Nehru School of Management Journal (NSMJ) ISSN: 2349-4883 Vol.3, No.

1, April-September 2017

Impact of Service Quality on Customer

Satisfaction and Loyalty with Reference to
Al-Manama Super Market, UAE
M. Sendhilkumar,
Research Scholar, Bharathiyar University, Coimbatore.
Assistant Professor, Dept. of MBA, Acharya Institute of Technology, Bangalore. E-mail:[email protected]
Dr.B. Adalarasu,
Dean, RVS Faculty of Management, Coimbatore.

Abstract--- Marketing is the art of creating,

satisfying customers by meeting the needs of I. INTRODUCTION
customers and by creating value satisfaction for
them. As Peter Drucker says “the essence of
marketing is that the entire business has to be seen
M ARKETING is the art of creating, satisfying customers
by meeting the needs of customers and by creating
value satisfaction for them. As Peter Drucker says “the
from the point given of the customer”. However, essence of marketing is that the entire business has to be
customers face a vast array of product and brand seen from the point given of the customer”. However,
choices prices, supplies and to understand the needs customers face a vast array of product and brand choices
and preferences of the customers it becomes prices, supplies and to understand the needs and
imperative for us to carry out research together preferences of the customers it becomes imperative for us
information. As retail chain store business is gaining to carry out research together information. As retail chain
popularity very quickly, people engaged in this store business is gaining popularity very quickly, people
sector should pay special attention to the growth of engaged in this sector should pay special attention to the
this sector. Customer satisfaction of this sector can growth of this sector. Customer satisfaction of this sector
be a pivotal indicator of how well the stores are can be a pivotal indicator of how well the stores are
meeting the expectations of the customers. This meeting the expectations of the customers.
study explores the relationship between service
quality and customer satisfaction on customer ‘Quality’ in a service organisation is a measure of the
loyalty with regards to service provided by “Al- extent to which the service is delivered meets customer’s
Manama Super market, UAE”. Retailing in the UAE is expectations because to the customer, quality is all about
expected to reach Dh200 billion by 2017, growing by meeting or exceeding their expectation.
a 5 per cent on average each year, according to an The national quality institute web site defined quality as
analysis by the Dubai Chamber of Commerce and follows:
Industry. Consumer spending is also expected to
“Quality is in the eye of the beholder. Yet we all recognize
continue rising in the medium-term, with growth
it when we
rates projected to stabilise at about 4 per cent on
See it … … Quality is when you are satisfied with a
average per year leading to a total spending of more
product or service
than Dh750 billion by 2017 across many categories,
That you go out of your way to recommend it to other
the analysis adds. To achieve objectives of the study,
people”
quantitative methods were used for the statistical
analysis and convenience sampling for selecting The nature of most services is such that the customer is
customers. For the research I used self-administered present in the delivery process. This means that the
questionnaire as a method for collecting data from perception of quality is influenced not only by the service
the sample consist of 100 customers randomly outcome but also by the service process. This study
selected from the population frame. explores the relationship between service quality and
customer satisfaction on customer loyalty with regards to
Keywords--- UAE-United Arab Emirates, AMSM-Al-
service provided by “Tuwairish Super market, UAE”. In
Manama Super Market.
UAE, supermarket sector has experienced a phenomenal
growth in the last decade due to changing tastes and

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preferences of consumers. This poses tight competition The retail sector includes all businesses that sell goods and
among the supermarkets as well as from the traditional services to consumers. Broadly, the sector can be classified
standalone retail shops. Consequently supermarkets have into the following two segments:
appreciated the importance of attracting and creating a
loyal customer base through provision of superior • Food: This segment comprises edible products,
shopping experience with emphasis on excellent customer including bakery products, organic food, meat and
service and relationship retailing driven by strategy. poultry, and ready-to-cook meals.
• Non-food: This segment can be further classified
into two categories–hard and soft products. The
II. INDUSTRY PROFILE hard products category includes appliances,
The retail sector includes all businesses that sell goods and electronics, furniture and sporting goods. Retailers
services to consumers. In 2014, it accounted for focused on hard products are called ‘hardline
approximately 22.5% of the world’s GDP. The sector is retailers’. The soft products category includes
largely dominated by the US and China. However, in the apparel. Apart from this broad classification,
recent past, the Chinese retail market has outpaced that of retailers are also classified on the basis of their
the US in terms of demand and supply. The retail sector is operational formats. The following are the major
highly fragmented and can be broadly divided into the operational formats used by retailers:
organised and unorganised segments. The organised • Department stores: Department stores are very
segment is dominated by large corporations such as Wal- large stores offering a wide range of goods and
Mart, Costco, Tesco and Carrefour. The top 10 retailers services, such as clothing, cosmetics, household
account for nearly 8.6% of global retail revenue, with Wal- items, electronics and sporting goods. Some
Mart alone accounting for approximately 3.1% in 2015. department stores also have a grocery section for
The retail sector has shown consistent growth after the selling food items. Target Corp, Sears Holdings and
global economic crisis. During 2009–2014, global retail Macy’s Inc are some of the major retailers that
sales grew at a CAGR of 5.3% to reach GBP10.6tn in 2014. have department stores as their dominant
The primary growth drives of the sector are a growing operational format.
middleclass population, rising income levels in Asia and • Grocery stores: Grocery stores offer both
technology-led business model transformations perishable and non-perishable food items. Some
worldwide. China has been the biggest contributor to grocery stores also sell non-food items, such as
global retail sales in recent years. Retail sales in the greeting cards, stationery, health care products and
country grew at a CAGR of 15.4% during 2009–2014, cookware.
driven by an increase in its middle-class population and • Specialty stores: Specialty stores offer a specific
the disposable income of its citizens. type of merchandise. For example, electronic stores
Global online retail sales reached GBP632.8bn sell only electronic goods and jewellers only stock
(USD839.8bn) in 2014, up 20.9% y-o-y. Retailers are products such as precious metals and gemstones.
increasingly leveraging information technology on the These stores are often small and independently
operational side, in areas such as supply chain owned. Best Buy, IKEA and Inditex are some of the
management, merchandising and store management, to major retailers that are specialty stores.
improve operational efficiency and enhance customer • Box stores: Also called supercentres, superstores,
experience. In 2014, the food and non-food segments of megastores and hypermarkets, box stores offer
the sector accounted for 47.2% and 52.8% of total sales, bulk merchandise at low prices. They conduct B2B
respectively. In 2009, these percentages were 45.1% and sales, in which they offer non-public access to
54.9%, respectively. Asia and Australasia accounted for items priced below their suggested retail price.
38.6% of total retail sales in 2014. Retail sales in the region Wal-Mart, Tesco and Carrefour are some of the
grew at a CAGR of 8.4% during 2009–2014, while in North major retailers that operate box stores.
America, it grew at a CAGR of 4.5% during the same • Online stores: Online stores sell products through
period. the internet. They either have a large product
portfolio or are focused on only one product line.
One of the major trends in the sector is the growth of Amazon, eBay and Alibaba are some of the world’s
e-commerce. Global e-commerce sales were GBP632.8bn major online stores. Some of the other popular
(USD839.8bn) in 2014, up 20.9% from GBP444.5bn operational formats in the sector are mom-and-pop
(USD694.8bn) in 2013. To better compete with pure online shops, convenience stores and discount store.
retailers such as Amazon, traditional retailers are shifting
to a multi-channel/omni-channel retail model. Other
significant trends in the sector are increasing M&A activity,
growing retail penetration in emerging countries and
rising retail IT spending.

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IV. CONSUMER TRENDS

The current consumer trends in the UAE are provided as
follows.
• Consumers are searching for bargains due to the
rising cost of living. Although the disposable
income is rising, the cost of living is increasing as
well. The UAE residents fear the rising prices of
groceries because their income is always fixed.
While large scale changes in prices of dairy and
III. RETAILING UNITED ARAB EMIRATES meat haven’t been occurred, vegetable prices are
Retailing is one of the pillars of the economy in United reported to have risen dramatically since 2014. As
Arab Emirates and accounts more than 11 percent of the a result, consumers are looking for bargains that
country’s GDP and close to 30 percent of Dubai’s GDP. The counter the rising prices of grocery products and
retail industry is divided into organized and unorganized daily goods. (Euro monitor 2015)
sectors. Over 12 million outlets operate in the country and • Consumers are developing more interest in
only 4% of them being larger than 500 sqft (46 m2) in size. healthier foods. Due to the growing awareness of
Organized retailing refers to trading activities undertaken health issues, the UAE consumers are seeking for
by licensed retailers, that is, those who are registered for healthier and foods with higher nutrition, better
sales tax, income tax, etc. These include the corporate- quality and fair prices. Fresh fruits and vegetables,
backed hypermarkets and retail chains, and also the natural foods, organic foods, whole foods and
privately owned large retail businesses. Unorganized dietary supplements market will have a larger
retailing, on the other hand, refers to the traditional customer base. Consumers are also demanding for
formats of low-cost retailing, for example, the local kirana products which are gluten-free, sugar-free, and
shops, owner manned general stores, paan/beedi shops, dairy free.
convenience stores, hand cart and pavement vendors, etc.
Most UAE shopping takes place in open markets and V. SOME TOP RETAILERS
millions of independent grocery shops. Organized retail
such supermarkets accounts for just 4% of the market as Lulu Group, Carrefour, Spinney's, Al Maya, Emirates
of 2009. Regulations prevent most foreign investment in Cooperative Society, Union coop.
retailing. Moreover, over thirty regulations such as
"signboard licences" and "anti-hoarding measures" may VI. COMPANY PROFILE
have to be complied before a store can open doors. There
are taxes for moving goods to states, from states, and even
within states. Food and beverage is the second most
significant consumer spending category, with a 14 per cent
share, followed by transport spending at 9 per cent.
Communications has a share of 7.8 per cent, and apparel
and footwear has a share of 7.4 per cent, while all other
items account for less than 5 per cent of private
expenditure. Another area that offers many opportunities Tuwairish Group aspires to empower all customers who
for consumption growth is luxury retail in the UAE. “There walk through our doors with a distinct advantage in
is growth of wealthy and ultra-rich consumers, the main leading their chosen lifestyle with pride and satisfaction,
potential customers of the luxury segment. All in all, irrespective of their social and economical status. This
consumption is going up and retailing in the UAE is a major apart, we seek to become a dependable and reassuring
sector, which is supportive of economic growth and offers companion who deeply perceives, and cumulatively fulfils
a lot of business opportunities,” the analysis stated. their lives’ needs, desires and dreams.
We are committed to offer our customers the most
extensive range of choices, the finest quality and
unmatched value, complimented by world-class customer
service standards through an enjoyable and rewarding
shopping experience.
Our Honourable Chairman & Managing Director Mr. P.P
Abu-Bakr says "a strong spirit of adventure inspired me to
various endeavours. Eventually the entrepreneur in me
was tempted to experiment with multiple lines of business,
UAE Consumer Spending by Category(2014, % shares in which led to focused effort in the retail sector since 2002.
total consumer spending) Back then the concept of a department store was not very

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popular, especially among the middle and lower strata of IX. SCOPE OF THE STUDY
the society. Yet, Tuwairish Group pioneered its way to
In this competitive world retaining the customers has
success by virtue of delivering everything under one roof
become very important; hence it has become part and
at affordable prices and offering impeccable customer
parcel of the business. Business which can adapt to quick
services. Tuwairish Group started as Tuwairish Trading
changes and get access to improvised technology can
LLC at Abu Dhabi, UAE. This deals with the distribution of
survive in this stuff market conditions
fresh meals and frozen items across United Arab Emirates.
• The study can be applied to understand various
level of quality services provided by the
supermarkets.
• The study help for further studies related to
customer preferences and customer loyalty.
• The present study also helps for understand the
new services for improving the quality of services

X. RESEARCH METHODOLOGY
Research methodology is one of the most essential
Tuwairish Group with a strong background of business
elements of a research study as it provides a framework to
experience of over 15 years in this part of world itself,
accomplish a research in the most efficient manner. It is a
under the guidance of esteemed chairman Mr. P.P Abu-
way to systematically solve the research problem and it
Bakr and other dedicated professionals, has grown
may be understood as a science of studying how research
vigorously. Combining the wisdom of our chairman and
is done. Research methodology involves different methods
experienced senior managers along with zeal of the
and strategies that are significant to develop a link
younger generation, our staff members believe as their
between research question and its objectives.
own company and strive hard to achieve the highest
standard to serve our customers to their satisfaction. Our
CEO, Mr.Muhammad Sideeq with an extraordinary XI. DATA SOURCE
combination of youthful dynamism, supports the chairman Primary Data
in running the business of the group. Our staff members,
who hail from various parts of the world, submerge into a Collection of primary Data
single work culture at Tuwairish Group. There are several methods of collecting primary data
particularly in surveys and descriptive researches.
VII. STATEMENT OF THE PROBLEM Important ones are as follows:
Quality service is defined as the judgment or perception 1. Observation Method
resulting from customers’ evaluation processes, whereby 2. Interview Method
customers compare their expectations with the service 3. Questionnaire
they perceive they have received. Keeping in view the 4. Schedules and
significance of service quality and customer satisfaction
Secondary Data
and loyalty, a study is designed to examine the impact of
service quality as an independent variable on dependent In order to have a proper understanding of the service
variables i.e. customer satisfaction and loyalty. quality of bank a depth study was done from the various
sources such as books, a lot of data is also collected from
The major research problems are: the official websites of the banks and the articles from
• What is the level of service quality deliver of various search engines like Google, yahoo search and
Tuwairish supermarket answers.com.
• What is the Customer satisfaction and Loyalty with
Tuwairish supermarket XII. RESEARCH DESIGN
To carry out this project, descriptive research is used,
VIII. OBJECTIVES OF THE STUDY since it is a systematic study in which the researcher is
• To assess the level of service quality of the able to formulate the objectives of the study.
Tuwairish Supermarket. Descriptive Research Design
• To analyse the relationship of service quality and Descriptive research also known as statistical research,
customer satisfaction and loyalty of Tuwairish describes data and characteristics about the population or
supermarket phenomenon being studied. Descriptive research answers
• Make recommendations based on the findings of the questions who, what, when and how...
the study that will help to address the challenges
identified by the customer.

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XIII. RESEARCH SAMPLE • Only the customers of Tuwairish Supermarket

were considered is respondents. The study was
Sampling Units: Customers of the Tuwairish Super
conducted for the period of 42 days from April 3rd
Markets, Mussafah, Abu dhabi
2017 to 13th May 2017.
Sampling Size: Sampling size consists of 110 respondents.
Service Quality and Customer Satisfaction and Loyalty
Sampling Method: Convenience sampling method is used. Since customer satisfaction has been considered to be
Research Instrument: Structured Questionnaire. based on the customer’s experience on a particular service
encounter, (Cronin & Taylor, 1992) it is in line with the
Contact Method: Personal Interview.
fact that service quality is a determinant of customer
Tabulation: It is the arrangements of classified data in an satisfaction, because service quality comes from outcome
orderly manner. This involves creating table for recorded of the services from service providers in organizations.
data of the questionnaire schedule. These tables were
Another author stated in his theory that “definitions of
helpful to analysis statistic tools.
consumer satisfaction relate to a specific transaction (the
difference between predicted service and perceived
XIV. LIMITATIONS OF THE STUDY service) in contrast with ‘attitudes’, which are more
• Customers were not interested to fill up the enduring and less situational-oriented,” (Lewis, 1993) This
questionnaire. is in line with the idea of Zeithaml et al (2006).Regarding
• Accuracy of the findings depends on the truth of the relationship between customer satisfaction and service
data given by the respondents. quality, Oliver(1993) first suggested that service quality
• Customers have not enough time to spend with would be antecedent to customer satisfaction regardless of
researcher. whether these constructs were cumulative or transaction-
• The study is purely academic. specific.
Customer Perceptions of Quality and Customer Satisfaction Wilson, 2008

Study titled contractual governance of Indonesia Railway

XV. REVIEW OF LITERATURE system by Retno sarisunarto 2009 found that the growth of
Study titled satisfaction level of hotel customers in Iran: private motor vehicle grows rapidly each year have
(case of Parsian Esteghlal Hotel by Neda shishavi 2007) negative impact not only for the extra contribution of air
found that success of every company or Organization lies pollution but also to time wasting. That impact can lead to
beneath the satisfaction of their customers. This is decreasing of people quality life. Public transportation is
especially obvious in hospitality sector. The success of the one of the solutions for the problem. Therefore, the shift
company active in hospitality environment has a direct from private motor vehicle user to public transportation,
relationship with their ability to satisfy their customers. in other word increasing market share of public
Hotels, as one main important sector of hospitality transportation, is necessary.
environment, will use their customers if they walk out the Study titled customer satisfaction with service delivery of
door dissatisfied. In this situation they will not hack to the mobile telecommunication networks in Ghana by Simon
hotel and they will not suggest the hotel to their friends. GyasiNimako, Foresight Koftazumah-2009 was conducted
This means losing customers and failure of the company to assess and analyze customer satisfaction with service
(hotel). delivery of mobile telecommunication networks (MTNs)

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with Ghana. The main problem of this study was whether Opinion about Variety of Products in One Product
customers are satisfied with service delivery of MTNs in Category
Ghana. The study was basically a survey that used both
qualitative approaches. A structured questionnaire was Percentage
developed, pre-tested and personally administered to the
target population of individual mobile subscribers. One 70
thousand (1000) respondents were sampled from the
target population of seven million, six hundred and four 60 57.27
thousand and fifty-three (7604053) mobile telecom
subscribers through a satisfied random sampling. 50
Palacio, Meneses, & Perez, (2012) also empirically proved
40
the dominant role of brand image in predicting customer
satisfaction in the hospitality industry. Moreover, the
30 24.55
congruence between the brand image and customers‘ self-
image would enhance customer satisfaction and 17.28
20
customers‘ preference for the brand. Furthermore, the
strategic importance of customer satisfaction for 10
organizations is even more highlighted. In a competitive 0.9
marketplace where businesses compete for customers like 0
in the service industry; customer satisfaction is seen as a
Yes No Not many None
key differentiator and increasingly has become a key
element of business strategy. It is essential for companies
to effectively manage customer satisfaction
Overall Satisfaction towards Tuwairish Supermarket
80
70
60
50 34.55
40
30 22.73
11.82
20 15.46 15.45
7.27 11.81
10 22.73 6.36 7.27 5.45
15.46 9.09 8.18
0 6.36
Highly
Highly Satisfied Satisfied Neutral Dissatisfied
Dissatisfied
Total Percentage 22.73 34.55 15.46 15.45 11.81
Female (%) 7.27 11.82 6.36 7.27 5.45
Male (%) 15.46 22.73 9.09 8.18 6.36

• 46.36% customers treats the quality of product as

XVI. FINDINGS the credential factor for purchase of products
From given period of time in main project at Tuwairish from Tuwairish supermarket
Supermarket, Musaffah, Abu Dhabi, I visited many • Quality of products and the cleanliness of the
customers and collected information from those customers supermarket have a great role in attracting and
through questionnaire distribution and analysed data. My retaining the customers.
findings and suggestions are as follows: • 64% of respondents agree that the time taken for
billing in the counter is excellent.
• Service quality of Tuwairish Supermarket is • 70% of respondents agree that Effectiveness of
satisfactory. store layout helps in easy purchase
• 30.5% of the customers visit the supermarket • 66.42% of respondents are satisfied with the
during offers. location of the store
• Speed of delivery and the behaviour of staffs are • 71.92% of respondents agree that employees have
the high ranking in the service quality of Tuwairish the knowledge level to answer the questions.
Supermarket.
• 57.27% respondents agree that supermarket have
more variety of products in one product category

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• 66.37% of respondents said that the store is which suggest that the customers are satisfied with the
reminding & intimating store discounts & prices to service quality of Tuwairish Supermarket.
all customers in store. As a researcher it was a good experience and also helped
• 60% of respondents agree that the store accept to get exposure to the field. We can hope that Tuwairish
return and exchange of products. Supermarket may continue its good performance in the
• Discount coupons and the one hour sales are the future also by satisfying the needs of customers.
most successful loyalty programs of Tuwairish
Supermarket.
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loyalty program. Make changes like giving equal
opportunity to all customers can improve this
loyalty program
• Company can improve customer service, by
reducing the wait time at checkout and also
creating a clean atmosphere in the store and
adding more variety of products in one product
category.

XVIII. CONCLUSION
In the current retail industry, customer purchasing and
managing their product option. To win and retain
customers, Retail firms must differentiate themselves by
more than just price. Quality and customer satisfaction
have long been recognised as playing a crucial role for
success and survival in today’s competitive market.
The research entitled “A study on impact of service quality
on customer satisfaction and loyalty at Tuwairish
Supermarket, Musaffah, Abu Dhabi, UAE” seeks to examine
the several aspects of effectiveness of service quality of
Tuwairish Supermarket. For the study of above topic
questionnaire containing relevant questions were supplied
to the customers. The questionnaire was prepared in such
a way that customers can understand it clearly and answer
easily. From this study all the variables had high
percentage of positive opinions. Only minority of the
customers gave negative opinions about certain variables,

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