MGT590 ACTION RESEARCH - MODULE 5 ASSESSMENT

Service Quality and Customer Satisfaction: An Empirical Evaluation of RSQS in Sri

Lankan Supermarkets

ABSTRACT

In terms of size and number of outlets, the Sri Lankan supermarket industry has grown rapidly in
recent years. A supermarket's success is determined by both the quality of its service and the
quality of the products it sells. The determinants of service quality were identified using the RSQS
framework with some modifications in this study, which investigates the impact of service quality
on customer satisfaction. The customer satisfaction was then measured using five dimensions of
service quality as antecedents. The information was gathered using a self-administered
questionnaire that included six demographic questions and thirty Likert scale questions. A total of
300 people were polled in order to identify significant service quality dimensions. Multiple
regression analysis with Minitab 17 was used to test the research hypotheses. The study's findings
revealed that all five RSQS dimensions have a positive and significant influence on customer
satisfaction, demonstrating that all dimensions are significant predictors of customer satisfaction.
Reliability has had the greatest impact, implying that Sri Lankan supermarkets must recognize the
importance of this dimension while striving for the others. In order to improve store reliability,
management should consider factors such as making good first impressions, providing services on
time, avoiding stock outs, and maintaining error-free sales transactions. According to the findings,
the policy factor has the second greatest impact, indicating the importance of integrating store
policies such as accepting major credit cards, providing high-quality merchandise, and maintaining
convenient operating hours that customers appreciate. The study's findings offer useful insight into
how supermarkets can improve service quality, which will ultimately increase customer
satisfaction (Lanka, 2021).

Keywords: Customer satisfaction; Service quality; Sri Lanka; Supermarket

 MGT590 ACTION RESEARCH - MODULE 5 ASSESSMENT

DATA ANALYSIS

Minitab was used for data organization and analysis. For the Likert-style format items, descriptive
statistics for each service quality dimension and customer satisfaction were calculated. To assess
the scale's reliability, an item reliability analysis in terms of Cronbach's Batch Alpha Coefficient
was performed. The data set's factor structure was then determined using confirmatory factor
analysis. The one-way independent sample T-test and analysis of variance (ANOVA) were used
to determine how the perceived relationships between the service quality dimensions and customer
satisfaction differed across demographic groups. The hypotheses were tested using regression
analysis, with service quality dimensions serving as independent variables and customer
satisfaction serving as the dependent variable. Furthermore, a correlation analysis was performed
between the service quality dimensions and the level of customer satisfaction.

The purpose of this study was to look into the impact of service quality on customer satisfaction
in the supermarket industry. The RSQS framework was used to identify the determinants of service
quality, which aligned with the service marketing literature, particularly that pertaining to the
retailing industry. Customer satisfaction was predicted using five dimensions: personal interaction,
physical aspect, reliability, problem solving, and policy. The highest factor score mean is reported
by the reliability dimension. It indicates that customers value the store's ability to keep promises
and complete tasks on the first try. Meanwhile, among the 27 items, the subscale item "products
items are available when customers want it" has the highest mean score. It emphasizes the
importance of effective stock maintenance practices in preventing stock outs, which can lead to a
negative perception of service quality.

According to the findings of the investigation into the relationship between service quality and
customer satisfaction level, the service quality dimensions have a fairly high predictive power in
customer satisfaction. This is consistent with previous research findings that have empirically
demonstrated a strong positive relationship in the Sri Lankan supermarket industry (Ushantha, C.,
Wijeratne, A., & Achchuthan, S., (2014) (Weerasiri, 2015). The correlation analysis shows that
there are positive associations between the perceived service quality dimensions and overall
customer satisfaction, with reliability and store policy having the strongest associations. The
preliminary evidences of correlation analysis were confirmed further by regression analysis. All
 MGT590 ACTION RESEARCH - MODULE 5 ASSESSMENT

five dimensions have been found to be effective in explaining customer satisfaction, with
reliability and policy having the greatest explanatory power.

The effect of dependability was much stronger than the other four dimensions. This reinforces the
idea that the supermarket should be able to keep its promises and do the right thing the first time.
Stock availability, visibility of product prices, information about sales promotions, and queue
length are all aspects of reliability. It demonstrates that customers are more likely to value, and
thus more likely to shop in supermarkets where they can find everything they want to buy, where
they do not want to waste time waiting in lines, and where they can be sure of error-free
transactions. The second strongest predictor of customer satisfaction was discovered to be personal
interaction. This factor is all about how customers perceive the sales staff. Customers appear to
value an environment in which sales staff are knowledgeable, friendly, and eager to assist them.
Many supermarkets are concerned about this because the industry is known for paying low wages
and hiring temporary workers. While paying minimum wages and expecting excellent customer
service from sales staff is a critical challenge that the industry is currently facing.

The physical aspect was discovered to have the least correlation with customer satisfaction. This
dimension primarily concerns the physical environment of a store in terms of cleanliness, store
layout effectiveness, and adequate maintenance. Customers benefit from stores' ability to plan an
effective store design by providing a safe, healthy, and convenient shopping experience (Beneke,
J., Hayworth, C., Hobson, R., & Mia, Z., 2012). Supermarkets are constantly upgrading their store
layouts in order to have the most appealing, convenient, and safest store than their competitors.
Most of them, particularly the major supermarket chains, provide aesthetically pleasing, logically
and orderly designed layouts while maintaining cleanliness. As a result, customers are unlikely to
identify enough grounds for differentiation based on the physical environment. For these reasons,
customers may not consider physical attributes to be a significant predictor of customer
satisfaction.

Except for problem solving, married and unmarried groups tend to rate service quality differently
across the board, according to demographic data. The groups of respondents are likely to perceive
service quality differently depending on their age and level of education. Only in terms of personal
interaction, there is no significant difference between different income groups. This could be
explained by the fact that people's desire to be treated or assisted gently by salespeople is not
 MGT590 ACTION RESEARCH - MODULE 5 ASSESSMENT

limited by their income level. The findings also show that male and female customers have similar
perceptions of service quality.

REFERENCES

Beneke, J., Hayworth, C., Hobson, R., & Mia, Z. (2012). Examining the effect of retail service
quality dimensions on customer satisfaction and loyalty: The case of the supermarket
shopper. Acta Commercii, 12(1), 27–43.
Lanka, W. U. (2021). SERVICE QUALITY AND CUSTOMER SATISFACTION: AN
EMPIRICAL EVALUATION OF RSQS IN SRI LANKAN SUPERMARKETS. The
Journal of Insurance and Finance, 1-13.
Ushantha, C., Wijeratne, A., & Achchuthan, S. ((2014). An assessment of retail service quality:
anempirical study of the RSQS in Sri Lankan supermarkets. Developing Country Studies,
4(3), 78–90.
Weerasiri, R. (2015). A study on service quality and customer satisfaction of supermarkets in Sri
Lanka. Sri Lanka Journal of Marketing, 1(2), 36–46.