The Factors Affecting Satisfaction of the Customers of Superstores in Dhaka City:

A Study Based on a Field Survey Using a Structured Questionnaire

Page- 1

The Factors Affecting Satisfaction of the Customers of Superstores in Dhaka City:

A Study Based on a Field Survey Using a Structured Questionnaire

Prepared for:

Dr. Kazi Tanvir Mahmud

Course Instructor, Research Methodology. Department of Business Administration American International University- Bangladesh

Prepared By:

F.R.M. Harun-Or-Rashid
ID: 09-93005-2

Md. Azharul Islam

ID: 09-93051-2

Tamanna Yasmin
ID: 09-93033-2

Md. Maitul Hossain

ID: 09-93119-2

Asif Iqbal
ID: 09-93064-2

A.S.M. Fahim
ID:09-92817-1

Research Methodology Section : A MBA

Page- 2

Date of Submission:
08 th May 8, 2010

May 08, 2010.

To, Dr. Kazi Tanvir Mahmud Course Instructor, Research Methodology. Department of Business Administration American International University- Bangladesh Dear Sir Subject: Submission of the report. Here is the report on The Factors Affecting Satisfaction of the Customers of Superstores in Dhaka City: A Study Based on a Field Survey Using a Structured Questionnaire assigned us by you as the part of the course Research Methodology (00651). This report will show you which factors of superstore are important to its different sort of customers and how preferably they marked the factors. There are also some guideline about how to satisfied customers. We have tried heart and soul to make this report perfect but for some limitations and other difficulties we could not meet our expectation. Though some things else for the limitations, we hope you will be able to draw a line from this report. We would like to thank you for keeping touch with us during the time of report preparing with lots of valuable information. We also thank to our friends .

Respectfully yours,

F.R.M. Harun-Or-Rashid Md. Azharul Islam Tamanna Yasmin Md. Maitul Hossain Asif Iqbal A.S.M. Fahim

ID: 09-93005-2 ID: 09-93051-2 ID: 09-93033-2 ID: 09-93119-2 ID: 09-93064-2 ID:09-92817-1

Page- 3

ACKNOWLEDGEMENT
First of all, I would like to convey our sincere thanks to ALLAH because He has given us the opportunity to complete this report. This report came to its existence by the sincere effort and co-operation of many people. We are grateful to those people who gave us suggestion and guideline with their invaluable opinions. The report is an outcome of our Postgraduate Program and it should be mentioned that we are grateful to The Faculty of Business of American International University- Bangladesh and the course instructor Dr. Kazi Tanvir Mahmud (Research Methodology (00651)) for their part on preparing this report. We want to give our gratitude to Dr. Kazi Tanvir Mahmud was very cooperative & helpful for us all through the semester. Without his moral support, it was impossible for us to prepare this whole report. So we want to thank him for his generosity.

Page- 4

ABSTRACT
The recommendation of this study is that the improvement of some factors of superstore particularly location, parking, security and price will satisfy customers. Assigned by Kazi Tanvir Ahmed, course instructor of American International University Bangladesh (AIUB), this report is submitted on May 8, 2010. This study gives a guideline to all the authorities of superstores in Dhaka City to satisfy their customers. The basis for this recommendation is the opinion of customers which was collected by field survey. Location is an important factor for almost every customer. If superstores located near customers house or beside the way to house, customers will easily access it. As a result, authority of superstores should place new stores or branches near customers house or beside the way to house. Packaging is also an important factor to lots of customers. So, very good commodities require the attractive packaging facilities. Packaging is required for satisfy customers and attract new customers. Security is a concerned matter to the entire inhabitant of Dhaka City now. A well protected place where no chance to explode bomb or mugging etc. is demanded by customers. Price of product is too high in superstores than grocery shop argued by customers. Actually the customers want product in more or less same price of grocery shop with some extra facilities in superstore. So, a reasonable price will fulfill customers expectation.

Regression model is Y (service) = + 1P+2L+3A+4T+5Pk+6Ly+7Se+.

We prepare compare paired sample T-Test

Page- 5

CHAPTER-1.00: INTRODUCTION
Superstore is often categorized as a self-service retail environment. For superstore retailers wanting to build relationships with their customers, being able to track their levels of satisfaction with the key elements of the supermarket environment is extremely important. From the retailers perspective the aim is to minimize the reasons for complaints and dissatisfaction and the cost of a service recovery plan whilst establishing a track of direct feedback from customers about their reactions to those key elements. Satisfaction is a consumers post-purchase evaluation of the overall service experience. It is an affective reaction in which the consumers needs, desires and expectations during the course of the service experience have been met or exceeded. Satisfaction in this sense could mean that a superstore has just barely met the customers expectations, not exceeded nor disappointed those expectations. The benefits of taking the customers response beyond satisfaction at this level by exceeding expectations, is a competitive strategy many retailers aspire to achieve. Customer satisfaction now represents a central strategic focus for customer-oriented firms across diverse industries. In recent years, researchers have focused their attention on measuring levels of customer satisfaction and on the cues that signal services quality to customers. There has also been an attempt to better understand the dynamics of the relationship that exists between satisfaction and service quality and the impact on customer purchase intentions. The superstore sector of the retail industry is highly competitive and stores operate in a mature market with slow growth opportunities and vie fiercely for market share. Any factor which might influence profit in such conditions is critical. Customer satisfaction has become a primary point of differentiation in a market where consumers typically make a weekly trip to their preferred superstore and spend more on this trip than at other times.

1.1. Problem identification

Super store concept is obviously a prospectus one in metropolitan city. But this concept is not free from error. Following problems were identified from the above statistical analysis and qualitative interview with the respondents regarding this popular concept: - Super stores are located in rich areas like Gulshan, Banani, Dhanmondi, Uttara etc which is not that much convenient for the low income people. Page- 6

- It was found that some super store are charging more than traditional kacha bazaar. Moreover, there is a (miss) conception with the customers that the super shops are charging more due to its well decorated space, more sales people and air conditioned environment. - Promotional activities of the super markets are more targeted to educated and high income people that discourage the lower income people to shop there. - We have got a tradition or heritage effect too. Still many people have a psychology to shop with kacha bazaar as thats the common tradition of Bangladeshi people. This image/culture of shopping goes against super markets concept. - Some said that many local rare fruits and vegetables are not available in super markets which they can easily buy at a reasonable cost from kacha bazaar.

1.2. Research Objectives:

The major purposes of this report are given below: To identify and analyze the factors that affects the satisfaction of superstores' customers. To help the managers of superstores to take decision. To give information to them who are planning to start superstore business.

1.3. Hypothesis:
The factors positively correlated to the services. H1: Age of the respondents impact positively to the services. H2: Price of the goods is positively correlated to the services. H3: Security is positively impact to the services. H4: Physical layout is correlated to the services. H5: Location impact positively to the services. H6: Packaging facility is correlated to the services positively. H7: Length of use is positively correlated to the services.

1.4 Scope
We have made the report in assembled way and we collect information from only 30 customers which are too modest. Not only that we did not consider all the factors of

Page- 7

superstore. That is why we could not make a clear concept on the satisfaction of overall customers.

1.5 Limitation
We faced some limitations to accomplish this report. When we went to superstores to take information some customers were not agree to give information and the employees of some superstores disturbed us. We had to work in SPSS software which was not available to us. We had to go to take help from our computer lab, but computer lab was very busy most of the time. Again the load shading has disturbed us in lab and our home. Some times floppy disk has crashed, ink of printer was finished and we also feel some sort of money though it was solved by our guardians patronization.

1.6 Historical background

First superstore established in late ninety, named Agora. And from than one after one, Mina Bazaar, PQS, Family needs, etc. superstores have started. Now these are part of daily life to rich and middle class family.

Page- 8

CHAPTER-2.00: LITERATURE REVIEW

In an early conceptual article, Kotler, (1973) develops a systematic exposition of atmosphere as a buying influence. Kotler explores the notion that one of the most significant features of the total product is the place where it is bought or consumed. The atmosphere of the place is more influential than the product itself in the purchase decision" Kotler, (1973, p. 48). The term atmospherics is defined in Kotler, (1973) as the effort to design buying environments to produce specific emotional effects in the buyer that enhance his/her purchase probability. Atmosphere is experienced through the senses, primarily sight, sound, scent, and touch. Bitner used the term servicescapes to describe the idea of atmospherics in a service setting. Servicescapes also adds the notion of the service personnel to physical setting (Bitner, 1992). Bitner elaborates on the neglect of the servicescape as follows: The effect of the atmospherics, or physical design and dcor elements, on customers and workers is recognised by managers and mentioned in virtually all marketing, retailing, and organisational behaviour texts. Yet, particularly in marketing, there is a surprising lack of empirical research or theoretically based frameworks addressing the role of physical surroundings in consumption settings. The servicescape is describe as covering such elements as physical layout of the service facility, ambience, background music and that the servicescape can also affect customers impressions of and satisfaction with service (Lovelock, Patterson and Walker, 2001). Service quality or desired expectations are defined as a blend of what the customer believes can be and should be (Zeithaml and Bitner1996). Service quality can be measured by the level of discrepancy between consumer expectations or desire and their perceptions of what they received as described by the SERQUAL scale (Bebko 2000). Customer satisfaction occurs when the value and customer service provided through a retailing experience meet or exceed consumer expectations. If the expectations of value and customer service are not met, the consumer will be dissatisfied. Unfortunately for retailers, most consumers do not complain when dissatisfied, they just shop elsewhere (Jackson, 1999). Retailers should always keep in mind that customer expectations move continuously upward and that only satisfied customers are likely to remain loyal in the long run.

Page- 9

CHAPTER-3.00: METHODOLOGY

3.1: Sampling plan

Serial No. 1 2 3 4 5 Location Agora PQS Meena Bazar Nandan Shopno Number 6 6 6 6 6

We collected data by field survey with help of 30 same structured questionnaires .At first we went to Agora (Dhanmondi) and collected the answer of the questionnaire by interviewing 6 customers. Next day we went to PQS (Dhanmondi), Mena Bazar, Nandan and Shopno collected another 24 questionnaire answer by interviewing the customers.

3.2: Sampling Techniques:

We use simple random sampling for this type of research. The way of drawing a simple random sample of n units using random numbers of a population of N units is described below: - Assign serial number to be units in the population from 1 through N. - Decide on the random number table to be used. - Choose an N sized random number from any point in the random number table. - If this random number is less than or equal to N , this number will be the first selected unit. - Move on the next random number not exceeding N, vertically or horizontally , or in any other direction systematically and choose the second unit. - If any stage of the selection, the random number is chosen exceeds N, discard it and choose the next random number. - If any random nu8mber is repeated, it must also be discarded and be replaced by a fresh random number appearing next. - The process stops once we arrive at our desired sample size.

3.3: Data collection

Collecting data (Questionnaire) from Whom Individuals Where Superstores of Dhaka City When From 24 March to 1 May 2010 How By asking to the individuals about the Questionnaire Page- 10

3.4: Data processing

After collecting data we number the questionnaires 1 to 30. Then we select demographic variables those are sex, age, Marital status, family size, length of user and frequency And problem specific variables are location, parking, quality, price, physical layout, return policy, after sales service, sales promotion, payment options and security we consider value of every factor (very important +2, important +1, neutral 0, unimportant -1) At last we analyze and interpret those tables. We prepared regression model, Ttest, explored etc Then we created another word document, which shows all the factors and inputted the values of those factors according to their variables. Then we added Bar graph to show the difference among the factors according to their importance and described them.

3.5. Regression Model:

Regression analysis is techniques of studying the dependence of one variable called dependent variable, on one or more other variables called the explanatory variables, with a view to estimating or predicting the population mean or average value of the former in terms of the known or fixed values of the later. Y (service) = + 1P+2L+3A+4T+5Pk+6Ly+7Se+ Y (service) = Dependent Variable, = slope of coefficient, = constant Independent Variable: P = price, L = location, A= age, T = time, Pk = package, Ly = Layout, Se = Security Error: = error

Page- 11

CHAPTER- 4.00: RESULTS AND DISCUSSION

4.1. Frequencies
Statistics Age of the Length ofLocation ofpackaging responden use the Store facility ts 30 30 30 30 0 0 0 0 1.8333 1.7667 1.8667 1.8667 .46113 .72793 .86037 1.04166 Physical Price ofAfter SalesSecurity Layout ofthe Goods Services the Floor 30 30 30 30 0 0 0 0 2.0333 1.9000 2.2667 1.9000 .80872 .80301 .82768 .71197

N Mean Std. Deviation

Valid Missing

It was found the mean and standard deviation results. The mean performance of services is greater than the mean performance of others. Service is an important factor. The mean of services is 2.2667 and the standard deviation is .82768. Ho: There is no significant association between services and other factors. HA: There is significant association between services and other factors

4.2. Frequency Table:

4.2.1. Age of the respondents
Frequency Percent Valid Below 256 Years 25-50 23 Years 50 Years1 and above Total 30 20.0 76.7 3.3 100.0 Valid Percent 20.0 76.7 3.3 100.0 Cumulativ e Percent 20.0 96.7 100.0

The result of frequency table is that 20% the age of the respondents is below 25 years whose are played important role in the purchasing power in super store and their behavior. The most respondents 76.7% go to buying or using super store and 3.30% are 50 or 50 above years old. 4.2.2. Length of use
Frequency Percent Valid 1 Year 12 2 Years 13 3 Years5 and above Total 30 40.0 43.3 16.7 100.0 Valid Percent 40.0 43.3 16.7 100.0 Cumulativ e Percent 40.0 83.3 100.0

Page- 12

The result of frequency table is that 40% the respondents is used the super store since 1 year and 43.3% users use the super store more than 1 years and 16.7% are used the super store more than 2 years. 4.2.3. Location of the Store
Frequency Percent Valid Very Important Important Neutral Unimporta nt Total 11 14 3 2 30 36.7 46.7 10.0 6.7 100.0 Valid Percent 36.7 46.7 10.0 6.7 100.0 Cumulativ e Percent 36.7 83.3 93.3 100.0

The result of location of the store is that 36.7% think it is very important factors, 46.7% it is important, 10% think it is neutral and 6.7% choose unimportant. 4.2.4. Packaging facility
Frequency Percent Valid Very Important Important Neutral Unimporta nt Total 15 7 5 3 30 50.0 23.3 16.7 10.0 100.0 Valid Percent 50.0 23.3 16.7 10.0 100.0 Cumulativ e Percent 50.0 73.3 90.0 100.0

The result of packaging facilities are that 50% of respondents think it is very important factors, 23.30% think it is important, 16.70% think it is neutral and 10% choose unimportant.

4.2.5.Physical Layout of the Floor

Frequency Percent Valid Very Important Important Neutral Unimporta nt Total 8 14 7 1 30 26.7 46.7 23.3 3.3 100.0 Valid Percent 26.7 46.7 23.3 3.3 100.0 Cumulativ e Percent 26.7 73.3 96.7 100.0

The result of physical layout is that 26.70% think it is very important factors, 46.70% it is important, 23.30% think it is neutral and 3.30% choose unimportant.

Page- 13

4.2.6. Price of the Goods

Frequency Percent Valid Very Important Important Neutral Unimporta nt Total 10 14 5 1 30 33.3 46.7 16.7 3.3 100.0 Valid Percent 33.3 46.7 16.7 3.3 100.0 Cumulativ e Percent 33.3 80.0 96.7 100.0

Price of goods is an important factor. The result of price of goods is that 33.30% think it is very important factors, 46.70% it is important, 16.70% think it is neutral and 3.30% choose unimportant. 4.2.7. After Sales Services
Frequency Percent Valid Very Important Important Neutral Unimporta nt Total 5 14 9 2 30 16.7 46.7 30.0 6.7 100.0 Valid Percent 16.7 46.7 30.0 6.7 100.0 Cumulativ e Percent 16.7 63.3 93.3 100.0

Service is dependent variable. The result of after sales service is that 16.70% think it is very important factor, 46.70% it is important, 30% think it is neutral and 6.70% choose unimportant. 4.2.8. Security
Frequency Percent Valid Very Important Important Neutral Unimporta nt Total 8 18 3 1 30 26.7 60.0 10.0 3.3 100.0 Valid Percent 26.7 60.0 10.0 3.3 100.0 Cumulativ e Percent 26.7 86.7 96.7 100.0

The result of security is that 26.70% think it is very important factors, 60% it is important, 10% think it is neutral and 3.30% choose unimportant.

Page- 14

4.3. Regression
4.3.1. Model Summary
R Square Adjusted RStd. ErrorChange Square of theStatistics Estimate Model R SquareF Change df1 df2 Change 1 .737 .544 .399 .64181 .544 3.747 7 22 a Predictors: (Constant), Security, Price of the Goods, Age of the respondents, Physical Layout of the Floor, Location of the Store, Length of use , packaging facility R

Sig. F Change .008

4.3.2. ANOVA
Model Sum ofdf Mean F Sig. Squares Square 1 Regressio 10.805 7 1.544 3.747 .008 n Residual 9.062 22 .412 Total 19.867 29 a Predictors: (Constant), Security, Price of the Goods, Age of the respondents, Physical Layout of the Floor, Location of the Store, Length of use , packaging facility b Dependent Variable: After Sales Service

4.3.3. Coefficients
Unstandardized Coefficients B Standardized t Coefficients Std. Beta Error .848 2.444 .273 -.008 -.054 .184 -.389 .154 .676 .149 -.504 .172 .058 .159 .333 .180 -.108 Sig. 95% Confidence Interval for B Lower Bound Upper Bound .023 .314 3.831 .957 -.581 .552 -.061 .970 -.091 .417 .674 .248

Model 1

(Constant) 2.072 Age of the-1.475E-02 responden ts Length of-.442 use Location of.650 the Store packaging -.401 facility Physical 5.977E-02 Layout of the Floor Price of.343 the Goods Security -.125 a Dependent Variable: After Sales Services

-2.405 .025 -.823 4.213 .000 .330

-2.687 .013 -.710 .347 2.157 -.695 .732 -.298 .042 .013 .494 -.498

In the regression model, Ho: There is positively association between service and others factors of customer satisfaction. So, the Ho is accepted. Because the significant value .008 is less than .05. For this reason we cannot prepare the model fit.

Page- 15

4.4.0 T-Test
4.4.1 Paired Samples Statistics
Mean Pair 1 Age of the1.8333 responden ts After Sales2.2667 Services N 30 30 Std. Std. Error Deviation Mean .46113 .08419 .82768 .15111

4.4.2. Paired Samples Correlations

Pair 1 N Age of the30 responden ts & After Sales Services Correlation Sig. -.060 .752

4.4.3. Paired Samples Test

Paired Difference s Mean Std. Std. Error95% Deviation Mean Confidenc e Interval of the Difference Lower Upper Age of the-.4333 .97143 .17736 -.7961 -.0706 responden ts - After Sales Services t df Sig. tailed) (2-

Pair 1

-2.443

29

.021

Ho: The factors of customers satisfaction affect on the services. Ho is accepted because the significant value is .021 which is less than .05 with 29 df.

Page- 16

CHAPTER- 5.00: CONCLUSION

As the super shop concept has already become popular, the entrepreneurs must take this opportunity to make more money. After a certain period of time it may not be quite impossible to see that traditional kacha bazaars are vanishing. Our prime suggestion to the entrepreneurs is: Go for establishing super markets in each area by co-operative shop building. In this case many grocery or other street shop owners can go for alliances among them to invest money to setup super markets in their respective area. This will eliminate the problem of funding too. Not only that, try to establish your own distribution system which will enable your shop to facilitate home delivery to most of the customers. Moreover, construct play ground for the kids within your super markets which will encourage the housewives to shop with your super chain shop. The demographic trends suggest that as super markets have proliferated in Dhaka city, better educated and higher income people have gravitated to these shops for shopping. These people/customers are likely to have better information about the quality of products and services provided by both super markets and kacha bazaar and their inclination to select super shops suggests, implicitly, that the quality of product is better at these shops even though their (super shops) product/service cost is somewhat higher. A class issue seems to be surfacing in the realm of shopping behavior; people with limited income and resources would seem to be deprived of super shops products or services available to the more affluent and better educated. While the ability to pay more should, realistically, enable the customers to get better and quality products, what is important is that defined standards of quality (quality of products, environment etc) procedures must be established (though some procedures are there theoretically) and ensured for all types of shops and kacha bazaar.

Page- 17

CHAPTER- 6.00: RECOMMANDATION

To solve this income and education disparity problem in shopping behavior the super markets can do following activities: - Offer different quality products at different prices so that even lower income people can rush to the super markets - Create promotional activities in such a way that it will also target the lower income people. Prepare creative advertisement that go in favor of lower class people - Make comparative advertisement to inform the customers that super markets are charging same for more quality or same for same quality products. This will remove the peoples psychology that super markets are charging more for same. Due to the lower income of the people, they are more concerned about price not about the quality of products. - Create advertisement to aware the people that kacha bazaars are creating hazardous waste that makes the shopping environment unhygienic. - Do a lot of personal selling of products and services to the customers - Train personnel to make them knowledgeable and interact well with the customers - Positive and societal marketing activities to build and project specific shop image - Design facilities to achieve specific marketing or image objectives of the shop - Establish formal system for controlling quality of goods and services and communicate that with the customers. - Provide specific effort to encourage customers to tell others about your services. In designing new and improved value added products/services and pricing the super markets can follow the strategies mentioned below: - Regularly collect information about customer needs - Perform marketing activities based on knowledge about customers - Ensure that the shops activities enhance customer satisfaction - Do marketing survey to design customer oriented and customer focused services - Base prices on what competitors charges (requires industry analysis) - Base prices on what the market and the customer is willing to pay

Page- 18

Notes and References 1. Hawkins Dell, Best Roger J., Poney Kenneth A. Consumer Behavior: Implication for Marketing Strategy, 3rd Ed, MN, 1996. 2. Huffman, C. and Kahn, B. E. (1998), Variety for sale: Mass Customization of Mass Confusion, Journal of Retailing, Vol. 74 No. 4, pp. 491-513 3. John W. Newstrom and Keith Davis, Organizational Behavior, Human Behavior at Work Tenth Edition, 2001 4. Kotler P. and Armstrong, G., Principles of Marketing, 10th Edn. New Delhi 5. Ludon David L. Della Bitta Albert. Consumer Behavior. 6. Malhotra Naresh K. Marketing Research, 3rd Edition, NJ 2000-2001 7. Zeithmal Balagie A. & Bitner Maro Jo, Service Marketing Integrating Focus Across the Firm, 6th Edition, NY-1999.

Page- 19