the gap between expected and actual service quality of organized retail stores in hyderabad

8/8/2019 The Gap Between Expected and Actual Service Quality of Organized Retail Stores in Hyderabad

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THE GAP BETWEEN EXPECTED AND ACTUAL SERVICE QUALITY OF ORGANIZEDRETAIL STORES IN HYDERABAD

ABSTRACT

This study assesses the gap between expected and actual service quality of retail stores in Hyderabad. Improving service quality is believed to improve

profitability and enhance retail store performance. Such improvements however,require monitoring and continuous measurement of performance along servicedimensions that determine standards of service quality. Majority of the retailstores in Hyderabad are operating the stores approximately up to thesatisfaction level of their customers. Broadly, customers found no difference

between their expected service quality and actual service quality of retail storesin Hyderabad.

INTRODUCTION

The organized retailing is growing faster in the big Tier I cities viz., Delhi,Chennai, Mumbai, Bangalore and Hyderabad, as well as in Tier II & III cities. Still,the organized retail sector in India is at a very nascent stage and its marketshare is around 4% of the total market. Though, organised retail look big and

growing, it is lag behind the traditional stores in satisfying a customer. Streetcorner mom n pop store give the benefit of accessibility along with theconvenience of home delivery (even for a single unit purchase), top of which italso provides petty credit to its customers. There is a sense of trust sharedbetween the customer and shopkeeper which in some cases come overgenerations of purchases. Still organized retail is not able to dent into theunorganized retail market , as they still radiate a feeling of being expensive andinstigating loose buying ( especially in Tier 2 & 3 cities ). Therefore the presentstudy focused on the assessment the gap between expected and actual servicequality of organized retail stores in Hyderabad.

Improving service quality is believed to improve profitability and enhance retailstore performance. Such improvements however, require monitoring andcontinuous measurement of performance along service dimensions thatdetermine standards of service quality. This study assesses the service quality of retail stores in Hyderabad with special reference on expected and actual servicequality.

Service Quality
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Sampling Method and Sample Size

Simple random and convenience sampling was applied. Data was collected fromthe customers of various retail stores in Hyderabad.

Data Collection

The primary data was collected from 100 customers by administering astructured questionnaire. The secondary data was collected from various

journals, magazines, and websites. The collected data was analyzed by usingstatistical tools such as mean and weighted averages. The attributes of eachdimension is analyzed in detail.

Methods and Statistical Tools used

The RSQS scale was applied to measure five-dimensions of service quality viz.,Physical Aspects, Reliability, Personal Interaction, Problem-Solving Capacity andEmpathy.

Likert five point scale was also employed for the study. Respondents were

asked to evaluate parameters on overall service quality in a five-point scaleanchored at strongly disagree and strongly agree. The questionnaire consistsof 15 statements on expectations and 15 statements on perceptions. Oncomparing the two aspects like expectations and actual service encountered,one can know the gap. To test the hypothesis ?2-test is applied in appropriatecontext.

Dimensions

The following sub-dimensions were included in the questionnaire:

Physical Aspects

1.


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o This store has modern-looking equipment and fixtures.

o The physical facilities at this store are visually appealing.

o Materials associated with this stores service (such as shopping

bags, catalogs, or statements) are visually appealing.o This store has clean, attractive, and convenient public areas

(restrooms, fitting room).

o The store layout makes it easy for customers to find what theyneed.

o The store layout makes it easy for customers to move around thestore.

Reliability

When this store promises to do something by a certain time, it will do so.

This store insists on error-free sales transactions and records.

Personal Interaction

Employees in this store give prompt service to customers.

Employees in this store are never too busy to respond to customersrequests.

Employees in this store are consistently courteous with customers.

Problem-Solving Capacity

When a customer has a problem, this store shows a sincere interest in

solving it. Employees of this store are able to handle customer complaints directly

and immediately.

Empathy

This store offers high quality merchandise.

This store gives customers individual attention.

Hypothesis


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The current study presumed that there is no significant difference between theexpected and actual service quality of retail stores in Hyderabad. Further it isassumed that there is no significant difference between expected physicalaspects, reliability, personal interaction, problem solving and empathy andactual physical aspects, reliability, personal interaction, problem solving andempathy.

Demographic Profile of Respondents

Gender

The majority of respondents (86%) were male (Table 1).

Gender

Frequency

Percentage

Male

86

86%

Female

14

14%

Total

100

100%

Table 1: Gender Figure 1: Gender

Source: Primary data


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Income Status

The respondents were from all income groups (Table 2). The majority of respondents (52%) were from the income group of 10001-20000.

Table 2: Income Status

Income Range

Male

Female

Total

Up to Rs. 5000

12

2

14

Rs. 5001-10000

16

2

18

Rs. 10001-15000

20

6

26

Rs. 15001-20000

24

2

26

Rs. 20001-25000

10

0

10


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The store has modern-looking equipment and fixtures (A)

0

10

26

42

22

100

The physical facilities at this store are visually appealing (B)

0

12

14

62

12

100

Materials associated with this stores service (such as shopping bags, catalogs,or statements) are visually appealing (C)

2

12

34

40

12

100

The store has clean, attractive, and convenient public areas (restrooms, fittingroom) (D)

2

12

20

42

24


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100

The store layout at this store makes it easy for customers to find what they need(E)

6

2

28

46

18

100

The store layout at this store makes it easy for customers to move around thestore (F)

0

6

24

42

28

100

Total

10

54

146

274

116

600


Figure 3: Expected physical Aspects

Table 4: Actual physical Aspects

Parameters

Strongly


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Disagree

Disagree

Neutral

Agree

Strongly

Agree

Total

Number of Respondents

The store has modern-looking equipment and fixtures (A)

0

10

40

40

10

100

The physical facilities at this store are visually appealing (B)

0

22

18

54

6

100

Materials associated with this stores service (such as shopping bags, catalogs,or statements) are visually appealing (C)

6

4

36


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42

12

100


6

22

30

24

18

100


0

8

36

42

14

100


2

12

32

42

12

100

Total

14


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3.50

-0.02


3.74

3.26

0.48


3.68

3.62

0.06


3.92

3.50

0.42


Figure 5: Physical Aspects

Null Hypothesis

There is no significant difference between expected and actual physical aspects.

By applying Chi-square test, the table value for 5 degrees of freedom at 5% levelof significance is 11.07. The calculated value of ?2 0.9996 is much lower than thetable value. Hence, the result of the experiment supports the hypothesis. We canthus conclude that, There is no significant difference between actual andexpected physical aspects.

Reliability


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Table 8 shows that there is no remarkable difference between expected andactual reliability with reference to time management and error-free salestransactions and records by the retail stores.

Table 6: Expected Reliability

Parameters

Strongly

Disagree

Disagree

Neutral

Agree

Strongly

Agree

Total


When this store promises to do something by a certain time, it will do so (A)

4

4

26

40

26

100

This store insists on error-free sales transactions and records (B)

2

8


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20

44

26

100

Total

6

12

46

84

52

200


Figure 6: Expected Reliability

Table 7: Actual Reliability

Parameters

Strongly

Disagree

Disagree

Neutral

Agree

Strongly

Agree

Total


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10

18

34

32

6

100


2

10

42

36

10

100

Total

12

28

76

68

16

200


Figure 7: Actual Reliability


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Table 8: Reliability

Parameters

Expected service (E) (weighted average)

Actual Service (A) (weighted average)

Difference (E-A)

(weighted average)


3.80

3.06

0.74


3.84

3.42

0.42


Figure 8: Reliability

Null Hypothesis

There is no significant difference between actual and expected reliability bycustomers.

By applying Chi-square test, the table value for 1 degrees of freedom at 5% levelof significance is 3.841. The calculated value of ?2 0.663 is much lower than the


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26

100

Employees in this store are consistently courteous with customers (B)

2

12

22

38

26

100

Employees in this store are never too busy to respond to customers requests (C)

0

12

20

40

28

100

Total

6

28

66

120

80

300


Figure 9: Expected Personal Interaction

Table 10: Actual Personal Interaction

Parameters


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Strongly

Disagree

Disagree

Neutral

Agree

Strongly

Agree

Total


Employees in this store give prompt service to customers (A)

2

16

20

48

14

100


2

10

38

36

14

100


2

18


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26

34

20

100

Total

6

44

84

118

48

300


Figure 10: Actual Personal Interaction

Table 11: Personal Interaction

Parameters

Expected service (E) (in terms weighted average)

Actual Service (A) (in terms weighted average)

Difference (E-A)

(in terms weighted average)

Employees in this store give prompt service to customers (A)

3.82

3.56

0.26


3.74

3.50

0.24



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3.84

3.52

0.32


Figure 11: Personal Interaction

Null Hypothesis

There is no significant difference between actual and expected personalinteraction of executives with customers.

By applying Chi-square test, the table value for 2 degrees of freedom at 5% levelof significance is 5.991. The calculated value of ?2 0.971 is much lower than thetable value. Hence, the result of the experiment supports the hypothesis. We canthus conclude that, There is no significant difference between actual andexpected personal interaction of executives with customers.

Problem-Solving Capacity

Table 14 shows that sales persons are able to handle customer complaintsdirectly and immediately. 48% of the respondents are strongly agreed thatemployees of the store are able to handle customer complaints directly andimmediately. 34% of the respondents are agreed that when a customer has aproblem, the store shows a sincere interest in solving it.

Table 12: Expected Problem-Solving Capacity

Parameters

Strongly

Disagree

Disagree

Neutral

Agree

Strongly

Agree


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Total


When a customer has a problem, this store shows a sincere interest in solving it(A)

2

4

28

34

20

100

Employees of this store are able to handle customer complaints directly andimmediately (B)

0

8

10

34

48

100

Total

2

12

38

68

68

200



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Figure 12: Expected Problem-Solving Capacity

Table 13: Actual Problem-Solving Capacity

Parameters

Strongly

Disagree

Disagree

Neutral

Agree

Strongly

Agree

Total



6

16

26

32

20

100


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4

32

12

26

26

100

Total

10

48

38

58

46

200


Figure 13: Actual Problem-Solving Capacity

Table 14: Problem-Solving Capacity

Parameters

Expected service (E) (weighted average)

Actual Service (A) (weighted average)

Difference (E-A)

(weighted average)


3.90

3.44


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0.46


4.22

3.70

0.52


Figure 14: Problem-Solving Capacity

Null Hypothesis

There is no significant difference between actual and expected customerproblem solving capacity to store executives.

By applying Chi-square test, the table value for 1 degrees of freedom at 5% levelof significance is 3.841. The calculated value of ?2 0.731 is much lower than thetable value. Hence, the result of the experiment supports the hypothesis. We canthus conclude that, There is no significant difference between actual andexpected customer problem solving capacity to store executives.

Empathy

According to Table 17, the qualities of merchandise are up to mark andemployees are giving individual attention to the customers. 34% of therespondents are agreed that the store offers high quality merchandise. Similarly,34% of the respondents also agreed that the store gives customers individualattention.


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Table 15: Expected Empathy

Parameters

Strongly

Disagree

Disagree

Neutral

Agree

Strongly

Agree

Total


The store offers high quality merchandise (A)

6

8

34

34

18

100

This store gives customers individual attention (B)

2

18

26

34

20

100

Total


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8

26

60

68

38

200


Figure 15: Expected Empathy

Table 16: Actual Empathy

Parameters

Strongly

Disagree

Disagree

Neutral

Agree

Strongly

Agree

Total



6

10

34


29/47

46

4

100


8

18

24

32

18

100

Total

14

28

58

78

22

200


Figure 16: Actual Empathy

Table 17: Empathy

Parameters


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Expected service (E) (in terms weighted average)

Actual Service (A) (in terms weighted average)

Difference (E-A)

(in terms weighted average)


3.50

3.32

0.18


3.52

3.34

0.18


Figure 17: Empathy

Null Hypothesis

There is no significant difference between actual and expected store empathy.

By applying Chi-square test, the table value for 1 degrees of freedom at 5% levelof significance is 3.841. The calculated value of ?2 0.892 is much lower than thetable value. Hence, the result of the experiment supports the hypothesis. We canthus conclude that, There is no significant difference between actual andexpected store empathy.

FINDINGS

The materials associated with retail stores services (such as shoppingbags, catalogs, or statements) are visually appealing. The respondentsfeel that modern-looking equipment and fixtures, physical facilities, theambience and store layout are up to the mark. It can also found that thereis no significant difference between actual and expected physical aspects.

There is no remarkable difference between expected and actual reliabilitywith reference to time management and error-free sales transactions andrecords by the retail stores. Further it is found that there is no significantdifference between actual and expected reliability.

The customers feel that employees are consistently courteous withcustomers. 26 percent of the respondents strongly agreed that the


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employees in the stores give prompt service to customers. Similarly, 26percent of the respondents strongly agreed that the employees in thestores are consistently courteous with customers. 28 percent of therespondents strongly agreed that employees in the stores are never toobusy to respond to customers requests. It can also found that there is nosignificant difference between actual and expected personal interaction of executives with customers.

Sales persons are able to handle customer complaints directly andimmediately. 48% of the respondents are strongly agreed that employeesof the store are able to handle customer complaints directly andimmediately. Similarly, 34% of the respondents are agreed that when acustomer has a problem, the store shows a sincere interest in solving it.Further it is also found that there is no significant difference betweenactual and expected customer problem solving capacity to store

executives. The qualities of merchandise are up to mark and employees are giving

individual attention to the customers. 34% of the respondents are agreedthat the store offers high quality merchandise. Similarly, 34% of therespondents also agreed that the store gives customers individualattention. It is also found that there is no significant difference betweenactual and expected store empathy.

CONCLUSION Majority of the retail stores in Hyderabad are operating the storesapproximately up to the satisfaction level of their customers. Broadly, customers

found no difference between their expected service quality and actual servicequality. Also majority of the customers strongly agreed that the physical facilitiesassociated with the retail stores are visually appealing, there is good reliability,employees are consistently courteous, sales persons handle complaintseffectively and the quality of merchandise are satisfactory. SUGGESTIONS

Though, the current study revels that organized retail stores are operating up tothe desired level of its customers, still they are lag behind the traditional storesin attracting and satisfying a customer. Some of the main tips for the modernretail sector to attract all types of customers are:

i. Small sized retail stores along with more accessibility and convince of homedelivery even for a single unit purchase.

ii. The employees and management should be well versed with local language,they should give common attention towards the customers irrespective of theireconomic and social status.

iii. The direction and information boards should be written in local language.


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iv. The stores should take steps to minimize the waiting time of the customersbefore the billing line and delivery line etc.

v. The employees should pay attention always while inviting customer toenhance the sense of trust shared between the customer and the store, which insome cases come over generations of purchases .

THE GAP BETWEEN EXPECTED AND ACTUAL SERVICE QUALITY OFORGANIZED RETAIL STORES IN HYDERABAD

Please note that this research is being conducted purely in the interests of academic research and is not funded by any institute. Respondents details or responses will be analyzed; information will not be forwarded to any for commercial purposes. Personal data provided by respondents will be processed and kept confidential.

Section A: Demography of Respondent

1. Name: -----------------------------------------------------------------------------

2. Gender: i. Male ( ) ii. Female ( )

3. Age: -----------------------------------

4. Marital Status: i. Married ( ) ii. Unmarried ( )

5. Occupation:

6. Income Category:1. Up to Rs. 5,000

2. Rs. 5,001-10,000

3. Rs. 10,001-15,000

4. Rs. 15,001-20,000

5. Rs. 20,001-25,000

6. Above Rs. 25,000


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Section B: Please express your opinion on the following questions regarding aMore Retail Store by marking an appropriate number.

Strongly Disagree

Disagree

Neutral

Agree

Strongly Agree

1. The store has modern-looking equipment and fixtures.

1

2

3

4

5

2. The physical facilities at the store are visually appealing.

1

2

3

4


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5

3. Materials associated with stores service (such as shopping bags, catalogs, orstatements) are visually appealing.

1

2

3

4

5

4. The store has clean, attractive, and convenient public areas (try rooms, fittingroom)

1

2

3

4

5

5. The store layout makes it easy for customers to find what they need.

1


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2

3

4

5

6. The store layout makes it easy for customers to move around the store.

1

2

3

4

5

7. When the store promises to do something by a certain time, it will do so.

1

2

3

4


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5

8. The store insists on error-free sales transactions and records.

1

2

3

4

5

9. Sales person in the store give prompt service to customers.

1

2

3

4

5

10. Sales person in the store are consistently courteous with customers.

1


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2

3

4

5

11. Sales person in the store are never too busy to respond to customersrequests.

1

2

3

4

5

12. The store offers high quality merchandise.

1

2

3

4


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5

13. The store gives customers individual attention.

1

2

3

4

5

14. When a customer has a problem, the store shows a sincere interest in solvingit.

1

2

3

4

5

15. Sales person of the store are able to handle customer complaints directly andimmediately.

1


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2

3

4

5

Section C: Please express your opinion on the following questions regarding aRetail Store by marking an appropriate number.

Strongly Disagree

Disagree

Neutral

Agree

Strongly

Agree

1. A Retail store should have modern-looking equipments and fixtures.

1

2

3

4

5


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2. The physical facilities at a Retail store should be visually appealing.

1

2

3

4

5

3. Materials associated with a Retail stores service (such as shopping bags,catalogs, or statements) should be visually appealing.

1

2

3

4

5

4. A Retail store must have cleaned, attractive, and convenient public areas (tryrooms, fitting room).

1

2


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3

4

5

5. The store layout at a Retail store should make it easy for customers to findwhat they need.

1

2

3

4

5

6. The store layout at a Retail store should make it easy for customers to movearound the store.

1

2

3

4


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5

7. When a Retail store promises to do something by a certain time, it should doso.

1

2

3

4

5

8. A Retail store must insist on error-free sales transactions and records.

1

2

3

4

5

9. Sales persons in a Retail store should give prompt service to customers.

1

2


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3

4

5

10. Sales persons in Retail store should never too busy to respond to customersrequests.

1

2

3

4

5

11. Sales persons in a Retail store should be consistently courteous withcustomers.

1

2

3

4


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5

12. A Retail store should give customers individual attention.

1

2

3

4

5

13. A Retail store should offer high quality merchandise.

1

2

3

4

5

14. When a customer has a problem, Retail stores person must show a sincereinterest in solving it.

1

2


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3

4

5

15. Sales person of Retail store should be able to handle customer complaintsdirectly and immediately.

1

2

3

4

5

References

1. Dr. S. V. Pathak, Aditya P. Tripathi (2009), Customer Shopping BehaviorAmong Modern Retail Formats: A Study of Delhi & NCR, Indian Journalof Marketing , February, 2009, pp. 3 12.

2. Dabholkar P A, Thorpe D I and Rentz J O (1996), A Measure of ServiceQuality for Retail Stores: Scale Development and Validation, Journal of the Academy of Marketing Science , Vol. 24 , No. 1.

3. Edvardsen B, Tomasson B and Ovretveit J (1994), Quality of Service:Making it Really Work , McGraw-Hill, New York.

4. Garvin D A (1983), Quality on the Line , Harvard Business Review , Vol.61, pp. 65-73.
http://www.articlesbase.com/marketing-articles/the-gap-between-expected-and-actual-service-quality-of-organized-retail-stores-in-hyderabad-1325840.htmlhttp://www.articlesbase.com/marketing-articles/the-gap-between-expected-and-actual-service-quality-of-organized-retail-stores-in-hyderabad-1325840.html


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5. Gronroos C (1982), Strategic Management and Marketing in the ServiceSector , Swedish School of Economics and Business Administration,Helsingfors.

6. Hjorth-Anderson C (1984), The Concept of Quality and the Efficiency of

Markets for Consumer Products, Journal of Consumer Research , Vol. 11,pp. 708-718.

7. Holbrook M B and Corfman K P (1985), Quality and Value in theConsumption Experience: Phaldrus Rides Again , in Jacoby J and Olson J(Eds.), Perceived Quality, Lexington Books, MA.

8. Juran J M (1999), How to Think About Quality , in Juran J M and Godfrey AB (Eds.), Jurans Quality and Book, 5th Edition, pp. 2.1-2.3, McGraw-Hill,New York.

9. Nikhil Chandra Shil, Dr. Bhagaban Das (2009), Analysis of Gap In ServiceQuality Through SERVQUAL: A Case of Deposit Service Provided By a Bankin Bangladesh, Indian Journal of Marking , June 2009, pp. 3 11.

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13.Sasser W E Jnr., Olsen R P and Wyckoff D D (1978), Management of Service Operations: Text and Cases , Allyn & Bacon, Boston.

14.Sunayna Khurana (2008), Customer Expectation and Perception: A Studyof Retail Sector of Haryana State, The Icfai University Journal of Consumer Behavior , Vol. III , No. 3, pp. 47-58.

15.Wisniewski M (2001), Using SERVQUAL to Assess Customer Satisfactionwith Public Sector Services , Management Service Quality , Vol. 11, No. 6,pp. 380-388.

16.Zeithaml V A (1987), Defining and Relating Price, Perceived Quality and Perceived Value , Report No. 87-101, Cambridge, MA.

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