EFFECTS OF SERVICE QUALITY ON CUSTOMER SATISFACTION: THE CASE OF ETHIOPIAN SHIPPING AND LOGISTICS SERVICE ENTERPRISE

Abstract

This study focused to examine the effect of service quality on customer satisfaction in Ethiopian Shipping and logistics Service Enterprise at head office level in Addis Ababa. There are some models to measure Service quality and customer satisfaction in service providing organization. In this study, the researcher chosen SERVPERF model for discussion and analysis purpose. The SERVPERF model is an important model to measure customer’s satisfaction relative to customer perceptions for the Shipping and Logistics Services. It measures customer satisfaction based on five dimension of service quality such as tangibility, reliability, responsiveness, assurance and empathy. To make the analysis the researcher distributed questionnaires to 234 customers of ESLSE at head office in Addis Ababa, out of these 216 (92.3%) respondents returned the questionnaires. This study used both descriptive and inferential statistics to carry out the research analysis. The analysis result indicated that on tangibility, responsiveness and assurance dimension service quality except one item from each category in all items customers were agree level, relatively on reliability dimension service quality customers were disagree and on empathy dimension of the service quality customers of ESLSE are neutral to the service provided by the organization. The correlation matrix indicated that customer satisfaction have positive and significant relationship with tangibility, reliability, responsiveness, assurance and empathy dimension service quality in ESLSE at the head office in Addis Ababa. The regression model result indicated that the independent variables explain 49.4% of the variance in customer satisfaction (dependent variable) in ESLSE at the head office in Addis Ababa. Based on the findings the researcher recommended to improve the reliability dimension service quality and the specific items from other service quality dimension. The ESLSE should also keep update the tangibility, reliability and assurance dimension of the service quality to satisfy their loyal customers.