MAKERERE UNIVERSITY MAKERERE UNIVERSITY BUSINESS SCHOOL

THE INFLUENCE OF WORD OF MOUTH, PERCEIVED SERVICE QUALITY AND TRUST ON CUSTOMER LOYALTY IN THE FREIGHT FORWARDING INDUSTRY IN UGANDA.

BY NABAASA DAN MUSINGUZI 2006/HD10/6168U

SUPERVISORS: 1. MR. CHARLES OMAGOR .. 2. ASSOC. PROF GEOFFREY BAKUNDA ..

A RESEARCH PROPOSAL SUBMITTED IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE AWARD OF MASTERS OF SCIENCE IN MARKETING OF MAKERERE UNIVERSITY.

DECEMBER, 2009

DECLARATION I declare that the work presented, published and submitted is original and has never been done for any other degree award to any other university before.

Signature . Nabaasa Dan Musinguzi

Signature . Mr. Omagor Charles Supervisor

Signature . Dr Bakunda Geoffrey Supervisor

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DEDICATION This research report is dedicated to my dear wife Flavia who inspired to do this course and our children Agaba and Amanya.

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ACKNOWLEDGEMENT I acknowledge the professional advice of my supervisors, friends and classmates. All other parties I have not mentioned are also highly appreciated.

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TABLE OF CONTENTS CHAPTER ONE: INTRODUCTION .................................................................................1 1.0 1.3 1.4 1.5 1.6 Background......................................................................................................................1 Purpose of the Study .......................................................................................................6 Objectives of study .........................................................................................................6 Research Hypothesis .......................................................................................................6 Significance of the study ................................................................................................6

1.7 Scope of the Study ..........................................................................................................7 1.8 Conceptual Framework...................................................................................................7

CHAPTER TWO: LITERATURE REVIEW ...................................................................9 2.1 2.2 2.3 Word of mouth and Customer loyalty ...........................................................................9 Word of mouth and Trust ............................................................................................ 10 Trust and Customer Loyalty ........................................................................................ 12

2.4 Perceived Quality and Customer loyalty .................................................................... 13 CHAPTER THREE: METHODOLOGY ....................................................................... 15 3.1 3.2 3.3 3.4 3.5 3.6 3.7 3.8 3.9 Introduction .................................................................................................................. 15 Research Design ........................................................................................................... 15 Sampling Design .......................................................................................................... 15 Target Population ......................................................................................................... 15 Sample size ................................................................................................................... 15 Data Collection Procedures ......................................................................................... 16 Data Quality Control.................................................................................................... 16 Measurement of variables............................................................................................ 16 Data processing and analysis....................................................................................... 17

3.10 Limitations of the study ............................................................................................... 18 CHAPTER FOUR:RESULTS & FINDINGS OF THE SURVEY .............................. 19 4.1 4.2 4.3 4.4 Sample Characteristics................................................................................................. 20 The relationships among the variables ....................................................................... 26 The Regression model ................................................................................................. 28 ANOVA (Analysis of variance) Findings .................................................................. 29

CHAPTER FIVE:DISCUSSION, CONCLUSION AND RECOMMENDATIONS 33 5.1 5.2 5.3 5.4 5.5 5.6 5.7 5.8 Introduction .................................................................................................................. 33 The relationship between word of mouth and customer loyalty. .............................. 33 The relationship between word of mouth and trust. .................................................. 34 The relationship between trust and customer loyalty ................................................ 34 The relationship between Perceived Service quality and customer loyalty ............. 35 Conclusions .................................................................................................................. 35 Recommendations ........................................................................................................ 36 Areas for future research ............................................................................................. 38

REFERENCES: ................................................................................................................... 39

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CHAPTER ONE: INTRODUCTION 1.0 Background

Customer loyalty has been defined as the degree to which a customer exhibits repeat purchasing behavior from a service provider, possesses a positive attitudinal disposition towards the provider and considers using only this provider when a need for this service arises (Bowen and Chen, 2001). There are three dimensions of loyalty namely; Behavioral, Attitudinal and Cognitive. Behaviour dimension refers to a customers behaviour on repeat purchases, indicating a preference for the brand over time, attitudinal dimension, on the other hand refers to a consumers intension to repurchase and recommend action while Cognitive dimension refers to the ease with which the consumer remembers the brand (Kandampully and Suhartanto, 2000).

Freight Forwarding Firms have long been recognized as one of the key logistical intermediaries for facilitating cross-border trade. Because of their expertise in various aspects of cross-border trade, they tend to be utilized by most companies, regardless of size, to facilitate their cross-border shipments (Lambert et al., 1998). Uganda is no exception and over years the Freight Forwarding industry has grown significantly and attracted both foreign and local investments like in most sectors (Sebunya, 2006) with about 120 licenced freight forwarding firms. Empirical study of International Freight Forwarders was conducted by Pope and Thomchick (1985), using forwarders based in the Northeastern USA indicated that Freight Forwarding firms are generally small organizations, frequently employing ten or fewer people which was later confirmed by Murphy et al.s (1992) who further discovered important demographic differences

between diversified (i.e. those offering multiple intermediary services) and nondiversified forwarders

Many of these firms large and small are united under the world wide umbrella of FIATA (Federation of International Freight Forwarders Association) and other regional bodies like FEAFFA (Federation of East African Freight Forwarders) whose main objectives are to unite the freight forwarding Industry in the areas of operation, represent, promote and protect the interests of the industry, familiarise trade and industry and the public at large with services rendered by freight forwarders, assist with vocational training of freight forwarders and to improve the quality of services rendered by freight forwarders among others.

Research has shown the importance of consumer word of mouth in the formation of attitudes (Bone, 1995), in the purchase decision-making context (Bansai and Voyer, 2000) and in the reduction of risk associated with buying decisions (Murray, 1991). Scholars agree that word of mouth is especially critical for success of service providers (Berry and Parasuraman, 1991). Word of Mouth has over time gained more prominence over traditional advertising and this can be explained by demand side factors and supply side factors. On the demand side, products and services are increasingly becoming complex and hence the average consumers ability to evaluate the product/service has correspondingly diminished. Coupled with information explosion particularly via internet where there is lots of information and often times contradictory, the traditional media are now perceived to be less reliable and hence consumers are now increasingly looking to each other in

order to simplify information processing and focus on what is important (David Godel et al, 2005).

On the supply side, interpersonal communication has increased over the last 10 years or so mainly because of the increase in the forms of decentralized communication. Initially such interpersonal communication was restricted to face to face communication and phone communication on limited scale. Today however information can be shared on mail, sms, mobile telephones, pagers, fax, internet, intranet, extranet. Though this does not necessarily mean that individuals share information simply because they have the means to do so, it all comes down to the individuals willingness to share information. But the fact that information can easily be passed on makes it relevant. Consumers are approached directly with the intent of turning them into buyers and then a missionary, the basic characteristic of word of mouth is that its diffusion is dependent on ones neighbors in the network the consumer will spread the word further.

In the shipping and freight forwarding industry, word of mouth seems to be very instrumental when it comes to choice and actual use of a particular shipping line among other factors and this is supported by the demand factors highlighted above and the fact that the trade involves a lot of money hence the need for consulting all pointing to trust. It would seem like, individuals consult those they trust in order to entrust their goods with a particular shipping line.

Trust is cognition-based in that we choose whom we will trust in which respects and under what circumstances, and we base the choice on what we take to be good reasons

(Lewis and Weigert, 1985,). Affective foundations for trust relate to the emotional ties that link individuals and the emotional investment in relationships, expressed in terms of genuine care and concern for the welfare of others and a belief that these sentiments are reciprocated (Rempel et al., 1975). Trust appears to be necessary where there is uncertainty and a level of risk, be it high, moderate or low, and this element of risk appears to be derived from an individual's uncertainty regarding the motives, intentions and future actions of another on whom the individual is dependent (Mayer et al.,1995, Mishra, 1996). Shipping generally involves a lot of money in terms of freight plus the value of the goods being transported, for example a 20 feet light container from Jebel Ali in United Arab Emirates to Kampala would cost approximately $ 5500 and yet cargo is normally transported at owners risk. Luhmann (1979) suggests that trust is necessary for us as it increases tolerance of uncertainty, trust reduces social complexity by going beyond available information and generalising expectations of behaviour in that it replaces missing information with an internally guaranteed security. In this respect it is enabling as it encourages people to take risks when the outcomes are uncertain.

The construct of service quality as conceptualized in the service marketing literature centres on perceived quality, defined as a consumer's judgment about an entity's overall excellence or superiority (Zeithaml, 1987). Lehtinen and Lehtinen (1982) defined service quality in terms of physical quality, interactive quality and corporate (image) quality. Physical quality relates to the tangible aspects of the service. Interactive quality involves the interactive nature of services and refers to the two-way flow that occurs between the customer and the service provider, or his/her representative, including both automated and animated interactions. Corporate quality refers to the image attributed to a service

provider by its current and potential customers, as well as other publics. They also suggest that when compared with the other two quality dimensions, corporate quality tended to be more stable over time. Shipping lines with a global outlook like Maersk,PIL.., and freight forwarders affiliated to shipping lines like Kenfreight with MSC are associated with service quality because of the global networks and perceived financial strength demonstrated by the investment in physicals like Ships, Containers, ICDs, offices and systems.

1.2

Statement of the problem

According to Sebunya (2006) over the years freight logistics industry has grown and attracted both foreign and local investments like in most sectors and the sector is expected to continue growing. According to URA, there are about 200 licensed firms implying too many freight forwarders relative to the number of importers/Exporters. According to Michael Porters 5 forces, this intensifies rivalry because more firms must compete for the same customers. Individual firms are striving to win over the prized few customers using the traditional marketing approaches; direct sales, advertising, promotion, e-marketing among others without much success. Getting a customer is one step but ultimately in such a very competitive environment retention is more important the focus is therefore on building Customer Loyalty. There is need therefore for Freight firms to move step further from mere customer attraction to Customer retention which calls for focus on customer loyalty particularly on how it is influenced by word of mouth, perceived service quality and Trust in order to retain their existing customers and/or attract new ones.

1.3

Purpose of the Study

The purpose of the study was to establish the relationship between word of mouth, perceived service quality, trust and customer loyalty in the freight forwarding Industry.

1.4

Objectives of study

The primary research objectives were; i. The relationship between word of mouth and customer loyalty. ii. The relationship between word of mouth and trust. iii. The relationship between trust and customer loyalty iv. The relationship between Perceived Service quality and customer loyalty. 1.5 Research Hypothesis

i. What is the relationship between word of mouth and customer loyalty? ii. What is the relationship between word of mouth and trust? iii. What is the relationship between trust and customer loyalty? iv. What is the relationship between Perceived Service quality and customer loyalty?

1.6

Significance of the study

a) The study adds to the existing pool of knowledge and debate on the influence of word of mouth, perceived service quality and trust on customer loyalty. It is also relevant as a future reference for other researchers. b) The findings and recommendations are useful to Freight Forwarders in re aligning their marketing strategies.

1.7 Scope of the Study Subject scope The study focused on word of mouth, Perceived service quality, trust, customer loyalty and establish if there is a relationship between them.

Geographical scope The study covered the major business district of Uganda Kampala and Jinja. The sample was drawn from importers/exporters. 1.8 Conceptual Framework

H1

Word of Mouth H2

Trust

Customer Loyalty H3

Perceived Service Quality H4

Based on literature review and modified by Researcher: (Ganesh et al. (2000); Gremler and Brown (1999); Hart and Johnson (1999); Moorman et al., 1993; Morgan and Hunt (1994); Gummerus, Liljanderpur and riel (2004).

The model shown in the figure above examines the relationship between word of mouth, Perceived service quality, trust and customer loyalty. Ganesh et al. (2000) found two factors in their loyalty items, active loyalty (word-of-mouth and intention to use) and passive loyalty (not switching even under less positive conditions). Gremler and Brown (1999) proposed trust as a conceptual antecedent of customer loyalty. Hart and Johnson (1999) offered anecdotal evidence in support of this argument asserting that the condition beyond satisfaction that ensures customer loyalty is trust. Trust is logically and experientially a critical variable in relationships, as has been hypothesized and borne out in the marketing literature (Moorman et al., 1993; Morgan and Hunt, 1994). Those who are not willing to trust a vendor in a competitive marketplace are unlikely to be loyal. Service quality and satisfaction, which are believed to be the primary drivers of most loyal behavior, have been widely researched in a traditional service context (Gummerus, liljanderpur and riel, 2004).

Literature further indicates that there are other factors that independently influence customer loyalty such as firm age, firm size, ownership, location and infrastructure, however this research scope will not cover these other factors.

CHAPTER TWO: LITERATURE REVIEW 2.1 Word of mouth and Customer loyalty

Word-of-Mouth is a term used in the marketing and advertising industry to describe activities that companies undertake to generate personal recommendations as well as referrals for brand names, products and services. Word-of-mouth promotion is highly valued by advertisers. It is believed that this form of communication has valuable source of credibility. Research points to individuals being more inclined to believe WOMM than more formal forms of promotion methods; the receiver of word-of-mouth referrals tends to believe that the communicator is speaking honestly and is unlikely to have an ulterior motive (i.e. they are not receiving an incentive for their referrals). (Wikipedia, free encyclopedia).

Dick and Basu (1994) define loyalty as the relationship between the relative attitude toward an entity (brand/product/service/store/vendor) and patronage behaviour. It is generally believed that the ultimate goal of customer satisfaction should be customer loyalty (Zeithaml et al., 1996; Fitzell, 1998,; Reynolds and Baetty, 1999; Sivada and Baker-Prewitt, 2000). Highly satisfied customers are likely to make future purchases (Zeithaml et al., 1996) and to recommend the source to other customers (Reynolds and Arnold, 2000; Reynolds and Beatty, 1999). Several researchers have argued that high levels of customer satisfaction will result in customer loyalty and will insulate companies from competitors by making consumers less receptive to the marketing efforts of competitors (Fornell et al., 1996; Fitzell, 1998). Some researchers propose that ensuring satisfaction and attempting to establish loyalty results in the development of customer

advocacy. In turn, it has been shown that customer advocacy often results in positive word of mouth (Griffin, 1995).

Considerable discussion exists in the academic literature over the definition and dimensionality of loyalty or similar constructs like commitment (e.g. Dick and Basu, 1994; Gundlach et al., 1995; Oliver, 1999; Buttle and Burton, 2002; Bennett and Rundell Thiele, 2002). Commitment, for example, has been defined as the desire to continue a relationship, along with the willingness to work towards that continuance and the expectation that the relationship will continue (Wilson, 1995; Andersen and Weitz, 1989). Similar definitions, based in attitude and behavioural intentions, exist for loyalty, but much of the original work on loyalty defined it in behavioural terms (repurchase or purchase frequency), and then later admitted an attitudinal component (Jacoby and Chestnut, 1978). Ganesh et al. (2000) found two factors in their loyalty items, active loyalty (word-of-mouth and intention to use) and passive loyalty (not switching even under less positive conditions).

2.2

Word of mouth and Trust

Repeatedly, research has shown the importance of consumer word of mouth (WOM) in the formation of attitudes (Bone, 1995), in a purchase decision-making context (Bansal and Voyer, 2000) and in the reduction of risk associated with buying decisions (Murray, 1991). Scholars agree that WOM is especially critical for the success of service providers (Berry and Parasuraman, 1991). The influence that a source's word of mouth information exhibits on the receiver has traditionally been explained by models of interpersonal influence (e.g. Bansal and Voyer, 2000; Bone, 1995; Cohen and Golden, 1972). Within

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this stream of research, it has often been suggested that interpersonal or social influence can be categorised as either informational or normative influence (e.g. Deutsch and Gerrard, 1955). Word of mouth can operate through both channels: Informational influence occurs when information is accepted as evidence of reality (e.g. Burnkraut and Cosineau, 1975). In contrast, normative influence operates through compliance, which means that the individual conforms to the verbalised expectations of referent others (Kelman, 1961). How strongly a WOM referral affects the receiver's attitudes or behaviour therefore depends on the level of informational and normative influence exhibited. On the other hand Morgan and Hunt (1994) conceptualized trust as existing when one party has confidence in a partners reliability and integrity. Trust can exist at the individual level (Rotter, 1967) or at firm level (Moorman et al., 1993). Further more, trust, when conceptualized as a dimension of service quality, could also be thought of as trust in the service itself (Parasuraman et., 1985, 1988).

Gremler and Brown (1999) proposed trust as a conceptual antecedent of customer loyalty. Hart and Johnson (1999) offered anecdotal evidence in support of this argument asserting that the condition beyond satisfaction that ensures customer loyalty is trust. Trust is logically and experientially a critical variable in relationships, as has been hypothesized and borne out in the marketing literature (Moorman et al., 1993; Morgan and Hunt, 1994).

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2.3

Trust and Customer Loyalty

Trust has been characterized as a multi-dimensional concept primarily consisting of a cognitive element (grounded on rational and instrumental judgments) and an affective dimension (grounded on relationships and affective bonds generated through interaction, empathy and identification with others) (Gambetta, 1988; Lewicki and Bunker, 1996; Mayer et al., 1995, McAllister, 1995). Trust is cognition-based in that we choose whom we will trust in which respects and under what circumstances, and we base the choice on what we take to be good reasons Lewis and Weigert (1985).

Trust is logically and experientially a critical variable in relationships, as has been hypothesized and borne out in the marketing literature (Moorman et al., 1993; Morgan and Hunt, 1994). Those who are not willing to trust a vendor in a competitive marketplace are unlikely to be loyal. The importance of trust in explaining loyalty is also supported by authors as Lim et al.,(1997), Garbariono and Johnson (1999), Chaudhuri and Holbrook (2000), Singh and Sirdeshmukh (2000), and Sirdeshmukh et al.(2002).

Trust is sometimes conceived of having two components, performance or credibility trust and benevolence trust, as Ganesan (1994) pointed out in a business-to-business context. In this context, Ganesan found strong effects for credibility trust on relationship commitment but not for benevolence trust. He argued that this was because businesses base their purchase and selling decisions much more on performance issues. Clearly, performance or credibility trust is important in business-to-consumer relationships as well. Other authors have also suggested the existence of an effect for credibility trust on loyalty (e.g. Chaudhuri and Holbrook, 2001; Garbarino and Johnson, (1999). Recently,

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Singh and Sirdeshmukh (2000) and Sirdeshmukh et al.(2002) have argued strongly for benevolence as a component of trust that may contribute to explaining loyalty.

In a business-to-consumer context, the benevolence component of trust may be strong in determining loyalty because many service markets where loyalty is important have a credence component, i.e. the consumer cannot always tell if the service provided is up to a high standard. That leaves the consumer to trust to the benevolence and integrity of the service provider. Second, benevolence trust may be critical because (particularly in the case of strong retail relationships such as banking or mobile telephones), the consumer may perceive the firm as being in a more powerful position due to the difficulty of switching. The consumer is sometimes vulnerable, and therefore trust in the benevolence of the firm is an issue.

However, it must be admitted that, while in a market with suitable alternatives lack of global and benevolence trust should lead to negative loyalty (desire and intention to switch), positive benevolence and global trust may not necessarily lead to positive loyalty. In some markets where all or nearly all vendors are trustworthy, one could trust many vendors equally, one could expect trust as a normal part of doing business, and therefore be loyal or not without reference to trust. So, the trust-loyalty relationship, while positive, may be weak in some markets.

2.4 Perceived Quality and Customer loyalty Leading organizations strive to maintain superior quality in an effort to gain customer loyalty (Zeithaml, 1996), therefore long term success of any organization in the market is essentially determined by its ability to expand and maintain a large and loyal customer

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base. The construct of service quality as conceptualized in the service marketing literature centers on perceived quality, defined as a consumer's judgment about an entity's overall excellence or superiority (Zeithaml, 1988). Kandampully and Suhartanto, (2000) suggest that quality of service has become the key to an organizations ability to differentiate itself from its competitors and to gain customers customer loyalty. There is a consensus amongst practitioners and academics that service quality is a prerequisites of customer loyalty. McAlexader et al (as cited by Kandampully and Suhartanto, 2000) found that patient satisfaction and service quality have a significant effect on future purchase intentions. They suggest that customers intentions to recommend are a function of their perception of both their satisfaction and service quality. Service quality and satisfaction, which are believed to be the primary drivers of most loyal behavior, have been widely researched in a traditional service context (Gummerus, liljanderpur and riel, 2004). Boulding et al., (1993) found positive relationships between service quality and intentions and willingness to recommend. Zeithaml et al., (1990) reported a positive relationship between service quality and the willingness to pay a higher price and the intentions to remain loyal in case of a price increase . Research in the banking industry in Greece proved that bank service quality is the most important element that customers consider in order to select their mortgage providers and establish a long-term relationship with them, Constantine (2006).

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CHAPTER THREE: METHODOLOGY 3.1 Introduction

This section provides the description of how the study will be conducted. It brings out the research design, target population, sampling design and size, data collection instruments, data analysis and interpretation tools and limitations of the study. 3.2 Research Design

A quantitative cross-sectional correlational research design will be undertaken. 3.3 Sampling Design

Samples of members from each stratum will then be drawn using a systematic sampling procedure to locate and isolate the customers. This will involve sampling every third 3 rd customer for Jinja and every 5th Customer for Kampala, starting from a random number. 3.4 Target Population

The study population comprise of an estimated clientele population of 16,000 (Asycuda+++ URA report 2006). 3.5 Sample size

The sample size will be 300 (285 based in Kampala and 15 in Jinja). Of which 25% will be large importers (Importing 30 containers and more a month) and 75% being medium (importing 6 29 containers per month) and small importers (importing 1 - 5 containers per month). Samples will be selected basing on a table for determining sample size by (Krejcie & Morgan, 1970) where they contend that a sample size of 379 is appropriate for a population of 30,000; therefore a sample of 300 for a population of 16,000 is more than 15

just appropriate. Stratified disproportionate random sampling will be used to select the respondents from each stratum.

3.6 3.6.1

Data Collection Procedures Questionnaire Design

The questionnaire format will have both closed questions and open ended questions. The closed questions will be used to elicit respondents evaluations of various variables while the Open ended questions will be used to gain respondent opinions on various general issues.

3.7 3.7.1

Data Quality Control Validity

The validity of the instrument was assessed using the Content Validity Index while the reliability was evaluated using the Cronbach Alpha Coefficient. 3.8 Measurement of variables

Scales from previous studies will be used to measure the study variables. 3.8.1 Customer loyalty.

The scale for brand customer loyalty developed by Beatty and Kahle (1988) will be adopted and used to measure loyalty. The scale includes five items. With a five-point response scale ranging from ``1 (strongly disagree) to ``5 (strongly agree).

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3.8.2

Word of Mouth

The Harrison-Walker (2001) scale will be used to measure word of mouth communication. 3.8.3 Trust

The scale used to measure the dimensions of trust will consist of 48 expressions in which participants will be asked to respond to. The instrument will be designed drawing upon the questionnaires used by Murray and Payne, Edmondson, Jarvanpaa and McAllister. For the purposes of this analysis, we will focus upon 11 expressions which relate to the quality of trust. 3.8.3 Perceived Service quality.

To measure perceived quality, the 21-item SERVQUAL instrument (Parasuraman et al, 1988) will be used. An important advantage of the SERVQUAL instrument is that it has been proven valid and reliable across a large range of service contexts, such as a dental school patient clinic, a tyre shop (Carman, 1990). 3.9 Data processing and analysis

Data from the field will be edited, sorted, coded, and analyzed using Statistical Package for Social Sciences (SPSS). To establish the relationships amongst study variables, correlation analysis will be carried out. Regression analysis will be carried out to establish the effect of the study variables (Word of Mouth, Trust and Perceived quality.) on the dependent variable (loyalty).

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3.10

Limitations of the study

The results of this research will be specific to the Shipping industry and may not be representative of other industries.

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CHAPTER FOUR RESULTS & FINDINGS OF THE SURVEY 4.0 Introduction

This chapter contains the results and the interpretation of the survey respondents. The presentation is guided by the research objectives and the statistics were generated with the aim of generating responses for the research questions. In the beginning of the chapter are the sample characteristics of the respondents such as their gender, age and marital status of the respondents. Statistical tools such as Cross tabulations, descriptives and correlations were used to generate the results for this chapter. The presentation was guided by the following research objectives; I. The relationship between word of mouth and customer loyalty. II. The relationship between word of mouth and trust. III. The relationship between trust and customer loyalty IV. The relationship between Perceived Service quality and customer loyalty

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4.1 4.11

Sample Characteristics Gender and Marital Status Distribution

The results in the table 4.11 below highlight the distribution of the gender across the respondent categories. Table 4.11 Gender and Marital Status Distribution
Marital Status Single Married Count Male Gender Row % Column % Count Female Row % Column % Count Total Row % 48 38.4% 54.5% 40 44.4% 45.5% 88 40.9% 77 60.6% 50 39.4% 127 Total 125 58.1% 90 41.9% 215

61.6% 100.0%

55.6% 100.0%

59.1% 100.0% 100.0% 100.0%

Column % 100.0%

The results in the table above showed that the minority of the respondents were the singles (40.9%) and the majority were the married (59.1%). The results further revealed that the among the married, the majority were the male (60.6%) and the minority were the females (39.4%). Males also dominated the singles category (54.5%) while the females comprised only 45.5% of this category. The results showed that overall, the females comprised 41.9% and the males comprised 58.1% of the sample. The results were further presented using a bar graph.

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Figure 4.11

Gender and Marital Status Distribution

80

70

60
Count

50

Marital Status 40
Single

30 Male Gender Female

Married

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4.12

Age group by Highest Level of Education Distribution

The results in the table below were generated to explore the distribution of the Age group by Highest Level of Education Distribution.
Table 4.12 Age group by Highest Level of Education Distribution Count 18-24 yrs Row % Column % Count 25-29 yrs Row % Column % Count Age group 30-34 yrs Row % Column % Count 35-39 yrs Row % Column % Count 40 yrs & Above Row % Column % Count Total Row % Column % Highest Level of Education Secondary Diploma Degree Masters Others 4 30.8% 14.8% 4 8.0% 14.8% 2 3.8% 7.4% 6 9.5% 22.2% 11 30.6% 40.7% 27 12.6% 100.0% 12 8 61.5% 7.7% 33 24.0% 66.0% 16.9% 31.7% 22 25 41.5% 47.2% 31.0% 24.0% 25 29 1 1.6% 1 2.8% 3 1.4% 39.7% 46.0% 35.2% 27.9% 12 16.9% 71 9 8.7% 104 33.3% 25.0% 1 7.7% 33.3% 1 10.0% 4 40.0% 2 Total 13 100.0% 6.0% 50 23.3% 53 24.7% 63 29.3% 36 16.7% 215 2.0% 100.0%

7.5% 100.0%

3.2% 100.0% 3

33.3% 20.0%

8.3% 100.0% 10

33.3% 30.0%

33.0% 48.4%

4.7% 100.0%

100.0% 100.0% 100.0% 100.0% 100.0%

The results showed that the majority of the respondents were holders of Bachelors Degrees (48.4%). Overall the holders of the Secondary school Certificates, Diploma, Masters, and Others qualifications comprised 12.6%, 33.0%, 1.4% and 4.7% of the sample respectively. Among the holders of the degrees, the majority were in the 25-29 year age bracket (31.7%) and only 7.7% of them were in the 18-24 years. The results were also shown using a bar graph shown in the table below.

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Figure 4.12

Age group by Highest Level of Education Distribution

40

30

Academic Level Secondary

Count

20

Diploma Degree

10 Masters 0
40 yrs & Above 18-24 yrs 25-29 yrs 30-34 yrs 35-39 yrs

Others

Age group

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4.13

Business Category and Period in Business Distribution

The results in the table below showed the distribution of the Business Category and Period in Business Distribution.
Table 4.13 Business Category and Period in Business Distribution Count Partnership Row % Column % Business Category Count Sole Row % Proprietorship Column % Count Limited Liability Row % Column % Count Total Row % Column % Period in Business Less than 5 yrs 16 39.0% 34.8% 22 18.5% 47.8% 8 14.5% 17.4% 46 21.4% 5-10 yrs 16 39.0% 13.4% 78 65.5% 65.5% 25 45.5% 21.0% 119 55.3% Over 16yrs 9 Total 41

22.0% 100.0% 18.0% 19.1% 19 119 16.0% 100.0% 38.0% 55.3% 22 55 40.0% 100.0% 44.0% 25.6% 50 215 23.3% 100.0% 100.0% 100.0%

100.0% 100.0%

The results in the table above showed that the Sole Proprietorships dominated the sample and these comprised 55.3% of the sample. In addition, the Partnerships and Limited Liability companies comprised 19.1% and 25.6% respectively of the sample. It was further shown that the majority of these Sole Proprietorships (65.5%) have been in operation for 5-10 years and only 16.0% have been in Operation for Over 16 years. Overall, the majority of the firms in the survey had been in operation for the last 5-10 years (55.3%) and only 21.4% had been in operation for Less than 5 years. The results were also presented in a graphical format as shown in the figure below

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Figure 4.13

Business Category and Period in Business Distribution

100

80

60
Count

40

Period in Business Less than 5 yrs

20 5-10 yrs 0 Partnership Sole Proprietorship Business Category Limited Liability Over 16yrs

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4.2

The relationships among the variables

The Pearson (r) Correlations were employed to test for the relationships between the study variables. Table 4.2 The relationships among the variables
Word of Mouth Trust Perceived Service Quality Customer Loyalty Word of Mouth 1.000 .278** .425** .383** 1.000 .208** .420** 1.000 .468** 1.000 Perceived Service Quality Customer Loyalty

Trust

** Correlation is significant at the 0.01 level (2-tailed).

4.21

The relationship between word of mouth and customer loyalty.

The results showed that the word of mouth is significantly and positively related to customer loyalty (r =.383, p<.01). These results show that the more positive the word of mouth from potential and existing customers of the clearing and forwarding firms that client firms are exposed to, the more loyal these firms are likely to be to their clearing and forwarding agents.

4.22

The relationship between word of mouth and trust.

The correlations further revealed a significant and positive relationship between the word of mouth and trust variables (r =.278**, p<.01). These results imply that if the existing and potential clients are exposed to positive word of mouth, they are likely to have more trust in the clearing and positive agents. However, if this word of mouth is negative, for instance if the existing clients hear a lot of complaints regarding tampering with their goods from other clients, they are bound to trust the firm less.

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4.23

The relationship between trust and customer loyalty

A positive and significant relationship was observed between the trust and the customer loyalty (r =.420**, p<.01). In other words the more the clearing and forwarding customers trust that their transactions will be handled in an honest manner, and their complaints will be handled promptly and addressed, the more they are likely to be loyal to the clearing and forwarding firms.

4.24

The relationship between Perceived Service quality and customer loyalty

Finally the Perceived Service quality was observed to be significantly and positively related to customer loyalty (r =.468**, p<.01). These results showed that the more customer perceive that the clearing and the forwarding agents have a good reputation, deliver as per the agreements with the customers, the more the customers are bound to be loyal and also make referrals for the clearing and forwarding agents.

27

4.3

The Regression model

The regression model shows the extent to which the predictors which are; Word of Mouth, Trust, Perceived Service Quality can explain the dependent variable which was Customer Loyalty.
Table 4.4 The Regression model Model (Constant) Word of Mouth Trust Perceived Service Quality Unstandardized Standardized Coefficients Coefficients B 1.145 .116 .241 .312 Std. Error .238 .048 .046 .057 Beta Dependent Variable: Customer Loyalty

Sig.

4.809 .000 R Square .154 2.425 .016 Adjusted R Square .305 5.196 .000 F Change .340 5.451 .000 Sig. F Change

.345 .336 36.597 .000

The regression model showed that the predictor variables can explain 33.6% of the observed variance in the Customer loyalty variable (Adjusted R Square = .336). The results further show that the Perceived Service Quality (Beta =.340, Sig.<.01) is a more more powerful determinant of the Customer loyalty than Trust (Beta =.305, Sig.<.01) and Word of Mouth (Beta =.154, Sig.= .016). The regression model was significant as observed from the level of Significant (Sig.<.01)

28

4.4 4.41

ANOVA (Analysis of variance) Findings ANOVA results for Management Rank by Variables

The results in the table below show the ANOVA results for Period in Business by Variable by variable of the respondents.
Std. Table 4.51 ANOVA results for Period in Mean Business by Variable Deviation Less than 5 yrs Word of Mouth 5-10 yrs Over 16yrs Less than 5 yrs Trust 5-10 yrs Over 16yrs Less than 5 yrs Perceived Service Quality 5-10 yrs Over 16yrs Less than 5 yrs Customer Loyalty 5-10 yrs Over 16yrs 3.369 3.684 3.882 3.586 3.775 4.014 3.435 3.683 3.730 3.389 3.668 3.703 0.517 0.806 0.548 0.841 0.572 0.725 0.540 0.639 0.464 0.662 0.527 0.409 Std. Error

Sig.

0.076 6.621 .002 0.074 0.078 0.124 4.898 .008 0.053 0.102 0.080 3.697 .026 0.059 0.066 0.098 5.348 .005 0.049 0.058

The results in the table above showed that there were significant differences across the businesses on all the variables (sig. <.01). With regard to trust, the results showed that the firms that had been operating for Over 16yrs (Mean =4.014) ranked higher than those that had been in operation for 5-10 yrs (Mean =3.775) or Less than 5 yrs (Mean =3.586).

29

4.52

ANOVA results for Business category by Variables

The results in the table below show the ranking of the various Business categories on the variables.
Table 4.52 ANOVA results for Business category Std. Mean by Variables Deviation Partnership Word of Mouth Sole Proprietorship Limited Liability Partnership Trust Sole Proprietorship Limited Liability Partnership Perceived Service Quality Sole Proprietorship Limited Liability Partnership Customer Loyalty Sole Proprietorship Limited Liability 3.738 3.594 3.756 3.860 3.755 3.815 3.624 3.612 3.719 3.632 3.625 3.585 0.535 0.758 0.733 0.839 0.706 0.501 0.442 0.570 0.716 0.382 0.587 0.560 Std. Error

Sig.

0.085 1.237 .292 0.069 0.099 0.133 .402 .669 0.065 0.068 0.070 .636 .530 0.052 0.097 0.061 .121 .886 0.054 0.075

The results showed no significant differences across the variables on all the constructs (sig. >.05). On the Customer loyalty the highest mean was observed with the Partnerships (Mean =3.632) and the lowest ranking was with the Limited Liability companies (Mean =3.585).

30

4.53

ANOVA results for Academic level by Variable

ANOVA statistics were further employed to explore the Academic level by Variable
Table 4.53 ANOVA results for Academic level Mean by Variable Secondary Diploma Word of Mouth Degree Masters Others Secondary Diploma Trust Degree Masters Others Secondary Diploma Perceived Service Quality Degree Masters Others Secondary Diploma Customer Loyalty Degree Masters Others 3.782 3.757 3.607 3.267 3.363 3.757 3.935 3.726 3.046 3.739 3.629 3.806 3.543 3.065 3.680 3.590 3.746 3.543 2.971 3.722 Std. Deviation 1.095 0.443 0.754 0.945 0.442 0.561 0.650 0.687 1.180 0.941 0.440 0.504 0.640 1.076 0.592 0.485 0.439 0.581 1.429 0.480 Std. Error

Sig.

0.211 1.324 .262 0.053 0.074 0.546 0.140 0.108 1.960 .102 0.077 0.068 0.681 0.297 0.085 2.933 .022 0.060 0.063 0.621 0.187 0.093 2.691 .032 0.053 0.057 0.825 0.152

The results showed that there are significant differences across the educational level categories on the Perceived Service Quality and the Customer Loyalty (sig.<.05) while with Word of Mouth and Trust, there were no significant differences (sig. >.05)

31

4.54

ANOVA results for Gender by Variable

These results show the ranking for the various Gender categories across the Variable
Table 4.54 Variable ANOVA results for Gender by Male Female Male Female Male Female Customer Loyalty Male Female Mean 3.706 3.602 3.863 3.687 3.709 3.548 3.683 3.522 Std. Deviation 0.744 0.673 0.755 0.565 0.618 0.536 0.531 0.556 Std. Error F Sig.

Word of Mouth Trust Perceived Service Quality

0.067 1.107 .294 0.071 0.068 3.455 .064 0.060 0.055 3.915 .049 0.057 0.048 4.537 .034 0.059

The results showed that there are significant differences across the gender categories on Perceived Service Quality, and Customer Loyalty (sig.>05). However with the Word of Mouth and Trust, there was no significant differences across these gender categories though on the Trust, the Females (Mean =3.687) ranked slightly higher than their male counterparts who are using the services of the clearing and the forwarding agents.

32

CHAPTER FIVE DISCUSSION, CONCLUSION AND RECOMMENDATIONS 5.1 Introduction

This chapter contains the detailed review and discussion of the findings with regard to the scholarly literature of other scholars. The chapter also contains the Conclusions resulting from the discussions. Also contained are the recommendations and the areas for future research

5.2

The relationship between word of mouth and customer loyalty.

The previous chapter showed a positive and significant relationship between the word of mouth and the customer loyalty variables. These results show that when customers have dealt with the clearing and forwarding firm in so much that they can talk well of the firm to other potential and existing customers, these customers are bound to be more loyal to ensure that they deal with the firm in future. This finding concurs with the work of can be Hume, (2007) supported with the work of which shows that customers normally do business with firms and institutions that give them a worthwhile experience. This experience is later on shared with others and the customers become loyal as long as the firm is offering services or products to their delight (Gale, 2007).

33

5.3

The relationship between word of mouth and trust.

It was further observed that the word of mouth and trust are positively related in this particular study. These results showed that the positive word of mouth about the clearing and the forwarding agents in the market will encourage the customers of these firms to remain loyal, make referrals and increasingly trust the firm. Such customers are also hard to convince to switch especially when they are the very witnesses of the experiences with the clearing and the forwarding firms. These findings are consistent with the work of Kueh and Voon (2007) which reveals that it is very important for firms to adopt a customer oriented approach in case they are to realise value from their efforts since the right client oriented approach leads to improved word of mouth about the firm in terms of referrals and praise about the service. This strengthens the loyalty of the other customers.

5.4

The relationship between trust and customer loyalty

Trust according to the study has been established to be positively related to Customer loyalty. Major implications for this finding had to do with the fact that if the customers of the clearing and the forwarding firms are contented with the way in which their agents conduct business, and manage transactions, these customers are bound to remain in business with the business for as long as they can. The clearing and the forwarding firm can actually realise the lifetime value from these customers if takes the necessary steps to ensure high levels of customer trust. Mirroring on the work Svensson (2006), it is as a result of the nature of interaction between the customer and the service provider that the trust between the Service Provider and the Customer is fostered and this consequently breeds loyalty from the Customer.

34

5.5

The relationship between Perceived Service quality and customer loyalty

The study established a positive relationship between Perceived Service Quality and Customer Loyalty. The implication in this case is that the more the customers rate the services offered by the clearing and the forwarding agents to be trustworthy, characterised by Integrity, the more they are more likely to be loyal to the transactions of the clearing and the forwarding agents of the firm. These findings also supported by the research study done by (Lorenzoni and Lewis, 2004).

5.6

Conclusions

Considering the findings and the discussion of the study, the following conclusions may be drawn;

Positive talk about a firm leads to loyalty from existing and potential customers. If the existing customers continually narrate their satisfaction and good experiences with a clearing and forwarding agent, this is likely to influence others to conduct with the firm.

Customer care becomes very essential when it comes to influencing the word of mouth about a clearing and forwarding firm. The way the customers are treated by the clearing and forwarding agency firm, is likely to influence the way the customers talk about the firm not only to fellow customers also to other potential customers.

35

Training Staff is very relevant to the clearing and the forwarding agent. The training of staff helps them become more proficient at their jobs and they are likely to make less errors and thus keep the customers satisfied.

For a clearing and forwarding agency to effectively manage the service quality, the word of mouth and thus the resulting customer loyalty, it is very essential that the Management is committed towards the effectiveness of service delivery. This is because it is management that generally implements the measures that are so employed.

It is also very essential for the staff of the clearing and forwarding firm to manage complaints promptly. When customer complaints are not addressed promptly and in a satisfactory manner, this leads to a situation where customers complain to all that they come in contact with. This ultimately impacts on the image of the firm.

5.7

Recommendations

The following recommendations are hereby

It is important that good customer care is recommended for the clearing and the forwarding firms since this automatically affects the word of mouth about the firm, and consequently, the rate at which the firm gets new customers. All the employees of the clearing firm should be customer care minded such that should any of them interact with the customers, the customers are never offended in spite of the circumstances.

36

Training of the staff becomes handy for the clearing and the forwarding agents because this directly improves on the competences and the proficiency of the staff. The Trainings should be conducted by professionals in the area of the clearing and forwarding sector if they to be fruitful.

At all costs, the clearing and the forwarding agents are all encouraged to have a hotline or tool free line where the customers can voice their concerns and complaints. This will minimise the chances of a scenario whereby the customers raise their complaints to other would be customers, thus tarnishing the image of the clearing and forwarding firm.

The clearing and the forwarding firms are also encouraged to adopt the strategy of conducting surveys so as to evaluate their levels of service quality, image and relevance. These surveys should be carried out in the business community from which the majority of the customers of these agents are.

Management positions in the clearing and forwarding firms should also be chosen selectively to avoid the much incompetence that can arise to the decisions of the management. The managers should be systematically and carefully chosen and the firms can for instance use aptitude tests among others to ensure that the management personnel are well suited for this role.

37

5.8

Areas for future research

Future researchers are hereby called upon to explore the following areas; Assess the elements of the Word of Mouth variable which matter most when it comes to maintaining loyal Customers. This will help managers to realise which aspects of Word of Mouth should be given priority if service Organisations are to retain their customers.

38

REFERENCES: Bansai and Voyer, (2000). Receiving word-of-mouth from the service customer: An emotion-based effectiveness assessment, 14, 123-136. Berry, L.L., Parasuraman, A. (1991), Marketing Services: Competing through Quality, New York, NY: The Free Press. Bone, P.F. (1995), "Word of mouth effects on short-term and long-term product judgements", Journal of Business Research, Vol. 32 No.3, pp.213-23. Brown, S.P., Beltramini, R.F. (1989), "Consumer complaining and word of mouth activities: field evidence", Advances in Consumer Research, Vol. 16 pp.9-16. Carman, J.M., (1990). Consumer perceptions of service quality: An assessment of the SERVQUAL dimension, Journal of Retailing, 66, 33-55. Constantine, L. (2006), The importance of service quality in bank selection for mortgage loans, Managing service quality, Vol.16, pp. 365-379. Day, R.L., Landon, E.L. Jr (1977), "Toward a theory of consumer complaining behavior", in Woodside, A.G., Sheth, J., Bennett, P. (Eds), Consumer and Industrial Buying Behavior, Elsevier, North-Holland, pp.425-37. Dick, A., Basu, K. (1994), "Customer loyalty: toward an integrated conceptual framework", Journal of the Academy of Marketing Science, Vol. 22 No.2, pp.99113. Fitzell, P. (1998), The Explosive Growth of Private Labels in North America, Global Books, New York, NY. Fornell, C. (1992), "A national customer satisfaction barometer: the Swedish experience", Journal of Marketing, Vol. 56 pp.6-21.

Gale, D. (2007), Higher frequency, Restaurants and Institutions, Vol. 117 No . 7, p. 83. Gambetta, D. (Ed.) (1988), Making and Breaking Co-operative Relations, Blackwell, Oxford.

39

Giese, J.L., Spangenberg, E.R. (1997), "Effects of product specific word of mouth communication on product category involvement", Marketing Letters, Vol. 7 No.2, pp.187-9. Gremler, D., Brown, S. (1999), "The loyalty ripple effect: appreciating the full value of customers", International Journal of Service Industry Management, Vol. 10 No.3, pp.271-93. Grifiin, J. (1995), Customer Loyalty: How to Earn It. How to Keep It, Lexington Books, New York, NY,. Grnroos, C. (1984), "A service quality model and its marketing implications", European Journal of Marketing , Vol. 18 No.4, pp.36-44 Harrison-Walker, L. (2001), "The measurement of word-of-mouth communication and an investigation of service quality and customer commitment as potential antecedents", Journal of Service Research, Vol. 4 No.1, pp.60-75. Howard, J., Sheth, J. (1969), The Theory of Buyer Behavior, Wiley, New York, NY, .

Kueh, K., and Voon, B. (2007). Culture and service quality expectations. Managing Service Quality, Vol. 17 No. 6, pp. 656-680.

Lewicki, R.J., Bunker, B.B. (1996), "Developing and maintaining trust in work relationships", in Kramer, R.M., Tyler, T.R. (Eds),Trust in Organizations: Frontiers of Theory and Research, Sage, Thousand Oaks, CA, Lewis, J.D., Weigert, A. (1985), "Trust as a social reality", Social Forces, Vol. 63 pp.967-85 Lorenzoni, N. and Lewis, B.R. (2004), Service recovery in the airline industry: a crosscultural comparison of the attitudes and behaviours of British and Italian frontline personnel,Managing Service Quality, Vol. 14 No. 1, pp. 11-25. Luhmann, N. (1979), Trust and Power, Wiley, Chichester, .

Mayer, R.C., Davis, J.H., Schoorman, F.D. (1995), "An integrative model of organization trust", Acad. Management Rev., Vol. 23 pp.438-58.

40

Merian Sebunya(2006), Future of Logistics and Freeport activities and its implications for the Kampala Industrial and Business Park. McAllister, D.J. (1995), "Affect- and cognition based trust as foundations for interpersonal co-operation in organisations", Acad. of Mangt. Journal, Vol. 38 No.1, pp.24-59. Mishra, A. (1996), "Organizational responses to crisis: the centrality of trust", in Kramer, Moorman, C., Gerald, Z., Rohit, D. (1993), "Factors affecting trust in marketing relationships", Journal of Marketing , Vol. 57 No.1, pp.81-101. Morgan, R., Hunt, S. (1994), "The commitment-trust theory of relationship marketing", Journal of Marketing , Vol. 58 No.3, pp.20. Murray, K.B. (1991), "A test of services marketing theory: consumer information acquisition activites", Journal of Marketing , Vol. 55 No.January, pp.10-25. Oliver, R. (1980), "A cognitive model of the antecedents and consequences of satisfaction decisions", Journal of Marketing Research , Vol. 17 pp.460-9. Oliver, R. (1987), Satisfaction: A Behavioral Perspective on the Consumer, McGraw-Hill, New York, NY,. Parasuraman, A., Zeithaml, V.A., Berry, L.L. (1988), "SERVQUAL: a multiple-item scale for measuring consumer perceptions of service quality", Journal of Retailing , Vol. 64 No.1, pp.12-40. R.M., Tyler, T.R. (Eds),Trust in Organizations: Frontiers of Theory and Research, Sage, Thousand Oaks, CA, . Reichheld, F., Sasser, W. (1990), "Zero defections: quality comes to services", Harvard Business Review, Vol. 68 pp.105-11. Rempel, J.K., Holmes, J.G., Zanna, M.D. (1975), "Trust in close relationships", J. of Personality and Social Psychology, Vol. 49 pp.95-112. Reynolds, K., Arnold, M. (2000), "Customer loyalty to the salesperson and the store: examining relationship customers in an upscale retail context", Journal of Personal Selling & Sales Management, April, pp.89-97. Reynolds, K., Beatty, S. (1999), "Customer benefits and company consequences of customer-salesperson relationships in retailing", Journal of Retailing, Vol. 75 No.1, pp.11-32.

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Richins, M. (1983), "Negative word-of-mouth by dissatisfied consumers: a pilot study", Journal of Marketing, Vol. 47 No.Winter, pp.68-78. Rotter, J. B. (1967). A new scale for the measurement of interpersonal trust. Journal of Personality, 35 (4), 657-665. Singh, J. (1988), "Consumer complaint intentions and behavior: definitional and taxonomical issues", Journal of Marketing , Vol. 52 No.January, pp.93-117. Sivadas, E., Baker-Prewitt, J. (2000), "An examination of the relationship between service quality, customer satisfaction, and store loyalty", International Journal of Retail & Distribution Management, Vol. 28 No.2, pp.73-82. Srinivasan, S., Anderson, R., Ponnavolu, K. (2002), "Customer loyalty in e-commerce: an examination of its antecedents and consequences", Journal of Retailing, Vol. 78 No.1, pp.41-50. Zeithaml, V.A., Berry, L.L., Parasuraman, A. (1996), "The behavioral consequences of service quality", Journal of Marketing , Vol. 60 pp.31-46.

42

MAKERERE UNIVERSITY BUSINESS SCHOOL Dear respondent, This questionnaire is intended to facilitate the study on The Influence of Word of Mouth, Perceived Service Quality and Trust on Customer Loyalty In the Freight Forwarding Industry In Uganda. The study is for academic purposes and is carried out as partial requirement for the award of a Masters Degree. As a customer of one Freight Industry players, your responses will be treated with utmost confidentiality. Thank you very much for your valuable time. Section A: Background Information

Demographic Characteristics 1. Gender: Male Female

2.

Marital Status:

Single

Married

3.

Age group
Code Age Group Tick

1 18-24

2 25-29

3 30-34

4 34-39

5 40+

4.

Please indicate your highest Level of Education

Code Education Tick

1 Secondary

2 Diploma

3 Degree

4 Masters

5 Others

5.

How would you best describe your business?

Code Business Tick

1 Partnership

2 Sole Proprietorship

3 Limited Liability

6.

How long have you been working in the same business? Code Period Tick 1 Less than 5 years 2 5-10 years 3 Over 16 years

43

Uncertain

Strongly Disagree

Disagree

1 2 3 4 5 6 7 8 9 10

Firms in the Clearing & Forwarding Industry perform their business in a satisfactory manner Employees of clearing firms that deal with us business are willing to help whenever we approach them We previously dealt with another firm(s) which were not reliable and could not be trusted Firms in this Clearing & Forwarding business take advantage of clients ignorance I can count on the clearing firms in the business to handle my goods in an honest manner When this clearing firm decides on something with customers, they both stick to it. Firms in the clearing /forwarding business readily act on customer complaints and concerns Employees of clearing/forwarding firms will can be relied on to help beyond their designated duties just to help clients Firms in the clearing /forwarding industry often perform beyond customer expectations. Firms in the Clearing & Forwarding Industry perform their business competitively Word of Mouth I say positive things about the clearing and Forwarding firms to others. I recommend my Clearing and Forwarding agents to whoever seeks advice from me about the Freight Industry player to use. Our Clearing and Forwarding agents encourage us to convince other importers/ exporters to use their services. The Clearing & Forwarding firm rewards me when I convince others to use their service There are quite a number of importing firms I have convinced to use the services of our clearing/forwarding agents. I encourage friends in other Importing/ Exporting firms to use this clearing and forwarding agent Our firm started using our current Clearing & Forwarding firm as a result of the positive word of mouth about the firm. The positive talk in the market about this particular Clearing & Forwarding firm us to start using them I say positive things about the clearing and Forwarding firms to others.

1 1 1 1 1 1 1 1 1 1

2 2 2 2 2 2 2 2 2 2

3 3 3 3 3 3 3 3 3 3

4 4 4 4 4 4 4 4 4 4

1 2 3 4 5 6 7 8 9

1 1 1 1 1 1 1 1 1

2 2 2 2 2 2 2 2 2

3 3 3 3 3 3 3 3 3

4 4 4 4 4 4 4 4 4

44

Strongly Agree

Agree

Trust: For the items in the table below, please indicate your level of agreement for each by choosing one of the options against it.

5 5 5 5 5 5 5 5 5 5

5 5 5 5 5 5 5 5 5

Uncertain

Strongly Disagree

Disagree

1 2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18

I am proud to be associated with this Clearing & Forwarding Firm I want to continue clearing with this Clearing & Forwarding Firm I am very committed to this Clearing & Forwarding Firm It would matter a lot to me if this Clearing & Forwarding Firm closed down tomorrow Overall I am satisfied with this Clearing & Forwarding Firm. We believe our Clearing & Forwarding Firm will always be able to deliver outstanding quality service and value. Clearing & Forwarding Firms really care about building a relationship with clients. Clearing & Forwarding Firms attract and retain competitive firms to work with them. Our Clearing & Forwarding Firm the standard for excellence in its industry. Our Clearing & Forwarding Firm communicates openly and honestly Clearing & Forwarding Firms value customers and relationships ahead of today's profits I am willing to refer my Clearing & Forwarding Firms to others The Clearing & Forwarding Firms treats me like a real partner I am very likely to switch to another service provider in the near future. I would continue to deal with the Clearing & Forwarding Firms even if the prices were increased. I would pay more than competitors prices for the benefits I am receiving from the company. Compared to other Clearing & Forwarding Firms I know this one gives me high quality services. The Clearing & Forwarding offers good value for money in terms of high quality of work. Perceived Service Quality
The clearing & Forwarding firm normally delivers our goods promptly

1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2

3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3

4 4 4 4 4 4 4 4 4 4 4 4 4 4 4 4 4 4

45

Strongly Agree

Agree

Customer Loyalty; For the items in the table below, please indicate your level of agreement for each by choosing one of the options against it.

5 5 5 5 5 5 5 5 5 5 5 5 5 5 5 5 5 5

Uncertain

Strongly Disagree

Disagree

2 3 4 5 6 7 8 9 10 11 12 13 14 15 16 17 18 19 20

Our clearing & Forwarding agents check on us to enquire whether we need to make orders for goods or not We often to call the Clearing & Forwarding firm to ensure that our goods have arrived The clearing & Forwarding agents can be relied on to deliver our goods intact and in good condition Our clearing & Forwarding agents deliver our goods in the right quantities without tampering with them The clearing & Forwarding firm I use has good reputation. The clearing & Forwarding firm I use handles my complaints in a prompt manner The Clearing & Forwarding firm agents take time to investigate what king of problems we get in our relationship with them The Clearing & Forwarding firm has a toll free number to which customers can send their complaints Serving customers needs takes precedence over serving personal needs for this Clearing & Forwarding firm The Clearing & Forwarding firm agents often perform their duties beyond our expectations The Clearing & Forwarding firm agents are trained and supported with resources and empowered to create satisfy customers Employees of the Clearing & Forwarding firm understand what the customers value most about the firms services Everyone in my Clearing & Forwarding firm has a responsibility for solving customers problems Our Clearing & Forwarding firm would offer better services if their sales force worked a bit harder In our company marketings most important job is to identify and help meet the needs of our customers After-sales service is an important part of our business strategy Policies and procedures that do not create value for customers are eliminated by Clearing & Forwarding firm Marketing is seen as a guiding light for the entire Clearing & Forwarding firm When customers are dissatisfied with the services of the Clearing & Forwarding firm, corrective action is immediately taken

1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1 1

2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2 2

3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3 3

4 4 4 4 4 4 4 4 4 4 4 4 4 4 4 4 4 4 4

46

Strongly Agree

Agree

5 5 5 5 5 5 5 5 5 5 5 5 5 5 5 5 5 5 5