willingness to help customers and provide
prompt service while assurance was referred to the knowledge and courtesy of employees
26
and their ability to inspire trust and confidence (Parasuraman et al., 1988).
Parasuraman et al. (1988) collected data for the study from four firms of retail and
service oriented businesses. In this study, the Cronbach’s alpha values were reported for
each individual firm for the constructs. The tangibility construct contained four questions
with Cronbach’s alpha values ranging from .52 to .64 (Parasuraman et al., 1988). The
reliability construct contained five questions with Cronbach’s alpha values ranging from
.74 to .84 (Parasuraman et al., 1988). The empathy construct also had five questions with
Cronbach’s alpha values ranging from .71 to .80 (Parasuraman et al., 1988). The
responsive construct contained four questions and had Cronbach’s alpha values ranging
from .69 to .76 (Parasuraman et al., 1988). Assurance also had four questions with
Cronbach’s alpha values of greater than .80 (Parasuraman et al., 1988). Parasuraman et
al. (1988) also reported the composite Cronbach’s Alpha values for the firms for each of
the constructs. The tangible constructs came with .72 while other four constructs came
above .80 (Parasuraman et al., 1988). Thus, the scale used in this study suffered from low
reliability, as Pallant (2013) stated that a score of .70 is acceptable, .75 is desirable, and
.80 is excellent.
Conway (2006) also questioned the reliability of the scale as they stated, “Although the
SERVQUAL framework has been pursued with some enthusiasm in various service
industries, empirical support for the suggested framework has not always been
encouraging” (p. 4). Besides low reliability, the instrument used in SERVQUEL model
was designed mainly for longitudinal study as Parasuraman et al. (1988) recommended
27
tracking service quality periodically for optimal results. On top of this, the SERVQUEL
model requires measuring the expectation prior to rendering of service and measuring the
perception after the service, making it ideal for longitudinal studies but unfit for a cross
useful when it is being used with other customer service measurement tools, such as
another reason for SEVRQUEL not being a match for the current study, as the current
study has neither solicited comments nor complaints. Finally, according to Parasuraman
et al. (1988), the SERVQUEL is a generic instrument. Since it is a generic instrument and
has not been specifically developed for the restaurant industry, this model is not a good
proposed the DINESERV model. Based on the five dimensions used in the SERVQUEL
model, Stevens et al. (1995) developed the 29-item DINESERV instrument. The survey
instrument used in their study included 10 items representing tangibility, five items
representing reliability, three items for responsive ness, five items for assurance, and
five items for empathy. Each of the five constructs in their study had a Cronbach’s alpha
value of greater than .89. Therefore, the survey instrument is highly reliable as a
Cronbach’s value of .70 is acceptable (Pallant, 2013). Stevens et al. (1995) collected data
from fast food, casual dining, and fine dining restaurants. Similar to the SERRVQUEL
model, Stevens et al. (1995) required collecting data on expectation prior to rendering the
service and collecting data on perception of the actual service after its rendering.
28
Therefore, this model is also designed for longitudinal study, as the authors recommend
conducting the survey every 2 to 3 months. So, DINESERV was not a good fit for the
Besides the above limitations, the SERVQUEL and DINESERV models have
the difference between customer expectation and perception of the actual service. Carman
(1990), Cronin and Taylor (1992), and Teas (1993) strongly opposed this idea of
satisfaction being the difference between expectation and perception. Carman (1990)
found SERVQUAL difficult to use in different settings without modification as was the
case in the DINESERV model. Carman (1990) also found these two models impractical
to use, as they require completing the expectation prior to providing service and the
perception of actual service after rendering the service, which is not suitable for the
current study because the participants are completing only one online survey on the
researcher of the present study looked at the transaction specific model proposed by Teas
(1993). Teas (1993) introduced the transaction specific model, and later Parasuraman et
al. (1994) expanded it. This expansion was useful in explaining the overall customer
satisfaction in terms of service quality, product quality, and price. Using this model,
Andaleeb and Conway (2006) emphasized that the product and service offerings at the
quick service restaurants could be viewed as a mixture of service and products, and, as a
result, customers were likely to consider specific aspects of a transaction, such as service
his or her experience with and reactions to a particular product transaction, episode, or
service encounter (Olsen & Johnson, 2003). Advantages of this model include its ability
given time period on the product and service offerings of a firm (Oliver, 1999). The
model also allows companies to better track changes in performance that result from
internal changes and quality improvements (Olsen & Johnson, 2003). Another advantage
is that this model allows many attributes to be added as independent variables (Tea,
1993). Besides, this model does not require collecting data twice for the same study like
Because of the advantages and the practicality of the transaction specific model,
the ‘KSM for QSR model developed in the current study is based on it. The adopted
model in the current study has added additional independent variables in addition of the
ones that have been used by Parasuraman et al. (1994). Thus, besides examining the
influence of service quality, product quality, and price (Parasuraman et al., 1994), the
‘KSM for QSR’ model examines the impact of physical environment, convenience, order
the subject hamburger chain. The current study also attempts to capture the impact of
current study examines the relationship between customer satisfaction and customer
loyalty at the subject hamburger chain. The ‘KSM for QSR’ model in the current study
technology, price and value, order accuracy, and speed of service are statistically
30
significant factors of customer satisfaction at the subject hamburger chain. The ‘KSM for
QSR’ model also assumes that demographic variables impact customer satisfaction at the
subject hamburger chain. Additionally, the ‘KSM for QSR’ assumes that there is a
customer loyalty. The next section examines all terms and concepts that are the
component parts of the ‘KSM for QSR’ model: satisfaction, loyalty, the relationship
between satisfaction and loyalty, classification of restaurants in the United States, and the
Satisfaction
The dependent variable in this study is satisfaction. The ‘KSM for QSR’ model in
the current study has attempted to determine the impact of the independent variables and
restaurant industry.
actual product or service while others defined it as the post purchase experience of a
Cronin and Taylor (1992), and Teas (1993) opposed the view of Parasuraman et al.
(1988) and claimed that satisfaction can be solely measured based on a customer’s
perception of a product or service. The ‘KSM for QSR’ model in the current study
Many other academic researchers echo this view. Stank, Daugherty, and Ellinge
specific product or service. Vavra (1997) defined satisfaction as the satisfactory post
purchase experience with a product or service. Olsen and Johnson (2003) defined
satisfaction as a customer’s evaluation of his or her experience with, and reactions to, a
defined customer satisfaction as the experience with products and services. Based on
by the consumer, and the time dimension, which is after purchase (Giese & Cote, 2000).
The ‘KSM for QSR’ model defines satisfaction as the post purchase behavior or
Loyalty
Customer loyalty is another dependent variable in the “KSM for QSR’ model.
Satisfied customers do not always become loyal customers because competitive products
and services in the market provide them with alternatives, and when there are
connection between the two. According to Wu (2013), to achieve customer loyalty, firms
behavioral intentions, implying that satisfied customers would visit a restaurant again and
again and, more importantly, recommend their favorite restaurants to their friends and
family. The ‘KSM for QSR’ model expands on this relationship. Thus, it is important to
particular business consistently in the future, despite situational influences and marketing
efforts by the competing products or businesses having the potential to cause switching
behaviors (Oliver, 1997). Generally, loyalty has been and continues to be defined by
(Tellis, 1998). However, some researchers view loyalty in two dimensions while others
look at it in terms of three dimensions. Hallowell (1996) mentioned two distinct aspects
of loyalty: One is the attachment to a good, service, or organization; and the other is a
behavior of repeat purchases of services from the same merchant, having larger scale
Wong, Dean, and White (1999) suggested three distinctive ways to evaluate loyalty—
determines the sense of loyalty, commitment, and faithfulness (Wong et al., 1999). And,
finally, the composite measurement of customer loyalty is the combination of the two
dimensions—behavioral and attitudinal (Wong et al., 1999). For the purpose of the ‘KSM
for QSR’ model, the composite measurement of loyalty is adopted. In short, the current
study assume that a loyal customer makes repeat purchase from a business faithfully and
consistently.
According to NRA (2014), 92% of the adults in the United Sates stated that a
recommendation from friends and family members is a factor when they choose a
when satisfied customers say positive things about a business and recommend that
33
business to friends and family (N. Terblanche, 2015). WOM reputation has a very long
lasting impact on patronage, competitiveness, and business survival (Min & Min, 2011)
because WOM receivers use the recommendations as one of the main criteria of
narratives on which to base their decisions to visit restaurants (N. Terblanche, 2015).
the underlying possibility that the receiver of a recommendation may be dissatisfied with
a service encounter, which will reflect adversely on the sender of the recommendation.
The relationship with the receiver of the recommendation and the potential to damage
this relationship due to a bad recommendation may cause the word of mouth activity to
be more of a description of what happened during the restaurant visit than an explicit
(N. Terblanche, 2015). Thus, the preferred way to assess true word of mouth
communication after a service encounter is to capture and evaluate what customers intend
to say about a service encounter because only 25% make explicit recommendations (N.
Terblanche, 2015). So, it is important for the restaurant operators to focus on increasing
word of mouth activity by creating memorable experiences for customers so that they can
Since satisfaction and loyalty have been defined in earlier sections, it is now time
to examine the existing literature to determine the relationship between satisfaction and
34
loyalty. Twelve empirical studies conducted from 2010 to 2015 that dealt with the
(restaurant, cell phone, e-commerce, and hotel) in many countries, South Africa,
Malaysia, Mongolia, United States, China, Iran, and India, were examined. Four studies
were conducted in the fast food industry (Bougoure & Neu, 2010; Min & Min, 2011;
Terblanche & Boshoff, 2010; Yondonperenlei & Song, 2015), one in full service
restaurants (Everson, Dagger, & Elliot, 2013), one in the restaurant industry in general
(Yan, Wang, & Chau, 2013), one in a Hong Kong style tea restaurant (Lai, 2015), two in
the cell phone industry (Deng, Lu, Wei, & Zhang, 2010; Shahin Sharifi & Rahim
Esfidani, 2014), one in web-auction sites (Chen, 2012) and two in the hotel industry
(Khan, Garg, & Rahman, 2015; Liat & Chiau, 2015). All these studies have found a
Terblanche and Boshoff (2010), Bougoure and Neu (2010), and Yondonperenlei
and Song (2015) conducted their studies to determine the relationship between
satisfaction and loyalty in fast food restaurants. Terblanche and Boshoff (2010) carried
out the study in South Africa, Bougoure and Neu (2010), in Malaysia, and
Yondonperenlei and Song (2015), in Mongolia. The authors in the first two studies,
(Bougoure & Neu, 2010; N. S. Terblanche & Boshoff, 2010), conducted structural
satisfaction and customer loyalty. Yondonperenlei and Song (2015) conducted regression
Similar to Terblanche and Boshoff (2010), Bougoure and Neu (2010), and
Yondonperenlei and Song (2015), Min and Min (2011) conducted a study in the United
States’ fast food market to examine the relationship between satisfaction and loyalty.
Customer feedback was obtained from 262 fast food restaurant customers who dined at
10 different fast food restaurants (McDonalds, Burger King, Wendy’s, Arby’s, Hardee’s,
Subway, Johnny Rocket, Red Robin, Fuddruckers, and Roy Rogers), located in the
southeastern and mid-western United States (Min & Min, 2011). Min and Min (2011)
study shares a lot of similarities with the current study as the current study also collects
data from a similar fast food outlet with operations also in the Midwest. Min and Min
found a pattern of correlation between the overall level of customer satisfaction with the
fast food restaurant and customer loyalty. Based on these research studies, it can be
concluded that the relationship between satisfaction and loyalty is universal in the fast
food industry across many countries. Does this relationship hold statistically significant
in other types of restaurant, such as fine dining, casual, and fast casual?
Similar to fast food restaurants, the relationship between satisfaction and loyalty
was also found statistically significant in other kinds of restaurants across many cultures.
Everson et al. (2013) conducted a study at full service restaurants in the United States to
determine the relationship between satisfaction and loyalty. Through research, Everson et
al. examined the relationship between satisfaction and loyalty by using a structural
equation modeling and found statistically significant association between satisfaction and
A major study was done in China by Yan et al. (2013) in the backdrop of the
restaurant industry. The results of their study were consistent with the aforementioned
36
studies. The authors in this study used regression analysis to analyze 10,136 responses
and found significant statistical relationship between satisfaction and loyalty. To test the
relationship between satisfaction and loyalty, Lai (2015) conducted a study in Hong
Kong style tea restaurant and collected data from 382 customers. Lai (2015) found a
strong relationship between satisfaction and loyalty in the study as well. Thus, based on
these research studies, it can be concluded that the significant statistical relationship
between satisfaction and loyalty exists across national boundaries and restaurant
segments. The strong positive relationship between satisfaction and loyalty found in
Deng et al. (2010) and Seyed and Esfidani (2014) found a statistically significant
relationship between satisfaction and loyalty in the cell phone market. Researchers in
both studies used structural equation modeling to examine this relationship. Deng et al.
(2010) used data from the Chinese cell phone market while Seyed and Esfidani (2014)
collected data in Iranian cell phone market. Chen (2012) aimed to examine the
trust, involvement, and perceived value as mediators in the e-service context. Regression
analysis findings suggested that customer satisfaction is an essential ingredient for loyalty
(Chen, 2012). Liat and Chiau (2015) and Khan et al. (2015) found satisfaction as an
antecedent of loyalty in hotel industry. Liat and Chiau (2015) collected data in Malaysia
and carried out regression analysis whereas Khan et al. (2015) collected data in India and
the strong statistical relationship between satisfaction and loyalty. In addition to customer
satisfaction and its relationship to customer loyalty, it is time to examine the different
37
Restaurant Industry
Since the present study will be conducted in the restaurant industry, it is important
to understand the different kind of restaurants, which provide consumers with a variety of
dining options. After an analysis of the existing literature, the restaurant industry has
been divided into four segments: fine dining, casual dining, fast casual, and fast food or
quick service.
Fine dining restaurant. Fine dining restaurants focus on the details of customer
service, high quality food, and interior design to make a visit memorable despite a high
price point. These restaurants are also known as full service restaurants. Fine dining
reservations, table cloths, generally above median price range, and a staff that is attentive
to the customer’s dining experience to ensure the highest level of satisfaction and overall
experience (Arora, 2012). Eleven Madison Park is an example of fine dining in New
York City. Eleven Madison Park as a gastronomic heaven that titillates the imagination of
the customers with a whimsical tasting menu and superb wine pairings ferried by
exceptional staffers in gorgeous art deco quarters; even given luxury-car-payment prices
($220 per meal), admirers affirm this once-in-a-lifetime experience should not be missed
Casual dining restaurant. The price point for a meal at casual dining restaurants
is less than fine dining restaurants. This class of restaurants has greater focus on fast
service and lesser attention to ambiance than fine dining. Casual dining restaurants have
38
grown in popularity during the 1980s, becoming one of the most common types in the
restaurant industry (Rivera et al., 2008). Casual dining restaurants are those that may
have one of the following characteristics: do not recommend or take reservations, focus
on quick order and service, use no tablecloths, and are less expensive than fine dining
(Arora, 2012). The Daily Meal compiled the list of America’s 50 best casual restaurants
and Katz’s Deli of New York City made the top of the list (Myers, 2014). According to
its website, a complete dinner for one with a choice of starter, choice of appetizer, choice
of main dish, and a choice of dessert at Katz’s Deli costs $29.95 ("High Holiday Menu,"
2015). The Daily Meal described Katz’s Deli’s famous corned beef and pastrami, made
on-premises and sliced to order, as legendary, and the simple act of taking your ticket,
standing in line, bantering with the counterperson while placing your order, and finding a
table has become as New York as the eating of a hot dog with a smear of mustard and a
little sauerkraut (Myers, 2014). Chili’s, Red Lobster, Ruby Tuesday’s, and Olive Garden
also fit into this segment of restaurant (Arora, 2012; Rivera et al., 2008).
Fast casual restaurant. Fast casual restaurants fall between fast food and casual
dining restaurants and focus on better quality food than fast food restaurants and faster
service than casual dining. Fast casual restaurants have a similar structure to quick
service restaurants but with a focus on higher quality food and an atmosphere similar to
casual dining restaurants (Ryu et al., 2010). The price structure at the fast casual is also
higher than the fast food restaurant segment. According to respective websites, a meal at
Num Pang, a fast casual restaurant in New York City runs about $12 ("Menus," 2015)
while a meal at White Castle, a fast food restaurant, in New York City, runs about $8
("Online Ordering," 2015). Num Pang is at the top of the Zagat compiled list of the 11
39
hottest fast-casual chains in New York City (Zagat, 2015). Zagat describes Num Pang as
freshly baked bread, paired with a funky hip-hop vibe and colorful interiors at a price
higher than fast food restaurants (Zagat, 2015). Other restaurant chains that fit into in this
category are Panera Bread, Chipotle, Panda Express, Zaxby’s, and Five Guys (Green,
2011).
Quick service restaurant or fast food. Fast food restaurants refer to those where
ready to eat products are prepared quickly and easily so that they are prepared to serve
directly to people (Rashid, Rani, Yusuf, & Shaari, 2015). Fast food is designed for ready
availability, use, or consumption with little consideration to quality (Rashid et al., 2015).
Fast food restaurants, therefore, provide quick food, low price point, self-service, and
quick turnaround (Arora, 2012). Thus, the fast food segment that is the focus of the
current study strives for quick and convenient food at the lowest price point. During the
1960s when the fast food restaurant industry was being introduced, efficiency and
timeliness became the primary driving factors of the business (Rivera et al., 2008). Fast
food generally consists of finger food, such as hamburgers, french fries, chicken nuggets,
tacos, and pizza (Rashid et al., 2015). Restaurants that are often included in this category
are McDonald’s, Wendy’s, Taco Bell, KFC, White Castle, and Starbucks (Arora, 2012).
A review of the existing literature showed that there are two component parts of
the restaurant industry: product manufacturing and customer service. The total
foodservice in the restaurant industry encompasses both tangible (food and physical
facilities) and intangible (behavior of employees toward customers) components (Ryu &
40
Han, 2009). Rodgers (2007) echoed Ryu and Han (2009) as he commented that the food
service operation has a dual nature: manufacturing of food items and serving customers.
service quality, which, in turn, leads to attaining customer satisfaction (Ryu & Han,
2009). The following sections examine current literature to determine the component
parts of satisfaction in the restaurant environment, such as service quality, food quality,
accuracy, and speed of service. Some of these constructs are purely tangible, some are
Service quality. Over the years, many researchers studied service quality as a
consumers’ evaluation of the service at restaurants. The NRA (2014) found that 87% of
United States’ consumers consider service quality while selecting a fast food restaurant.
The subject hamburger chain in the current study also greatly focuses on service quality
(Z. Diaz, personal communication, October 11, 2015). However, the importance of
service quality varies in the restaurant environment and relies significantly on employee
behavior (Harrington et al., 2012). Service quality differs from fast food to fine dining.
Customers get, and expect, a much higher level of service quality at a fine dining
service quality and satisfaction. These studies were conducted from Australia to China to
Taiwan to Malaysia to Spain. Five studies were conducted in the fast food industry:
(Keillor, Hult, & Kandemir, 2004; Qin & Prybutok, 2008; Reich, McCleary, Tepanon, &
Weaver, 2005; Wen, Qin, Prybutok, & blankson, 2012; Wu & Mohi, 2015). Some of
these studies found a significant relationship between service quality and satisfaction, and
some of them did not. Four studies were completed in the full service restaurants:
Andaleeb & Conway, 2006; Fu & Parks, 2001; Chow, Lau, Lo, Sha, & Yun, 2007; results
exists between service quality and satisfaction. One study was carried out in a college
cafeteria (Andaleeb & Caskey, 2007) and found a statistically significant relationship
between service quality and satisfaction. One more study was conducted at a Chinese
restaurant (Shariff et al., 2015), another one was carried out at hotel and restaurant
industry (Gracia, Bakker, & Grau, 2011), and the final study was conducted in the
hospitality industry (Kattara, Weheba, & El-Said, 2008). All these three studies found a
Keillor et al. (2004) conducted a major study in eight countries (Australia, China,
Germany, India, Morocco, the Netherlands, Sweden, and the United States) to determine
the relationship between customer loyalty and service quality in the fast food industry.
the restaurant industry. Keillor et al. (2004) analyzed data via structural equation
modeling. Their results indicated that service quality positively affects behavioral
intentions in Australia, Germany, India, Sweden, and the United States. On the other
behavioral intention in China, Morocco, and the Netherlands. One of the major strengths
42
of Keillor et al. (2004) is that it tested the framework in a multinational and multicultural
setting and used large samples to solidify the contribution to determine the effects of
Another cross cultural study was conducted by Wen et al. (2012) in the United
States and China to determine the relationship between satisfaction and service quality in
the fast food industry. The authors distributed the survey and received 282 usable
responses in the United States and 171 usable responses in China for a total of 453
responses. Wen et al. (2012) results suggested that service quality has a stronger
influence on customer satisfaction in the United States than in China, thus validating the
findings of Keillor et al. (2004), which revealed service quality to be an important factor
of satisfaction in the United States but not in China. Based on these two studies, it also
can be concluded that the relationship varies between service quality and satisfaction
across national boundaries and cultures. The unique characteristics of culture play a
significant role in determining the expectation of customers from fast food restaurants.
Reich et al. (2005) attempted to measure the relationship between service quality
and satisfaction as well. They collected data from 175 customers patronizing
McDonald’s, Burger King, and Wendy’s to examine the relationship between satisfaction
and service quality in the United States. Reich et al. (2005) found a statistically
significant relationship between satisfaction and service quality. On the other hand, the
results of Qin and Prybutok (2008) contradicted the findings of Reich et al. (2005) as they
found the relationship between satisfaction and service quality in the United States fast
collected data from 208 students at a large southwestern university and conducted
43
students and found service quality as an antecedent of customer satisfaction in the fast
food industry. Rashid et al. (2015) examined the relationship between service quality and
satisfaction in the Malaysian fast food industry and found a statistically significant
relationship between the two as well. Rashid et al. (2015) collected data from 300
customers from McDonald, KFC, Domino Pizza, and Secret Recipe, and data was
analyzed via regression. Thus, based on these studies, it can be concluded that the effects
Andaleeb and Conway (2006) conducted a study in the United States in the
(2006) carried out regression analysis. The results of the Andaleeb and Conway (2006)
study suggested that customer satisfaction was influenced most by the responsiveness of
the frontline employees, which points to the importance of the quality of service provided
A similar study was carried in Chinese full service restaurant by Chow et al.
(2007). The authors proposed and tested a conceptual model of service quality using
structural equation modeling. Their results supported the theory that there are significant
links between service quality and customer satisfaction. Thus, based on the above-
determinant of satisfaction in fast food and full service restaurants. Therefore, service
44
cultural differences, which makes sense as people go to a full service restaurant to dine,
Andaleeb and Caskey (2007) also found similar results as Andaleeb and Conway
(2006). Andaleeb and Caskey (2007) tested the importance of service quality on
Pennsylvania. The results of the multiple regression analysis suggested that the most
important variable explaining student satisfaction at the college cafeteria is staff behavior
(Andaleeb & Caskey, 2007). In other words, the quality of service provided by the
employees was important in determining the satisfaction of students with the college
cafeteria. Shariff et al. (2015) also confirmed the findings of (Keillor et al., 2004),
Andaleeb and Conway (2006), and Andaleeb and Caskey (2007) in Malaysian Chinese
restaurants. The objective of the study conducted by Shariff et al. (2015) was to identify
the relationship between service quality and customer satisfaction in the context of
Chinese restaurant in Malaysia, where data was collected from 395 customers from
Chinese restaurants. Shariff et al. (2015) found a direct and positive relationship between
enhancing customer loyalty. Based on a sample of 586 hotel customers and 571
restaurant customers from 120 Spanish establishments, the results of the multi-group
quality increases positive affective responses and these, in turn, increase customer
45
satisfaction (Gracia et al., 2011). Kattara et al. (2008) investigated the relationship
quality, and overall customer satisfaction. The authors collected data from over 300
customers in the hospitality industry, concluding that employees’ behaviors have great
The primary objective of Fu and Parks (2001) was to use the SERVQUAL
instrument to investigate the service quality dimensions that influence older diners’
intentions to return to a restaurant. Their study’s research design included a survey at two
family-style restaurants in a northeastern state in the United States where a total of 415
usable questionnaires were collected at the two selected restaurants. What is more
important to older diners in those two restaurants is the friendliness of service and the
feeling that they are valued customers (Fu & Parks, 2001). Based on the aforementioned
studies, it can be concluded that the impact of service quality on customer satisfaction
depends on the nature of the restaurants and the culture of the participants.
So, what are the attributes of service quality? After a review of the literature, the
Employees are instructed in the restaurants to engage in positive social behaviors, such as
smiling, making eye contact, greeting the customer, and expressing sympathy for
customers, and these are wise practices because much research has shown that such
2013). Industry insiders say it is hard to understate the value of giving customers
46
to complement the main meal, friendliness, and the willingness of a competent team to go
A smile while facing a customer goes a long way in the context of the restaurant
Parasuraman, Zeithaml, and Berry (1985) found that service with a smile affects
customer attitudes and behaviors such as perceived service quality and met expectations.
Kattara et al. (2008) echoed the same sentiment about a smile as they have mentioned
that it does not take a lot to make a customer happy: Simple actions on the part of an
(Kattara et al., 2008). A smile also makes customers respond similarly, perceiving the
employees as providing quality service and feel satisfied with their encounters (Barger &
Grandey, 2006). Thus, employee smiling correlates with service quality and customers’
encounter satisfaction in the food service industry (Barger & Grandey, 2006). A customer
goes to a restaurant to dine, wine, and enjoy, not to see sad faces. A genuine smile speaks
about the openness of employees and their approach to customer service. It definitely
helps to open the doors to a great experience. The subject hamburger chain requires its
employee to smile and make eye contact with customers (Z. Diaz, personal
customer after that customer has already decided to buy one or several items (Söderlund,
2013). It is not only an effective strategy in the restaurant industry to increase sales but
also to increase customer satisfaction. Not every customer accepts a suggestion but
47
enough of them do, which significantly increases average sales per ticket. Suggestive
selling has another element, which is to provide excellent customer service via educating
consumers about food items offered at the restaurant. The change from providing service
in the traditional sense to providing service and engaging in explicit suggestive selling
there are no studies that attempted to determine the effect of suggestive selling on
attribute of service quality in the current study because the subject hamburger chain
customer service specialist at the subject hamburger chain (Z. Diaz, personal
factor when they are choosing a fast food restaurant (Tristano, 2013). Friendliness and
perceptions, and they are found to be amongst the top five drivers of positive experience
in the restaurant environment in the United States. (Harrington et al., 2012). Ali (2015)
also found it to have a significantly positive relationship with customer satisfaction in the
resort hotels in Malaysia. Additionally, Dube et al. (2015) mentioned that friendliness of
employees is important because that can enhance service quality in the quick service
restaurant industry (Hsieh & Yeh, 2015). The general managers at the subject hamburger
chain expect and require their team members to be friendly to customers and reinforces
this behavior on an ongoing basis via a host of devices, including incentives and
48
industry (Dube et al., 2015). Competent, knowledgeable employees are found to have a
Malaysia (Ali, 2015). The researcher has not come across any study that has explored the
effects of competent employees on service quality in the fast food environment. It is,
therefore, important to include this attribute in the present study to test its impact on
service quality and satisfaction as it was found to have an impact on the hotel industry in
Malaysia. Besides, the subject hamburger chain believes in training team members in all
aspects of the operations (Z. Diaz, personal communication, October 11, 2015).
(Parvin, Perveen, & Afsana, 2014). Employees’ willingness to help the guest is found to
be one of the important factors of service quality in the mid to upper class restaurants in
the United States (Namkung & Jang, 2008). Satisfaction with employees has a significant
positive effect on customer loyalty in the chain restaurants in Taiwan (Liu, Huang, &
Chen, 2014). If employees have the best intention in their hearts about customers,
be important at fine dining restaurants in the United States and chain restaurants in
Taiwan, it has never been tested in the context of the fast food industry in the United
States. Thus, it is important to test its impact on service quality here in the United States.
The next section will address the importance of food quality in the restaurant settings as
restaurant environment. Almost half the consumers in the United States (45%) say that
they will stay away from a fast food restaurant due to poor quality of food and beverages
(Tristano, 2013). Many empirical studies in the restaurant industry established what an
important role the quality of food and beverage has in shaping patrons’ behavior (Auty,
1992; Hyun, 2010; Lewis, 1981; Mamalis, 2009; Namkung & Jang, 2007, 2008; Sulek &
Hensley, 2004; Swimberghe & Wooldridge, 2014). On the other hand, many studies
focusing on restaurant industry examined the determinants of food quality. Taste (Hyun,
2010; Namkung & Jang, 2007, 2008), presentation (Hyun, 2010; Namkung & Jang, 2007,
2008), appropriate temperature (Hyun, 2010; Namkung & Jang, 2007, 2008), healthy
option (Hyun, 2010; Namkung & Jang, 2007, 2008; Swimberghe & Wooldridge, 2014),
and menu variety (Namkung & Jang, 2007) have been suggested as aspects of food
quality evaluation. Sulek and Hensley (2004) and Namkung and Jang (2007, 2008) have
postulated that these attributes are determinants of customer satisfaction in the restaurant
industry as well. Moreover, food quality is related to food safety issues and, thus,
influences the trustworthiness of a restaurant (Knight, Worosz, & E.C.D. Todd, 2007).
Lewis (1981) attempted to pinpoint the factors that impacts customers’ decision to
visit a restaurant. The data used in Lewis’ study was gathered from a systematic random
sampling of 400 persons in the United States. Data analysis suggested that food quality
was the most important factor for customers when making a decision to visit a restaurant
(Lewis, 1981). A similar study was conducted a decade later by Auty (1992) in the
United Kingdom to determine the factors of customer behavior in the context of the
restaurant industry. Auty (1992) found food type and food quality as the two most
50
important factors of consumer behavior in the restaurant industry, thus validating the
findings of (Lewis, 1981). In his study, Auty (1992) went much deeper than Lewis (1981)
and divided the restaurant visits into three distinct categories based on occasion: social
gathering, celebration of special events (birthdays, anniversary, sweet sixteen etc.), and
quick meal. Auty (1992) found food type and food quality to be the most frequently cited
Twelve years after Auty (1992), Sulek and Hensley (2004) conducted a research
study to determine the most important factors of satisfaction and repeat patronage at a full
service restaurant in the United States. Since Sulek and Hensley (2004) measured the
impact of food quality on satisfaction and repeat visit intention, it was different from
Lewis (1981) and Auty (1992), as both only measured its impact on the revisit intention.
Sulek and Hensley (2004) collected data from 239 customers using a 5-point Likert-type
scale and allowing participants to rate their satisfaction with each design feature: speed of
service, service quality, and food quality. They conducted a regression analysis and found
food quality to be the most important statistically significant factor in customers’ overall
dining experience at the selected restaurant. Sulek and Hensley (2004) ran another full
model that regressed the design attributes against repeat-patronage intentions. Regression
results identified only one design attribute, food quality, as the statistically significant
predictor of repeat patronage intention (Sulek & Hensley, 2004). Thus, Sulek and
Hensley (2004) found food quality to be an important factor for customer overall
experience and customer loyalty at a full service restaurant in the United States.
Customer comments in their study also supported the conclusion of both regression
analyses because half of all comments contained suggestions pertaining to food quality.
51
So far we have seen Lewis (1981), Auty (1992), and Sulek and Hensley (2004)
found food quality to be the most important factor in decision-making in the restaurant
industry. However, Mamalis (2009) found food quality as a statistically significant factor
but not as the most important factor of satisfaction in the fast food restaurant industry.
Mamalis (2009) found food quality to be the second most important factor of satisfaction.
Mamalis (2009) work is an important study in light of the present study as the data was
collected from fast food outlets similar to the subject hamburger chain. A sample of 305
people at Goody’s and McDonald’s in Greece rated the different items for fast food
restaurants on a 7-point Likert scale marked strongly agree to strongly disagree for 23
items ranging from quality of food to store personnel and service, adapted to the Greek
culture (Mamalis, 2009). The total instrument’s reliability coefficient alpha was 0.827
and the model explained 67.604% of the variance (Mamalis, 2009). The food quality was
Namkung and Jang (2007) went much deeper than the aforementioned researchers
in their investigation of food quality. They not only investigated the effects of the overall
food quality on customer satisfaction and customer loyalty but also looked at the
determinants of food quality in full service restaurants in the United States. Their study
identified the critical attributes of food quality in improving satisfaction and heightening
revisit intention. The authors collected a total of 372 questionnaires, and 300 were used in
the study after excluding incomplete questionnaires. The level of internal consistency
found in this study for each construct was acceptable with Cronbach’s alpha estimates
ranging from .89 to .95. With a structural equation modeling technique, the authors
showed that overall food quality significantly affected customer satisfaction and customer
52
loyalty. Namkung and Jang (2007) also revealed that the relationship between food
quality and customer behavioral intentions was mediated by satisfaction. The current
study also assumes that the impact of food quality on loyalty will be mediated by
satisfaction.
The food quality constructs in Namkung and Jang (2007) study had six attributes:
food presentation, menu variety, healthy options, taste, freshness, and food temperature.
The authors carried out a regression analysis and demonstrated that taste, presentation,
and temperature were the three greatest contributors to customer satisfaction in the
context of full service restaurants. Namkung and Jang (2007) conducted another
regression analysis to determine the impacts of the six attributes on customer loyalty. The
results of the Namkung and Jang (2007) revealed that customer loyalty was significantly
influenced by the quality of presentation, taste, and healthy options. In this model,
healthy option, which was not shown as a significant predictor of satisfaction, had a
significant influence on customer loyalty (Namkung & Jang, 2007). The authors
theorized that the result may have reflected the increasing concern with physical well-
being and healthy food. However, variety of food was not found as a significant indicator
Namkung and Jang (2008) took a different approach than their previous study in
2007 as they included only highly satisfied customers in their analysis. They omitted all
survey participants who indicated the level of satisfaction with the visits were medium to
low. Namkung and Jang (2008) is different in another way than their 2007 study as the
2008 study attempted to identify the importance of the food quality determinants on
customer satisfaction and ignored the effects of overall food quality on customer
53
satisfaction. The data used for the 2008 study was collected from full service restaurants
in the United States. In 2008 study, food quality had five attributes: presentation, healthy
option, taste, freshness, and temperature. Menu variety was omitted from the 2008 study
as opposed to 2007 study. Similar to 2007 study, food taste and food presentation were
found as important factors of customer satisfaction in 2008. Food temperature was found
marginally significant in 2008 study. However, the availability of healthy options was not
2007 study. Freshness and temperature were found statistically insignificant in 2008
study, thereby validating the findings of 2007 study in terms of freshness and
temperature.
Hyun (2010) conducted a similar study like Namkung and Jang (2008) to
determine the effects of food quality on customer satisfaction and loyalty in the context
of a chain restaurant. Unfortunately, the nature of the chain restaurant was not revealed.
Hyun (2010) used structural equation modeling while Namkung and Jang (2008) used
regression analysis. Data in Hyun’s (2010) study was collected via a questionnaire that
was distributed to a randomly selected group of 698 students and faculty members at
Virginia Tech, and 223 of them were collected with a response rate of 31.95%. Food
quality was measured in Hyun’s study based on the five items used by Namkung and
between customer satisfaction and food quality. This finding validates the findings of
Namkung and Jang (2007). In Hyun’s study (2010), among food quality attributes, food
taste and food presentation were the two most important factors contributing to customer
54
satisfaction, thus validating the findings of Namkung and Jang (2007, 2008). Hyun also
validating the findings of Namkung and Jang (2007), which also found temperature as an
restaurant chain in the United States, to determine the effects of food quality on customer
satisfaction and customer loyalty. They collected data from 483 customers for this study.
Based on Hyun (2010) and Namkung and Jang (2008), Swimberghe and Wooldridge
(2014) measured food quality in this study with a five-item scale: presentation, healthy
options, taste, freshness, and temperature. Structural equation modeling was conducted,
and it was found that food quality was a significant contributor not only to customer
Shaharudin, Mansor, and Elias (2011) found food taste and presentation to be
data was collected from 120 customers at a Subway restaurant. Hummel and Murphy
(2011) conducted a similar study as Shaharudin et al.’s (2011) in Malaysia, and their
In addition, the results of the Domenge and Arciniega (2015) study suggested
taste and texture of the food are the key factors influencing customers’ intention to return
and provide free, word-of-mouth publicity. Their data was collected at fast food
restaurants in Mexico City, and the collected data was analyzed by regression analysis. It
was determined that the effect of product quality on behavioral intentions is more than
Based on the aforementioned research studies, it can be concluded that the appeal
generations of food lovers. Lewis (1981), Sulek and Hensley (2004), Namkung and Jang
(2007, 2008), Hyun (2010), and Swimberghe and Wooldridge (2014) examined the
impact of food quality in the restaurant industry in the United States and found it to be
important. Swimberghe and Wooldridge (2014) and Mamalis (2009) found food quality
important in the fast food industry while Sulek and Hensley (2004) and Namkung and
Jang (2007, 2008) found it important in fine dining; finally, Lewis (1981), Auty (1992),
and Hyun (2010) found food quality important across restaurant industry.
environment.
significance of food taste, temperature, presentation, and the availability of healthy food
options across multiple cultures and restaurant segments. Presentation is the tangible cue
for customer perception of quality, and it involves how attractively food is presented and
decorated (Namkung & Jang, 2007). Kivela, Inbakaran, and Reece (1999a) supported the
Decorating food with an elaborate garnish and using plates that blend into dishes are
important for satisfying guests with a sense of aesthetics (Namkung & Jang, 2008). The
subject hamburger chain in the present study also takes food presentation very seriously.
To retain heat and maintain quality, the unique two square inch sandwiches are placed
inside interlocking corrugated boxes made of 100% recycled materials and then stacked
56
inside a 100% recycled brown bag by ten sandwiches to serve the environmentally
conscious customers without guilt — or at least less guilt (Z. Diaz, personal
Menu variety involves the number or assortment of different menu items available
have found it to be of no importance. As stated in the prior section, Namkung and Jang
(2007) and Hummel and Murphy (2011) found menu variety as a statistically
and a menu based on local taste and new menu items in the fast food restaurant industry
in Central America. Menus based on local taste and new menu items are signs of food
variety. Fast food menu innovation affects customer satisfaction in Central America, and
when no new menu items are offered, customer satisfaction will decrease (Castillo,
2013). Additionally, industry experts also found menu variety as an important factor for
customers in the fast food environment. According to Pilon (2014), in general, 73% of
fast food customers in the United States said they like having a variety of menu items at
fast food restaurants. Dehghan, Dugger, Dobrzykowski, and Balazs (2014) also stated
that 32% of those surveyed stated that reducing menu variety is bad business practice for
fast food restaurants. When it comes to restaurant menus, size doesn’t matter but variety
does, according to a Technomic survey report published recently, showing that restaurant
guests will continue to prioritize creativity on the menu (Tristano, 2013). Thus, the
importance of menu variety is emphasized not only by academic researchers, but also by
healthy and safe food (Giray & Soysal, 2007). Another way to look at food safety is that
it is the opposite of food risk, i.e. as the probability of not contracting a disease as a
consequence of consuming a certain food (Grunert, 2005). None of the studies discussed
in the food quality section examined the impacts of food safety on customers’ decision-
making process. However, Knight et al. (2007) conducted a study in the United States to
find out how food safety affects customers’ decision making choices—choices such as
which restaurant to visit. The data for their study was gathered from telephone interviews
conducted with 1,014 randomly selected United States adults. Their main findings were
that a substantial number of consumers think about food safety in general, and they
consider it particularly when eating at restaurants. Likewise, J. Ali and Nath (2013)
conducted a study in India and collected data from 618 urban respondents eating at
family friendly and fast food restaurants and found food safety as the top rated factor
impacting customer satisfaction. In 2015, in United States, food safety in the restaurant
industry came into prominence with the E.coli and Norovirus outbreaks at Chipotle
restaurants in multiple states, which forced the CEO Steven Elis to publicly apologize for
failure to secure food safety (Mohney, 2015). Another report focused on the cost of this
outbreak on Chipotle’s profit. Recently Chipotle warned in an SEC filing that same-store
sales may plunge as much as 11% and profits could fall 26% in the fourth quarter because
of an E. coli outbreak resulting a 20% loss in share prices for 2015 (Monica, 2015). Thus,
food safety in the restaurant industry is of great importance. The subject hamburger chain
takes food safety very seriously. When it comes to food safety, there are no cutting
58
corners and compromises — food safety is our highest priority (Z. Diaz, personal
customer loyalty in the restaurant industry by Namkung and Jang (2007). The same study
industry. However, Namkung and Jang (2008) and Hyun (2010) did not find healthy meal
options important in the restaurant industry. Industry research also finds that the
availability of healthy meals is important. According to the NRA (2014), 87% of quick
service restaurant operators say their customers pay more attention to the nutritional
content of their food than they did 2 years ago. Additionally, the NRA has found that
65% of adults consider healthy menu options while they are choosing a quick service
restaurant. NRA research also has found that health and nutrition continue to be very
important to consumers when dining out—more than seven out of 10 consumers say they
are more likely to visit a restaurant that offers healthy options. However, Namkung and
Jang (2008) and Hyun (2010) did not find healthy options statistically significant.
Freshness of the food, a crucial intrinsic value of food, refers to the fresh state of
food and it is related to the crispness, juiciness, and aroma of the food (Namkung & Jang,
2007). However, Namkung and Jung (2007, 2008) didn’t find food freshness as an
United States. But, freshness of the food was the most important determiner of customer
satisfaction among Malaysian fast food customers (Hummel & Murphy, 2011). The
importance of fresh food in the fast food industry is so great that a new fast food concept
named People Dedicated to Quality( PDQ) was being conceptualized in 2011, with the
59
focus being on fresh locally sourced ingredients, and now is operating in 42 locations in
Alabama, Florida, Georgia, North Carolina, Nevada, South Carolina and Texas (Bradley,
2015).
setting and conditions which can be controlled by restaurateurs (Han & Ryu, 2009).
Environment in this study refers to the physical and sanitary condition of the interior and
exterior of the restaurant including sidewalk, parking lot, garden area, building exterior,
menu boards: interior and exterior, positioning of the marketing materials, dining room,
restroom, chairs and tables, counter area, etc. Maintaining these are important, as 54% of
United States consumers consider environmental quality while selecting a fast food
Making the atmosphere more pleasant and innovative is essential for restaurants’
(décor, artifacts, music and layout) before, during, and after the meal when dining out in
a restaurant (Han & Ryu, 2009). Thus, the importance of the physical conditions in the
interiors and exteriors of their dining facilities to create a pleasant, unique ambiance for
their patrons and to enhance their sense of well-being (Kim, Jeon, & Hyun, 2012).
Pleasant music should be chosen to ensure that patrons feel entertained, thus experiencing
higher levels of well-being (Kim, Jeon, & Hyun, 2012). In this section, 12 empirical
studies (Ali & Amin, 2014; Ali, Omar, & Amin, 2013; Barber, Goodman, & Goh, 2011;
Chow et al., 2007;Han & Ryu, 2009; Hosseini et al., 2014; North & Hargreaves, 1996,
1998; Ryu & Han, 2010, 2011; Ryu & Jang, 2008; Wilson, 2003) will be examined to
60
Chow et al. (2007) examined the impact of physical environment in the context of
the full service restaurant in China. They used a self-administered survey questionnaire to
collect 340 responses. The results of the structural equation modeling suggested that
Following Chow et al. (2007), Ryu and Han (2010) collected data from 360 customers at
fast casual restaurants via a self-administered questionnaires in the United States. The
results of the regression analysis suggested that physical environment is the second most
important factor of satisfaction at fast casual restaurants while food quality registered at
the top (Ryu & Han, 2010). Thus, physical environment plays an important role in the
Ali et al. (2013) examined the impact of physical environment as a whole in the
hotel industry in Malaysia similar to Chow et al. (2007) and Ryu and Han (2010). Ali et
al. (2013) collected data from 280 guests of resort hotels using a survey questionnaire and
used structural equation modeling to assess the model. The major findings were that
guests with higher perceptions of the physical environment are more likely to have a
positive image of the hotel and value for money and are also likely to revisit the
establishment more often (Ali et al., 2013). Ali et al. (2013) was replicated by Ali and
Amin (2014) in the Chinese resort hotel. A total of 500 questionnaires were distributed
by Ali and Amin, and 170 were returned with 35% response rate. The result of the study
suggested that customers who have higher perceptions of the physical environment of the
restaurant they visited are more likely to have positive emotions, increasing customer
variable while Ryu and Jang (2008), Han and Ryu (2009), and Ryu and Han (2011)
examined physical environment in terms of its attributes. Ryu and Jang (2008) proposed a
influence emotion and behavioral intention in the full service restaurant setting in the
United States. Using a structural equation modeling analysis, Ryu and Jang showed that
facility aesthetics, ambience, and layout had significant effects on customer pleasure
while facility aesthetics and employees significantly influenced arousal. In addition, the
results indicated that facility aesthetics had direct influences on behavioral intention.
Lighting was deemed important to determine behavioral intention (Ryu & Jang, 2008).
On the other hand, Han and Ryu (2009) divided the environment into three
distinct parts—décor and artifacts, spatial layout, and ambient conditions—to determine
the impact on satisfaction in the full service restaurant setting in the United States. They
used a total of 279 cases from a survey to assess the overall fit of the proposed model to
test the hypotheses using structural equation modeling. The results suggested that décor
and artifacts had a significant positive effect on customer satisfaction (Han & Ryu, 2009).
However, spatial layout and ambient conditions had no significant direct effect on
customer satisfaction (Han & Ryu, 2009). Following Han and Ryu (2009), Ryu and Han
(2011) also looked at the attributes of the physical environment in the full service
restaurant settings. Using a structural equation modeling analysis, Ryu and Han (2011)
showed that facility aesthetics, lighting, and layout had significant effects on
On the other hand, Barber et al. (2011) focused on the importance of cleanliness
in the restaurant environment. They analyzed collected data to see if there is a correlation
exists between physical environment service quality attributes and repeat patronage. The
Results of Barber et al. (2011) indicated decisions to return to restaurants were based
upon cleanliness attributes, and these results are meaningful because they suggest the
The subject hamburger chain’s focus on sanitation and cleanliness surpasses all other fast
food hamburger chain in New York City, as it was named the cleanest restaurant in New
York City in 2014 (Z. Diaz, personal communication, October 11, 2015).
North and Hargreaves (1996) examined the effect of music on ambient condition
in a college cafeteria. The authors found that customers liked the cafeteria more if they
liked the music played at the cafeteria. North and Hargreaves (1996) found a positive
relationship between music and the liking of a restaurant. On a follow-up study in 1998,
North and Hargreaves (1998) investigated whether affective responses to music could
North and Hargreaves (1998) suggested that different musical conditions influenced
subjects’ perceptions about the cafeteria and purchase intention, thus validating the
restaurant in Australia. Wilson collected data from 300 customers at a full service
restaurant. Wilson indicated that different types of music had different effects on
63
perceived atmosphere and the amount patrons were prepared to spend. Wilson found that
classical, jazz, and popular music were associated with patrons being prepared to spend
the most on their main meal. Wilson also found that customers were willing to spend a
significantly lower amount of money in the absence of music and when easy listening
music was played. Hosseini et al. (2014) examined the effects of physical environment in
a retail environment and found atmosphere and music to play an important role in
and it will be interesting to see its impact at the subject hamburger chain.
environment in the restaurant backdrops. Chow et al. (2007), Ryu and Han (2010), Ali et
al. (2013), and Ali and Amin (2014) examined physical environment as a global variable.
On the other hand, others examined physical environment in terms of its attributes—
spatial layout (Han & Ryu, 2009; Ryu & Han, 2011; Ryu & Jang, 2008), cleanliness
(Barber et al., 2011), interior design and décor (Han & Ryu, 2009), ambient condition
(Han & Ryu, 2009; Hosseini et al., 2014; Ryu & Jang, 2008), facility aesthetics (Ryu &
Han, 2011; Ryu & Jang, 2008), lighting (Ryu & Han, 2011; Ryu & Jang, 2008) and
music (Hosseini et al., 2014; North & Hargreaves, 1996, 1998). Based on these empirical
studies, the ‘KSM for QSR’ model adopted spatial layout and seating arrangement,
sanitation, interior design and décor, and ambient condition as the attributes of physical
environment.
customers in a restaurant where ample space is essential for moving around and sitting in
comfortably (Han & Ryu, 2009). Besides the above-mentioned studies, studies
64
(Harrington et al., 2012; Hussain & Ali, 2015; Namkung & Jang, 2008; Sulek & Hensley,
2004) mentioned in other sections of this chapter also found spatial layout important in
restaurant settings.
which affects customers’ feelings towards the restaurant (Hussain & Ali, 2015). Besides
Barber et al. (2011), Andaleeb and Caskey (2007), Markovic, Raspor, and Šegaric
(2010), Min and Min (2011), Harrington et al. (2012), Dube et al. (2015), and Hussain
and Ali (2015), studies discussed in other sections also found cleanliness to be a
the restaurant in current study refers to the cleanliness of the overall restaurant, which
includes outside area, building, restroom, dining room, customer service counter, and
kitchen.
environment of a restaurant. It includes the color schemes of the walls, ceiling and wall
decorations, pictures and paintings, plants and flowers, tableware, linens, floor coverings,
and furniture, creating an overall aesthetic impression (Han & Ryu, 2009).
such as nice smells, pleasing music, a comfortable temperature, a low noise level, and
and influence their responses to the environment. All of these things, harmonizing with
other elements in a restaurant, may result in customers having more favorable perceptions
of an operation and evaluating their experiences more positively (Han & Ryu, 2009).
Convenience. The NRA (2014) showed that 72% of United States consumers
65
consider convenience while selecting a fast food or fast casual restaurant. Convenience is
related to the customers’ desire to conserve time and effort, and an increase in
convenience is associated with an increase in satisfaction (Kimes, 2008). Over the years,
between convenience and customer perception (Hosseini et al., 2014). After a review of
the literature, the researcher found location (Harrington et al., 2012; Min & Min, 2011;
Sharkey, Johnson, Dean, & Horel, 2011), hours of operation (Andaleeb & Caskey, 2007),
parking (NRAt, 2014) and access to transportation (J. Ali & Nath, 2013; Min & Min,
Availability of location within close proximity from home and workplace is found
Harrington et al. (2012) and Min and Min (2011) empirical studies mentioned previously
segment. Upadhyay, Singh, and Thomas (2007) investigated the impact of location in the
context of the Indian restaurant industry. The authors collected and analyzed 300
responses. The findings of their study supported the notion that location is considered as
the fourth important choice criteria in selection of restaurants. Those findings sync well
with the results of Kokko (2005), who also found location as the fourth most important
Spatial access to fast food, in terms of proximity and coverage, is associated with
frequency of fast-food meals (Sharkey et al., 2011). Increased distance to the nearest fast
food restaurant from home or workplace is associated with the decreased frequency of
66
fast food meal (Sharkey et al., 2011). If a fast food restaurant is within close proximity
from customers’ home and workplace, they will frequent the restaurant more often than if
important at the college cafeteria because a college cafeteria is usually open when the
campus is open. Thus, it might be important in the case of fast food restaurants as more
and more restaurants, including the subject hamburger chain, are offering extended hours,
and many are offering 24-hour service including the subject hamburger chain.
In the United States, 65% of consumers consider easy access to parking while
selecting a fast food or fast casual restaurant (NRA, 2014). Besides the NRA study, not a
However, since the NRA found it to be important, it should be further studied. Parking
becomes very important in urban centers like New York City, where finding street
Accessibility in the current study refers to the easy access to a restaurant via either
chose a restaurant. Customers of the quick service restaurant are more likely to visit a
restaurant that has easy access (Min & Min, 2011). Accessibility is an important deciding
factor when customers eat out at a fast food restaurant (J. Ali & Nath, 2013).
American life, and more consumers are showing an increasing interest in using
technology at restaurants (NRA, 2014). Data has revealed that 32% of the adults in the
67
United Sates stated that availability of social media platforms, such as Facebook or
technology comes at a cost, but it can enhance customer satisfaction in many ways
(Kimes, 2008). Technology can improve speed of service by reducing the order-taking
time by using smart phone apps or handheld devices, reducing food production time
through the use of kitchen display, tightening service time through the use of table
management systems, shortening payment time through handheld devices, and cutting
turnaround time through the use of communications technology (Kimes, 2008). Greater
control over service encounters enhances customer satisfaction, and technology can give
customers that control by allowing them to choose the time they eat, by minimizing their
Even though the full extent of the effect of technology on customer satisfaction in
the restaurant industry is not fully understood by academic researchers, industry experts
and practitioners have spoken about its importance. Thus, technology ought to be part of
NRA, 2014), Wi-Fi (NRA, 2014), smart phone apps (NRA,, 2014), and social media ( Gu
More and more customers are now preordering via online or smart phone app
because it gives customers control over their time by allowing them to select their food
before arriving at the restaurant (Kimes, 2008). The NRA’s (2014) surveys have found
that 43% of United States consumers place orders online for delivery or take out.
Restaurants are mindful of this trend and are offering online ordering, and Kimes (2008)
68
stated that 38% of casual and fine dining restaurants allowed online ordering through
their own website and others, such as webfood.com, waiter.com, delivery.com, and
foodjr.com. The subject hamburger chain also offers preordering via a smart phone app
and online ordering via its website, which is instrumental in cutting service time (Z. Diaz,
smart phone apps, Wi-Fi connectivity, and ordering kiosks, while selecting a quick
service or fast casual restaurant, and this number goes up to 33% for the young
consumers (NRA, 2014). In another survey, the NRA (2014) found that the majority of
consumers (63%) said that they recently have used restaurant-related technology options,
such as using a smartphone or tablet to find restaurant locations and directions, ordering
However, the researcher of the present study have not found a single empirical
study examining the effect of online ordering, smart phone apps, and Wi-Fi on customer
satisfaction. One of the reasons for the lack of academic study in this area is that these are
relatively new phenomena for the past four/five years that impacting restaurant industry,
but increasingly they are becoming important (S. Lockyer, personal communication,
November 11, 2015). Because of its importance as evident by the NRA survey and
Kimes’ work (2008), these factors are important enough to be explored in the current
study.
interactive platforms via which individuals and communities share, create, discuss, and
Social media is a group of Internet based applications that are built on the ideological and
technological foundations of Web 2.0, and they allow the creation and exchange of user
generated content (Kaplan & Haenlein, 2010). The types of social media include social
networks (Facebook, Myspace, and LinkedIn), micro-blogs (Twitter, Plurk, and Friend
Feed), reviews and ratings sites (Yelp, Amazon, and Trip Advisor), video sites (YouTube
and Vimeo), and more (Karimi & Naghibi, 2015). The subject hamburger chain puts
heavy emphasis on social media as well with a strong presence in Facebook, Twitter and
Social media plays an important role in today’s consumer market, as more and
more people are spending increasing time on social media, and their purchase decisions
are being heavily influenced by social media (Gu & Ye, 2014). Additionally, since social
social media in a variety of ways, ranging from reading blogs to seeking information
from friends on social networks to visiting consumer review forums (Gu & Ye, 2014).
Not a single academic study in the restaurant industry examining the impact of
social media on customer satisfaction has been found for the current research. However,
the NRA has published data on the use of social media in the restaurant industry. The
NRA (2014) data showed that 22% of the United States consumers view social media
pages of the restaurants they visit, and 5% follow restaurants on Twitter. Seven of 10
quick service restaurant operators said that they planned to invest more in social media
marketing in 2014 as younger consumers are much more likely than older adults to
communicate with restaurants via social media (NRA, 2014). The NRA, in its 2014
Restaurant Industry Forecast market research, also revealed that 68% of quick service
70
restaurants plan to increase their marketing budget for social media while only 2% plan to
cut spending in social media. Thus, due to its importance demonstrated by NRA study,
social media will be included in this study to determine its effect on customer satisfaction
Price and value. As reported by the 2014 Restaurant Industry Forecast (NRA,
2014), 85% of the United States consumers consider value while selecting a fast food
restaurant, and 23% of the United States consumers say they will stay away from a fast
food restaurant due to high prices (Tristano, 2013). Thus, price and value are important in
the context of fast food environment as Dube et al. (2015) stated that customers place a
high premium on price, making it a strategic priority for the restaurants in question. It is
likely that when customers do not associate price and value to what the restaurants are
offering, they will give their business elsewhere (Dube et al., 2015). Therefore, it is
important to understand price and value and the impact price and value have on customer
satisfaction. Price fairness indicates reasonable prices of the food items served in a
maintain the same quality standards (Vanniarajan, 2009). Many researchers over the
years have examined the impact of price and value on customer satisfaction in the
restaurant industry and found it to be an important factor (Ali & Nath, 2013; Gupta,
McLaughlin, & Gomez, 2007; Haghighi et al., 2012; Homburg, Hoyer, & Koschate,
2005; Pei & Ayub, 2015; Ryu & Han, 2009; Steiner, Siems, Weber, & Guhl, 2013). Only
Pedraja Iglesias and Jesus Yagüe Guillén (2004) found price and value not to be an
Pedraja Iglesias and Jesus Yagüe Guillén (2004) conducted a study to determine
71
the effect of price on customer satisfaction in the restaurant setting in Spain. The authors
collected data from 156 people. The researchers observed that the total perceived price
does not exercise a significant effect on the level of customer satisfaction in the
restaurant. Thus, the total sacrifice (monetary and non-monetary) that is perceived to be
associated with the transaction at a restaurant does not significantly affect satisfaction
customer satisfaction in the German restaurant industry. Their results suggested that as
satisfaction goes higher, the negative impacts of price decreases on the repurchase
intention, thus proving the fact that there is an inverse relationship between the two; if
one goes up, the other goes down. If price goes up, satisfaction goes down (Homburg et
al., 2005).
Gupta et al. (2007) findings contradicted the findings of Pedraja Iglesias and
Jesus Yagüe Guillén (2004). Gupta et al. (2007) set out to determine the principal drivers
of customer satisfaction in a restaurant chain in the United States. Theirs was a major
study that analyzed more than 80,000 guest surveys regarding their overall restaurant
experience. A robust and statistically significant model showed that restaurants that pay
attention to appropriate cost of the food among others have the greatest chance to
increase guests’ satisfaction and the return intention of customers (Gupta et al., 2007).
Han and Ryu (2009), a study mentioned previously, found similar results as Gupta et al.
(2007) about the impact of price on satisfaction in the full service and fast food
restaurants in the United States. Haghighi et al. (2012) conducted a study in Iran and
collected data from 268 customers. They conducted structural equation modeling for data
72
analysis and hypothesis testing. The obtained results showed that perception of price
fairness among others had a positive impact on customer satisfaction and trust (Haghighi
et al., 2012).
According to Steiner et al. (2013), the highest level of customer retention occurs
when consumers are most satisfied with the price of the products or services. The authors
strategy, and bundling. This is an important point as the current study attempts to
measure price perception against customer satisfaction, not the actual price. J. Ali and
Nath (2013) conducted a study in India and collected data from fast food and family style
restaurants. Data analysis suggested that food price is one of the seven most important
factors in making restaurant choices for eating out (J. Ali & Nath, 2013).
Pei and Ayub (2015) conducted a study at a hospital cafeteria in Malaysia. They
collected data from 50 patients and 50 employees of the hospital to measure the impact of
price on the level of dissatisfaction with the hospital cafeteria. The results of the Pei and
Ayub (2015) revealed that high price was one of the two most important factors of
According to the industry expert (Gala, 2013), another aspects of price and value
in the fast food market is that customers do not mind paying more for high quality
products. When customers shop at fast food restaurants, they look specifically for value,
rather than price. A study from Phoenix Marketing International found that customers do
not mind paying higher prices at restaurants as long as there is a perceived value in the
item or bundled items (Gala, 2013). Gala (2013) also mentioned that after viewing quick-
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serve ads, participants were asked if they would visit that particular restaurant within 30
days. Ads with value messages drove 20% more participants to report an intent to visit
than ads without value messages (Gala, 2013). It will be interesting to find out the
individual contribution of price and value to satisfaction in the subject hamburger chain.
Thus, the impact of price on satisfaction at fast food and full service restaurants is
established by all the above mentioned studies except Pedraja Iglesias and Jesus Yagüe
Guillén (2004). Industry experts also point to the importance of price and value to
determine the customer satisfaction in the restaurant industry. Besides price and value,
other factors also impact satisfaction at restaurants and one such factor is order accuracy.
customer’s order accurately and error free. It is important to fill a customer’s order
correctly, as 96% of United States’ consumers said order accuracy is important or very
important when they are choosing a fast food restaurant (Tristano, 2013). Recently, there
has been an intense focus on completing orders with accuracy among restaurant
operators. This is especially true when customers are shopping via drive-thru or take out
simply because once customers leave the restaurants with the food, the opportunity to
correct an incorrect order is no longer available (Duncan, 2015). The subject hamburger
chain in the current study also focuses on filling orders correctly by repeating orders
multiple times (after taking order, while collecting money and while handing out the
order) during the transaction (Z. Diaz, personal communication, October 11, 2015).
Restaurants that were included in Markovic et al. (2010) study represented different types
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pizzerias. Data analyses suggested that one of the most important expectations of
Markovic et al. (2010) did not measure the impact that filling an order accurately has on
customer satisfaction.
in the context of the restaurant industry because no academic study has addressed it yet.
environment. Industry experts (Duncan, 2015; Little, 2015; Oches, 2012 & 2014) have
also written about its importance. Nothing beats driving away with a bag of food from a
fast food restaurant and discovering when you get home that your order is wrong (Tice,
2012). Imagine leaving a fast food restaurant, and upon arrival at home, only to find out
the only chicken sandwich that was ordered for 109 years old grandmother is missing. It
is definitely not a pleasant experience. Missing an item from an order is definitely a deal
breaker.
One of the two most important gauges of drive-thru performance in the quick
top concern for fast food operators (Oches, 2014). Fast food managers’ biggest focus
right now is improving the drive-through accuracy because once customers leave and the
order is not right, it is a lot more difficult to recover those guests than someone who is
dining in (Duncan, 2015). To improve order accuracy, McDonald’s, the industry sales
leaders, is quietly rolling out a new initiative called "Ask, Ask, Tell" during which drive-
through crews will repeatedly verify the correct order at three separate times (when a
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customer orders, pays, and receives a meal) to improve accuracy (Little, 2015).
Thus, due to its importance as expressed by industry experts and insiders and to
understand its effect on customer satisfaction in the fast food environment, the order
accuracy construct is being added in to the current study. It contains four attributes. When
visiting a restaurant, it is important to receive all items ordered along with all necessary
condiments and supplies, such as napkins, fork, spoon, knife, etc. It is also important to
receive proper change when conducting the transaction with cash as mentioned by
Speed of service. In service industries like restaurants, firms compete with each
other on the basis of providing fast service along with other deliberate mechanisms such
as price and value. This section discusses the significance of speed of service in the
restaurant industry. Tristano (2013) reported that 90% of consumers in the United States
said that speed of service is an important factor when they are choosing a fast food
restaurant. Speed of service in the current study refers to the time it takes to serve a
customer at a restaurant. Usually, the time starts as soon as a customer enters a restaurant,
and it stops when the customer has been served (Z. Diaz, personal communication,
in restaurants. Kimes (2008) stated that if speed of service can be accelerated, more and
more customers could be served, resulting in improved service velocity and satisfaction
because faster service results in higher customer satisfaction in the fast food restaurants.
Chang and Huang (2014) also stressed the importance of addressing the long waiting
service providers. Speed of service is much more important at fast food than other
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segments and the subject hamburger chain focus the most on speed of service (Z. Diaz,
personal communication, October 11, 2015). Therefore, managers at fast food restaurants
should focus on improving speed of service since customers place greater value on faster
service and are willing to pay more for it (Parsa, Gregory, Self, & Dutta, 2012). Seven
empirical studies dealing with speed of service in the restaurant industry were examined.
Some of them (Allon, Federgruen, & Pierson, 2011; Dube et al., 2015; Dube-Rioux,
Schmitt, & Leclerc, 1989; Iqbal, Whitman, & Malzhan, 2012; Wang & Chen, 2012)
found speed of service as an important factor while others (Harrington et al., 2012;
Namkung & Jang, 2007) found it as an unimportant factor in the restaurant industry.
restaurant industry in an interesting way. They divided the restaurant visit into three
phases—the beginning, meal delivery, and the end. The authors hypothesized that waiting
time at different phases would have different impacts on satisfaction. They found the
same length of a delay had different consequences depending upon when it happened.
According to Dube-Rioux et al., customers got annoyed at the beginning and at the end of
their restaurant visit while, on the other hand, seemed to be more understanding and
forgiving when the actual meal was delayed. Therefore, a delay in providing service is
Wang and Chen (2012) conducted a study in the full service restaurant and found
speed of service as the second most important factor of overall service quality and
perceived value, and perceived service quality and perceived value were related to
customer future behavioral intention. However, the findings of Namkung and Jang
(2007), a study previously discussed, and Harrington et al. (2012) contradicted the
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findings of Wang and Chen (2012). Both studies (Harrington et al., 2012; Namkung &
Jang, 2007) found speed of service is not an important factor in the context of full service
speed of service differs in the full service and casual service restaurant segments.
However, the importance of speed of service is certain in the fast food industry. It
is different when people go to a fast food restaurant than a full service or casual
restaurant. Usually, they have much less time and are in a rush to get in and get out while
visiting a fast food restaurant. Thus, it is not surprising to see that all explored empirical
food restaurants. Allon et al. (2011) conducted a major study in the United States to
determine the impact of waiting time in the fast food industry. They collected data from
388 outlets belonging to McDonald’s (173), Burger King (92), Wendy’s (62), White
Castle (42), Dairy Queen (10), and Steak ’n Shake (9). They conducted data analysis via
structural equation modeling. The results of the Allon et al. (2011) suggested that a
reduction in waiting time significantly improved satisfaction and gave the fast food
restaurants ability to increase market share. Harrington et al. (2012) also found speed of
service as a determinant of positive experience at fast food restaurant. They collected data
from 575 people in the southwest United States patronizing fast food, casual dining, and
full service restaurant. The results of the Harrington et al. (2012) suggested that speed is
an important determinant of positive experience at fast food while speed was found
Iqbal et al. (2012) also examined the impact of speed of service in the fast food
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environment in the United States. The results of their study indicated that high wait time
has a negative effect on customer satisfaction and many customers chose not to stay in
the line when wait time was high, resulting in a direct hit on satisfaction and sales.
Finally, Dube et al. (2015) investigated the importance of speed of service in three fast
food restaurants in South Africa and found speed of service as one of the most important
factor of satisfaction.
Another aspect of speed of service in the fast food industry is that the tolerance of
long wait time differs based on the time of day—breakfast, lunch, dinner, and late night.
There is a consensus among fast food operators in the Unites States that customers will
be less forgiving during breakfast and lunchtime because of limited time available to
spend on meals (Z. Diaz, personal communication, October 11, 2015). Usually, people
are rushing to work after breakfast and lunch due to limited time. On the other hand, they
will be much more forgiving during dinner and late at night because they are not as time-
starved as during breakfast and lunch. While speed and consistency are important
throughout the day, breakfast and lunch, in particular, have certain urgency for many
guests while moving into snack, dinner, and late night, fast food operators interpret that,
in the guest’s mind, there may be a little less of the time-starved nature of their visit
(Duncan, 2015). The current study collects speed of service data at different times of the
undisputed in the fast food industry, it is getting much slower at fast food lanes. Tice
(2013) cited several reasons why fast food is getting slower; as chains have diversified
consumers also eat out more often now, which leads to longer lines. Then, there is the
challenge of managing the difference between perceived wait and actual wait (Choi &
Sheel, 2012). Usually, perceived wait at the fast food restaurants is far greater than actual
wait (Choi & Sheel, 2012). This is an important distinction as the current study deals with
the perceived wait rather than the actual wait. Speed of service is also linked to improved
market share as Allon et al. (2011) stated that restaurants can improve market share
reduction pays off handsomely in the fast-food industry. Since the speed of service
impacts customer satisfaction greatly in the fast food industry and has the potential to
increase market share, its impact ought to be studied at the subject hamburger chain.
Summary
In summary, a review of the current literature has revealed that many empirical
studies exist in the context of the restaurant industry establishing the importance of
customer satisfaction. These studies have examined the impact of service quality, food
quality, physical environment, convenience, price, and value, and speed of service on
customer satisfaction. No such study has ever been conducted at the subject hamburger
chain, creating the need to conduct the current study. Existing literature has not addressed
(NRA, 2014) has found their importance in determining customer satisfaction in the
restaurant industry. Industry experts and practitioners also stressed their importance to
dictate satisfaction in the restaurant environment. So, there is a need to study the effect of
order accuracy and technology on customer satisfaction. Finally, the researcher of the
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current study has not found any study that considered all the variables and their related
attributes that are used in the current study to determine customer satisfaction in the
restaurant industry. This has created the need to conduct the current study.
research, the current study will proceed with a review of the research questions, related
hypotheses, and the research methodology. It will bring to further study the constructs
convenience, customer-facing technology, price and value, order accuracy, and speed of
service. It will thereby detail the selection of data sources, sampling, data analysis
CHAPTER 3
METHODOLOGY
Chapter 2 investigated the existing knowledge about customer satisfaction and the
food quality, physical environment, convenience, price and value, and speed of service.
The researcher of the current study did not locate any significant academic study that
satisfaction in the restaurant industry. However, the Restaurant Industry Forecast (NRA,
2014) and industry journals discussed the importance of order accuracy (Duncan, 2015;
Little, 2015; Oches, 2012, 2014; Tice, 2012; Tristano, 2013) and customer-facing
technology (Gu & Ye, 2014; Kimes, 2008). Chapter 2 also established that there is a
the context of restaurant industry. However, the researcher of the current study did not
find any empirical study that included all variables, which are included in the current
Chapter 3 discusses the research design and the rationale behind the design,
moral and ethical issues, survey instrument, validity and reliability of the instrument, data
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collection, data analysis, and the assumptions of the study in detail. This chapter
framework of the current study includes the following three research questions.
Research Design
A fast food hamburger restaurant chain in the United States served as the setting
for the current study. By design, this is a quantitative cross-sectional study and aims to
determine the most important factors of customer satisfaction at the subject hamburger
chain. The current study also examined the effects of demographic variables on customer
satisfaction at the subject hamburger chain. Finally, the current study explored the
relationship between customer satisfaction and customer loyalty at the subject hamburger
chain.
Creswel (2008) identified three criteria for a quantitative study: collecting and
analyzing numerical data, measuring distinct attributes of the subject matter, and
comparing groups or relating factors. In the current study, data was collected in numeric
form by using an instrument, which was self-developed, industry experts validated and
pilot tested. Like the example provided by Sulek and Hensley (2004), the participants
rated their perceptions of actual services and products received at the subject hamburger
chain on a 5-point Likert-type scale. The collected numeric data measures the
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participants’ perceptions of different aspects of the actual product and service received at
order to answer the research questions and test the hypotheses. Since the current study
satisfies all three criteria, it qualifies as a quantitative study. As evidenced by Kivela et al.
(1999a), Andaleeb and Conway (2006), Liat and Chiau (2015), Hussain and Ali (2015),
and Shariff et al. (2015), quantitative research methodology was used by previous
restaurant industry.
Following the example set in the research done by Andaleeb and Conway (2006),
Cronin and Taylor (1992), Pei and Ayub (2015), Sulek and Hensley (2004), and Young
and Soocheong (2010), a cross-sectional design was used in the current study to
determine the factors influencing customer satisfaction at the subject hamburger chain.
existing differences rather than changes following interventions, and demographic groups
based on existing differences rather than random allocation (de Vaus, 2004). All of these
three characteristics are present in the design of the current research study.
The current study does not have a time dimension. Data was collected only once,
as allowed by the subject hamburger chain, in 40 of the chain’s 400 locations, which are
spread out through the mid-western to eastern United States. Every 250th customer in
each location was given the opportunity to complete the survey as dictated by the subject
hamburger chain. The subject hamburger chain restricted the data collection to two times:
the first for the pilot test and the second for the final study. Since there was only one data
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collection opportunity for the final study, a longitudinal study was not feasible because a
Namkung and Jang (2008) conducted a similar cross sectional study in the mid-western
and eastern United States to determine the effects of food quality, service quality, and
The current study relied on existing differences rather than changes following
after implementing intervention measurements based on the initial study (de Vaus, 2004).
Capturing the results of the improvement measurements after the initial study at the
subject hamburger chain is beyond the scope of the current study. Thus, a cross-sectional
design is more appropriate for the current study as it does not require collecting data after
Namkung and Jang (2007) conducted a similar cross-sectional study to determine the
effects of food quality on customer satisfaction and the relationship between satisfaction
and customer loyalty in the mid-western and eastern United States in the context of
restaurant industry.
In this study, demographic groups are based on existing differences rather than
random allocation. Since data was collected only once, there were no opportunities to
time. This is another reason cross-sectional design is appropriate for the current study
because this design does not require comparison of groups on multiple data collection as
stated by de Vaus (2004). Sulek and Hensley (2004) conducted a similar cross sectional
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study in the southeastern United States to determine the effects of speed of service,
physical environment, food quality, and service quality on satisfaction in the context of
restaurant industry.
One of the major strengths of the study is the support received from the subject
hamburger chain. The chief executive officer of the company showed a personal interest
in the research and assigned the vice president of marketing to work with the researcher.
General managers, district managers, regional directors and vice presidents of operations
of the selected restaurants were asked to cooperate with the research project. To increase
survey return rate, the firm offered an incentive of three free hamburgers to the
participants for completing the survey. The incentive offer of three free hamburgers was
chosen because it has been proven to be effective in increasing response rate at the
subject hamburger chain’s own customer satisfaction survey. Academic studies also
found incentive increase survey response rate as Selm and Jankowski (2006) stated that
conducted by Pedersen and Nielsen (2014) showed that the survey response rate in online
Collecting data online via the Survey Monkey platform is another strength of the
study. Data collection via online systems is particularly useful when survey participants
are spread across a large geographic region. The survey participants of this study are
spread across the mid-western and eastern United States. Another advantage of the web-
cannot be tracked or collected. To ensure anonymity, the researcher neither collected any
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personal information nor tracked the Internet Protocol (IP) addresses of the respondents’
computers. According to Selm and Jankowski (2006), the main advantages of online
surveys include reduction of costs and time, ease in reaching large numbers of potential
respondents, and the possibility of providing anonymity to participants. Since the data
was collected via the web-based survey, there was no need for data entry as mentioned by
With a cross sectional research design, data is gathered at only one point in time
(de Vaus, 2004). Thus, in the current study, data was collected only one time. However,
due to intense competition in the fast food industry, frequent changes in consumer
consumer opinion to change frequently (NRA, 2014). This means that the results may
have been very different if longitudinal data, which captures the impact of changes in the
market condition, were used. In longitudinal study, data is collected in multiple phases—
pre-intervention and post-intervention (de Vaus, 2004). Usually, after the initial data
collection and analysis, a set of measurements is put into place to address the condition of
the business. Then, a few months later, data are collected once more, and new analyses
are done to determine how the interventions affected the business and to assess the
competitive environment again. The current study lacks this advantage because it is not a
longitudinal study.
The survey was administered only at the subject hamburger chain, which means
that the findings of the study do not apply to the other fast food chains and restaurant
types—fine dining, casual, and fast casual. The current study cannot, therefore, be
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generalized across the fast food industry and the restaurant industry as a whole.
Additionally, data was collected only from the mid-western and eastern United States;
thus, the results cannot be generalized across the United States and, more importantly, the
global fast food market. The lack of generalization issue was acknowledged by Wu and
Mohi (2015), and they recommended that studies should attempt to examine the issues of
concern targeting different samples across different kinds and ratings of restaurants in
other regions with the possibility of comparative studies involving other regions or
countries. N. Terblanche (2015) echoed the same as Wu and Mohi (2015) by stating that
different samples in other restaurant settings might produce alternative insights. Another
weakness of the study is that the subject hamburger chain restricted administering the
survey only to every 250th customer at the selected locations due to operational challenge
and the possibility of conflict with their own customer satisfaction survey.
However, there may be some other dimensions of customer satisfaction that have
not been identified in the ‘KSM for QSR’ model. Future studies should focus on
satisfaction that was not identified in this study, such as environmental sustainability,
food source, marketing efforts, humane treatment of animals and brand image. This
Finally, the respondents neither were asked any open-ended questions nor any
interviews were conducted carrying out the current study. Therefore, the study solely
captured the opinions of the respondents but failed to understand the motives behind the
opinions about the impacts of service quality, food quality, physical environment,
convenience, customer-facing technology, price and value, order accuracy, and speed of
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research project, which is solely based on survey questionnaires, lacks the ability to have
have provided more useful insights. The need to conduct mixed method study was voiced
by Hussain and Ali (2015), who conducted a study to determine the effects of physical
objects, or events, and it is very important to have a very clear idea and well-defined
population in mind before sampling (O'Leary, 2010). In the current study, the population
is the customer base of 400 restaurants of the subject hamburger chain across the mid-
western and the eastern United States. The aim in population research is to gather data
from everyone in the population, but this is impractical unless the population is a small,
defined, accessible group (O’Leary, 2010). Since the subject hamburger chain serves
millions of customers every year in its 400 locations, it is impractical to collect data from
all customers. Therefore, sampling techniques were employed to raise to the challenge of
research study, and it attempts to be representative, meaning that the sample distribution
size means that the sample distribution and characteristics allow findings to be
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generalized across the population (O'Leary, 2010). Sampling also provides such
advantages as lower costs, greater accuracy of results, and greater speed of data
The subject hamburger chain restricted data collection at 10% of its locations and
allowed distribution of the survey to every 250th customer at each location. The
restriction was put in place to reduce interference with its own customer satisfaction
survey. Thus, following Haghighi et al. (2012) and Dube et al. (2015), address of the 400
locations were placed in a hat, and 40 of them were pulled randomly. These 40 selected
locations served about 400,000 customers during the data collection period. Because of
the restriction imposed by the subject hamburger chain, every 250th customer in the
selected locations received the survey invitation with instructions on the receipt to
complete the survey. Therefore, the current study used a two-tiered sampling frame. In
the first tier, the researcher chose 40 out of 400 restaurants, and in the second stage,
every 250th customer was selected to participate in the survey. Thus, systematic random
sampling was used in the second tiered selection process that involves selecting every nth
case with a defined population (O’Leary, 2010). Kivela, Reece, and Inbakaran (1999b)
used systematic random sampling where every fourth customer was asked to complete
Ethical Issues
de Vaus (2004) mentioned that all social research ought to conform to four broad
Approval of the research protocol used in the study was sought from the Human
protocols within the university community (faculty, staff, and student) to make sure that
the rights and safety of research subjects are protected ("Human Subjects Review,"
2015). The research protocol was approved by HSRC in August 2015. To partake in the
survey, the participants had to be at least 18 years old to comply with the HSRC
regulation. A letter of consent explaining that participation was voluntary and that
anonymity of the participants would be strictly maintained was shown to the participants
prior to surveying them. Data was collected via Survey Monkey platform, and no
are stored in electronic format on a flash drive and secured at a safe deposit box at the
researcher’s bank in New York City. The data will be deleted permanently after 3 years
these steps, formal permission to conduct the survey was sought from, and granted by,
The reliability and validity of the survey instrument is necessary for conducting
any solid empirical study (Lai, 2015; Liat & Chiau, 2015). The quest for validity is the
attempt to eliminate or minimize systematic error while the quest for reliability is the
attempt to eliminate or minimize random error (O'Leary, 2010). A pilot test was
conducted and industry experts were consulted to ensure that the survey instrument was
Validity
supposed to measure, and to achieve this, it must be free from systematic influences that
move responses in another direction (Vavra, 1997). The current study focuses on content
and construct validity. Content validity deals with the appropriateness and the
inclusiveness of the questions to the measured construct while construct validity deals
with the extent to which a question represents an underlying construct and the extent to
which the question relates to other associated constructs (Vavra, 1997). To ensure the
validity of the instrument, three industry experts working at the subject hamburger chain
were consulted. One of the experts was a general manager overseeing a restaurant in New
York City while another was a district supervisor managing 10 restaurants in Chicago.
Finally, a marketing professional who was the vice president of marketing at the subject
restaurant chain was consulted. All three experts agreed that the content and construct of
the survey instrument were valid and relevant to the fast food industry.
Reliability
Reliability means the lack of random error. If an instrument produces the same
scores on the attributes of the questionnaire reliably reflect the underlying construct, the
instrument must be highly reliable. Internal consistency tests are useful in assessing the
Cronbach’s coefficient alpha that tests how well each item, or question, in the instrument
is related to each other (Vavra, 1997). A pilot test was done to conduct the Cronbach’s
coefficient alpha tests for each of the constructs to ensure reliability and internal
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consistency of the instrument. The Cronbach’s alpha values from the pilot test are
Table 1
Price/value 0.94
Satisfaction 0.92
Environment 0.90
Convenience 0.90
Loyalty 0.90
Technology 0.87
According to Table 1, the Cronbach’s alpha values are greater than or equal to .85
for each of the construct, and according to Hayes (2008), anything over .70 is acceptable.
Therefore, it can be concluded that the instrument used in this study is highly reliable.
Survey Instrument
After a review of the current literature, and industry journals and researches on
customer satisfaction in the restaurant industry, the survey instrument was formulated and
tested on a pilot basis in June 2015 at five locations of the subject hamburger chain in the
eastern United States. Each location received 40 survey questionnaires and was instructed
to administer them throughout the week ending on June 27, 2015. A total of 156 survey
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questionnaires were returned with a return rate of 78%. The responses obtained from the
pilot supported the launch of the full survey with minor changes in the instrument. The
Cronbach’s Alpha for each construct was either greater than or equal to .85. The value of
adjusted R2 for the model was .75 without any of sign of multicollinearity. The full
facing technology, order accuracy, price and value, speed of service, customer loyalty,
and customer satisfaction. A summary of factors, codes, and questions of the survey can
be seen in Appendix B. Q1 was the survey qualifier, which the participants answered
with a yes-no scale. If they answered “yes,” they were not allowed to move forward with
the survey. Respondents were asked about their level of agreement on a 5-point Likert-
type scale ranging from 1 (strongly disagree) to 5 (strongly agree) for Q2 to Q39. An
option to answer “did not observe during the visit,” was also offered. Demographic
information was collected through asking Q41 – Q47. Question 48 asked the participants
to identify which factor they thought most important for the restaurant chain to focus on
data that allows systematic comparisons between cases, or groups of cases (de Vaus,
2004). In this study, data were collected from the selected 40 restaurants of the subject
hamburger chain using the same variables. Only 40 locations were randomly selected
because the subject hamburger chain did not allow more due to potential interference
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with its existing customer satisfaction survey. Out of these 40 locations, seven were in the
East Coast (four in New York and three in New Jersey), and 33 were in the Midwest (six
in Chicago and Cincinnati, five in Indianapolis, four in St. Louis, three in Columbus,
size, developing summaries, searching for patterns, and applying statistical techniques
(Sulek & Hensley, 2004). The researcher sought answers to the research questions, and
tested the hypotheses of the study by deploying statistical technique via Statistical
Package for Social Sciences (SPSS). Rigorous descriptive and inferential statistical
analyses were carried out. Descriptive statistics indicate general tendencies in the data—
the spread of scores, or a comparison of how one score relates to all others—while the
inferential statistics help analyze data from a sample to draw conclusion about an
data while the inferential statistics provided answers to the research questions and helped
In order to compare the aggregated scale scores from the survey, and better
understand the factors influencing customer satisfaction at the subject hamburger chain,
multiple regression analysis has been carried out. Multiple regression is a correlation-
based statistical technique that can be used to explore the relationship between dependent
variables and multiple independent variables with a high level of sophistication (Pallant,
research that has the ability to either confirm a priori established theories or identify data
patterns and relationship (Josephs, Hair, Hult, Ringle, & Sarstedt, 2014). Therefore,
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between customer satisfaction and its eight independent variables. Correlation analysis, a
first-generation technique, is used to determine the strength and direction of the linear
relationship between two variables (Pallant, 2013). Therefore, correlation analysis is also
addition, correlation is being used to explore the relationship between satisfaction and
The first research question is, Which variables related to dining at the subject
eight hypotheses to test the relationship between customer satisfaction and its eight
independent variables. The eight independent variables are service quality, food quality,
accuracy, and speed of service. Each of these eight variables has one hypothesis to test its
relationship with satisfaction. The researcher tested these eight hypotheses with customer
table and correlation analysis. Then, regression analysis was conducted to test the
The second research question of the study is, Which demographic variables
this research question, the effects that race, gender, income, age, marital status, service
delivery method, time of visit, and geographic location have on customer satisfaction
were analyzed. This research question contains one hypothesis to measure the impact of
demographic variables of race, gender, income, age, marital status, service delivery
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method, time of visit, and geographic location on customer satisfaction. Custom table, t-
The final research question is, To what extent are customer satisfaction and
customer loyalty related? The final research question contains one hypothesis to
determine the relationship between customer satisfaction and customer loyalty. Pearson
Assumptions
Some important assumptions were made for this study. The researcher assumed
that the respondents were truthful while completing the survey, which asked that they
base their answers on their most recent experience at the subject hamburger chain. The
researcher also assumed that the selection of the 40 participating locations in the study
represented all demographic groups of the overall customer base of the subject
hamburger chain.
exchange for participation in the survey would attract enough customers to complete the
survey without any bias. The three-free-hamburger offer has been proven to be very
successful in attracting enough participants for the existing customer satisfaction survey
conducted by the subject hamburger chain. Thus, the three-free-hamburger offer was
chosen in this study to entice customers to participate in the study. It is important to note
that the subject hamburger chain was offering the participants three hamburgers for free.
No monetary incentive was offered by the researcher to the participants for completing
the survey.
Finally, it was assumed that the participants were truthful in terms of their race,
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gender, income, age, marital status, service delivery methods, time of visit, and
Summary
design for the study mainly due to lack of time and restrictions imposed by the subject
hamburger chain. The strengths and weaknesses, along with the moral and ethical issues,
of the study were discussed in the chapter 3 as well. There was a discussion of the
instrument used in the study, which was developed and adopted after a review of the
existing literature and industry journals. To ensure its content and construct validity, three
industry experts reviewed the instrument. The instrument was tested on a pilot basis, and
its reliability was checked through an internal consistency test, Cronbach’s alpha test.
The rationales behind selecting the population, sample frame, sample size, and sampling
strategy were also discussed in this chapter. The chapter concluded with a discussion of
data collection, data analysis, and the assumptions made for the study.
Chapter 4 contains the results of the study. Based on Sulek and Hensley (2004)
and Namkung and Jang (2007), the researcher employs regression analysis, Pearson
correlation, t-test, ANOVA, and custom table by using IBM SPSS to answer the research
CHAPTER 4
RESULTS
determine the relationship between customer satisfaction and its independent variables of
technology, price and value, order accuracy, and speed of service at a regional fast food
hamburger chain. The secondary purpose of the current study is to determine the impact
final purpose of the present study is to determine the relationship between customer
satisfaction and customer loyalty at the subject hamburger chain. The framework for the
3. To what extent are customer satisfaction and customer loyalty related at the
To answer research questions and test the related hypotheses, data was collected
via a self-developed, industry experts validated, and pilot tested survey instrument. The
5-point Likert-type scale measured dependent and independent variables ranging from 1
= strongly disagree to 5 = strongly agree. A mean score greater than 3 and less than 4
indicates that the respondents agreed with the statements and the subject hamburger chain
is meeting the expectation of customers. The survey instrument also collected data on
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demographic variables of race, gender, income, age, marital status, service delivery
method, time of visit, and geographic location. The final question on the instrument
collected data on the developmental needs of the subject hamburger chain as seen by the
Data Collection
The targeted population for the study was the customer base of the 400 restaurants
operated by the subject hamburger chain in the mid-western and the eastern United
States. Forty of the 400 locations were randomly selected for data collection. Every 250th
the study via the SurveyMonkey platform. Total customers served at the selected
restaurants during the data collection period were 400,000. Therefore, 1,600
(400,000/250 = 1,600) survey invitations were issued. A total of 1,042 surveys were
returned with a response rate of 65.12%, of which 970 responses were included in the
analysis. Survey responses with 15% missing data were discarded. The 15% test was also
used by Kivela et al. (1999b). Table 2 contains the frequency of data collection.
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Table 2
9/14/2015 13%
9/21/2015 18%
9/28/2015 30%
10/5/2015 27%
10/12/2015 12%
was dictated by the subject hamburger chain. The survey link was open for 5 weeks to
give the invitees an additional week to complete the survey. Survey invitations were
distributed from September 14, 2015, to October 05, 2015. The survey link was
deactivated on October 12, 2015. Table 2 reflects the percentage of total survey responses
for each week during the 5-week data collection period. Most of the responses occurred
during the weeks of September 28, 2015 (30%) and October 5, 2015 (27%), accounting
for the majority (57%) of the responses. Responses for the first and fifth week were
almost identical at 13% and 12% respectively. The second week produced 18% of the
responses.
Data Screening
screening related issues prior to data analysis are fundamental to an honest data analysis.
Therefore, careful attention was given to ensure data integrity in the current study. The
first issue that needed to be addressed was error free data entry, and the second issue was
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the handling of missing data (Tabachnick & Fidell, 2013). Since participants entered data
via the SurveyMonkey platform, data entry is not a concern in this study. To handle the
second issue, missing value analysis with SPSS 22 was run to identify and eliminate
cases from the analysis with more than 15% of missing data.
Demographic Variables
Table 3 also contains the details on the demographic variables of time of visit, service
Table 3
Demographic of Respondents
Asian 10% 3%
Source: Internal document provided by the subject hamburger chain; mid-western United
States—Chicago, Cincinnati, Detroit, St. Louis, Indianapolis, Columbus, Minneapolis, and
Nashville; eastern United States—New York and New Jersey; NA = Not Available.
The largest racial group in the current study is White (50%) followed by Black
(27%), which is representative of the industry as a whole. White and Black males who do
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not spend a lot of time cooking meal at home are the biggest consumer of fast food in the
United States (Bryant, 2011). Unfortunately, Bryant (2011) did not mention if the males
and females were married or single, as it would provide further insights. Asian and
Hispanics are equally represented with 10% while the Native Americans are at 3%.
Whites and Hispanics are underrepresented in the study in comparison with the subject
In terms of gender, males and females are evenly represented with 50% each,
which is typical of the subject hamburger chain—53% male and 47% female. When it
comes to income, the largest income group in the study is less than 25k while the least
represented group is 50k to 74k. Two groups (75k – 99k and > 100k) are representative
of the subject hamburger chain while the remaining three groups are not. The typical
customers at the subject hamburger chain make up to 49k; this represents 41% of the total
customers. These findings are not typical of the fast food customers in the United States
either. Melnick (2011) mentioned that people visit fast food restaurants more often as
their household income increased to $60,000. Beyond that, visits start to drop, replaced
by full-service, sit-down dining at higher prices. This makes good sense as people with
more spending power would want to have a better dining experience at a full-service or
(18 – 34), Generation-X (35 – 50), Baby Boomers (51 – 69), or Silent Generation (greater
than 70). The age of participants indicates that the largest group (38%) is the Generation-
X. The second largest group of respondents (33%) is the Baby Boomers. The lower and
upper ranges, Millennials and the Silent Generation, represent 24% and 5% respectively.
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These results are not representative of the subject hamburger chain. There is a 13%
difference between the current study’s and the subject hamburger chain’s demographics
in terms of Millennial while the difference is even steeper in terms of Baby Boomers at
18%. The steepest difference exists in the Silent generation, which is 23%.
49% of the United States’ population and 56% of Internet users; on the other hand, the
Silent Generation represents 7% of the United States population but only 5% of Internet
users (Zickuhr, 2010). Therefore, the difference in participation among the Silent
Generation have been caused by the data collection method. If data was collected also via
personal and telephone interview, more participants representing the Silent Generation
probably would have participated because the Silent Generation is less represented
The largest group among the participants was married at 41%, followed by single
other – divorced, widowed, and separated. The results of the single participants are
similar to the subject hamburger chain’s while married and others are not. There is a 15%
difference among married and 12% among others with the subject hamburger chain.
The subject hamburger chain has divided its 24-hour business day into four
different parts – breakfast (6 a.m. – 11a.m.), lunch (11 a.m. – 2 p.m.), dinner (5:30 p.m.
to 8:30 p.m.), and late night (11p.m. – 2 a.m.). According to Table 3, 31% of the
participants visited the restaurants during lunch, which is consistent with the industry
standard (34%). There is a 9% difference between the current study and the industry
standard’s in terms of dinner traffic. There are no significant differences in traffic count
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during breakfast between the current study and the fast food industry as a whole. There
are no late night data available for the industry; thus, this is not a true comparison.
The subject hamburger chain has three different service delivery methods: drive-
thru, dine in, and takeout. Fast food hamburger chains serve about 57% of the customers
via drive-thru, 17% of them take the food home or to work, and 27% of them eat at the
restaurant (McDonnell, 2015). Thus, the takeout method is over represented by 10%
while the drive-thru is under represented by 5%, and dine-in is over represented by 5% in
the current study in comparison with the industry as a whole. It is important to note that
79% (drive-thru 52% and take out 27%) of the customers leave the restaurant with the
food at the subject hamburger chain. Thus, it is important to get them satisfied the first
time because once they leave the restaurant, there are no more opportunities to correct
mistakes.
The majority of the responses came from the mid-western United States (82%)
while the remaining 18% came from the eastern United States. This is consistent with the
geographic locations of the subject hamburger chain as 17% of the restaurants are located
in the eastern United States while 83% are located in mid-western United States. From
the mid-western regions, Chicago had the highest number of cases with 24% while
Nashville had the lowest with 6%. It is important to note that seven restaurants
participated from Chicago and only two participated from Nashville. Cincinnati returned
11% of the cases, the second highest, while the rest of the mid-western cities returned
from 9% to 7% responses. The subject hamburger chain has operations only in New York
and New Jersey in the eastern United States. In New York, 11% of the cases were
Research Question 1
question, first mean and standard deviation of satisfaction for independent variables were
examined. Then, correlation of each independent variable with satisfaction was explored.
Finally, regression analysis was conducted to determine the ability to predict satisfaction
Mean and standard deviation. Table 4 contains the mean and standard deviation
Table 4
Note. Responses were coded 1= strongly disagree, 2= disagree, 3= neither disagree, nor agree,
4= agree, 5= strongly agree
The results indicate that customers agree with the fact that the subject hamburger
4.22), speed of service (mean = 4.22), food quality (mean = 4.12), and price and value
(mean = 4.10). Customers agreed with the notion that the subject hamburger chain is
meeting expectations in filling orders, providing fast service, serving quality food, and
offering a competitive price and value, which makes sense because the chain is very
focused on these aspects of the operation. Since the subject hamburger chain is open 24
hours a day, providing ample parking and being easily accessible by public and private
The results also indicate that customers were neutral in terms of the subject
(mean = 3.91), and technology (mean = 3.25). The neutral rating on service quality came
as inconsistent because the subject hamburger chain is very focused on service quality
and scores very high on its own satisfaction survey. However, the neutral rating in service
quality presented the subjcet hamburger chain with a unique opportunity for further
development. The average age of the restaurant at the subject hamburger chain is over 10
neutral rating on technology is also understandable as the subject hamburger chain started
Twitter, Instagram, smartphone app, and web ordering for the past 3/4 years. Therefore,
there is an opportunity for the subject hamburger chain to focus more on service quality,
satisfaction.
With the exception of the physical environment, service quality, and customer-
facing technology, all other constructs have a standard deviation of less than 1 (SD = .05
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to SD = .96), signaling a narrow spread around the mean scores of satisfactions. These
also signal that the majority of participants gave a neutral rating on the constructs in
question. Technology has the highest standard deviation (SD = 1.28), signaling a wide
spread in responses. Some respondents have strongly agreed while others have strongly
disagreed.
Table 5
Note. Correlation is significant at 0.01 level (2-tailed). SQ = Service Quality, FQ = Food Quality,
PE = Physical Environment, Con. = Convenience, Tech = Technology, PV = Price and Value,
OA = Order Accuracy, SOS = Speed of Service, Sat. = Satisfaction, ** = p < .001 (2-tailed).
variable of satisfaction. With the exception of technology, all other variables have a
relationship. Speeds of service (.699), order accuracy (.696), food quality (.675), service
quality (.644), price and value (.628), physical environment (.558), and convenience
(.524) have positive moderate association with satisfaction while technology (.421) has a
The results of the correlation are consistent with existing literature as study after
study and industry experts have provided evidence for the importance of these variables
in determining satisfaction in the fast food restaurant industry. Allon et al. (2011) and
United States’ consumers say order accuracy is important or very important when they
are choosing a fast food restaurant (Tristano, 2013). Food quality is important as many
studies (Hyun, 2010; Mamalis, 2009; Namkung & Jang, 2007, 2008; Sulek & Hensley,
2004; Swimberghe & Wooldridge, 2014) found food quality an important factor of
satisfaction in the restaurant industry. Reich et al. (2005), Rashid et al. (2015), and Wu
satisfaction and service quality in the context of the restaurant industry. Many researchers
over the years have examined the impacts of price and value on customer satisfaction in
the restaurant industry and found it to be an important factor (Ali & Nath, 2013; Gupta et
al., 2007; Haghighi et al., 2012; Homburg et al., 2005; Pei & Ayub, 2015; Ryu & Han,
2009; Steiner et al., 2013). Ali and Amin (2014), Chow et al. (2007), and Ryu and Han
industry. Andaleeb and Caskey (2007), Harrington et al. (2012), and Min & Min (2011)
Technology is quickly becoming a part of American life, and more consumers are
predictors of customer satisfaction at the subject hamburger chain. Table 6 contains the
R, R2, adjusted R2, and the standard error of the estimate for the regression model.
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Table 6
Note. Predictors: (Constant), service quality, food quality, physical environment, convenience,
technology, price and value, order accuracy and speed of service.
The adjusted R2 in this model is .702, which indicates that 70% of the variance in
customer satisfaction was explained by the model at the subject hamburger chain.
According to Cohen (1988), this is a large effect. The sum of squares, df, mean square, f
Table 7
.05 indicating the statistical significance of the model. Anything less than .05 represents
statistical significance (Pallant, 2013). Table 8 contains the regression weight for the
Table 8
coefficients coefficients
Note: B = unstandardized weight; Beta = standardized weight; t = statistics which test for the
significance of each variable; Sig = significance; Adjusted R2 = .702; F (8, 765) = 229.06; p =
.000.
0.05X5 + 0.037 X6 + 0.029X7 + 0.075 X8 + error, where .319 is the constant, .283 is the
regression weight for order accuracy, X1 represents the predictability of order accuracy
on satisfaction, .254 is the regression weight for speed of service, X2 represents the
predictability of speed of service on satisfaction, .201 is the regression weight for food
regression weight for price and value, X4 represents the predictability of price and value
.029 is the regression weight for service quality, X7 represents the predictability of
service quality on satisfaction, and .075 is the regression weight for convenience, X8
The coefficient t score for order accuracy, which tests for the significance of each
variable, was significant, t = 8.08, p< 0.05, p = .000. Speed of service t score was
significant, t = 11.04, p < 0.05, p = .000. Food quality coefficient score was significant,
t=6.08, p < 0.05, p = .000. Price and value coefficient score was significant, t=6.90, p <
0.05, p = .000. Technology coefficient score was significant, t=3.26, p < 0.05, p = .001.
Convenience coefficient score was statistically significant, t = -2.608, p < 0.05, p = 0.009.
However, environment (t = 1.705, p > 0.05, p = 0.089) and service quality (t = 1.042, p >
speed of service, food quality, price and value, technology, and convenience are
environment and service quality are not. Note that order accuracy (.283), speed of service
(.254), food quality (.201), and price and value (.161) displayed the ability to
significantly predict customer satisfaction at the subject hamburger chain when all eight
independent variables are included. The results of the regression are consistent with the
A .283 unstandardized coefficient for order accuracy means that if the order
accuracy move by one unit, for example, from agree to strongly agree, then satisfaction
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will improve by .283. A .254 unstandardized coefficient for speed of service means that if
the speed of service moves by one unit, for example, from agree to strongly agree, then
satisfaction will improve by .254. A .201 unstandardized coefficient for food quality
means that if the food quality moves by one unit, for example, from agree to strongly
agree then satisfaction will improve by .201. A .161 unstandardized coefficient for price
and values means that if the price and value moves by one unit, for example, from agree
to strongly agree, then satisfaction will improve by .161. Therefore, based on this model,
if there an improvement in each of these four factors by one unit, satisfaction will be
Findings
The following section contains the findings for each hypothesis for the Research
Question 1.
have statistically significant moderate correlation (.644). Thus, the null hypothesis is
being rejected.
Findings: According to the Table 5, customer satisfaction and food quality have
statistically significant moderate correlation (.675). Thus, the null hypothesis is being
rejected.
environment have statistically significant moderate correlation (.558). Thus, the null
statistically significant moderate correlation (.524). Thus, the null hypothesis is being
rejected.
statistically significant moderately weak correlation (.421). Thus, the null hypothesis is
being rejected.
Findings: According to the Table 5, customer satisfaction, and price and value
have statistically significant moderate correlation (.628). Thus, the null hypothesis is
being rejected.
have statistically significant moderate correlation (.696). Thus, the null hypothesis is
being rejected.
have statistically significant moderate correlation (.699). Thus, the null hypothesis is
being rejected.
Research Question 2
answer research question. The effects of eight demographic variables of race, gender,
income, age marital status, time of the day, delivery method, and geographic regions on
customer satisfaction at the subject hamburger chain are measured. The following section
Race. Table 9 contains the mean and standard deviation for customer satisfaction
Table 9
All racial groups agree that the subject hamburger chain satisfies them. Among
them, Asians (mean = 4.74) are the most satisfied while the White (mean = 4.15) and
African Americans (mean = 4.08) are least satisfied. The standard deviation for each of
the race is less than 1 (Asian SD = .62, Hispanic SD = .73, Native American SD = .72,
White SD = .83, and African American SD = .85), signaling a narrow spread in responses
in regard to satisfaction at the subject hamburger chain. This means that most of the
the five racial groups of Asian, Hispanic, Native American, White, and Black. Table 10
Table 10
ANOVA – Race
Results show a significant difference across the five categories of race in terms of
satisfaction at the host hamburger chain, F (4, 834) = 14.12, p = .000. It is expected to
the expectation and background of each group is different. However, this does not
indicate which group is different from which other group. The statistical significance of
the differences among the groups is provided in the multiple comparisons. Thus, a
Univariate Analysis, using the Tukey test, was run to identify the statistical significance
among different racial groups with regard to customer satisfaction at the subject
Table 11
Tukey HSD
Lower Upper
bound bound
Lower Upper
bound bound
satisfaction at the subject hamburger chain with Hispanics and Asians. These findings
signal that Whites (mean – 4.15) are less satisfied than the Hispanics (mean = 4.61) and
the subject hamburger chain with Hispanics, Asians, and Native Americans, signaling
that Blacks (mean = 4.08) are less satisfied than Hispanics (mean = 4.61), Asians (mean
= 4.74), and Native Americans (mean = 4.58). It is important to note that the differences
in satisfaction between Whites and Blacks are not statistically significant, meaning that
Blacks and Whites are equally satisfied with the subject hamburger chain. It is also
important to note that there are no significant differences among the Hispanics, Asians,
and Native Americans in satisfaction at the subject hamburger chain, which means that
Hispanics, Asians, and Native Americans are equally satisfied at the subject hamburger
chain. Based on the results, it can be concluded that the subject hamburger chain should
be considering diversity while dedicating resources and making adjustments to its service
delivery method.
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Gender. Table 12 contains the mean score and the standard deviation for female
Table 12
The mean score for males is 4.18 while the mean score for females is 4.28. A t-
test was conducted. The standard deviations (female SD = .84, male SD = .86) for males
and females are less than 1, which indicates that the responses were around the mean
score of both categories. The sig value (2-tailed) for the gender is .068, which is greater
than .05. Therefore, the difference between male and female in terms of satisfaction is not
statistically significant. These findings signal that males and females are equally satisfied
Income. Table 13 contains the mean scores and standard deviations for customer
Table 13
The results demonstrate that when income rises, the satisfaction rises as well.
These findings can be attributed to the fact that customers with lower income and limited
food dollars available on meals away from home are looking for greater value in the form
of products and services from the subject hamburger chain. The standard deviation is less
than 1 for each income group, which means that there is little spread in the data, and most
responses are around the mean scores of each income group. A one-way ANOVA was
Table 14
ANOVA – Income
Results show a significant difference across the five categories of income in terms
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of satisfaction at the subject hamburger chain, F (4, 744) = 7.890, p = .000. The Sig.
value in the ANOVA table is .000, which is less than .05. The Sig. value indicates that
there is a significance difference somewhere among the mean scores of satisfaction for
the five income groups. However, this does not indicate which group is different from
which other group. The statistical significance of the differences among the groups is
provided in the multiple comparisons. Thus, a Univariate Analysis, using the Tukey test,
was run to identify the statistical significance among different income groups with regard
to customer satisfaction at the subject hamburger chain. Table 15 contains the results.
Table 15
Multiple Comparisons
Tukey HSD
Lower Upper
bound bound
$25k - $49k Less than $25k -0.11835 0.0831 0.612 -0.3456 0.1089
Lower Upper
bound bound
existing between people making less than 25k and people making between $75k – $99K.
People making $25k – $49k also have a statistically significant difference with people
making greater than $75k. Finally, people who are making $50k – $74k have a
statistically significant difference with people making $75k – $99k. These findings
suggest that people with lower income are less satisfied than those of higher income.
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Lower income customers with less income available for food away from home are more
demanding of the subject hamburger chain than customers with higher income.
Customers with lower disposable income are looking for greater value for their money.
Age. Table 16 contains the mean and standard deviation for customer satisfaction
Table 16
All age groups agree that the subject hamburger chain satisfies them. The pattern
of the mean score for each age group reveals that the older generations are more satisfied
with the subject hamburger chain. These findings are problematic for the subject
hamburger chain because it is much more focused on the younger customers than the
older, and the efforts to reach are not resonating with the younger customers. More
recently, the subject hamburger chain targets the Millennial and Generation X via its
presence on Facebook, Twitter, and Instagram because the younger population is more
likely to be on the social media than their older cohorts. According to Pew Research
Center, 89% of 18-29 year olds use social media, and the social media use drops to 49%
with people over 65 years old ("Social Networking Fact Sheet," 2014). A one-way
Table 17
ANOVA - Age
Results show a significant difference across the four categories of age in terms of
satisfaction at the subject hamburger chain, F (3, 941) = 3.306, p = .011. The Sig. value
in the ANOVA table is .011, which is less than .05. The Sig. value indicates that there is
a significance difference somewhere among the mean scores of satisfaction for the four
age groups. However, this does not indicate which group is different from any other
group. The statistical significance of the differences among the groups is provided in the
multiple comparisons. Thus, a Univariate Analysis, using the Tukey test, was run to
identify the statistical significance among different age groups with regard to customer
Table 18
Tukey HSD
Age (I) Age (J) Mean Std. error Sig. 95% Confidence
difference interval
bound bound
Silent
-.37685* .13297 .038 -.7403 -.0134
Generation
Silent
-.28167 .12831 .182 -.6323 .0690
Generation
Silent
-.17964 .13010 .640 -.5352 .1759
Generation
Table 18 contains the multiple comparisons for the different age groups.
According to table 18, only Millennials have statistically significant differences with the
Silent generation on satisfaction at the subject hamburger chain. These findings suggest
that Millennials, Generation-X, and Baby Boomers have similar feelings about the
subject hamburger chain. However, the eldest (Silent Generation) and youngest
(Millennials) have different feelings about the subject hamburger chain in terms of
satisfaction. Millennials are less satisfied with the subject hamburger chain than the
Silent Generation because the Millennials are more drawn to the fast casual segments that
provide them better quality food quickly with transparency with sourcing of food.
Millennials’ and Generation X’s new attitudes have created an outspoken segment of
customers who demand high quality, locally-sourced meals, offering bold and diverse
Marital status. Table 19 contains the mean and standard deviation for customer
satisfaction at the subject hamburger chain for different groups based on marital status.
Table 19
All groups in this category agree that the subject hamburger chain satisfies their
need in terms of satisfaction. Among them, others (mean = 4.63) are the most satisfied
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while singles (mean = 4.11) are the least satisfied. The mean scores for satisfaction
suggests that people who are divorced, separated, and widowed (classified as others in
the current study) are more satisfied with the subject hamburger chain than married and
singles. The standard deviations for three categories are less than 1, which signals that the
responses for each group were centered on the mean scores. A one-way ANOVA was
Table 20
Results show a significant difference across the three categories of marital status
in terms of satisfaction at the host hamburger chain, F (2, 871) = 30.442, p = .000. The
Sig. value in the ANOVA table is .000, which is less than .05. The Sig. value indicates
that there is a significance difference somewhere among the mean scores of satisfaction
for the groups in this category. However, this does not indicate which group is different
from any other group. The statistical significance of the differences among the groups is
provided in the multiple comparisons. Thus, a Univariate Analysis, using the Tukey test,
was run to identify the statistical significance among different groups based on marital
status with regard to customer satisfaction at the subject hamburger chain. Table 21
Table 21
Tukey HSD
(I-J)
Based on table 21, others (separated, widowed, and divorced) have statistically
significant differences with married and singles. However, there are no statistically
significant differences in satisfaction at the subject hamburger chain among married and
singles. These results suggest that the married and single customers at the host chain are
widowed, and divorced and married and single customers. This requires further
Time of day. Table 22 contains the mean scores of satisfaction for the different
day parts.
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Table 22
Based on table 22, customers visiting during different time of the day agree that
they are satisfied with the subject hamburger chain. The results also suggest that
customers are slightly more satisfied during late night than breakfast, lunch, and dinner.
The standard deviations for each day parts are less than 1, indicating that the responses in
each group were centered around the mean score. A one-way ANOVA was performed,
and there were no significant statistical differences observed in satisfaction based on time
of visit.
Delivery methods. Table 23 contains the mean scores of satisfaction for different
delivery methods.
Table 23
4.25 0.87
Drive-thru
4.24 0.82
Dine in
4.14 0.85
Take out
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Based on table 23, customers using during different service delivery methods
agree that they are satisfied with the subject hamburger chain. The mean scores for the
three different delivery methods are similar. Thus, no matter how they purchase their
meal, customers are equally satisfied. A one-way ANOVA was conducted, and there
were no statistically significant differences observed among the customers visiting via
Geographic region. Table 24 contains the mean scores of satisfaction for the
Table 24
Std. deviation
Geographic regions Mean
.51
Nashville 4.72
.74
New York 4.46
.83
St. Louis 4.38
.85
Columbus 4.28
.81
Indianapolis 4.25
.80
Minneapolis 4.18
.85
Chicago 4.15
.91
New Jersey 4.06
.85
Detroit 4.04
.98
Cincinnati 3.95
agree that they are satisfied with the subject hamburger chain, which came as inconsistent
133
because Cincinnati is one of the top performers in the company’s internal survey. The top
performer, Nashville, came as inconsistent as well because Nashville is one of the poor
performers in the company’s internal survey. This calls for further investigation. The
standard deviation for each region is less than 1, which signals that the responses on
satisfaction in each region are centered around the mean. A one-way ANOVA was
Table 25
satisfaction at the subject hamburger chain, F (9, 8934) = 5.432, p = .000. The Sig. value
in the ANOVA table is .000, which is less than .05. The Sig. value indicates that there is
a significance difference somewhere among the mean scores of satisfaction for the groups
in this category. However, this does not indicate which group is different from any other
group. The statistical significance of the differences among the groups is provided in the
multiple comparisons. Thus, a Univariate Analysis, using the Tukey test, was run to
identify the statistical significance among different groups based on geographic location
with regard to customer satisfaction at the subject hamburger chain. Table 30 contains the
results.
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Table 30
Tukey HSD
(I) Regions (J) Regions difference Std. Error Sig. Lower Upper
(I) Regions (J) Regions difference Std. Error Sig. Lower Upper
(I) Regions (J) Regions difference Std. Error Sig. Lower Upper
(I) Regions (J) Regions difference Std. Error Sig. Lower Upper
(I) Regions (J) Regions difference Std. Error Sig. Lower Upper
Based on table 26, Nashville, the top performer in this study, has statistically
significant differences with Chicago, Cincinnati, Detroit, Minneapolis, and New Jersey.
The success in Nashville requires further investigation. It will be a very good idea to
gather the best practices from the Nashville region to be implemented in other geographic
regions. It is important to note that Columbus and Indianapolis do not have any
statistically significant differences with other geographic regions. New York, the second
best performer in this study, has a statistically significant difference with Cincinnati and
Detroit. The success of New York is attributed to its consistent focus on food quality,
order accuracy, and speed of service (Z. Diaz, personal communication, December 21,
2015). It is also important to note that the top five performers (Nashville, New York, St.
Louis, Columbus, and Indianapolis) do not have any significant differences among
themselves. This observation is also true in the case of Minneapolis, Chicago, New
Findings
for Question 2 is partially supported. There are statistically significant differences among
the participants in terms of race, income, age, marital status, and geographic location
while there are no statistically significant differences among the participants in terms of
Research Question 3
To what extent are customer satisfaction and customer loyalty related at the
subject hamburger chain? To answer this research question, a Pearson correlation was
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conducted with IBM SPSS 22. One hypothesis is tested to answer this research question.
loyalty and customer satisfaction at the subject hamburger chain, a Pearson correlation
Table 31
Satisfaction Loyalty
Sig. (2-tailed) 0
positive relationship between satisfaction and loyalty. High scores on one variable are
associated with high scores on the other variable. Therefore, if satisfaction goes higher,
the loyalty goes higher too. The 2-tailed Sig. value (.000) signals a statistically significant
relationship between satisfaction and loyalty. Therefore, the null hypothesis is being
rejected.
The strength of the relationship between satisfaction and loyalty can be between
-1 to 1. This value indicates the strength between the two variables—satisfaction and
Pallant, it can be concluded that the relationship between satisfaction and loyalty is large
at the subject hamburger chain. The results are also consistent with the existing literature
as discussed in Chapter 2. Four studies conducted in the fast food industry (Bougoure &
Neu, 2010; Min & Min, 2011; Terblanche & Boshoff, 2010; Yondonperenlei & Song,
2015) which found a statistically significant relationship between satisfaction and loyalty.
Findings
Based on the results of the regression analysis, order accuracy, speed of service,
food quality, and price and value are the four most important factor of satisfaction at the
subject hamburger chain. Based on the correlation analysis, there are statistically
significance differences in satisfaction based on race, age, income, marital status, and
based on gender, time of visits, and the service delivery method. The results also suggest
loyalty. The results found support for all eight hypotheses under Research Question 1,
and the hypothesis for Research Question 3, and partial support for the hypothesis under
Research Question 2.
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Additional Findings
variables, the survey instrument also collected data on developmental needs of the subject
hamburger chain as seen by survey participants. Table 32 contains data for the
developmental needs.
Table 32
Constructs Percentage
Physical environment 9%
Technology 7%
Order accuracy 3%
Convenience 3%
Based on table 32, the top four developmental needs are speed of service (28%),
price and value (24%), service quality (14%), and food quality (12%). It is important to
note that with the exception of service quality, speed of service, price and value, and food
quality also came in as three of the top four predictors of satisfaction at the subject
hamburger chain in regression analysis. It is also important to note that order accuracy
came at the bottom of the table 32 tied with convenience, and it is the most important
predictor of satisfaction based on regression. A low score for development for order
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accuracy makes perfect sense as the subject hamburger chain performs well (98%) in
filling orders as evident by its internal survey. Besides, in the present study, order
accuracy has the highest mean score. Even though service quality is not one of the
The results suggest that satisfaction has a statistically significant association with
convenience, customer-facing technology, price and value, order accuracy, and speed of
service, thus providing support for Hypotheses 1-8 for Research Question 1. The results
also provide partial support for the hypothesis related to Research Question 2. The
findings suggest that there are statistically significant differences in satisfaction for race,
income, age, marital status, and geographic regions while there are no statistically
significant differences in satisfaction for gender, times of visit, and service delivery
method. Furthermore, the results suggest that there is a statistically significant positive
relationship between satisfaction and loyalty, thus, providing support for the hypothesis
related to Research Question 3. Based on the regression analysis, order accuracy, speed
of service, food quality, and price and value are the most important factor of satisfaction
at the subject hamburger chain. Convenience and technology are also proven to be
quality and physical environment are not found to be statistically significant factors of
satisfaction. Based on developmental needs, speed of service, price and value, service
Thus, based on the regression analysis results, it can be concluded that order
accuracy, speed of service, food quality, and price and value are the most important
factors of satisfaction at the subject hamburger chain that need to be taken with
concentrated focus on these will enhance not only satisfaction but also loyalty as it has
been established that satisfaction and loyalty have a statistically significant positive
CHAPTER 5
FUTURE RESEARCH
The primary objective of the current study is to gauge the bearings of service
price and value, order accuracy, and speed of service on customer satisfaction at a
regional fast food hamburger chain (the subject hamburger chain) with operations in the
mid-western and eastern United States. The secondary purpose is to assess the impact of
demographic variables of race, gender, income, age, marital status, time of visit, service
delivery method, and geographic region on satisfaction at the subject hamburger chain.
The final aim is to determine the relationship between customer satisfaction and customer
Chapter 1 introduced the ‘KSM for QSR’ model based on the transaction specific
model and the key concepts used in this study. Chapter 2 examined the existing literature
related to the ‘KSM for QSR’ model and the key concepts in the context of restaurant
industry. Chapter 3 discussed the methodology for the study. Chapter 4 discussed the key
findings from the study. Now, Chapter 5 discusses the implications of the key findings
the subject hamburger chain, discusses the limitations of the study, and, finally, proposes
The key findings contribute to the hospitality literature in fast food restaurant
industry in two ways. First, the ‘KSM for QSR’ model provides a systematic
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understanding of customer satisfaction in the context of the fast food restaurant industry.
Second, the current study conceptualizes and operationalizes the perception of customer
satisfaction in the fast food industry by adapting the ‘KSM for QSR’ model based on the
transaction specific model. The ‘KSM for QSR’ model measures customer satisfaction in
terms of eight different aspects of a transaction— service quality, food quality, physical
model for the service industry that defined satisfaction as the difference between the
expectation of the customer and the perception of the actual service. On the other hand,
the restaurant industry by Stevens et al. (1995). These two models require carrying out a
survey to measure the expectations of customers first, and then after the rendering of
service, conduct another survey to measure the perception of the service; thus, making it
suitable for a longitudinal study and unfit for a cross sectional study (Carman, 1990;
Cronin & Taylor, 1992; Teas, 1993). This is a major weakness of the models. Thus, the
approach of the ‘KSM for QSR’ model helps to overcome the weaknesses associated
with the SERVQUAL and DINESERV methods, and, therefore, provides a more accurate
method for assessing satisfaction in the fast food industry. The framework of the current
variables of customer satisfaction at the subject hamburger chain. Eight hypotheses were
subject hamburger chain is no exception. Therefore, there is an intense focus built into
the daily operation of the restaurants within the chain to improve customer satisfaction.
Based on the findings of the current study, order accuracy is the number one predictor of
satisfaction, which makes good sense for many reasons. If an order is being filled
incorrectly, it does not matter, if the subject hamburger chain is fast, hospitable, and
cheap with really good food; customers will have difficulty forgiving the restaurant for
incorrectly filling an order. Results also revealed that speed of service is the second most
restaurants for a quick meal with very limited time to stand in a line. Due to time
constraints, the subject hamburger chain’s customers expect fast service. For example,
customer will not visit a restaurant during their lunch break if it takes half an hour to be
served, but if the restaurant takes only a few minutes, customers will have no problem
hamburger chain is the tasty food. Thus, the food quality came as the third most
important factor of satisfaction. Price and value came as the fourth most important
determinants of satisfaction. This makes good sense as many of the subject hamburger
chain’s customers have limited disposable income and limited dollars available for food
away from home are looking for low price and high value. The implication for the subject
hamburger chain of these findings is critical; it must focus on improving these four
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This is expected because the use of technology to enhance customer satisfaction is a new
phenomenon at the subject hamburger chain, which started about 3/4 years ago. The
media platforms (Facebook, Twitter, and Instagram), a smart phone app, web ordering,
and an order confirmation board by engaging customers at a whole new level. Although
operation, parking facility, and easy accessibility. However, the increased usage of
technology will transform the idea of convenience in the future. Convenience may be
considered ordering and paying via a smartphone app and picking up the meal in 30
minutes to avoid the line at the restaurants. The implication for the subject hamburger
technology and convenience, but with much less focus than the four factors discussed
previously.
satisfaction at the subject hamburger chain. The implication from these findings is real
and potentially huge to attain better satisfaction and loyalty because the subject
hamburger chain dedicates considerable amount of recourses to better service quality and
physical environment. If some of these resources are diverted to improve order accuracy,
speed of service, food quality, and price and value, the results could be spectacular in
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Based on the above discussion, it can be concluded that order accuracy, speed of
service, food quality, and price and value are the most important factors of satisfaction at
important, but with very little ability to influence satisfaction. On the other hand, service
quality and physical environment were not important factors of satisfaction. Thus, it is
recommended that the subject hamburger chain focus more on order accuracy, speed of
service, food quality, and price and value, somewhat reduce the focus on service quality
and physical environment, and, finally, keep some focus on customer-facing technology
order accuracy, speed of service, food quality, and price and value at the subject
hamburger chain. It also makes a case to reduce attention on service quality and
suggestive selling.
Order accuracy. It is not only the customer at the subject hamburger chain, but
customers, in general, in the fast food industry have the same view on the importance of
order accuracy. All fast food operators interviewed for the drive-thru performance study
McDonald’s, the sales leader in the industry, recently started a program dubbed as
“Ask, Ask and Tell,” which gives workers three chances to check if they got the
customer's order correct (Marcin, 2015). There are no alternatives of repeating order
again and again to customers to ensure that the orders are being filled correctly. Subject
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hamburger chain should start a program based on McDonald’s that will ensure employees
ask for the order when they take it, then again when they collect the money, and finally,
Some of the regions of the subject hamburger chain use plastic bags, which makes
it easy for the customers to verify their order. Thus, it is recommended that the subject
hamburger chain use plastic bags throughout the company. Language skills of the
employees also impact order accuracy. It is difficult for an employee to take an order if
he/she does not understand what the customer is saying (Z. Diaz, personal
communication, January 04, 2016). Therefore, it is important for the frontline managers
at the restaurants within the subject hamburger chain to assign employees who can
effectively communicate with customers in positions that will be facing customers (Z.
Diaz, personal communication, January 04, 2016). The subject hamburger chain also has
to ensure that the drive-thru order taking system is in good working order. If the system is
The subject hamburger chain has order confirmation boards which are very
helpful to ensure order accuracy in its drive-thru. When a customer places an order,
he/she can see the order on a screen in drive-thru. It is very effective in the drive-thru to
enhance order accuracy. Because of its effectiveness in drive-thru, it may help order
board next to each register in the dining room too. Failure to capitalize on these
recommendations may hamper the subject hamburger chain’s ability to improve order
accuracy.
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Thus, the subject hamburger chain should encourage its frontline team members
to repeat orders to customers multiple times, use plastic bags to pack food, place team
members with fluent English language skills on the positions that directly interact with
customers, ensure that the drive-thru order taking system is in good working order, and
install order confirmation board in the dining room order taking stations.
many measures can be taken. According to, Jonathan Deutsch (2014), fast food restaurant
operators want the operations to be faster, cheaper, and better, but one common problem
is that managers ask for speed without carefully assessing where the holdups are. Speed
of service problems are often related to poor employee training, lack of adequate
equipment, and inefficient design and layout of the kitchen and order processing area
(Deutsch, 2014). Other issues that cause speed of service to suffer are poor scheduling of
labor turnover rate. According to the National Restaurant Association, the overall
turnover rate for the restaurant industry was 66.3% in 2014, up 10 percentage points from
the recent low of 56.6% in 2010 while the average turnover rate for all private sector
workers stood at 44.4% in 2014, up four percentage points from 2010 ("Hospitality
Employee Turnover Rose in 2014," 2015). The labor turnover rate at the host chain was
above the industry standard in 2015 with around 90%. The costs associated with
replacing a single employee average more than $3,000 at a fast food restaurant (Kelso,
2012). Therefore, it is important for the subject hamburger chain to work on reducing
labor turnover.
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service. The top reason for employee turnover is lack of training, according to many
surveys and business publications, including the Harvard Business Review; the desire to
learn is a significant catalyst in the attraction and retention of top talent (Hoffman, 2000).
A seasoned long-term trained employee is much more valuable than a brand new
employee as he/she understands the subject hamburger chain’s business model and
customers better than a new team member. A team member with understanding of
business model and customers will possess a sense of urgency, which is a prerequisite to
give faster service. If employees are not skilled and properly trained, they will not work
with a sense of urgency; thus, it is important to ensure team members are properly
trained.
Often poor speed of service is the result of lack of adequate equipment to cook
enough food to meet the demand. Thus, the subject hamburger chain ought to ensure that
there is adequate equipment to guarantee that employees can keep up with the demand.
When employees are not able to keep up with the demand, the speed of service suffers.
The layout of the restaurants and placement of the equipment are also important in
to efficient order taking, processing, and delivery. While filling an order, an employee
should not have to walk around the kitchen to collect each item; all items should be
placed within a few steps. Thus, the subject hamburger chain should critically evaluate
the kitchen design of each restaurant and take necessary steps to ensure it is efficient and
employees to prepare products, keep the restaurant clean, and serve customers. A highly
trained team, efficient design and layout, and proper equipment placement will fail if the
proper number of employees is not scheduled. Thus, the scheduling of employees must
reflect the needs of the business at each of the restaurants at the subject hamburger chain.
However, scheduling the right amount of help is contingent upon the managers’ ability to
forecast sales effectively. The good news is that the subject hamburger chain has a very
good system to project sales and prepare an effective weekly schedule. However, the
issue of the proper usage of the forecasting and labor scheduling software persists; thus,
the subject hamburger chain should continue to train its managers in the effective use of
software. The subject hamburger chain also may think of adding a module within the
scheduling system enabling the system to alert employees of their schedule weekly or
even daily via text message or/and email. This will greatly improve tardiness and
absenteeism problems that effect its restaurants often. Today’s restaurant workers rely on
their cell phones, text messages, email and the web to connect with their work; to operate
at optimum staff levels, employers need to create an employee work schedule and use
scheduling software that fits into the busy lifestyle of today’s new mobile worker
(Halvorson, 2011).
Technology can help shorten lines at fast food restaurants and improve speed of
service. A smart phone app can be of immense help in improving speed of service at fast
food restaurants. With a smart phone app, restaurant chains can allow guests to order
ahead, pay for their meal, order and send gift cards, study the nutritional aspects of their
customized choices, and track their loyalty reward points (Jennings, 2015). The good
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news is that the subject hamburger chain has a smart phone app on the IOS, Android, and
Windows platforms. The subject hamburger chain should continue to promote the smart
phone app and encourage customers to use it more often by offering promotional prices
Besides the smart phone app, a digital menu board can be of great help in
reducing service time at fast food restaurants. With high-definition graphics, digital menu
boards can fit more photos and prices, giving a restaurant a much better way to
communicate the food offerings and related prices with customers. It can make the menu
board less busy, thus improving readability. Digital boards have reduced ordering time at
fast food chains, thus improving speed of service (Hardy, 2014). Therefore, it is
recommended that the subject hamburger chain install digital menu boards at the
restaurants it operates.
Thus, to improve speed of service, the subject hamburger chain should train its
employees properly to reduce high labor turnover, ensure that there is enough equipment
to meet the demand, ensure that the kitchen design is conducive to speed, train managers
on the proper use of sales forecasting and labor scheduling programs, alert team members
via text message or email about their weekly and daily schedule, and, finally, use
technology for its advantage to advance speed of service. Failure to capitalize on the
Food quality. Based on industry journal, the emerging food trends in the fast
food industry consist of healthy food, Thai inspired food, transparency of food sourcing,
sustainability, customized meals, local tastes, and food safety. These trends indicate a
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changing customer base for the fast food industry, and the industry ought to adapt
quickly. Thus, it is recommended that the subject hamburger chain incorporate some of
Today’s health conscious customers are craving healthy meals even at fast food
chains. A few years ago, no American customer would have regarded a bowl of vegetable
scraps dressed with lime-cilantro or spicy pesto vinaigrette as fast food, but millions of
diners, fueled by concerns about their health and propelled by a general distaste for
industrially produced and highly processed food, have begun to shun the fast food chains
that have long shaped the American culinary character in favor of fast food chains
The majority of the existing products at the subject hamburger chain are meat-
based, creating two problems. First, the meat-based products increase the food cost and,
more importantly, portray an unhealthy image; as a result, the subject hamburger chain
should look at vegetables as ingredients when developing new menu items (Wolf, 2016).
Fast food operators are realizing this trend and offering more and more vegetable-only
options and plant-based meatless proteins than ever before (Wolf, 2016). To make meals
healthy, the subject hamburger chain should focus on introducing new menu items based
on vegetables and plant-based protein. A salad and vegan chili with locally sourced
the subject hamburger chain should look into the creative uses of potatoes, mushrooms,
broccoli, cabbage, kale, and other vegetables in its menu development process. Vegetable
based menu items will cut food costs and raise its profile as a provider of healthy meals.
Failure to offer a healthy menu option will be a missed opportunity to bring in new
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The use of the flavorful Thai ingredients in fast food environment is bringing
success in advancing sales and profit. Texas-based Pie Five Pizza Company ran a limited-
time offer of a Thai-rrific Pie, a pizza crust topped with sweet Thai chili sauce,
mozzarella and provolone cheeses, sliced grilled chicken, a mix of vegetables, crushed
red peppers, carrot sticks and cilantro, and it was a hit with customers, increasing average
sales by 8% (Glazer, 2016). The subject hamburger chain experimented with sriracha
flavored chicken sandwiches with limited success. It should consider using other Thai
ingredients (fish sauce, curry paste, garlic etc.) while developing new menu items in the
future. A Thai curry paste inspired chicken sandwich is worth experimenting with.
Customers are looking not only for healthy meals at the fast food chain but also
for transparency in terms of sourcing of the food. They want to have a general idea of
how their food was prepared and where did it come from? How the animals are being
raised? Increasingly, fast food customers are demanding information such as what they
are eating and how it was made; they prefer to watch their food being prepared, see the
ingredients, and have a sense of where it all came from (Specter, 2015).
Fast food chains are listening to their customers. Recently, McDonald’s, the fast
food sales leader, announced measures to make its food sourcing more in line with
introduced low calorie food (Specter, 2015), abandoned chicken raised with antibiotics
and milk from cows that have been treated with growth hormones (Taylor, 2015) and
cage free eggs (Strom, 2015). Denny’s also committed to cage-free eggs and said the
cage-free egg commitment was part of a larger shift toward premium ingredients on its
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menu, which includes USDA select beef, wild-caught and sustainable salmon, fresh-cut
seasonal fruit and vegetables, and seven-grain bread options (Ruggless, 2016).
The subject hamburger chain can take a cue from McDonald’s and Denny’s. The
24-hour breakfast offering at the host chain with cage-free eggs will go well and far with
customers who focus on humanely raising animals. In January 2016, the subject
hamburger chain announced that, it will be serving cage-free eggs by year 2025. The
sourcing of the food also needs to be communicated with customers via a smart phone
app, point of sales material, website, and social media. It will be beneficial to dedicate a
portion of the subject hamburger chain’s website to food transparency. Even starting a
brand new website to communicate these issues with customers is not a bad idea at all.
Failure to reveal the sourcing of food may hinder attracting customers who like to eat
Customers are also looking for the ability to customize their meals to their unique
taste (Specter, 2015). Giving customers the ability to create a meal with options to mix
and match, especially with ingredients, is a new trend in the fast food environment. The
subject hamburger chain can introduce restaurants with digital kiosks, where customers
can build their own sandwiches on a touch screen and then wait for the speedy delivery of
the freshly made product. McDonald’s started a program dubbed “Create Your Own
Taste” that allows customers to choose from a wide variety of buns (artisan roll, tender
and buttery, or the sesame seed-topped premium bun), toppings (bacon, chili-lime tortilla
strips, guacamole, red onion slices, tomatoes, pickles, grilled mushrooms, grilled onions,
and lettuce leaves), cheese (natural sharp white cheddar, natural pepper jack, and
American) and sauce (ketchup, mustard, sweet barbecue, creamy garlic, and peppercorn)
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for a hamburger prepared either with beef or sirloin (Herman, 2015). Among other
McDonald’s recent comeback in the domestic market (Egan, 2015). A similar program
like McDonald’s dubbed as “Crave Your Way” will give customers at the subject
hamburger chain the opportunity to mix and match and customize meals to their own
tastes. Lack of ability for customers to customize their meal may be a missed opportunity
when sick employees are allowed to cook and serve. Due to lack of paid sick days and
low wage, workers often cannot afford to stay home when they are sick. According to the
Restaurant Opportunities Center (ROC) United, 88% of the fast food workers do not have
paid sick days, 66% of them cook and serve while sick, and 74% of them cannot afford to
take the day off while sick, and these workers have been linked to outbreaks of
Norovirus, hepatitis A and typhoid fever among customers ("Serving While Sick," 2010).
Thus, the subject hamburger chain should pay particular attention when employees come
to work sick to ensure food safety is not compromised. The subject hamburger chain
gives employees personal days off, which can be used while employees are sick. The
frontline managers have to make sure that team members do not work while they are sick,
Another trend in fast food arena is incorporating local taste into the menu.
McDonald’s has started to serve lobster roll in Maine; an Indiana McDonald’s restaurant
is testing pulled pork; in Maryland and Virginia, customers can order a Filet-O-Fish
sandwich seasoned with Old Bay; and Kentucky customers can get burgers with bourbon-
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flavored sauce (Maze, 2015). The subject hamburger chain should look into the
possibility of including menu items based on local taste. Markets with large Hispanic
population should explore the possibility of offering rice and beans. Another opportunity
for the subject hamburger chain is the introduction of a halal menu, especially in New
York City where there is a large Muslim population. Estimates of the Muslim population
in New York City range widely from 600,000 to 1,000,000 (Otterman, 2014). Opening
the restaurants to Muslims via offering a halal menu option may open the door to
thousands of new customers, bringing in new revenue and boosting the profit margin.
Based on the above discussion, the subject hamburger chain should focus on
healthy food options, Thai inspired food option, transparency on food sourcing,
sustainable food sourcing, customization of meal, food safety, and food items based on
local tastes and preferences. Failure to capitalize on these recommendations could result
in increasing insolation with the prevailing trends in the fast food industry.
Price and value. Maintaining a low price is increasingly becoming difficult for
the labor-intensive fast food industry due to changes in cost structure. Nowadays, rising
labor cost is a major concern for the fast food operators in the backdrop of political
rhetoric to accelerate minimum wage increases across the country. Since 2014, many
states and municipalities have announced hikes up to $15, and the State of New York has
even targeted the fast food industry for mandatory increases up to $15 by year 2018 in
New York City and 2021 in the rest of the state (Kelly, 2015). Thus, an effective pricing
strategy has become increasingly difficult to adopt, but there are some pricing strategies
that can work for the subject hamburger chain to be profitable without alienating its
customer base.
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The “big data,” which is cost analytics, is here and can help fast food operators
hamburger chain can achieve a unique ability to adjust pricing (relative to market
(2015) also explained that the big data opportunity involves a massive sampling of
customers’ habits and behaviors to determine how consumers will react to variations in
In the midst of big data, what is the best approach for the subject hamburger
chain? Over category and cost based pricing, Kelly (2015) suggested a market based
pricing strategy, which involves looking at direct and indirect competitors in a category
and aligning a brand’s position within the market’s price range. Thus, it is recommended
that the subject hamburger chain hire a data scientist to create an algorithm to assess
competitive and current market trends to accurately determine pricing with the idea to
garner invaluable business insights on an ongoing basis. This may provide the subject
hamburger chain with the opportunity to set a different price at each location based on the
competitive landscape. Without harnessing the power of big data, the subject hamburger
chain may struggle as minimum wages increase across the board, and incorporating
analytics into the pricing strategy can be the key that opens the door to sustained growth
that cost less and burgers that cost more is not the actual ingredients, but the mere
mentioning of those ingredients on the menu (Massa & Covington, 2014). Massa and
Covington (2014) referred to a new pricing strategy for the restaurant industry dubbed as
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‘attribute based pricing’, which is a strategy that draws from a product’s internal
characteristics and external factors to ensure that an item’s price reflects its consumer-
perceived value. For example, the cost of seasoned hand cut fries is more than machine
cut fries. The point here is that if an operator is seasoning and hand cutting fries and not
mentioning these in pricing the product, the operator is missing an opportunity to charge
customer more.
Based on the above discussion, the subject hamburger chain should focus on
harnessing the power of big data to set dynamic pricing in its restaurants based on market
environment and attribute based pricing. The implication for not following these
recommendations will result in a loss of sales increase via charging customers what they
Service quality and suggestion selling. The subject hamburger chain focuses
are expected to greet customers with their name— ‘Hi, this is Sara, how may I help you
today?’. They are expected to make eye contact and, if possible, make conversation with
customers. Doing this definitely makes customers feel special, but this takes valuable
time away that could have been used to improve order accuracy and speed of service.
Thus, it is recommended that the subject hamburger chain move some of the attention
away from being hospitable and invest those valuable seconds to better order accuracy
and speed.
The subject hamburger chain also focuses immensely on suggestive selling. There
are no doubts that suggestive selling adds to the topline sales. But the question is, at what
expense? It is often at the expense of accuracy and speed. Because of the focus on
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suggestive selling, the customer service specialists are expected to suggest cheese with
the combo meals and upsizing the fries and soda, and then complete the sale with the
suggestion of a dessert. These slow down the service. Suggestive selling creates another
major problem for the subject hamburger chain by negatively affecting the perception of
price and value. As much as 30% more can be added to tickets/bills due to suggestive
selling, severely hampering the value proposition. Therefore, it is recommended that the
subject hamburger chain move the focus from suggestive selling to accuracy and speed.
Thus, the host chain should move its focus from service quality and suggestive
selling in favor of order accuracy and speed of service. Failure to do so will hamper
speed and accuracy and give rise to the high price and low value proposition. The
implication of these changes for the subject hamburger chain is huge. Focus away from
service quality and suggestive selling will mean the difference between being a faster
chain and a slower chain and a chain with a reputation to fill orders correctly and
incorrectly.
subject hamburger chain? Race, gender, income, age, marital status, time of visit, service
delivery method, and geographic region were analyzed and explored in terms of their
The results of the current study demonstrate that race, income, age, marital status,
and geographic location have important impacts on satisfaction at the subject hamburger
chain. People from different races, incomes, ages, marital statuses, and geographic
locations feel differently about satisfaction at the subject hamburger chain. The
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restaurants, the subject hamburger chain should focus on demographic variables. Since
there are racial differences in satisfaction, what works for one group may not work for
another racial group. The same applies for groups based on income, age, marital status,
and geographic locations. Lower income customers are looking for lower price and
greater value, so restaurants with a customer base of low income should focus on lower
price while restaurants with a higher income customer base definitely should charge
more. What works for the Millennials and Generation X will not work for the Baby
Boomers and the Silent Generation. There should be more focus on technology to engage
young customers while the focus should be on human element to interact with their older
cohorts of Baby Boomers and the Silent Generation. The success of halal menu items will
be much greater in a city with a large Muslim population than a city with very little or no
Muslim population.
Gender, time of visit, and service delivery method did not have any effect on
satisfaction at the subject hamburger chain. These findings also have implication for the
subject hamburger chain. Since there are no differences in satisfaction based on gender,
time of visit, and service delivery method, efforts at customer service at the subject
hamburger chain based on these three demographic factors may be a waste of efforts and
resources.
Based on the above discussion, the subject hamburger chain should consider the
effects of race, income, age, marital status, and geographic locations while developing
programs to improve satisfaction and loyalty at the restaurants that it operates. The
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subject hamburger chain also should not engage in developing programs to improve
satisfaction and loyalty based on gender, time of visit, and service delivery methods.
To what extent are customer satisfaction and customer loyalty related? The
relationship between customer satisfaction and customer loyalty was explored at the
subject hamburger chain. One hypothesis was tested to answer this research question.
The results of the study suggest that there is a positive relationship between
customer satisfaction and customer loyalty at the subject hamburger chain. This finding
has significant implications. To build loyal customers, the subject hamburger chain must
focus on creating a satisfied customer. Results of the study suggest that to create satisfied
customers, the subject hamburger chain must focus on order accuracy, speed of service,
food quality, and price and value. A loyal customer gives repeat business. More
importantly, he/she also recommends the restaurant to friends and family (Min & Min,
2011). This is a powerful tool to build sales and volume. Thus, it is recommended that the
subject hamburger chain focus on creating satisfied customer by filling the orders
accurately, serving the customers quality food quickly, and keeping the price competitive.
The results of the current study contribute to the body of knowledge in the fast
food industry specific to determinants of satisfaction. However, the current study has
limitations. It was limited to the sample of customers at one regional fast food restaurant
chain with operations in the mid-western and eastern United States. Many fast food
chains, such as McDonald’s, Burger King, Wendy’s, and Subway, have extended their
165
business to the global market, and the factors identified in this study impacting customer
satisfaction have the potential to be inconsistent across national borders or even state
borders here in the United States. Therefore, future studies should attempt to examine the
impact on satisfaction of the variables used in the current study by targeting different
samples in the fast food restaurant industry in wider geographic regions or even multiple
countries.
This study was conducted at a regional fast food hamburger chain. Therefore, the
results of the study cannot even be generalized across fast food industry, let alone fine
dining, casual, fast casual restaurants, and the restaurant industry as a whole. Thus, future
studies should include other segments of restaurants, such as fine dining, casual dining,
and fast casual, to reap the benefits of covering the restaurant industry as a whole. What
is important at fast food restaurants may not be important in other segments. For
example, speed of service came as the second most important factor in this study; this
may not be the case when people dine at fine dining restaurants.
On the other hand, service quality did not come as an important factor of
satisfaction in the current study while it may be the most important factor in fine dining
attributes of all types of restaurants may assist restaurant managers to better match the
needs of each restaurant segment. Data collection across the restaurant industry also will
allow comparative analysis among different classes of restaurants – fine dining, casual
The current study considered only the effects of service quality, food quality,
accuracy, and speed of service. From a pure study design standpoint, future studies
should benefit from developing a more robust measurement incorporating the eight
customer satisfaction factors considered in the current study and other unique attributes
that exist in the restaurant industry and missed by this study, such as corporate image,
data was collected at one point in time. A longitudinal study would probably provide
more valuable business insights, as data would have been collected at least in two
different points in time. Collection of data in more than one time would allow further
change in perception about the subject hamburger chain among customers. Thus, in the
future, a longitudinal study may uncover better business insights for the subject
hamburger chain.
Because of its sheer quantitative nature, only quantitative data was collected and
analyzed capturing the perception of customers about the impact of service quality, food
order accuracy, and speed of service on satisfaction. The study did not ask any open-
ended questions. Since the study did not ask any open-ended questions, the participants
were not given the opportunity to express their reasoning behind their perceptions. Thus,
Another limitation of the study is the ‘halo effect’, the tendency of a judge to rate
individual traits according to the rater's general impression of the object that is being
167
rated (Oh, 2007). Wu and Petroshius (1987) explained this phenomenon further by stating
that when a participant in a study has a very positive attitude toward a particular attribute
which is important or the overall impression of a retail organization, he/she may project
the positive feeling to other attributes covered by the same instrument. Thus, the
existence of a halo effect for any of the eight variables used in the present study may
have clouded others, impairing the true effectiveness of the study as a whole. For
brand, the halo effect may be in play. This is particularly true because the participants
were recruited at the restaurants. To minimize the halo effect, future studies should
collect data from other means, such as an e-mail list, a college community, etc.
Another limitation is that the study used only an Internet survey tool and,
therefore, might have restricted some users from participating in the survey. The
customer population may have been more adequately represented if the survey was
interviews. Thus, future studies should also use a method of data collection aside from an
As a reflection of the multiple recommendations for future studies, the two most
important recommendations that should be incorporated into a future study would be the
brand image, and marketing efforts, and collection of data not only via quantitative
Conclusion
Based on the result of the current study, order accuracy, speed of service, food
168
quality, and price and value are the most important factors of satisfaction at the subject
hamburger chain. The results of the study also established that there is a statistically
satisfaction, the subject hamburger chain should focus on filling orders accurately,
providing faster service, serving quality food, and keeping the price competitive.
Increased satisfaction will lead to increased loyalty as it is proven that there is a positive
taking the order, prior to collecting money, and during delivery of the meal.
• Improve food quality by serving healthier food, being transparent about the
sourcing of the ingredients, developing menus based on local tastes, and giving
• Improve pricing by tapping into big data and adopting an attribute based pricing.
The overall conclusion is that through careful and creative management of the most
important factors of satisfaction, the subject hamburger chain should be able to improve
customer satisfaction and loyalty, which will help in achieving both customer service
goals and overall company goals in terms of transaction, sales, and profits. According to
the chief marketing officer of White Castle System, Inc., “Today’s customers are not only
169
looking for their orders to be filled correctly, they are also looking for good food supplied
from sustainable and humane sources, served fast yet also at a great price” (K. Kelly-
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Appendix B
Survey Code
Qualifier QUA1 Q1
STATUS
OTHER TIME
DRIVE-THRU
211
COLUMBUS, DETROIT,
INDIANAPOLIS,
LOUISVILLE,
NASHVILLE,
MINNEAPOLIS, NEW
LUIS
Appendix C
Email Communication
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Appendix C
Email Communication