TABLE OF CONTENTS

>>>CERTIFICATE…………………………………………………...I

>>>PREFACE ……………………………………………………….II

>>>ACKNOWLEDGEMENT………………………………………III

CHAPTER 1.0 INTRODUCTION

1.1)COMPANY PROFILE……………………………………………1

1.2) CUSTOMER SATISFTACTION………………………………..7

1.3)CUSTOMER LOYALTY………………………………………...10

1.5)COMPANY OVERVIEW………………………………………..14

1.6)SOWT ANALYSIS……………………………………………….15

CHAPTER 2.0 CONCEPTUAL DISCUSSION ( 20 – 29)

CHAPTER 3.0 RESEARCH METHODOLOGY

3.1) OBJECTIVE OF STUDY……………………..…………………32

3.2) SIGNIFICANCE OF STUDY…………………..………………..33

3.3) POPULATION…………………………………..……………….34

3.4) SAMPLE…………………………………………..……………...35

3.5) COLLECTION OF DATA………………………….……………37

3.6) TECHNIQUES OF DATA ANALYSIS………………............…

CHAPTER 4.0 FINDINGS AND ANALYSIS (38-59)

CHAPTER 5.0 CONCLUSION AND SUGGESTION…… (60-63)

>>>APPENDIX

>>>BIBLIOGRAPHY

1
Introduction

2
 INTRODUCTION

COMPANY PROFILE

1.1 Overview

Logistics market is all set to experience a period of explosive organic growth,

judging by independent market analyst Datamonitor's latest research. The

Datamonitor report, "India Logistics Outlook 2007," predicts high double-digit

growth rates for both outsourced and contract logistics in India.

With India's gross domestic profit (GDP) growing at over 9% per year and the

manufacturing sector enjoying double digit growth rates, the Indian logistics industry

is at an inflection point, and is expected to reach a market size of over $125 billion in

year 2010.

Strong growth enablers exist in India today in the form of over $300 billion

worth of infrastructure investments, phased introduction of value-added-tax (VAT),

and development of organized retail and agri-processing industries. In addition, strong

foreign direct investment inflows (FDI) in automotive, capital goods, electronics,

retail, and telecom will lead to increased market opportunities for providers of 3PL in

India."

3
 However, as a result of the under-developed trade and logistics infrastructure,

the logistics cost of the Indian economy is over 13% of GDP, compared to less than

10% of GDP in almost the entire Western Europe and North America.

As leading manufacturers realign their global portfolios of manufacturing

locations, India will have to work on such systemic inefficiencies, in order to attract

and retain long-term real investments.

3PL/outsourced logistics is the outsourcing of a company's logistics operations

to a specialized firm, which provides multiple tactical logistics services for use by

customers as opposed to the respective company having a business unit in-house to

oversee its supply chain and transportation of goods.

Some Facts:

• Market Size US $ 1.5 Billion

• Growth rate between 15 to 20% per annum

• International gateways:
o Mumbai
o Delhi,
o Chennai
• Domestic gateways
o Mumbai,
o Delhi,
o Kolkata,
o Chennai,

4
 o Bangalore,
o Hyderabad,
o Pune,
o Salem,
o Ambala,
o Gauwhati,
o Ahmedabad,
o Nagpur.

• Employs over 1.2 Million people

• Air express witnessed maximum growth in the air cargo market

• In 2007 over 1.70 Billion shipments handled

• Air traffic grows faster than anywhere in the world

• Total cargo traffic increased by 21.5 % in 2006-07

• 126 airport

• 14 int‘l airport account for 96 % of total freight traffic

• Estimated market size US$ 1.5 Billion

• High growth rate

• Express market expected to grow more than 20 %

• India‘s Express industry bigger than tea and entertainment industry

5
 • 2nd fastest growing major economy

About DHL

DHL is a Deutsche Post World Net company of Germany that provides

international Mail, Express, Logistics and Finance. The company was founded in
1969 by Adrian Dalsey, Larry Hillblom, and Robert Lynn.

The trio initially provided a courier service between the Continental United
States and Hawaii then expanded the business from there. In 1998, Deutsche Post
World Net began to acquire shares in DHL, finally reached majority ownership in
2001, and completed the purchase in 2002.

DHL's global headquarters are located in Bonn and London (its Exel
subsidiary). Headquarters for the Americas are located in Plantation, Florida, while its
Asia Pacific & EEMEA headquarters are located respectively in Singapore &
Bahrain/Brussels.

DHL owns its own cargo airlines, European Air Transport, originally based in
Brussels, and DHL Air, based at the East Midlands Airport in the United Kingdom.
EAT moved from Brussels Airport in Belgium to Leipzig/Halle Airport in Germany
in Spring 2008 with its fleet of Boeing 757SF freighters and Airbus A300 B4
freighters. Leipzig is now DHL major European Airline hub with dedicated brand
new facilities.

Major competitors of DHL include:

• FedEx.
• UPS.
• TNT.
• United States Postal Service and,

6
 • Royal Mail.

As on 2006 DHL employees around 2,85,000 people across the various locations.

1.2 Customer Satisfaction

The term logistics is often misinterpreted to mean transportation. In fact, the

scope of logistics goes well beyond transportation. Logistics forms the system that

ensures the delivery of the product in the entire supply pipeline. This includes

transportation, packaging, storage and handling methods, and information flow. The

impact of logistics in the ability of a company to satisfy its customers cannot be

overstated. All other efforts at modernization within a company would not bear fruit

until the logistics system is carefully designed to facilitate the smooth and efficient

flow of goods in the system.

The topic of logistics is relatively new in India. There have been some

companies that have done work in this area, but a large number of companies are only

now beginning to realize the benefits of designing and managing the entire supply

chain. With India joining the global marketplace, the role of logistics assumes greater

importance.

The industrial policies in India have prompted manufacturers to build plants in

remote, backward areas due to inexpensive land and tax benefits. This poses some

serious logistical problems. Apart from a poor road and transportation network, the

7
existing communications system in India leaves a lot to be desired by any

international standard. It is in this context that logistics has to be considered in India.

Customer Satisfaction in 7 Steps

1. Encourage Face-to-Face Dealings

This is the most daunting and downright scary part of interacting with a

customer. If you're not used to this sort of thing it can be a pretty nerve-wracking

experience. Rest assured, though, it does get easier over time. It's important to meet

your customers face to face at least once or even twice during the course of a project.

2. Respond to Messages Promptly & Keep Your Clients Informed

This goes without saying really. We all know how annoying it is to wait days

for a response to an email or phone call. It might not always be practical to deal with

all customers' queries within the space of a few hours, but at least email or call them

back and let them know you've received their message and you'll contact them about it

as soon as possible. Even if you're not able to solve a problem right away, let the

customer know you're working on it.

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3. Be Friendly and Approachable

A fellow Site Pointer once told me that you can hear a smile through the

phone. This is very true. It's very important to be friendly, courteous and to make your

clients feel like you're their friend and you're there to help them out. There will be

times when you want to beat your clients over the head repeatedly with a blunt object

- it happens to all of us. It's vital that you keep a clear head, respond to your clients'

wishes as best you can, and at all times remain polite and courteous.

4. Have a Clearly-Defined Customer Service Policy

This may not be too important when you're just starting out, but a clearly

defined customer service policy is going to save you a lot of time and effort in the

long run. If a customer has a problem, what should they do? If the first option doesn't

work, then what? Should they contact different people for billing and technical

enquiries? If they're not satisfied with any aspect of your customer service, who

should they tell? There's nothing more annoying for a client than being passed from

person to person, or not knowing who to turn to. Making sure they know exactly what

to do at each stage of their enquiry should be of utmost importance. So make sure

your customer service policy is present on your site -- and anywhere else it may be

useful.

9
5. Attention to Detail (also known as 'The Little Niceties')

Have you ever received a Happy Birthday email or card from a company you

were a client of? Have you ever had a personalized sign-up confirmation email for a

service that you could tell was typed from scratch? These little niceties can be time

consuming and aren't always cost effective, but remember to do them.

Even if it's as small as sending a Happy Holidays email to all your customers,

it's something. It shows you care; it shows there are real people on the other end of

that screen or telephone; and most importantly, it makes the customer feel welcomed,

wanted and valued.

6. Anticipate Your Client's Needs & Go Out Of Your Way to Help Them Out

Sometimes this is easier said than done! However, achieving this supreme

level of understanding with your clients will do wonders for your working

relationship.

7. Honour Your Promises

It's possible this is the most important point in this article. The simple

message: when you promise something, deliver. Clients don't like to be disappointed.

10
Sometimes, something may not get done, or you might miss a deadline through no

fault of your own. Projects can be late, technology can fail and sub-contractors don't

always deliver on time. In this case a quick apology and assurance it'll be ready ASAP

wouldn't go a miss.

1.3 Customer Loyalty

Obtaining a thorough understanding of customer loyalty is a prerequisite for

the execution of the research at hand. For that, the development of customer loyalty

research within the framework of relationship marketing will be presented first, before

different customer loyalty concepts will be introduced. From these concepts, a

definition of customer loyalty for use in this study will be derived, before both

consequences and antecedents of customer loyalty will be portrayed.

Since the beginning of the 1990s, customer loyalty has gained importance both

in relationship marketing research and in business. In business, this can be attributed

to changing market- and competition-environments. Due to a shift from a sellers’ to a

buyers’ market and because of an increasing degree of globalization, most industries

find themselves confronted with new challenges. In a first phase, firms tried to face

these challenges by focusing on their internal processes and organizational structures,

trying to achieve cost reductions by concentrating on internal improvements. A

second phase of external focus followed, where firms directed attention to their

customers, trying to retain existing ones and to win over new ones (churning). Since

11
“acquiring new customers is much more expensive than keeping them”. And “loyal

customers are the bedrock of any business”. A loyal customer base represents a

barrier to entry, a basis for a price premium, time to respond to competitor

innovations, and a bulwark against deleterious price competition. Loyalty is critical to

brand volume, is highly correlated to market share, and can be used as the basis of

predicting future market share; consequently, understanding loyalty appears critical to

any meaningful analysis of marketing strategy.

In marketing research, two trends mark the development of customer loyalty.

While individual transactions initially were in the center of marketing research, the

focus shifted towards analyzing relationships states that the ‘traditional’ marketing

concept of the marketing mix with its ‘4 Ps’, developed in the middle of the last

century, had been the established approach until the 1990s. This approach, how-ever,

focuses solely on transactions, a deficit tackled by the relationship marketing

approach. At the core of it is the study of relationships between buyers and sellers of

goods or services, in contrast to merely examining transactions. An often cited and

comprehensive definition of relationship marketing is provided “Relationship

marketing refers to all marketing activities directed toward establishing, developing,

and maintaining successful relational exchanges.” Therefore, the relationship

marketing approach pro-vides a suitable environment in which customer loyalty

research can be nested.

12
 While the development of relationship marketing began in the early 1970s, it

was not until the late 1980s that works from the ‘Nordic School of Services’. Initiated

a paradigm shift that geared marketing towards the creation, conservation, and

extension of buyer-seller relationships. Although relationship marketing today is

widely accepted among marketing researchers, its promoters do not postulate the

replacement of the transactional approach, but rather juxtapose the two approaches.

For example, delineates a strategy continuum, in which different goods require

different degrees of transaction- and relationship-based marketing strategies. As a

result of the focus on relationships in marketing research, customer loyalty gained

importance within research.

Before determining which stream the present study can be associated with,
however, it is important to create a clear understanding of different customer loyalty
concepts prevalent in research. This will be accomplished in the following section.

Customer Loyalty Concepts

Reviewing research, it becomes obvious that the notion of customer loyalty is

blurred. At its core, customer loyalty deals with relationships between suppliers and

their customers and can be distinguished from other loyalty aspects, such as brand

loyalty, which refer to a more abstract attachment, such as that towards a brand.

Within German customer loyalty literature, the notion of customer loyalty is even

more faceted, encompasses both ‘customer loyalty’ and ‘customer retention’

13
distinguishes an active, supplier-focused component and a passive, customer focused

component of customer loyalty.

In the supplier-focused perspective, customer loyalty is seen as a bundle of

measures that aim at improving relationships with customers. The supplier is in the

center of attention and the customer is only regarded as the factor at which success of

customer loyalty becomes manifest. Here it becomes clear that this approach contains

a conceptual deficit. It is the customer who eventually decides on whether customer

loyalty management is successful or not, because all activities undertaken by a

supplier can only be geared at influencing customers to be loyal. A customer-focused

perspective therefore has to be added to evaluate the success of customer loyalty

management.

Within the customer-focused perspective, customer loyalty is conceptualized

taking into account customers’ complex characteristics. These can either be

approached as customers’ directly observable actions and/or take into account their

attitudes and intentions. Since customers’ actions are directly influenced by their

attitudes and intentions, it is obvious that these have to be scrutinized to understand

and manage loyalty. A third perspective is a synthesis of the former two approaches.

The relationship-focused perspective directly examines the relationship between

suppliers and customers. Accordingly, the objects of study in this perspective usually

are buying behavior in retail contexts and long-term relationships marked by frequent

interaction between suppliers and buyers in industrial contexts.

14
1.4 COMPANY OVERVIEW

 DHL is the global market leader in international express, overland transport

and air freight,

 It is also the world's No.1 in ocean freight and contract logistics,

 DHL's international network links almost 220 countries and territories

worldwide,

 Around 285,000 employees are dedicated to providing fast and reliable

services that exceed customer’s expectations in 120,000 destinations in all

continents.

1.5 SWOT ANALYSIS

15
STRENGTHS

Strong Brand Image

Globalism

eServices and technology

Corporate symbiosis

Smart-truck Project

OPPORTUNITIES

Epansion Globally

Joint-Ventures

Expansion Of E-commerce

Increase In The Number Of Manufactured Goods

WEAKNESSES

High Prices

Market-Share Estimate

Weak Visibility

Not as well known as UPS and Fedex

THREATS

16
Relations With Foreign Countries

Economic And Political Conditions

Restrictions

Economic Slow-down

Fuel prices can go up

COMPANY STRENGTHS

 Strong Brand Image: In 1997, DHL became the global express transportation
company to obtain simultaneous system-wide ISO 9001 certification in

international quality standards. DHL has also developed their own quality

system that matches their customer’s standards.

 Globalism: DHL operates on a global scale. They operate in more than 220
countries. They provide services that appeal to most of the world. They have

such a large market in which to operate, and thus realize tremendous revenues.

They can also achieve global economies of scale.

 eServices and Technology: DHL uses and continues to search for new
technology. They spend nearly 10% of total revenues, for information

technology. DHL also has excellent eServices that provide access to systems

that ensure customers have control and visibility of their supply chains at all

times. Products can be tracked, queried and ordered online.

17
  Corporate symbiosis:DHL has developed its own organizational structure to
serve the global market, which it has called “corporate symbiosis.” This

approach encompasses the empowerment of the DHL personnel at a local

level, at the same time recognizing the interdependence of the parts of DHL as

a corporate whole.

 Smart-Truck Project: It is the programme which allows DHL to deliver

faster. The data are transmitted directly to the dynamic route planning system,

which recalculates the routes, depending on the current order situation and

volume of traffic.

COMPANY WEAKNESSES

 High Prices: DHL’s prices are above their competitors. This can be a
weakness if their customers do not perceive a difference between DHL and its

competitors’ services.

 Mistakes in Market-Share Estimate: The biggest weakness is DHL’s

market-share estimate. It is difficult to estimate even when the market is

stagnant and contains few competitors, and all market-share estimates should

be viewed with circumspection.

 Weak Visibility: It has weak visibility in the community compared with its
potential

 Not Well-known in USA as UPS and Fedex

18
COMPANY OPPORTUNITIES

 Expansion Globally: DHL can continue to expand globally, including the

other companies under DHL.

 Joint-Ventures: DHL can form joint ventures to enjoy the growth of

integrating their customer bases.

 Expansion of e-commerce: DHL already has a major presence of shipping

online. They should keep finding Internet companies to contract delivery of

their products. Since the growth of e-commerce is rapid now, DHL could

enjoy both profits and brand name recognition from this kind of expansion.

 Increase In The Number Of Manufactured Goods: The World Trade

Organization estimates that the rate of world trade in manufactured goods will

increase exponentially up to 2010.

COMPANY THREATS

 Relations with Foreign Countries: Through DHL’ expansions globally, they

are subject to laws and regulations of all foreign countries. There could be

major problems in this area, stunting growth and raising costs.Everywhere

19
 DHL goes, they are at risk for regulations that hinder their operations or

efficiency.

 Economic and Political Conditions: DHL is subject to the entire world’s

economic and political condition in the areas of fuel prices and supply,

customer purchase of their services, and relations with foreign countries. As a

global company, they are subject to much more risk than domestic companies.

 Restrictions: Some restriction like ‘To prevent import from China’ are big
problems in the logistic sector

 Economic Slow-down: Economic slow-down is decreasing the number of

products that are produced.

 Price of fuel can go up: Even if the price of fuel goes up, DHL can pass that
along to the customer but fuel is always a concern both in price and

availability

20
21
 Conceptual
discussion

REVIEW OF LITERATURE

Logistics

After having presented the necessary fundamentals of customer loyalty in the

preceding section, this section will elaborate on the reference point of the research

project, i.e. logistics. For that, the first section will present different views on logistics

and lay the notional basis for the understanding of logistics embraced in this study. As

relationships between logistics service providers and their customers are to be

analyzed, the logistics outsourcing phenomenon will be detailed, before taxonomy of

logistics service providers is provided.

22
Nature of Logistics

Logistics is an established discipline both in theory and in practice, yet there is

no agreement on a universal definition of logistics. One widely accepted view stems

from the Council of Supply Chain Management Professionals (CSCMP). In their

latest definition (CSCMP 2005), logistics management is seen as “that part of Supply

Chain Management that plans, implements, and controls the efficient, effective

forward and reverses flow and storage of goods, services and related information

between the point of origin and the point of consumption in order to meet customers'

requirements.”This view is clearly marked by the economic objectives of

effectiveness and efficiency and regards logistics as part of supply chain management.

Other definitions e.g. that of Weber and Kummer are broader and refer to

logistics as a flow-oriented design of all value-creation processes. At the base of their

understanding is the empirically backed assumption that there are different stages of

maturity in logistics. While there are several researchers that also argue for stage

models of logistics development, there is no unity as to how many stages such a

model has. The model that will be briefly examined in this section stems from Weber,

who identifies four maturity stages. These stages are determined by the level of

logistics knowledge present in a firm and require path-dependent development from

the lowest to the highest level of logistics knowledge:

In the first maturity stage, logistics is a specialized service function that

provides transportation, handling, and storage services that are necessary for an

23
efficient flow of materials and goods. Weber states that this stage of logistics maturity

was first observable in the 1950s, when markets changed from suppliers’ to buyers’

markets, requiring improved materials flows to succeed in the changed market

environment. This is in line with Bowersox and Daugherty, who confirm that

advanced logistical organizations barely existed at that time. Effects of this paradigm-

change were two-fold. On the one hand, logistics optimization was achieved through

process improvements and advances in forecasting and planning techniques. On the

other hand, organizational changes took place, as many companies institutionalized

their logistics functions in dedicated departments and therefore created a specialized

service function that was separated from other functions such as procurement or

manufacturing.

The second stage of logistics maturity was initiated by contextual changes in

the economic environment. In addition, advances in technology facilitated

communication and networks between different departments in companies’ state. As a

result, firms realized that efficiency could be increased by improving the coordination

of materials flows from inbound streams in procurement through the value creation

process in manufacturing to outbound streams in distribution. Through this focus on

the integration of different functions, cost and performance benefits were achieved.

Weber provides coordination of lot-sizes and just-in-time supply and production as

examples of these benefits.

The following third stage of logistics maturity was necessitated by further

changes of the market environment. Simon points out that the intensity of competition

24
increased, an effect attributable to over-capacities, and a world-wide convergence of

product quality, shortened product-life-cycles, and a strengthened focus on customer

demands. The required simultaneous focus on differentiation and cost leadership was

not feasible under the prevalent functional structures and rigid organizational systems.

Instead, a process-oriented intra-company value chain that reduces complexity was

needed to succeed in the changing market environment. Hence, logistics evolved from

a mere functional concept to a management concept or, as from operational to

strategic orientation.

The fourth and, for the time being, last maturity stage of logistics development

is again driven by market pressures. When companies realized that optimization

potentials within the organization had been largely exploited, the focus of attention

was furthered to include upstream and downstream partners in the supply chain. In

this sense, the view of logistics as a management concept from the third maturity

stage is ex-tended over company boundaries and can be labeled supply chain

management (SCM).

This underlines the outstanding importance of logistics for companies, which

can realize significant economic benefits by allocating management capacities to the

improvement of logistics and the creation of flow-oriented organizations. A way, in

which many companies presently try to accomplish this, is by outsourcing parts or all

of their logistics activities to third parties.

25
Logistics Service Providers

If a company employs an outside provider to perform some or all of its

logistics activities, this outside provider is termed a logistics service provider. These

LSPs were originally only offering a very narrow spectrum of services, mainly

consisting of transportation or warehousing services. In order to react to changing

demands from their customers, as pointed out in the preceding sections, LSPs have

started to offer integrated service portfolios that include a multitude of different

services. According to, five types of LSPs can currently be distinguished: carriers,

couriers & express & parcel/postal (CEP), freight forwarders, third-party LSPs

(3PLs), and fourth-party LSPs (4PLs), which will be briefly described below.

Carriers are firms that own assets for transportation purposes. These as-sets

are usually confined to road, sea, air, or rail transportation. In some cases, however,

carriers own several of the aforementioned transportation assets. management of

capacity and load-factor optimization are at the core of the carrier business. CEP

providers are also transportation providers. As opposed to carriers, CEP providers

send parcels or mail though their networks, employing different transportation

vehicles and incorporating handling at hubs. In this way, they can virtually supply

door-to-door services anywhere in the world, without having to rely on any third

parties. Core competencies of CEP providers are the operation and management of

highly complex distribution networks.

26
 Freight forwarders are intermediaries between suppliers and buyers of

transportation services. In most cases, brokers carry out additional ser-vices, such as

transportation planning and management, including the associated provision of

information systems. In some cases, brokers also dispose of their own transportation

assets. Bundling and coordination of demand for transportation services are the core

competencies of brokers.

In contrast to the aforementioned LSPs, 3PLs or contract LSPs offer their

customers logistics solutions that often include management capacities. These

solutions most commonly include several services, such as warehousing and

pick/pack operations that are carried out on a longer-term contractual basis.

Sometimes, customers’ value chains, such as fleet management, order handling,

complaints management, call centers, or assembly services. A recent addition to the

list of types of LSPs comes in the form of 4PLs. While there is no universal

agreement on the definition of the 4PL, the cur-rent state of the debate establishes

4PLs as suppliers of complete logistics systems, without carrying out the services

themselves. Instead, 4PLs sub-contract all operations from other LSPs and confine

themselves to the management of logistics systems. Thus, they do not dispose of any

logistical assets and are a neutral intermediary between businesses and asset-based

LSPs.

27
 As 3PLs form the point of reference for logistics outsourcing as dealt with in

this study, the existing notional ambiguities in research have to be examined. Author

to identify different types of 3PLs. To him, there are four distinct classes of 3PLs:

(1) asset-based 3PLs use their own assets (e.g. trucks and warehouses) to offer

dedicated logistics services;

(2) management-based 3PLs supply logistics management through

information systems or consulting;

(3) Integrated 3PLs use their own assets to provide logistics services, but also

subcontract from other vendors if necessary; and

(4) administration-based 3PLs mainly offer administrative management (e.g.

Freight payment).

The six key factors that influence customer loyalty

According to Peter Clark, co-editor of The Wise Marketer and

co-author of The Loyalty Guide report series, there are six major
factors that play key roles in influencing the loyalty and
commitment of customers:

28
 Figure 1: Factors that influence customer loyalty

Research Motivation

A multitude of companies today has already identified the need to create a

loyal customer base and acknowledges that maintaining existing customers and

extending business with them is significantly less expensive than acquiring new

customers. Empirical proof of the proliferation of such customer loyalty efforts in the

business world is e.g. provided in the form of loyalty programs, which many

companies have installed during the past years. By engaging in efforts aimed at

creating customer loyalty, which in turn fosters financial success in monetary terms

firms react to increasing competitive challenges.

Within research, the investigation of customer loyalty gained importance when

the classic marketing paradigm with its instrumental and transactional orientation

29
proved unsuitable in the context of longer-term business relationships. Instead, the

relationship marketing approach, which is specifically concerned with the study of

relational ex-changes, gained importance within research, serving as a conceptual

foundation for the majority of customer loyalty researchers.

The question of how loyalty develops has been subject to an abundance of

research, leading to an expansive body of literature on loyalty determinants. The

extant literature exploring different factors and their constituent effects on loyalty,

however, reveals a strong focus on consumer goods and industrial equipment settings,

while industrial services have received relatively little attention so far. In addition, the

majority of articles incorporates merely a few potential determinants and thus fails to

draw a comprehensive picture of the mechanisms of customer loyalty formation.

Place: Chennai

Just like other businesses, logistics service providers (LSPs) are faced with

increasing competitive pressure that urges them to concentrate not only on operational

business processes, but also on an efficient and effective customer management. In

the US alone, LSPs’ revenues grew from US-$ 31 billion in 1995 to US-$ 85 billion

in 2004 and logistics outsourcing expenditures as a fraction of total logistics

expenditures are at over 40% and expected to rise even further. One way to meet this

challenge of rapid growth and expansion, according to Langley et al. is to focus on

establishing, maintaining, and developing relationships with customers.

30
An often proposed driver of logistics outsourcing is the need to develop and maintain

competitive advantage, which customers of LSPs intend to achieve through

concentrating on core competencies and re-engineering. Another important driver is

the ongoing globalization, which several authors regard as the most important

challenge that companies are facing. In this context, LSPs can play an important role

as facilitators of global trade. Along with globalization, however, companies that

outsource logistics activities increasingly try to consolidate the number of LSPs they

use globally. Therefore, LSPs do not only have to devise sustain-able growth

strategies, but also have to develop intercultural management competencies, a

challenge hardly ad-dressed in LSP management literature.

While intercultural management deals with the influence of culture on

management styles in different countries, it is also arguable whether a one best way

management paradigm is applicable even within national confines. LSPs’ customers

are extremely diverse and similarly, relationships between LSPs and their customers

can be expected to exhibit momentous differences. As such, it is a crucial

management issue for LSPs to de-sign their customer loyalty efforts in a manner that

accounts for both cultural context and different relationship characteristics.

Research goals

As outlined in the preceding section, LSPs are confronted with diverse

management challenges that result from continuous growth, globalization, and

31
customer diversity. The aim of the present study therefore is to identify determinants

of customer loyalty in relationships between LSPs and their customers by explicitly

considering different characteristics and cultural contexts of such relationships. In this

sense, the present research is positioned at the interface of marketing and logistics and

is intended to contribute not only to logistics research, but also to research in

marketing, customer loyalty, and cultural studies.

In order to address the concept of customer loyalty, it is important to

understand the mechanisms underlying loyalty in the logistics outsourcing context.

For this reason, the starting point of the present research will be the study of

Wallenburg, who studied customer loyalty within relationships between LSPs and

their customers. On this basis, factors that can be surmised to determine customer

loyalty in such relationships will be proposed and interdependencies between these

factors will be identified. The resulting comprehensive explanatory model of customer

loyalty will not only provide insights into the constitution of customer loyalty, but

will also serve as the basis for subsequent analyses.

As stated previously, a globalizing marketplace and the need of LSPs to render

logistics services on an international scale requires intercultural management

competencies. Before being able to apply such management techniques, though, a

thorough understanding of cultural differences between different countries is

necessary. The present study will therefore provide a starting point for such analyses

by investigating cultural differences between two important markets for logistics

outsourcing, the USA and Germany. Particular differences between Germany and the

32
USA will be identified and applied to the previously devised customer loyalty model.

As a result, differences between the two countries with respect to the formation of

customer loyalty can be inferred.

Finally, this study will investigate in how far different relationship conditions

influence the development of customer loyalty. For this purpose, important

relationship characteristics will be identified and their moderating influences on the

customer loyalty model will be examined. This will provide information on the

robustness of the customer loyalty model versus relational contingencies and will

suggest if it is necessary to differentiate customer loyalty efforts accordingly.

33
Research
methodology

34
 RESEARCH METHODOLOGY

3.1 Objective of the study

 A study on customer level of satisfaction in towards DHL

Express (I) Pvt Ltd

 To identify the loyalty of customer towards DHL Express (I)

Pvt. Ltd.

 To measure the specific reasons for satisfaction and

dissatisfaction in with DHL Express.

 To identify the recommendations of DHL Express to others

by existing loyal customers.

35
3.2 Scope of the study

 Scope of the study mainly to know the current level of

customer satisfaction.

 Scope of the study mainly to know the loyalty of the custom

towards the company.

 To give suggestion regarding improvement of performance

standard of the Company

 To inform the management about current level.

36
3.3 Limitations of the study

 Time limit restricts detailed survey work for this particular

topic of research

 The survey is restricted to the customers of DHL Express I

Pvt ltd who are involved in imports.

 Some customers have lack of time, so they may not

communicate properly.

37
3.4 Research design

The objective of the study has been achieved by using both Primary and
Secondary Data’s. The data’s obtained for the study was primarily from field
investigation carried out among the customers of DHL.

Sampling

Sample design is a definite plan for obtaining a sample from a given

population. It refers to the technique or the procedure the researcher would adopt in
selecting items for samples.

Samples are studied for the population who are the customers of DHL Express
I Pvt. Ltd. Research design is needed because it facilitates the smooth railing of the
various research operations thereby making research as effective as possible yielding
maximal information with minimal expenditure of effort, time and money.

Sample Size

The Customers, to whom DHL provides service is taken into consideration.

The sample size is 85.

Primary Data

Primary data was collected through Online Survey

http://dhl-customerloyalty.surveyconsole.com/

Survey Research:

38
 Survey research as name suggests, is distinguished by the facts that the data
are collected from the people who are thought to have the desired information,
through questionnaire.

Questionnaire was posted over the internet and sent to the respective
customers in order to collect information related to the topic. The questionnaires so
designed for this purpose were structured.

Secondary Data

Secondary data was collected through company websites and records. And
analysis on various aspects has been done using different statistical techniques.

The methods followed for the analysis and interpretation of data are:

• Uni variate Percentage Analysis

• Weighted average method

Univariate Percentage Analysis:

Percentage refers to a special kind of ratio. It is used to make comparison

between two or more series of data. They can be used to compare the relative items,
the distribution of two or more series of data, since the percentages reduces every
thing to a common base and there by allow meaningful comparisons to be made. Here
only one factor is considered.

NO OF RESPONDENTS
PERCENTAGE = x 100
TOTAL RESPONDENTS

39
Weighted Average Method:

This method is a used when the relative importance of the different items is
not the same. The term weighted stands for the relative importance of the different
items. It is assumed that inventory costs should be assigned on the basis of average
costs of identical units. An average cost unit is determined by dividing the total costs
of the units by the number of units.

The weighted average method is logical when assigning costs to units that become
mixed together, there by making separate identification difficult or impossible.
The formula is:

__ ∑ WX
X =
∑W

Where;

X = Weighted Arithmetic mean

X = Frequency or no of response dents

W = Weighted allotted to each factor

40
Findings and
Analysis

41
 DATA ANALYSIS & INTERPRETATION

Customers overall experience to accessibility and responses of DHL

representative through Telephone.

Options Respondents Percentage

Excellent 16 20 %

Very Good 16 20 %

Good 32 40 %

Fair 16 20 %

Poor 0 0%

Total 80 100 %

Table - 1

Interpretation:

20 % of the customers responded that their overall experience to

accessibility and responses through Telephone is Excellent. Next 20 % says it is very

good. Good being awarded by 40 % of the customer. Final 20 % is not so satisfied so

they said that the service is fair

42
 Poor
Fair 0% Excellent
20% 20%

Excellent
Very Good
Good
Fair
Very Good
Poor
20%

Good
40%

Figure - 2

(Chart showing Customers overall experience to accessibility and responses of

DHL representative through Telephone)

43
Customers overall experience to accessibility and responses of DHL
representative through E-mail.

Options Respondents Percentage

Excellent 16 20 %

Very Good 16 20 %

Good 32 40 %

Fair 16 20 %

Poor 0 0%

Total 80 100 %

Table - 2

Interpretation:

20 % of the customers responded that their overall experience to

accessibility and responses through E-mail is Excellent. Next 20 % says it is very

good. Good being awarded by 40 % of the customer. Final 20 % is not so satisfied so

they said that the service is fair

44
 Poor
Fair 0% Excellent
20% 20%

Excellent
Very Good
Good
Fair
Very Good
Poor
20%

Good
40%

Figure - 3

(Chart showing Customers overall experience to accessibility and responses

of DHL representative through E-mail)

45
Clearance representative ability to help customer issue/need

Options Respondents Percentage

Excellent 15 19 %
Very Good 17 21 %
Good 22 28 %
Fair 19 24 %
Poor 7 9%
Total 80 100 %

Table - 3

Interpretation:

` 19 % of the customers responded that their overall experience to ability

to help resolve issue or need is Excellent. Next 21 % says it is very good. Good being

awarded by 28 % of the customer. 24 % is somewhat satisfied so they said that the

service is fair. 9 % is not satisfied with the service.

46
 Poor
9% Excellent
19%

Fair
Excellent
24%
Very Good
Good
Fair
Very Good
21% Poor

Good
27%

Figure - 4

(Chart showing Clearance representative ability to help customer issue/need)

47
Customers Overall experience with DHL Clearance Department

Options Respondents Percentage

Excellent 17 21%
Very Good 15 19%
Good 14 18%
Fair 30 38%
Poor 4 5%
Total 80 100 %

Table - 4

Interpretation:

21 % of the customers responded that their overall experience with

DHL clearance department is Excellent. Next 19 % says it is very good. Good being

awarded by 18 % of the customer. 38% is somewhat satisfied so they said that the

service is fair. 5 % is not satisfied with the service.

48
 Poor
5%
Excellent
21%

Excellent
Fair Very Good
37% Good
Fair
Very Good Poor
19%

Good
18%

Figure - 5

(Chart showing Customers Overall experience with DHL Clearance

Department)

49
Customers Overall experience with DHL Shipment Delivery at doorstep

Options Respondents Percentage

Excellent 9 11%
Very Good 25 31%
Good 40 50%
Fair 4 5%
Poor 2 3%
Total 80 100 %

Table - 5

Interpretation:

11 % of the customers responded that their overall experience with

DHL clearance department is Excellent. Next 31 % says it is very good. Good being

awarded by 50 % of the customer. 5 % is somewhat satisfied so they said that the

service is fair. 3 % is not satisfied with the service.

50
 Fair Poor Excellent
5% 3% 11%

Excellent
Very Good
Good
Very Good
31% Fair
Poor
Good
50%

Figure - 6

(Chart showing Customers Overall experience with DHL Shipment Delivery at

doorstep)

51
Customer Satisfaction level with DHL Express I Pvt Ltd

Options Respondents Percentage

Extremely Satisfied 15 19%
Satisfied 20 25%
Neutral 22 28%
Dissatisfied 18 23%
Extremely Dissatisfied 5 6%
Total 80 100 %

Table - 6

Interpretation:

19 % of the customers responded they are Extremely Satisfied with the

service. Next 25 % they are satisfied. Neutral is 22 % of the customer. 23 % is

somewhat satisfied so they said that the service is fair. 3 % is not satisfied with the

service.

52
 Extrem ely
Dissatisfied
6% Extremely Satisfied
19%
Dissatisfied
23% Extremely Satisfied
Satis fied
Neutral
Dissatisfied
Satisfied
25% Extremely Dissatisfied

Neutral
27%

Figure - 7

(Chart showing Customer Satisfaction level with DHL Express I Pvt Ltd)

53
Customer Responses or Reasons for satisfaction with DHL Express I Pvt Ltd

• Less transit time

• Clear tracking

• Advance furnishing of documents

• Keeping customer fully informed

• Timely clearance

• Good Shipment delivery at doorstep

Interpretation:

Various reasons are given by customers for satisfaction like less transit time,

Clear tracking, Advance furnishing of documents, keeping customer fully informed,

Timely clearance, Good Shipment delivery at doorstep etc.

54
Customer Responses or Reasons for Dissatisfaction with DHL Express I Pvt Ltd

• Original Bill of Entry getting only after 3 days after our follow up, this should

come along with delivery

• Freight Bill received 30 days after delivery this should deliver within 24 hrs,

so that your payment will not be delayed

• The currency some times wrongly mention in the B/E before filing with

Customs, check the invoice or check with the customer - this will help

avoiding mistake.

• In some of the instances your response is not proper

• Since express service is preferred only when there are some urgency, though

the cargo reaches at airport. clearance team takes minimum 7-25days takes for

customs clearance

• Commitment not met in several cases

Interpretation:

Various reasons are given by customers for dissatisfaction. The company need

more focused approach for satisfying the customers

55
Recommend DHL Express to others

Options Respondents Percentage

Yes 51 64%
No 29 36%
Total 80 100 %

Table - 7

Interpretation:

64 % of the customer responded in favour of recommending DHL Express to

others. On the other hand 36 % of the people say No to recommend DHL Express to

others.

56
 No
36%

Yes
No

Yes
64%

Figure - 8

(Chart showing Recommendation DHL Express to others)

57
Over the past years loyalty towards DHL Express has grown stronger

Options Respondents Percentage

Yes 55 69%
No 25 31%
Total 80 100 %

Table - 8

Interpretation:

69 % of the customer responded in favour that loyalty towards DHL Express

has grown stronger. On the other hand 31 % of the people say No that loyalty towards

DHL Express has not grown stronger.

58
 No
31%

Yes
No

Yes
69%

Figure - 9

(Chart showing status of loyalty towards DHL Express has grown stronger)

59
DHL Express Values people & Relationships ahead of Short-term goals

Options Respondents Percentage

Yes 41 51%
No 39 49%
Total 80 100 %

Table - 9

Interpretation:

51 % of the customer responded in favour that DHL Express Values people &

Relationships ahead of Short-term goals. On the other hand 49 % of the people say No

that DHL Express do not Values people & Relationships ahead of Short-term goals.

60
 No Yes Yes
49% 51% No

Figure – 10

(Chart showing DHL Express Values people & Relationships ahead of Short-
term goals)

61
 FINDINGS

• 20 % of the customers responded that their overall experience to accessibility

and responses through Telephone is Excellent. Next 20 % says it is very good.

Good being awarded by 40 % of the customer. Final 20 % is not so satisfied so

they said that the service is fair

• 20 % of the customers responded that their overall experience to accessibility

and responses through E-mail is Excellent. Next 20 % says it is very good.

Good being awarded by 40 % of the customer. Final 20 % is not so satisfied so

they said that the service is fair

• 19 % of the customers responded that their overall experience to ability to help

resolve issue or need is Excellent. Next 21 % says it is very good. Good being

awarded by 28 % of the customer. 24 % is somewhat satisfied so they said that

the service is fair. 9 % is not satisfied with the service.

• 21 % of the customers responded that their overall experience with DHL

clearance department is Excellent. Next 19 % says it is very good. Good being

62
 awarded by 18 % of the customer. 38% is somewhat satisfied so they said that

the service is fair. 5 % is not satisfied with the service.

• 11 % of the customers responded that their overall experience with DHL

clearance department is Excellent. Next 31 % says it is very good. Good being

awarded by 50 % of the customer. 5 % is somewhat satisfied so they said that

the service is fair. 3 % is not satisfied with the service.

• 19 % of the customers responded they are Extremely Satisfied with the

service. Next 25 % they are satisfied. Neutral is 22 % of the customer. 23 % is

somewhat satisfied so they said that the service is fair. 3 % is not satisfied with

the service.

• 64 % of the customer responded in favour of recommending DHL Express to

others. On the other hand 36 % of the people say No to recommend DHL

Express to others.

63
• 69 % of the customer responded in favour that loyalty towards DHL Express

has grown stronger. On the other hand 31 % of the people say No that loyalty

towards DHL Express has not grown stronger.

• 51 % of the customer responded in favour that DHL Express Values people &

Relationships ahead of Short-term goals. On the other hand 49 % of the people

say No that DHL Express do not Values people & Relationships ahead of

Short-term goals.

64
Suggestions

65
 SUGGESTIONS

• Communicate. Whether it is an email newsletter, monthly flier, a reminder

card for a tune up, or a holiday greeting card, reach out to your steady

customers.

• Customer Service. Go the extra distance and meet customer needs. Train the

staff to do the same. Customers remember being treated well.

• Employee Loyalty. Loyalty works from the top down. If you are loyal to your

employees, they will feel positively about their jobs and pass that loyalty

along to your customers.

• Employee Training. Train employees in the manner that you want them to

interact with customers. Empower employees to make decisions that benefit

the customer.

• Customer Incentives. Give customers a reason to return to your business. For

instance, because children outgrow shoes quickly, the owner of a children’s

shoe store might offer a card that makes the tenth pair of shoes half price.

Likewise, a dentist may give a free cleaning to anyone who has seen him

regularly for five years.

66
• Product Awareness. Know what your steady patrons purchase and keep these

items in stock. Add other products and/or services that accompany or

compliment the products that your regular customers buy regularly. And make

sure that your staff understands everything they can about your products.

• Reliability. If you say a purchase will arrive on Wednesday, deliver it on

Wednesday. Be reliable. If something goes wrong, let customers know

immediately and compensate them for their inconvenience.

• Be Flexible. Try to solve customer problems or complaints to the best of your

ability. Excuses — such as "That's our policy" — will lose more customers

then setting the store on fire..

• People over Technology. The harder it is for a customer to speak to a human

being when he or she has a problem, the less likely it is that you will see that

customer again.

• Know Their Names. Remember the theme song to the television show Cheers?

Get to know the names of regular customers or at least recognize their faces.

67
Conclusions

68
 CONCLUSIONS

In addition to suggestions and findings, this study also provides several scopes
for further research, which will be addressed in the following paragraphs:

(1) While the customer loyalty model validated in this study possesses good
power for explaining repurchase intentions and referral behavior, only partial
explanation of the construct of additional purchase intentions is achieved. As
stated before, factors not contained in the model such as strategic outsourcing
considerations can be assumed to affect the intention of customers to
outsource additional logistics activities to the currently most important LSP.
For this reason, future studies should explore additional determinants of this
loyalty dimension.

(2) Measurement model assessment revealed that the operationalization of

fairness in this study does not achieve sufficient discriminance from other
constructs, especially from trust and relational satisfaction. As there is a strong
theoretical indication that fairness is important in customer loyalty
considerations, further studies should modify fair-ness’ measurement model,
e.g. by more strongly recurring to the concept of inequity.

(3) Within this study, four relational characteristics were examined. In addition,
analyses were conducted for a multitude of other contingency factors that are
not included in the present study. Overall, however, no conclusive
moderations were identified. Nevertheless, it may be assumed that customer
diversity still has moderating effects on the formation of customer loyalty. The
determinants contained in this study, however, capture rather general
evaluations of relationships between LSPs and their customers, which may be
too broad to be subject to moderating effects. For this reason it would be
sensible to examine antecedents of the employed determinants, as moderating
effects could surface when this level of detail is added to the analyses.

69
70
71
 DHL Customer Satisfaction & Loyalty Survey

• How would you rate your overall experience to accessablity

and responses (of DHL representative) through phone and e-
mail :

Excellent
Very Good
Good

Fair
Poor

• How you rate the representative ability to help you resolve

your issue/need?

Excellent
Very Good
Good
Fair
Poor

• How you rate the representative on being Courteous &

helpfulness?

Excellent
Very Good
Good

Fair
Poor

72
• Think specifically about the CLEARANCE Department, How
would you rate your overall experience:

Excellent
Very Good
Good
Fair
Poor

• Think specifically about the SHIPMENT DELIVERY at your

doorstep, How would you rate your overall experience:

Excellent

Very Good
Good
Fair
Poor

• In scale of 1 to 5, where 1 represents ‘Extremely Dissatisfied’

and 5 represents ‘Extremely Satisfied’. How would you rate
your level of satisfaction with DHL Express.

1
2
3
4

73
What specifically are you SATISFIED with DHL Express, Chennai.
Enter your response below: { E.g., - Safety & security, Excellent
tracking, Less transit time }

What specifically are you DISSATISFIED with DHL Express, Chennai.

Enter your response below: {E.g, - Commitment not met. etc.}

• How likely are you to recommend DHL Express to others? The

chances are:

Excellent
Very Good
Good

Fair
Poor

• In total, how long you have been a customer of DHL Express:

More then 10 years

7 to 10 years
5 to 7 years
3 to 5 years
74
Less then 3 years
Please list top 3 reasons, initially becoming a member of DHL Express
in order of importance:

Please rate your level of agreement with the following statements. In

scale of 1 to 5, where 1 represents ‘Completely Disagree’ , 3
represents ‘Neutral’ and 5 being ‘Completely Agree’

 I believe the company, DHL Express deserves my loyalty:

1 2 3 4 5

 Over the past years, my loyalty to the company, DHL Express has
grown stronger:

1 2 3 4 5

 DHL Express Values people & Relationships ahead of Short-term

goals:

1 2 3 4 5

75
*
••• Suggestions ••• ( if any)

THANKS FOR THE FEEDBACK.

76
 BIBLIOGRAPHY

Books:
• Research Methodology – Kothari
• The Loyalty Guide report series - Peter Clark
• Marketing Management 12 e – Philip Kotler

Websites:

• www.google.com
• www.wikipedia.com
• www.dhl.com
• www.scribd.com

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