Customer Satisfaction in the Restaurant Industry

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Research Proposal

Customer Satisfaction in the Restaurant Industry

Part I: Research Proposal

I-1. Research Background

In today’s competitive dynamic environment it is crucial to maintain existing customers and gain new ones. This goes for the restaurant industry as well, where not only the quality of the food plays a major role, but also the quality of the service itself. This has been recognized by the restaurant X which offers traditional Greek food. Due to increasing competition and decreased disposable income during recent year, the restaurant management decided to focus more on increasing the quality of their food and service in order to ensure high customer flow. Delivering quality at the constant pace guarantees competitive advantage, which leads to customer satisfaction and positive word of mouth, as well as repeated sales and customer loyalty. It is important to mention that every fourth purchase results in customer dissatisfaction but only 5% of those customers complain (Kotler et al.,1999). As a result restaurants needlessly loose customers without getting a real feedback from them. This is why it is necessary to do customer satisfaction survey to motivate the customers to share their opinion about the restaurant which will later be used to improve quality in areas of the restaurant management process that need it the most.

I-2. Problem Definition

Restaurant industry is becoming more and more competitive which makes it hard on single restaurants to stay in the business. Economic crisis during recent years has just made things worse by affecting disposable income and the ability for people to afford a meal outside of their home. In addition, people’s life-styles are changing, with people having less time for entertainment and leisure. In order to ensure customer loyalty and consequently increasing profits, many restaurants turned to understanding what causes customer satisfaction in their particular case and what can they do to improve it. Constant measurement of food and service quality provides management and rest of the staff with valuable information which can be used to maintain or improve the ways in which they meet and exceed customer expectations. Encouraging constant feedback from customers and carrying out regular surveys motivates restaurant staff to stay customer-oriented and ensures that the whole organization works toward the same goal which is, ultimately, customer satisfaction.

I-3. Purpose of the Research

The purpose of this research is to determine how satisfied customers are with the Restaurant X overall experience. The restaurant has been operating successfully for long period of time, but it decided to find out which areas of the business can be improved and how. This is why a research should be conducted in order to find out the level of satisfaction of existing customers and provide restaurant’s management with the solution how to develop the ineffective areas of the business which cause customer dissatisfaction. Since Serbian people do not have a habit of complaining when the food and service quality does not meet their expectations, this research will ensure that customers give the necessary feedback which will serve as a guide for improving the product, in terms of food quality and price, and service, in terms of people, process, and physical environment. Customer feedback is the best tool to ensure that a restaurant stays on track with delivering high quality experience.

I-4. Research Questions and Research Hypotheses

1. Which factors cause customer satisfaction?
2. What is the correlation between food quality and customer satisfaction? 3. What is the correlation between the physical environment element (atmosphere, design, layout, cleanliness, accessibility of the restaurant) and customer satisfaction? 4. What is the correlation between people element (staff...
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