CORRELATION BETWEEN SERVICE QUALITY AND CUSTOMER’S

SATISFACTION ON FOOD ESTABLISHMENT IN

GIPORLOS EASTERN SAMAR

A research paper presented to the

Faculty of the College of Technology

Eastern Visayas State University

In partial fulfillment

Of the requirements for the course

Research in Hospitality 1

by:

Amabelle A. Abit

September 2021
 Chapter I:

INTRODUCTION
This chapter will introduce the research background, motivation, problem and aim,

significance and limitation of this study.

A. Background of the Study

In recent decades the service industry has grown in importance (Schettkat & Yocarini,

2003), and manufacturing has declined (Jovane, Yoshikawa, Alting, Boër, Westkamper,

Williams, Tseng, Seliger & Paci, 2008;Berry, Wall & Carbone, 2006). The service sector

accounts for 70% of the employment in all OECD member states, making most countries

dependent on the service sector (Berry, et al., 2006 and Gardner, 1985). More insights into

innovative service processes are needed (Arvanitis, Kubli & Woerter, 2008). Companies

continuously look for new and innovative ways to provide service quality, and differentiate

their service offerings. This is used as a competitive advantage to attract and retain customers

and make a profit (Sandström, Edvardsson, Kristensson, and Magnusson, 2008 and Khan &

Fasih, 2014) through skill exchange and customer co-creation (Prahalad & Ramaswamy,

2004).

Service quality is the difference between a consumer’s perception and expectation of a

service (Grönroos, 1982). Seth, Deshmukh & Vrat (2005) defined service quality as the

ability for service providers to match expected service with perceived service to achieve

customer satisfaction. While Grönroos (1982); Lehtinen & Lehtinen (1982) and Parasuraman,

Zeithaml & Berry (1985) defined service quality as the comparison stemming from what
customers feel a company is supposed to offer and the actual service performance of the

corporate. Service quality can be accessed with the SERVQUAL scale (Khan & Fasih, 2014).

SERVQUAL scale measures the quality of a service before and after the consumption of a

service, with five dimensions. Namely; tangibility (visible elements of a service such as

buildings, sites and tools); responsiveness (how fast service providers respond to customer

queries/ the willingness for service providers to assist customers and provide prompt services);

reliability (the ability for a service provider to assure customers of a reliable and proper

service); assurance ( the level of knowledge displayed by a service provider when delivering

its services and their ability to inspire 6 trust and confidence ); and empathy (ability for a

service provider to pay attention to individual customer demands/ individualization of service).

Due to the increased competition faced by companies around the world, companies

choose to expand their market size and increase customer expectations through advancement

in technology and globalization (Lin, Lai, & Yeh, 2007). Hence necessitating businesses to be

more customer centric (Khan & Fasih, 2014; Naidoo, 2011 and Schneider, Ehrhart, Mayer,

Saltz & Niles-Jolly, 2005).The quality of a service positively influences customer satisfaction

(Kaura et al (2012) and as such, service quality is of vital importance to customer satisfaction.

Abd-El-Salam, et al. (2013) and Chen (2010) suggest that customer satisfaction is the

result of a customer's comparison of perceived quality and actual service performance. This

comparison may lead to customer satisfaction or dissatisfaction. Kaura, et al. (2012, after,

Rust & Oliver, 1994) suggest that customer satisfaction reflects the degree to which a

consumer believes that the use or possession of a specific service will evoke positive feelings.

Hence customer satisfaction is the physiological state of emotion associated with the
conformity or nonconformity of a consumer's perceived quality of service during and after

service experience (Kaura, et al., 2012, after, Oliver, Rust & Varki, 1997:13 and Chen, 2010).

The Philippines food service market is expected to witness a CAGR of 4.67% during

the forecast period, 2021 - 2026. After the advent of COVID-19, the food service sector was

majorly hit by the strict lockdown measures introduced in the Philippines to limit the spread

of the virus. However, this resulted to significant decline in the country’s economy. To avoid

further economic decline, food services that can meet government safety protocols were

allowed to reopen, with strict hygiene and social distancing measures being a must.

Service quality remains crucial to the success of any service organization with or

without the intervention of Covid-19 crisis. Ordering food online become the new trends in

this pandemic season and since customers participate in delivery and consumption of services,

they interact closely with various aspects of organizations. This knowledge gives them the

opportunity to assess critically the services provided in organizations (Kandampully, 2000).

Customers will assess service quality by comparing services they received with their desired

services. Hence, service quality plays a critical role in adding value to the overall service

experience (Lau et al, 2005). Customer satisfaction is affecting repurchase goals and

behaviors. In addition to this, present profit and revenue of the organizations also rely on

customer satisfaction. According to Tam (2000), there’s a close link between service quality

and customer satisfaction. In addition, service quality has been well recognized for playing a

vital role in improving organizational profits because it is directly related to customer

satisfaction, and customer loyalty (Baker and Crompton 2000; Leal and Pereira, 2003;

Zeithaml and Bitner, 2000).

Organizations that give prevalent service quality have satisfied customers more than the firms

who do not provide service quality (Gilbert & Veloutsou, 2006; Gilbert et al., 2004). There is

less literature available that address the customer satisfaction and quality of the services

provided by the organizations, in some selected food establishments in Giporlos Eastern

Samar. In this small town various emerging food services are on its way of providing a quality

service to its customers. But studies are limited and do not explain the significant association

between customer satisfaction and service quality thus making it hard for food owners to

manage and meet an adequate level of customer’s satisfaction that will sustain their business.

In creating a repetitive and satisfied customer, service quality plays an important role.

Therefore the aim of this research is to provide recommendations for a quality food

service in order to increase the customer satisfaction through identifying the relationship

between service quality and customer’s satisfaction. And in the process we will also be able to

identify the dimensions of quality service and measure the level of customer’s satisfaction on

selected food establishment in Giporlos Eastern Samar.

The following objectives were developed for the current study:

• To identify the relationship between service quality and customer’s satisfaction in

selected food establishments in GES.

• To identify the dimensions of quality service on selected food establishment in GES.

• To measure the level of customer’s satisfaction on selected food establishment in

GES.

• To provide recommendations for a quality food service in order to increase the

customer satisfaction.

C. Research Hypothesis

H0: There is no significant relationship between service quality and customer’s

overall satisfaction.

H 1: There is a significant and positive relationship between service quality and

customers’ overall satisfaction.

Independent Variable

Dependent Variable

Service Quality
Customer’s
 Empathy Satisfaction
 Reliability
 Assurance

Theoretical Framework

Our theoretical framework is a combination of the work of Khan & Fasih (2014) who

suggest that empathy, assurance and reliability have the most impact on customer satisfaction.

Kaura, et al. (2012) also suggested that empathy, assurance and reliability dimension of

service quality are experienced through the people aspect of service quality. We have

narrowed the five service quality dimensions to three (empathy, assurance and reliability)

because previous studies have indicated that these three Servqual dimension have the most

influence on customer satisfaction. We have also narrowed the aspects of service quality

(people, process and physical evidence) to the people aspect of service quality because the

empathy, assurance and reliability dimension of service quality can only be

performed/accessed through the people aspect of service quality. Hence, it is logical for us to

base our research on established facts/theories.

This research will provide a great understanding on service quality and customer’s

satisfaction and the relationship of these two variables in some food services in Giporlos

Eastern Samar. This will also be helpful on the management of food establishment to provide

best services to their customers by improving service quality dimensions. Lastly, this will

serve as future reference for research on this subject.

F. Scope And Delimitation

The coverage of this research will solely be focusing on the relationship

between service quality and customer’s satisfaction. There are some limitations in this

study, a lot of factors cannot be studied due to limited access from data collection.

Tangibility, reliability, responsiveness, assurance and empathy are fundamental tools

to access service quality in association with customer satisfaction. However, this study

will not investigate all the five concepts that impact customer satisfaction. Rather it

will focus on empathy, reliability and assurance dimension of the SERVQUAL scale.

There are three aspects of the servqual scale (people, process and physical evidence),

but this research will be limited to the people aspect of Servqual scale.

As the research was conducted on chosen food services in Giporlos Eastern

Samar, the outcomes are not universal and therefore might not be considered relevant

in some other places in the Philippines. a lot of factors cannot be studied due to limited

access from data collection.

 Customer’s satisfaction – also known as the respondents of the research, the ones who

will give feed backs or reviews about the food establishment they went to.

 Food establishment – where the research takes place, it helps the researcher to easily

locate the respondents.

 GES -

 Service quality -
Online References

 https://www.researchgate.net/publication/313192868_Importance_of_Service_Quality_in
_Customer_Satisfaction_A_Study_on_Fast_Food_Restaurants [accessed Sep 25 2021].
 https://www.mordorintelligence.com/industry-reports/philippines-foodservice-market
 https://www.arabianjbmr.com/pdfs/OM_VOL_6_(4)/1.pdf
 https://www.bworldonline.com/trends-in-the-food-industry/
 https://www.dlsu.edu.ph/wp-content/uploads/pdf/conferences/research-congress-
proceedings/2017/EBM/EBM-I-001.pdf
 https://www.singaporeanjbem.com/pdfs/SG_VOL_4_(6)/6.pdf