Correlates the Relationship of Service Quality, Customer Satisfaction, and Customer Retention on Selected Restaurants in Muscat, Sultanate of Oman

Abstract

This study primarily aimed at investigating the relationship of service quality, customer satisfaction and customer retention on selected restaurants in Muscat, Sultanate of Oman. It also showcased the application of the 5-dimensions of service quality in relation to customer satisfaction. To achieve the objectives of the study, it utilized the descriptive research design that mainly used the survey questionnaire as the main data gathering tool and initially distributed to 130 sample respondents. However, only 105 filled questionnaires were retrieved on the basis of convenience sampling. Reliability and validity test was conducted to ensure that the research instrument is reflective of the research objectives and research questions. In analyzing the data, tables and frequencies were used to analyze the demographic profile of respondents; weighted mean and standard deviation were employed to determine the level of agreement of the respondents on service quality, customer satisfaction and customer retention. Regression, correlation and t-test were used to analyzed the relationship between the 5-dimensions of service quality and customer satisfaction; relationship between service quality, customer satisfaction and customer retention; and, determining the significant difference between the demographic profile and service quality respectively. Key findings revealed that among other variables only reliability has no significance on service quality while there is significant correlation between the three variables: service quality, customer satisfaction and customer retention. But there is no significant difference between the demographic profile such as age, gender, nationality, source of income and income of the customers and service quality. Based on the outcome of this study, it can be recommended that, restaurants should try to improve their current services to achieve better results. The level of agreement by the customers about the current services can be elevated that may require excellent performance. Trainings and programs relative to enhancing service quality can be a good suggestion and if possible, these restaurants can perform benchmarking to assess their present performance with other restaurants who may have excellent services as starting point of improvement. Above all, the management should strive to strike a balance between service quality, customer satisfaction and customer retention to achieve competitive advantage.