A TWO-FACTOR MODEL FOR SERVICE QUALITY MANAGEMENT:THE CONCEPTUAL DEVELOPMENT AND AN APPLICATION TO

CO-OP MART NGUYEN DINH CHIEU, VIET NAM.

by

Ho Dac Nguyen Nga

A research study submitted in partial fulfillment of the requirements for the degree of Master of Business Administration.

Examination Committee Dr. Do Ba Khang (Chairman)Dr. Fredric W. SwierczekDr. Clemens Bechter

Nationality VietnamesePrevious degree Bachelor of Civil Engineering

HCMC University of TechnologyHo Chi Minh City, Vietnam

Scholarship donor Government of Switzerland /SDC (SAV)

Asian Institute of TechnologySchool of Management

Bangkok, ThailandApril 2001

ACKNOWLEDGEMENT

I am most grateful to Dr. Do Ba Khang, my Research Advisor and Chairman of Research Committee, for his invaluable guidance, constructive suggestions, and constant encouragement throughout the course of my research study. His profound knowledge and boundless enthusiasm are a great inspiration for me to conduct this research.

I would like to express sincere thanks to Dr. Fredric W. Swierczek and Dr. Clemens Bechter for their valuable contribution in serving as Research Committee members, as well as for their constructive comments and critical suggestions on the research study.

The sincerest thanks come to the Swiss-AIT-Vietnam Management Development Programme (SAV) and Asian Institute of Technology (AIT), all the faculty members, staffs, and friends who contribute greatly to my learning progress.

Thanks are also extended to Vietnam Asia Pacific Economic Center (VAPEC), managers and staffs of many supermarkets in Ho Chi Minh City, especially managers and staffs of Saigon Co-op, for helping me in data collection.

Last but not least, I would like to express my deep gratitude to my family and my girlfriend, who provide continuous supports to me during my learning process and the course of this research study.

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ABSTRACT

The goal of this research is to investigate the quality level of Co-op Mart Nguyen Dinh Chieu in the perception of customers in order to help management improve the store’s quality properly.

For the purpose above, a new quality model, called “Two-factor model”, is developed. This model measures customer perception towards two factors -attributes performance and shopping preference of customers- and identifies the relationship of these two factors to construct the quality perception of customers. The results of this research reveal that Two-factor model is more appropriate than Servqual in recommending the attributes improvement priorities.

Primary data of the research is collected through two surveys, one is for supermarket customers in Ho Chi Minh City and one is for customers of Co-op Mart Nguyen Dinh Chieu. The former is used to collect general perception about supermarket quality attributes and the latter is used to identify quality level of Co-op Mart Nguyen Dinh Chieu’s attributes. Responses from these two surveys are analyzed by Two-factor model to derive characteristic curve of each attribute as well as current performance, contribution to current shopping preference of customers, preference gap, and improvement efficiency of each attribute of the store.

Based on the research findings, recommendations are made to improve the quality of the store. Quality attributes are classified into 3 main groups. The first group includes attributes which should be improved. The second group includes attributes which should be improved after all the attributes of the first group reach their potential. The attributes of the third group are recommended to be unchanged. Moreover, priorities for improvement of attributes in each group are also specified. Among attributes which should be improved, quality of merchandise, agility of locker personnel, hospitality of personnel and variety of product lines are four attributes which have the highest priorities for improvement. They are the keys to improve quality of Co-op Mart Nguyen Dinh Chieu.

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TABLE OF CONTENTS

Acknowledgement.................................................................................................................i

Abstract.................................................................................................................................ii

Table of Contents................................................................................................................iii

List of Figures.......................................................................................................................v

List of Tables........................................................................................................................vi

Chapter 1: Introduction.......................................................................................................11.1 Rationale of The Research...........................................................................................11.2 Problem Statement.......................................................................................................11.3 Research Objectives.....................................................................................................21.4 Research Framework....................................................................................................21.5 Scope of The Research.................................................................................................31.6 Organization of The Research......................................................................................3

Chapter 2: Co-op Mart Introduction.................................................................................42.1 Background of Supermarket.........................................................................................42.2 Co-op Mart Introduction..............................................................................................6

Chapter 3: Development of Two-factor Model................................................................133.1 Review of Multi-attribute Concept............................................................................133.2 Review of Servqual Model.........................................................................................133.3 Review of Kano Model..............................................................................................153.4 Proposed Two-factor Model.......................................................................................19

Chapter 4: Research Methodology...................................................................................254.1 Information Needed....................................................................................................254.2 Target Populations......................................................................................................254.3 Questionnaires Development.....................................................................................254.4 Sampling Procedure...................................................................................................274.5 Sample Characteristics...............................................................................................28

Chapter 5: Findings Analysis and Discussion..................................................................315.1 Facility Attributes Analysis........................................................................................315.2 Goods Attributes Analysis.........................................................................................345.3 Personnel Attributes Analysis....................................................................................395.4 Policy Attributes Analysis..........................................................................................425.5 Two-factor Model vs. Servqual..................................................................................46

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Chapter 6: Conclusion.......................................................................................................486.1 Present Customer Perception.....................................................................................486.2 Improvement Strategy................................................................................................496.3 Two-factor Model......................................................................................................52

Appendix A: Questionnaire A...........................................................................................53

Appendix B: Questionnaire B...........................................................................................56

Appendix C: Interview Schedule......................................................................................59

Appendix D: Data Analysis...............................................................................................60

Appendix E: Quality Attributes of a Supermarket.........................................................74

References............................................................................................................................76

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LIST OF FIGURES

Figure 1.1: Research framework............................................................................................2Figure 2.1: Proportion of merchandises sold through supermarket.......................................5Figure 2.2: Saigon Co-op organization chart.........................................................................7Figure 2.3: Old procurement procedure.................................................................................9Figure 2.4: New procurement procedure...............................................................................9Figure 2.5: Co-op Mart Nguyen Dinh Chieu Organization chart........................................10Figure 2.6: Co-op Mart Nguyen Dinh Chieu sales volume (2000)......................................10Figure 3.1: The Kano diagram.............................................................................................16Figure 3.2: Three basic shapes of characteristic curve.........................................................20Figure 3.3: Structure of characteristic curve........................................................................21Figure 3.4: Two-factor model’s coefficients........................................................................23Figure 4.1: Respondents’ age of sample A..........................................................................28Figure 4.2: Respondents’ frequency of shopping in supermarket of sample A...................28Figure 4.3: Respondents’ average spending for each shopping of sample A......................28Figure 4.4: Respondents’ age of sample B...........................................................................29Figure 4.5: Respondents’ frequency of shopping in supermarket of sample B...................29Figure 4.6: Respondents’ average spending for each shopping of sample B.......................29Figure 5.1: Convenience of parking.....................................................................................32Figure 5.2: Air condition......................................................................................................33Figure 5.3: Store size............................................................................................................33Figure 5.4: Quality of merchandise......................................................................................35Figure 5.5: Variety of product lines, variety of brand names and varieties for each product

line................................................................................................................................36Figure 5.6: Convenience of products arrangement for finding and attractiveness of products

display..........................................................................................................................37Figure 5.7: Introduction of new products.............................................................................38Figure 5.8: Unique products which customers cannot find somewhere else.......................38Figure 5.9: Agility and hospitality of locker personnel.......................................................40Figure 5.10: Hospitality, expertise in product information, and helpfulness in finding of

salesperson...................................................................................................................41Figure 5.11: Hospitality, accuracy, and agility of cashier....................................................41Figure 5.12: Price level compared with other supermarkets................................................43Figure 5.13: Returning unqualified products policy............................................................44Figure 5.14: Attractiveness of promotion campaigns..........................................................44Figure 5.15: Flexibility of paying method...........................................................................45Figure 5.16: Convenience of open hours.............................................................................46Figure 5.17: Convenience of open hours and quality of merchandise.................................47

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LIST OF TABLES

Table 2.1: Co-op Mart stores.................................................................................................8Table 2.2: List of Co-op Mart’s direct competitors.............................................................11Table 3.1: Kano questionnaire combination table................................................................17Table 4.1: List of studied attributes......................................................................................26Table 4.2: Attributes classification......................................................................................27Table 5.1: Facility attributes................................................................................................31Table 5.2: Goods attributes..................................................................................................34Table 5.3: Personnel attributes.............................................................................................39Table 5.4: Policy attributes..................................................................................................42Table 6.1: Present customer perception...............................................................................48Table 6.2: Improvement priorities of the first group............................................................51Table 6.3: Improvement priorities of the second group.......................................................51Table C.1: Schedule of survey A.........................................................................................59Table C.2: Schedule of survey B..........................................................................................59Table D.1: Variables coding................................................................................................60Table D.2: Shopping preference contributed by very good performance............................61Table D.3: Shopping preference contributed by very bad performance..............................62Table D.4: Current attributes' performance.........................................................................63Table D.5: Shopping preference contributed by current attributes' performance................64Table D.6: Difference between current attributes' performance and very good performance

......................................................................................................................................65Table D.7: Difference between current attributes' performance and very bad performance

......................................................................................................................................66Table D.8: Difference between shopping preference contributed by very good performance

and shopping preference contributed by current performance.....................................67Table D.9: Difference between shopping preference contributed by current performance

and shopping preference contributed by very bad performance..................................68Table D.10: Attributes' characteristics.................................................................................69Table D.11: List of attributes in the order of preference gap...............................................71Table D.12: List of attributes in the order of improvement efficiency................................72Table D.13: Pair test for difference in improvement efficiency..........................................73

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CHAPTER 1: INTRODUCTION

1.1 RATIONALE OF THE RESEARCH

After more than 20 years of planned economy, Vietnam entered to the market economy with a lot of new kinds of business imported to the country. Among them, the concept of supermarket seems to be the one which has most impact on the lifestyle of Vietnamese. While the knowledge of supermarket quality receives many attentions from researchers in other countries, the specific knowledge on Vietnam’s situation is scarce. Saigon Co-op Mart is chosen for the research because it has the largest coverage in Ho Chi Minh City, the most dynamic city in Vietnam.

Saigon Co-op is a co-operative which used to operate in many businesses from manufacturing to trading, exporting and retailing. In the recent years, it has a strategic move from a diversified portfolio investment to focusing on retailing especially the supermarket chain. Many business units were divested for freeing resources to develop the supermarket chain. From the beginning, Co-op Mart gains a significant market share thank to be one of the first movers. However, it could not enjoy this advantage forever. Recently, the competition on this kind of business increases rapidly in term of quantity as well as quality. Many supermarkets have been opened with modern facilities and larger area in the last year. In the near future, the competition will be more intensive as the result of the penetration of foreign supermarket chain and the co-operation of other chains. For sustaining the market leader position, Saigon Co-op must improve its competitiveness and the basic for this competitiveness is quality. Quality leads to customer satisfaction and loyalty; satisfied and loyal customers are a source of increasing future purchasing then the firm long-term profitability and market share (Anderson, Fornell, and Lehmann, 1994).

On the other hand, for capturing the market quickly, Saigon Co-op Mart spreads its stores all over the city with very high speed. As the result, the operation and quality level of the stores are not unified. It creates a problem with customer perception of the brand. Moreover, it makes the co-operation among stores having problems and the operation of the whole chain is not effective. To overcome these problems, the management of Co-op Mart set up Co-op Mart Nguyen Dinh Chieu as the model for their next generation stores. After that, they standardize other stores based on this model.

The result of this research will give the company management a better understanding of the relationship between store’s performance and shopping preference of customers and also the perception of customer about Co-op Mart Nguyen Dinh Chieu. Consequently, they can have more precise and systematic decisions to improve the quality of Co-op Mart Nguyen Dinh Chieu. The result is not only the improvement of Co-op Mart Nguyen Dinh Chieu but also the improvement of the whole chain when they apply this model to other stores.

1.2 PROBLEM STATEMENT

The goal of this research is to provide the management of Saigon Co-op a better insight of Co-op Mart Nguyen Dinh Chieu quality in the perception of customer in order to improve its quality.

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1.3 RESEARCH OBJECTIVES

For more detail to drive the research activities, this goal could be broken down into a series of objectives:

Developing a new model to examine the quality of a service and set up priorities for quality improvement based on the influences of performance improvement on shopping preference of customers.

Identifying the attributes of a supermarket that affect perceived quality of customer and finding out how these attributes’ performance influence the shopping preference level of customers in an incremental manner.

Measuring customer’s perception about attributes performance of Co-op Mart Nguyen Dinh Chieu and how much these attributes contribute to shopping preference of customers.

Providing recommendations to improve Co-op Mart Nguyen Dinh Chieu’s quality in an efficient way: improving the right attributes in the right priorities based on the incremental contribution of these attributes performance to shopping preference of customers.

1.4 RESEARCH FRAMEWORK

Figure 1.1: Research framework

Studied attributes

Attributescharacteristics

Attributes'performance

Analysis

Quality attributes

Managementinterview

Previous research Focus group ofcustomer

Survey BSurvey A

Shopping preference

Managementinterview Observation

Recommendation

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Quality attributes of a supermarket are discovered through previous research and focus group of customers. Then an interview with the company management to decide which attributes will be studied. After that, two surveys will be conducted to collect primary data. The result of these two surveys will be used to characterize the attributes. On the other hand, the second survey will be used to measure Co-op Mart Nguyen Dinh Chieu’s attributes performance and how much this performance level contributes to shopping preference of customers. Based on these findings, some recommendations will be made to help company management improve their store’s quality.

Quality attributes are characterized, based on their impacts to shopping preference of customers. The concept underlies this method is twofold. Firstly, when an attribute is improved or declined, it does not affect shopping preference of customers by the same amount. Secondly, this difference is not the same for every attribute but each attribute has its own property. Some will have more impact on increase side and others will have more impact on decrease side.

1.5 SCOPE OF THE RESEARCH

The research excludes all other kinds of complementary businesses in the area of supermarket and focuses on supermarket business (self-service area) only.

The research focuses on three delivery processes of Co-op Mart which are believed to be main processes of a supermarket. They are preparation for shopping, self-shopping, and billing processes.

The research does not take into consideration the opinions of customers who visit supermarket less than 4 times in the year since they are assumed not to be familiar with this kind of shopping. In addition, customers who are under 15 are also excluded.

1.6 ORGANIZATION OF THE RESEARCH

Chapter 1(Introduction) provides an introduction including the rationale of the research, problem identification, objectives, research framework, scope of the research, and organization of the research report.

Chapter 2 (Co-op Mart introduction) presents the literatures of supermarket background and supermarket in Viet Nam and introduces the development, organization, and operation of Saigon Co-op and the Co-op Mart chain, especially Co-op Mart Nguyen Dinh Chieu store.

Chapter 3 (Development of Two-factor model) provides the literatures review of multi-attribute concept and quality measurement, especially the Servqual and Kano models. This chapter also presents the development of Two-factor model, which is to be used in this research to examine service quality of Co-op Mart Nguyen Dinh Chieu and set up priorities for quality improvement.

Chapter 4 (Research methodology) presents the information needed, target populations, questionnaire development, sampling procedure, and sample characteristics of the research.

Chapter 5 (Findings analysis and discussion) contains the discussion and analysis of findings from customer surveys as well as management interview and observation. Some recommendations are also discussed in this chapter.

Chapter 6 (Conclusion) draws out the conclusions for current perceived quality of Saigon Co-op Mart Nguyen Dinh Chieu, quality improvement strategy, and Two-factor model.

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CHAPTER 2: CO-OP MART INTRODUCTION

2.1 BACKGROUND OF SUPERMARKET

2.1.1 History and concept of supermarketThe supermarket was born in the US and was one of the most interesting innovations which has changed the retailing environment. Exact place and time it was born has been debated for many years. According to Peak H.S. (1977), most authors cite December 8, 1932 as the birth date of the supermarket when a new store called the Big Bear was opened in New Jersey. This store, along with other early supermarkets, was a child of the Great Depression. Economic conditions were such that the price was all-important, and every penny counted.

The lower price in supermarkets is the result of low-margin operations that depend on very high stock turnover rates to sustain profits. Operation out of clean, modern facilities, the supermarket is basically a self-service operation supported by such services as parking, check cashing, fast check out, and bagging. Cash and carry is the preferred method of doing business (Lewison, 1994).

The supermarket was generally accepted as the food retailer until the years 1970s. By the end of 70s, the changing lifestyle of the customers focused on convenience had led some operators to a “one-stop-shopping-for-household-goods” supermarket. The emphasis on one-stop shopping and the adding of new departments and sections has continued up till now (Peak, 1977). Today, a supermarket’s upgraded and upscale operations include such non-food lines as prescription medicines, electronic appliances, auto accessories, books, magazines, clothing, flowers, and house ware. Moreover, many supermarkets have added numerous services including dry cleaning, postal, banking, tailoring, medical, dental, insurance, and legal services.

No one definition of a supermarket exists because of the wide range of business formula used in this industry. There are three criteria used to define a supermarket: the minimum size requirement, the characteristics and extent of self-service, and the stock requirements. In the US, a supermarket was firstly defined by the Supermarket Institute as a self-service departmentalized food store having a minimum sales volume of $250,000 per year. In 1954, the sales volume was revised to $500,000 (Charvar, 1961 and McCleland, 1963). Prior to 1981, supermarket included food stores with annual sales of at least $1 million. Recently, the minimum annual sales requirement is $2 million (Lewison, 1994). In the UK, a supermarket is defined as a self-service food store with centralized checkouts and a sales area of over 2,000 square feet (Khalifa Othman, 1990).

In the US, supermarkets, using 80% of retail food industry’s personnel, account for about 90% of all retail food sales (Peak, 1977). In the UK and Canada, supermarkets and large superstores account for about 85% of grocery trade. Similarly in other European countries, supermarkets dominate the food retailing system (Khalifa Othman, 1990).

2.1.2 Supermarket in Viet NamIn general, Vietnamese perceives that the store offering self-service, having fixed price labels and electronic checkout as a “supermarket” (Thu Huong, 1997, p.33). In her research, Thu Huong (1997) reached the conclusion that most of the people (94.9%) consider a store as a “supermarket” because of its self-service characteristic, which is

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pretty new for Vietnamese shoppers. Many customers cite self-service as a positive side of the store, because shoppers can enjoy free choice and comparison among brands, and can avoid the high pressure selling which is normal practice in other traditional stores. Fixed pricing is also thought as a sign of a “supermarket” by nearly 85% of customers. More than half of the customers point out that a “supermarket” should have electronic checkout. In addition, nice and convenience product displays are also considered as one attribute of a “supermarket” by 40% of customers.

In contrast with supermarket concept used in developed countries which is characterized by a large volume, multi-line store that serves mass market at competitive prices, the supermarkets in Viet Nam are more expensive than traditional outlets, and tend to cater the middle and upper class customers. The supermarkets are still fairly basic in terms of design, range and service, but they are a far cry from the small and congested roadside stalls. Different with traditional markets, supermarkets have well designed interior and shopping comforts such as air conditioning, cold storage, and electronic checkouts. They offer self-service, high quality goods at fixed prices. The merchandise mix is mainly household amenities and personal care products, ready-to-eat foods, confectionary and cooking materials, as well as footwear, clothing and some durable products (Thu Huong, 1997, p.41).

According to Tu Giang (1999), most of Vietnamese have not been similar with shopping in supermarket. There are 78% of customers in Ho Chi Minh City and 66% of customers in Ha Noi who thought that the price in supermarket is higher 5%-10% than that in other outlets. Shopping frequency in supermarket is very limited. In developed countries, 80% of customers go to supermarket every week. This number in Viet Nam is 12% in Ho Chi Minh City and 8% in Ha Noi. As a result, proportion of sales volume which is sole through supermarket is very low, just about 5% of total retail volume in Viet Nam.

Figure 2.1: Proportion of merchandises sold through supermarket1

However, year 2001 begins a new era for supermarket in Viet Nam. The shopping area of supermarket is larger, the product lines and brands are more varied, services are better, and especially, the price will be cheaper due to fierce competition and efficient operation.

1 Source: AC Nielsen (1999).

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Demand for supermarket is more and more increasing. The number of customers who go to one supermarket for shopping increases from hundreds per day to 5 thousands per day in average. Especially, Mien Dong Supermarket and Maximart received 20,000 customers per day in opening days after off days for extent. In addition, the average value of one bill increases from 50,000VND to 200,000VND. The number of above 1 million VND bill also increases (Chanh Khai, 2001). Moreover, the traffic condition in big cities of Viet Nam is worse and worse. As a result, one-stop shopping will be preferred more and more because customer will avoid traveling from store to store for shopping. For conclusion, the development of supermarket is the indispensable trend in big cities of Viet Nam.

2.2 CO-OP MART INTRODUCTION

2.2.1 Saigon Co-opIn 10/1975, Co-operative of Ward Cay Sung District 7 (recent name is Trading Co-operative of Ward 14 District 6) was founded. It opened the movement of co-operatives in Ho Chi Minh City. Many co-operatives were founded in other districts. For accelerating the foundation and operation of co-operatives, Propaganda Board for Consumer Co-operatives and Trading Co-operatives was founded on 20/06/1976. In 04/1978, the Propaganda Board was renamed to Management Board of Consumer Co-operatives and Trading Co-operatives. The main function of Management Board was to organize and guide the operation of co-operatives in Ho Chi Minh City.

From 1989, under the influence of social and economic reform process (Doi Moi), many member co-operatives were disintegrated, merged, or reformed because of the fierce competition of other forms of business organization. At that time, there were only 7 member co-operatives under the management of Management Board. To reinforce the co-operative segment, The Union of Trading and Service Co-operatives of Ho Chi Minh City (Saigon Co-op) was founded in 05/1989 based on resources of Management Board and member co-operatives.

Recently, Saigon Co-op operates in many areas as following:

Supermarket: Co-op Mart chain is the most well-known supermarket chain in Ho Chi Minh City with 6 stores. It will be discussed more deeply in next sections.

Mini mart: Saigon Co-op has just started to develop a mini mart system (mCo-op Mart) in the form of joint ventures with other local co-operatives. Up to now, 2 stores were opened in Ho Chi Minh City; mCo-op Mart Cao Thang is a joint venture with Wards 2-4-5 Co-operative and mCo-op Mart Cau Kinh is a joint venture with Cau Kinh Co-operative. These stores supply daily necessities to customer such as food-grains, foodstuffs, health care products, and family used items, etc. The competitive advantage of this kind of mart is the convenience for customer because the mart is located in residential area.

Distribution agent for other companies: distributing and selling domestic products and imported products all over the country.

Manufacturing: Nam Duong sauces with brand name “Con Meo Den” was elected as Viet Nam high quality product during 4 successive years from 1997 to 2000. Nam Duong sauces are distributed and sold all over the country and exported to European, American, and Russian markets.

Export: agricultural products, aquatic products, seafoods, processed foods, textile, garment, leather products, and handicraft.

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Import: raw and working materials (such as plastic, textile, and chemical), foods, machine, motorcycle, auto, and consumer’s goods.

Services: besides tourism services of Saigon Co-op tourism center, Saigon Co-op also provides other services such as advertisement, foreign exchange but not well developed till now.

Dong Khoi computer center: trading computer, computer parts, maintenance, and installing software.

Figure 2.2: Saigon Co-op organization chart

Committee of memberco-operatives

Board of management

Board of directors

Inspection section

R&D Domesticbusiness Marketing Import/

export Accounting AdministrativeTechnical-Project

Co-op Mart chain

Co-op Mart Cong Quynh

Co-op Mart Tran Hung Dao

Co-op Mart Nguyen Dinh Chieu

Co-op Mart Dinh Tien Hoang

Co-op Mart Dam Sen

Co-op Mart Hau Giang

Distribution agentfor other companies

Nam Duong saucesfactory

Services

Nhat Nam tradingcenter

mCo-op Mart chain

Saigon Co-op tourism center

Advertisement services

Foreign exchange services

Ben Thanh tradingstore

Dong Khoicomputer store

Joint-ventures

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Ben Thanh trading store: trading textile and garment with fixed price.

Nhat Nam trading center: this is a joint venture of Saigon Co-op and Hasegawa Company (Japan). In addition to a supermarket, it has many departments for rent.

However, the strategy for long-term development of Saigon Co-op is to develop the Co-op Mart chain. It is the core business of Saigon Co-op in future.

2.2.2 The development of Co-op Mart chainIn 1993, some supermarkets were established in Ho Chi Minh City such as Maxi Mart, Citi Mart, etc. These events created a new kind of shopping behavior of customer in Ho Chi Minh City. Operating in retailer segment, Saigon Co-op realized the necessary of development a supermarket chain. It was also the opportunity to develop and diversify the operation.

Co-op Mart Cong Quynh is the first store of Co-op Mart Chain. It was founded on 01/06/1996 with operating area of 732 m2 and investment fund of 6,530 billion VND. Based on the very good result of the first year, Saigon Co-op decided to develop the Co-op Mart chain by founding some more stores after many carefully done market researches. Recently, Co-op Mart Chain has 6 stores placed in Ho Chi Minh City. As the common trend, the operating area of the store is increasing.

Table 2.1: Co-op Mart stores2

Store name Address Founded date

Shop-Area

Co-op Mart Cong Quynh 189c Cong Quynh, dist. 1 09/02/1996 760 m2

Co-op Mart Tran Hung Dao 727 Tran Hung Dao, dist. 5 30/04/1997 1200 m2

Co-op Mart Hau Giang 188 Hau Giang, dist. 6 05/01/1998 1272 m2

Co-op Mart Dam Sen 3 Hoa Binh, dist. 11 16/12/1998 2060 m2

Co-op Mart Nguyen Dinh Chieu

168 Nguyen Dinh Chieu, dist. 3

31/12/1999 2620 m2

Co-op Mart Dinh Tien Hoang 127 Dinh Tien Hoang, dist. Binh Thanh

26/01/2000 2938 m2

The vision of Co-op Mart is: “Co-op Mart is a trustworthy shopping center for everyone with high quality goods, reasonable price, and hospitable services”.

For achieving the vision above, Co-op Mart started to implement following strategies and movements:

Standardizing the operation of the stores in Co-op Mart chain.

Opening new stores in many important areas in Ho Chi Minh City and other provinces.

Considering the market price and implementing direct procurement from foreign and domestic suppliers to establish a reasonable and competitive pricing policy.

2 Source: Ho Chi Minh City Commerce Service, List of Supermarkets & Trading Centers in Ho Chi Minh City, 07/2000.

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Establishing the center warehouse and distribution center, standardizing the procurement procedures, and selecting suppliers to standardize product quality, price, and product coding.

Increasing promotion campaigns and advertisement.

Developing “Khach Hang Than Thiet” program (friendly customer) to increase the quantity and quality of loyal customer.

Computerizing all of the operation and management in Co-op Mart Chain.

Standardizing the labor force and preparing the labor force for future development.

Figure 2.3: Old procurement procedure

Figure 2.4: New procurement procedure

2.2.3 Co-op Mart Nguyen Dinh ChieuAs the result of the fast development, the operation of Co-op Mart stores was different from store to store. Realizing the necessary of standardization in supermarket chain, management of Co-op Mart is trying to construct a suitable model for supermarket then standardize the supermarket chain based on this model. Therefore, they establish the new store based on the experience of old stores and learning from other domestic and foreign supermarket then synchronize the whole chain with the new store. Co-op Mart Nguyen Dinh Chieu is the one.

Opened on 31/12/1999 with operating area of 2620 m2, Co-op Mart Nguyen Dinh Chieu is the flagship of Co-op Mart chain. Applying the newest techniques, arrangement, and procedures, Co-op Mart management attempt to position this store as a model for the next generation of supermarket in Viet Nam. In case of success, other Co-op Mart stores will be reformed as this model.

Information

Order 30% items

Goods

Order 70% itemsSuppliers

Domestic business departmentCo-op Mart stores

Supplier 2

Distribution Center

Co-op Mart store 1 Co-op Mart store 2 Co-op Mart store 3

Supplier 1 Supplier 3

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Figure 2.5: Co-op Mart Nguyen Dinh Chieu Organization chart

Director

Securitysupervisor

Marketingstaff

Cashiersupervisor

Officesupervisor

Vice-director for groceries Vice-director for foods

Operatingmanager

Operatingmanager

Warehousesupervisor

Salessupervisor

Warehousekeepers

Salespeople

Warehousesupervisor

Salessupervisor

Warehousekeepers

Salespeople

Securities

Vehiclekeepers

Cashiers Administrator

Accountant

Treasurer

Office staffs

Figure 2.6: Co-op Mart Nguyen Dinh Chieu sales volume (2000)3

After one year of operation, the performance of Co-op Mart Nguyen Dinh Chieu was quite good. The sales volume per m2 of Co-op Mart Nguyen Dinh Chieu was higher than other stores in the chain (except Co-op Mart Cong Quynh, the first store of Co-op Mart). After the intensive promotion campaigns when opening and the peak shopping season of Tet (Lunar New Year) in the first quarter, the sales volume was increasing from the second quarter to the last quarter of year 2000 dramatically.

3 1USD = 14500VND (03/2001)

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2.2.4 CompetitionThe competitors of Co-op Mart chain are other supermarkets and other kinds of retailer such as traditional market and grocery. However, supermarket has some special characteristics which are different from others, for example, fixed price, self-service, highly merchandise concentration, cleanliness, etc. Therefore, the direct competitors of Co-op Mart are other supermarkets.

Table 2.2: List of Co-op Mart’s direct competitors

Store name Address Shop-Area(m2)

No. of items

Cora Dong Nai 11C4KP1 Long Binh Tan, Bien Hoa, Dong Nai

20,000 20,000

Cora An Lac 354 Hung Vuong, dist. Binh Chanh

Under construction

N/A

Maximart Le Loi 65 Le Loi, dist.1 2,734 22,000

Maximart 3/2 3C 3/2, dist. 10 12,000 22,000

Citimart 21-23 Nguyen Thi Minh Khai, dist.1

200 10,000

Citimart Minh Chau 369 Le Van Sy, dist. 3 2,900 10,000

Citimart 39 Le Duan, dist.1 3,000 20,000

Minimart 95-101 Nam Ky Khoi Nghia, dist. 1

600 10,000

Minimart Superbowl A43 Truong Son, dist. Tan Binh

835 15,000

International Trading Center 95-101 Nam Ky Khoi Nghia, dist. 1

14,876 15,000

Thuong Xa Tax 135 Nguyen Hue, dist.1 7,500 20,551

Pacific Mart 8B 3/2, dist.10 750 21,440

Foodcomart 1 3/2, dist. 10 1,356 15,000

Tenmart 277B Cach Mang Thang Tam, dist.10

2,000 15,000

Mien Dong Supermarket 202B Hoang Van Thu 8,000 10,000

Ha Noi Supermarket 189 Cong Quynh, dist.1 1,000 20,000

In Ho Chi Minh City (and Cora Dong Nai in Bien Hoa), there are 16 supermarkets of 11 supermarket chains (excluding Co-op Mart) have considerable scale. Among them, there are three redoubtable competitors: Cora (Bourbon), Maximart, and Mien Dong Supermarket. All of the three have considerable larger operating area than Co-op Mart stores.

Cora: Bourbon Corporation (France). Although Cora Dong Nai is the only operating supermarket, Cora will develop fast with Cora An Lac and another one in district 10 are in construction. With a strong financial fund and the support from Bourbon Corporation, they

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can spend a lot of money in marketing, promotion campaigns and lower the price to gain more market share. In addition, the experience in supermarket business and good management skills help them operate more efficient and professional.

Maximart: there are many product lines and varieties as well as brand names, especially in imported products. Other strengths of Maximart are good management skills and low tax.

Mien Dong Supermarket: the operating area is large and having ability to extent. There are many product lines and varieties as well as brand names. The price is lower than other supermarket.

In addition, there is the threat of merger of other supermarket into a bigger supermarket chain. Especially, the intention of the co-operation and might be merger of Maximart, Citimart, and Mien Dong Supermarket into the biggest supermarket chain in Ho Chi Minh City.

For survival and development in such a fierce competitive environment, Co-op Mart positions itself as the most coverage supermarket chain with standardized service and price by establishing many supermarkets with average operating area cover a large region. The first step of standardization is to establish the flagship store then synchronize the whole chain. Co-op Mart Nguyen Dinh Chieu is to be the one.

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CHAPTER 3: DEVELOPMENT OF TWO-FACTOR MODEL

In this research, a new model is developed to examine service quality of Co-op Mart Nguyen Dinh Chieu and set up priorities for quality improvement. Although many textbooks introduce Servqual as a prefer model to measure service quality, it faces a lot of criticisms from literature as well as empirical testing. In addition, its managerial implication is also challenged. Therefore, based on the ideas of the relationship of two quality constructed components and incremental effect of Kano model, an alternative model is designed. As Servqual and Kano models, this model is also a multi-attribute model, which provides more insight to managers and researchers than an overall effect model. Before developing the new model, multi-attribute concept, Servqual model, and Kano model are reviewed.

3.1 REVIEW OF MULTI-ATTRIBUTE CONCEPT

According to Wilkie and Pessemier (1973), in multi-attribute models, a service (or product) is viewed as a bundle of benefits and costs. The potential advantage of multi-attribute models over the simpler “overall effect” approach is that yields understanding and feasible improvement direction. A model which cannot help analysts gain these things is prone to be theoretically vacuous. Attributes provide the basic dimensionality of the model. However, the weakness of the construct in this model is that attributes are perceptual rather than objective product construct, that reasonable candidate lists can be generated by combining unstructured interviews. Each attribute has two measures, importance weight and belief rating. Both of them are presumed to add explanatory power; belief rating contribute product differences while importance weight provide differential stress on attributes.

For applying this kind of models, a service (or product) will be divided into many attributes. Based on customer perception about each attribute, the measurement will be conducted. By doing that way, researcher could understand deeper the construct of quality then know how to improve the quality perception of customer by improving each attribute performance.

Many multi-attribute models were designed to measure service quality up to this time such as Servqual (Parasuraman, Zeithaml, and Berry, 1985, 1988, 1991), Servperf (Cronin and Taylor, 1992), Evaluated performance (EP) model and Normed quality model (Teas, 1993). Among them, Servqual is the most well known one in textbooks. In addition, Kano quality model is also a multi-attribute model even though it is a quality identification model rather than a quality measurement model. The next sections will present Servqual and Kano models as the bases to develop Two-factor model.

3.2 REVIEW OF SERVQUAL MODEL

3.2.1 Quality definitionThe concept of Servqual model is generally based on gap theory of Parasuraman, Zeithaml, and Berry (1985), which suggests that “the difference between customers’ assessment of the actual performance of a specific firm within a general class of service providers and their expectation about the performance of that class (P-E gap) drives the perception of service quality.”

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3.2.2 Servqual dimensionsAccording to its developers, Servqual instrument consists of 22 attributes which can be classified into 5 dimensions: tangible, reliability, responsiveness, assurance, and empathy (Parasuraman, Berry, and Zeithaml, 1988).

Tangibility dimension: because of the absence of a physical product, customers often rely on the tangible evidence that surrounds the service in forming evaluation. This dimension includes variety of objects such as desks, lightning, wall color, brochures, appearance of firm’s personnel, etc.

Reliability dimension: reflects the consistency and dependability of a firm’s performance. Does the firm provide the same level of service time after time, or does quality dramatically vary with each encounter? Does the firm keep its promises, bill its customers accurately, keep accurate records, and perform the service correctly the first time?

Responsiveness dimension: reflects the commitment of a firm to provide its service in a timely manner. This dimension concerns the willingness and readiness of personnel to provide a service. It reflects the preparedness of the firm to provide the service.

Assurance dimension: addresses the competence of a firm, the courtesy it extends to its customers, and the security of the service. This dimension refers to how a firm’s personnel interact with customers and customers’ possession such as courtesy reflects politeness, friendliness, and consideration for the customers’ property.

Empathy dimension: is ability of the firm’s personnel to experience customers’ feeling as their own. Empathic firms understand their customer needs and make their service accessible to customers.

3.2.3 Servqual questionnaireServqual questionnaire includes 22 pairs of question designed to capture the perception of customer about their expectation toward 22 attributes of a service and their perceived performance of these attributes. These pairs of question have the same format according to Parasuraman, Berry, and Zeithaml (1991):

Expectation: Excellent company will have “attribute 1” (attribute 2, 3, .., 22).

Performance: XYZ company has “attribute 1” (attribute 2, 3, .., 22).

3.2.4 Managerial implicationThe bigger the gap between attribute performance and customer expectation of the attribute is, the lower the quality is. Therefore, there is more improvement needed for this attribute rather than others. As a result, the priorities for improvement are associated with the magnitude of P-E gaps. The larger the P-E gap is, the more benefits can be gained by closing the gap and the higher priority to improve the attribute has.

3.2.5 Critiques for Servqual modela) Reliability and dimensionality of 5-dimension structure

The reliability tests of Cronin and Taylor (1992) in four industries (banks, pest control, dry cleaning, and fast food) prove that the 5-dimension structure of Servqual is not confirmed in any of research samples. The chi square statistic universally indicates a poor fit between the theoretical and measurement model for 5-dimension structure. The adjusted goodness-

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of-fit indices are also not indicative of a good fit. In addition, the dimensional test indicates that 22 attributes are unidimensional or they are considered as one composite of individual measures.

From the testing results above, Cronin and Taylor suggest that the dimensional structure of quality measures and quality attributes should be constructed flexibly according to specific industry. Five-dimension structure of Servqual has a conceptual meaning rather than a framework to design a practical research.

b) Validity of Servqual measures

The primary threat to validity of Servqual measures is construct validity. Carmines and Zeller (1979, p.23) state, “fundamentally, construct validity is concerned with the extent to which a particular measure relates to other measures consistent with theoretically derived hypotheses concerning the concepts (or constructs) that are being measure”. The validity test of Cronin and Taylor (1992) suggests that the performance-based measures provide a more construct-valid explication of service quality than Servqual measures because of their content validity. In addition, the findings of Kenneth Teas’ empirical test (1993) prove that evaluated performance measurement framework is characterized by higher validity than P-E framework.

Hence, the attributes performance is measured in this research rather than the P-E gaps.

c) Priorities for improvement

The managerial implication of Servqual model implies that the improvement of an attribute which has bigger P-E gap will provide more benefits than improvement of an attribute which has smaller P-E gap so the former has higher priority to improve. The results of this research will prove that this implication is not always valid. In case of some attributes, the improvement is not worth even though the performance gap is large.

3.3 REVIEW OF KANO MODEL

3.3.1 Quality definitionIn JIS (Japanese Industrial Standards) Z8101, quality is defined as “the totality of quality characteristics, or level of performance, that determines whether a product or service satisfies the purpose of use” (Kano, 1996, p.114).

Quality concept is divided into 2 components, performance and satisfaction. Having more meaning than quality definition in Servqual, this definition does not stop at performance measure (performance is not a benefits related factor) but it goes further, this performance must contribute to customer satisfaction in order to be defined as quality. This definition links quality concept with customer benefits.

3.3.2 Kano diagramIt is clear that companies should provide service (or product) with high quality and it is easy to understand that higher service (or product) performance can result in higher customer satisfaction. However, the relationship between customer satisfaction and service (or product) performance is more complicated than this. For some attributes, customer satisfaction can be greatly improved only with a small improvement of performance; while, for some other attributes, customer satisfaction can only be improved a little even when the performance of the service (or product) has been greatly improved. Thus, the

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deep understanding of this relationship is the prerequisite to achieving customer satisfaction.

For the above purpose, Kano have developed a very useful diagram to characterise customer needs. This diagram is a tool in the field of R&D for development new products and services, especially in the integration with Quality Function Deployment (QFD) (Shen, Tan, and Xie, 2000). It devides service (or product) features into three distinct categories, each of them affects customer satisfaction in a very different way:

Must-be attributes: customer take them for granted when fulfilled. However, if the service (or product) does not meet this basic need sufficiently, the customer may become very dissatisfied.

One-dimensional attributes: these attributes result in customer satisfaction when fulfilled and dissatisfied when not fulfilled. The better the attributes are, the better the customer like them.

Attractive attributes: the absence of attractive attributes does not cause dissatisfaction because they are not expected by customers who may be unaware of such service (or product) features. However, strong achievement in these attributes delights customer.

Figure 3.1: The Kano diagram

In addition to three main categories above, Kano introduced two more categories (Kano, 1996, p.130) to cover all posible attributes:

Indifference attributes: an increase or decrease in performance level does not make any difference. However, it is very hard to have an absolute indifference attribute. Usually, an attribute has some effects, more or less, on some customer.

Adverse attributes: an increase in performance level results in customer disatisfaction, and a decrease results in satisfaction. These attributes are nothing than the oppositions to three main categories.

Satisfaction

Must-be

Attractive

One-dimensional

Performance

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To conclude, in Kano model, the measurements of performance level and customer satisfaction are distinct. Moreover, the relationship of these two measurements is not always linear but may be convex.

3.3.3 Kano questionnaireKano devised a questionnaire (Rao, Carr, Dambolena, Kopp, Martin, Rafii, and Schlesinger, 1996, p.400-401) that helps categorize the different attributes by using pairs of opposite questions, each with five possible responses. For example, an attribute about availability of brand choice in supermarket may be questioned as:

If there are many brands for one product in the supermarket, how do you feel?1. I like it that way2. It must be that way3. I am neutral4. I can live with it that way5. I dislike it

If there is only one brand for one product in the supermarket, how do you feel?1. I like it that way2. It must be that way3. I am neutral4. I can live with it that way5. I dislike it

In this kind of questionnaire, one question deals with the attribute in a positive manner, and the twin deals with negative manner. The responses are compiled to categorize the attributes as following table:

Table 3.1: Kano questionnaire combination table

Negative

1 2 3 4 5

Posi

tive

1 Q A A A O

2 R I I I M

3 R I I I M

4 R I I I M

5 R R R R Q

Majority of the responses for a specific pair are in cell:

“A”: attractive attribute.

“O”: one-dimensional attribute.

“M”: must-be attribute.

“I”: indifference attribute.

“R”: adverse attribute.

“Q”: some customers would like the attribute to be present and also not to be present. This probably indicates that the item for the response was improperly formulated.

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3.3.4 Managerial implicationThe priorities for improvement should be from must-be attributes to one-dimensional attributes then attractive attributes at last (Rao, Carr, Dambolena, Kopp, Martin, Rafii, Schlesinger, 1996, p.402). In addition, there are some more specific managerial implications:

For must-be attributes: they must reach the threshold where the improvement of performance does not gain any increase in customer satisfaction or the increase is not considerable. However, if they do not reach this threshold, the customer will terribly dissatisfy.

For one-dimensional attributes: the more we can improve them, the better the customer satisfaction.

For attractive attributes: a little improvement of these attributes might increase the customer satisfaction dramatically but the absence of them will not be recognized by customer.

3.3.5 Critiques for Kano modela) Qualitative vs. quantitative analysis

The measurement in Kano model is qualitative rather than quantitative. It is used to classify quality attributes into five categories but it cannot distinguish quality attributes within each categories. Therefore, all of attributes in one category are treated identically. As a result, the analyst cannot make the specific recommendation for each attribute. Moreover, the difference among attributes within one category may be very significant. For instance, in one-dimensional category, the steeper the attribute, the more meaningful to improve the attribute. In Kano model, all one-dimensional attributes are the same and the steepness of attribute is ignored. Similarity to other categories, the steepness and the convexity of attributes are ignored in each category.

b) Too much indifference attributes

A large proportion of attributes might fall into indifference category due to the large number of indifference cells in the Kano questionnaire combination table (9/25). It leads the analyst to ignore many attributes. In fact, an absolute indifference attribute is scarce. An attribute usually has more or less impact into the perception of the customer. The attribute which is called indifference is the one that has less impact than others. The wider the range of indifference attributes in the model, the bigger the chance to ignore a meaningful attribute. In addition, the central tendency bias in responses makes this problem more seriously.

c) Quality identification vs. quality measurement

The Kano model is used to identify the quality perception of customer about a service (or product), not to measure the quality of this service (or product). In the model, quality attributes are classified into different categories but perception of customer about quality level of a specific service (or product) is not measured. This is the reason why Kano model has not been used in previous quality measurement research. In fact, this model is used widely in service (or product) development in which the service’s (or product’s) attributes are designed according to their categories.

However, the ideas of measuring the relationship between product performance level and customer satisfaction and incremental affect concept in Kano model are very interesting.

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The next section will be dedicated for developing the model which is to be used in this research.

3.4 PROPOSED TWO-FACTOR MODEL

In this section, a new model is developed to examine a service quality and set up priorities for quality improvement. This model, called “Two-factor model”, will overcome some shortcoming of Servqual and Kano models as following discussion.

On one hand, Servqual model faces with some critical problems as discussion in the second section of this chapter:

Firstly, the 5-dimension structure of attributes is not reliable and the dimensional property of this structure is also weak (Cronin and Taylor, 1992). Other quality measurement models such as Servperf model, Evaluated performance model, and Normed quality model also face this problem due to using the same dimensional structure. Hence, it is not necessary to apply this structure into quality measurement model. Using the interview or focus group to explore quality attributes of a specific product or service as in the basic of multi-attribute models (Wilkie and Pessemier, 1973) may be a flexible alternative in which the characteristics of a product or service are reflected more specifically.

Secondly, using P-E gap to measure quality is worse than using performance in validity tests (Cronin and Taylor, 1992, and Teas, 1993). It is suggested that the new model should be a performance measurement base rather than P-E gap measurement base.

Thirdly, the implication of using P-E gap to determine priorities to improve is challenged. It is necessary to add one more component in the model to make sure that the improvement of performance will cause the improvement of firm benefit.

On the other hand, Kano model is not a quality measurement model but it is a qualitative model to determine the relationship of attribute performance and customer satisfaction in an incremental manner. However, this idea opens a new approach to measure quality which overcomes the third weakness of Servqual.

In conclusion, a new model is proposed to overcome the weaknesses of Servqual. Based on the concept of the relationship of two quality constructed components in an incremental manner of Kano model, Two-factor model is designed as a performance base quantitative model to examine quality by measuring attributes performance and a firm’s benefit related factor and it also determines the relationship between them. Moreover, it could be used to set up the priorities for quality improvement.

3.4.1 Executive quality definitionThe proposed Two-factor model is based on the similar quality definition of JIS (Japanese Industrial Standards) Z8101 as Kano model because it is also constructed by two quality components. However, for practical purpose, this definition is somewhat modified. Satisfying the purpose of use is conceptually a customer benefit. It is easy to agree that customer satisfaction has positive relationships with customer loyalty, purchase intention, and shopping preference, which are the benefits of the firm (Anderson, Fornell, and Lehmann, 1994) but “how strong are these relationships?” is a difficult question to answer.

For associating quality concept directly with the firm benefits to bypass the question above, we should go further by replacing satisfaction factor with one of the firm’s benefit

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related factors, shopping preference. Therefore, the quality definition is modified as: “the totality of quality characteristics, or level of performance, that determines the shopping preference of customers toward a product or service”.

Besides, using this executive definition could gain more interest of managers, who are interested in the firm benefits, to improve quality. The reason is that quality improvement has direct effect on shopping preference of customers toward their product or service.

According to the definition above, quality is constructed by the totality of product or service’s attributes performance which contributes to shopping preference of customers. Therefore, a model for quality examination must satisfy four requirements: Total measuring. Measuring the performance level (the first factor). Measuring the shopping preference of customers contributed by this performance level (the second factor). Identifying the relationship between two factors above.

To ensure that total quality characteristics are measured, Two-factor model must be a multi-attribute model. Idea of relationship of two factors in an incremental manner from Kano model is used to found the model. Instead of the relationship of attribute performance and customer satisfaction as in Kano model, the relationship in Two-factor model is of attribute performance and shopping preference of customers. Nevertheless, the concept of the relationship is the same. For some attributes, shopping preference of customers can be greatly improved only with a small improvement of performance; while, for some other attributes, shopping preference of customers can only be improved a little even when the performance of the service or product has been greatly improved. In addition, this relationship is not always linear but can be convex.

Based on the quality concept in this section, an analytical framework is developed in following sections.

3.4.2 Characteristic curve and managerial implicationFigure 3.2: Three basic shapes of characteristic curve

Shopping preference

Linear

Negative convex

Positive convex

Performance

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In Two-factor model, each attribute is presented as a curve called “characteristic curve” in two-dimensional co-ordinates. The horizontal axis represents performance level of an attribute and the vertical axis represents the shopping preference of customers contributed by this performance level. The characteristic curve has three basic shapes: negative convex curve, straight line (linear), and positive convex curve. In order to determine the shape of the curve, three points are needed. Information of these three points comes from two surveys:

Survey A is used to measure shopping preference contributed by very good performance and by very bad performance of each attribute. For this purpose, the questionnaire of this survey consists of pairs of one extremely positive question and one extremely negative question.

Survey B is used to measure performance level of each attribute of studied product or service and shopping preference contributed by this performance level. The questionnaire of this survey is constructed of two sets of questions, one for performance level and one for shopping preference contributed by this performance level.

From the response of survey A, two extreme points are determined. Horizontal coordinates of these two points are very good (positive point) and very bad (negative point) performance level of an attribute and vertical coordinates are respective shopping preference of customers contributed by these performance levels. The third point (current point) comes from the response of survey B. Its coordinates are performance level of studied product or service in an attribute and shopping preference of customers contributed by this performance level.

Figure 3.3: Structure of characteristic curve

Characteristics of an attribute could be derived from characteristic curve as following:

The more linear the curve is, the more symmetrically the attribute performance affects shopping preference of customers. This kind of attribute is called “linear attribute”.

The more positive convex the curve is, the more significantly the attribute performance affects shopping preference of customers on the decreasing direction than that on the increasing direction. This kind of attribute is called “positive convex attribute”.

Shopping preference

Current point

Negative point

Positive point

Performance

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The more negative convex the curve is, the more significantly the attribute performance affects shopping preference of customers on the increasing direction than that on the decreasing direction. This kind of attribute is called “negative convex attribute”.

The steeper (positive or negative) the curve is, the more shopping preference is sensitive (positive or negative) to performance improvement.

The higher the curve is, the more it contributes to shopping preference of customers.

The current point represents the current situation of studied service (or product) at each attribute. Its horizontal coordinate indicates the current perceived performance of this attribute and its vertical coordinate indicates the shopping preference of customers contributed by this level of performance. The negative point represents the worst case of an attribute when its performance is very bad. In contrast, the positive point represents the best case of an attribute when its performance is very good.

Based on the relative position of current point compared with positive point on the characteristic curve and the shape of characteristic curve, we can answer the question “how would we gain in shopping preference of customers if a specific attribute performance is to be improved?” In general, the attribute which has steepest angular co-efficient at current point will be in the first priority for improvement because shopping preference of customers is most sensitive with this attribute.

Similarly, the relative position of current point compared with negative point and the shape of the characteristic curve indicates that “how would we lose in shopping preference of customer if a specific attribute performance is to be decreased?”

For conclusion, characteristic curve determines the relationship between shopping preference of customers and a specific attribute performance in an incremental manner. Together with current point, negative point, and positive point, the shape of characteristic curve uncovers the behavior of shopping preference of customers if a specific attribute performance increases or decreases from current performance.

3.4.3 Two-factor model’s coefficients and managerial implicationIn addition to graphical evaluation, there are two measures which indicate the priorities for improvement:

Firstly, preference gap (difference between shopping preference level contributed by very good performance and shopping preference level contributed by current performance) of an attribute is used to measure the potential for shopping preference improvement which can be achieved by improving the attribute performance. The larger the preference gap is, the more benefits the firm can gain in term of shopping preference of customer toward its product or service by improving the attribute performance.

Secondly, improvement efficiency (preference gap divided by performance gap –the difference between very good performance and current performance) of an attribute is used to measure the efficiency of shopping preference improvement by improving attribute performance. It is the average angular co-efficient of characteristic curve from current point to positive point. Hence, it indicates the improvement priorities of attributes performance. The higher the improvement efficiency is, the more shopping preference amount the firm gains by improving a certain amount of attribute performance.

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Figure 3.4: Two-factor model’s coefficients

As a result, the higher the improvement efficiency is, the higher the priority for performance improvement the attribute has. Moreover, attributes which have low improvement efficiency but high preference gap are the reserve sources for improvement in term of shopping preference when all of high efficient attributes reach their potential so the firm cannot gain any amount of shopping preference of customer by improving them.

However, the efforts and resources needed for performance improvement vary from attribute to attribute. For some attributes, it is very easy and cheap to improve the performance. In contrast, it is very difficult and expensive to improve some attributes performance. For detailed improvement program, this factor must be considered and an action plan with cost/benefit analysis should be conducted. This research model focuses mostly on benefit side (shopping preference of customers).

3.4.4 Critiques for Two-factor modela) The determination of characteristic curve

By using three points in two dimensions co-ordinates as the method described above to construct characteristic curve, the shape of characteristic curve is determined rather than the exact curve. However, it is good enough for the analysis in this research because the needed information is the shape of characteristic curve and three critical points: negative point, current point, and positive point.

b) The accuracy of improvement efficiency

The improvement efficiency is the average angular coefficient of characteristic curve from current point to positive point. Therefore, it does not determine exactly the efficiency of performance improvement at current point but it determines the average efficiency of

Improvement efficiency

Performance

Performance gap

Preference gap

Shopping preference

Current point

Positive point

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performance improvement from current performance to very good performance. If the attribute performance does not improve thoroughly to very good performance, this coefficient will be less accurate. In addition, the more convex the curve is (from current point to positive point), the less accurate the improvement efficiency is because the convexity leads to the variety of angular coefficient from current point to positive point. If the characteristic curve is degenerated to be a straight line, improvement efficiency will be absolutely accurate.

For conclusion, improvement efficiency is an accurate coefficient when the attribute performance improves thoroughly to very good performance or when the convexity is not so significant. Otherwise it should be considered as an approximate coefficient.

c) The need of two surveys

Two surveys are needed for data analysis. Survey A is used to measure shopping preference contributed by very good performance and by very bad performance of each attribute and survey B is used to measure performance level of each attribute of studied product or service and shopping preference contributed by this performance level. It is the price for the quality and quantity of information. However, survey A could be reused for other research of the same kind of service (or product). For example, Co-op Mart can use the same survey A to examine the quality of all stores in the chain.

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CHAPTER 4: RESEARCH METHODOLOGY

4.1 INFORMATION NEEDED

In order to achieve the objectives of the research study as discussed in Chapter 1, and based on Two-factor model discussed in Chapter 3, the following information is needed for the research:

Attributes of a supermarket which construct the quality perception of customers.

Source: previous research, focus group of customer, and management interview.

Characteristics of these attributes which determine the relationship between attributes performance and shopping preference of customers. How does shopping preference of customers behave when these attributes performance move up and down?

Source: survey A and survey B.

Co-op Mart Nguyen Dinh Chieu’s attributes performance in the perception of customer and how much this performance level contributes to shopping preference of customers.

Source: survey B.

Recent operation of Co-op Mart Nguyen Dinh Chieu store.

Source: management interview and observation.

4.2 TARGET POPULATIONS

Primary data of the research is collected through two kinds of survey called survey A and survey B. These two surveys are conducted on two target populations.

Survey A: uses the questionnaire called “questionnaire A” (appendix A) to interview customers of all supermarkets in Ho Chi Minh City.

Survey B: uses the questionnaire called “questionnaire B” (appendix B) to interview Co-op Mart Nguyen Dinh Chieu’s customers, who have experiences of this supermarket’s services.

4.3 QUESTIONNAIRES DEVELOPMENT

4.3.1 Studied attributesAs the discussion in chapter 3, quality attributes of supermarket is generated by combining unstructured interviews as in other multi-attribute models to reflect the specific quality of supermarket. My previous research with collaborators suggests the list of 60 quality attributes for supermarket after many customer interviews and one focus group discussion. Starting with this list, convenience of open hours and location were added to make a list of 62 attributes (appendix E).

The list of 62 attributes was shortened by a focus group discussion. There are 2 male and 3 female customers in the group. All of them were invited to the discussion after finishing their shopping at Co-op Mart Nguyen Dinh Chieu. The moderator led the discussion from preparation for shopping, went through self-shopping, then the billing process. All attributes which are not related to these three processes were wiped off. Some remained attributes were combined and others were discarded because of unimportance. After the

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discussion, a short list of quality attributes was established and this list has the agreement of the whole group.

The opinions of Co-op Mart management were also taken into account. All attributes in the list were discussed one by one. The management decided to drop out some attributes which they cannot improve or modify by just basing on this research. For example, the location of supermarket is decided as a result of a series of researches and the convenience of location depended on customer’s residence so including this attribute into this research is not relevant. In addition, there are many important attributes which are studied more conveniently by other methods such as observation, incidence, etc. They are also excluded from this research, for example, the availability of locker, the availability of shopping trolley, the convenience of entries, etc. The management also added one more attribute which was not considered by customer but the management wants to investigate: flexibility of paying method. After all, the list of studied attributes was completed with 23 items.

Table 4.1: List of studied attributes

1. Convenience of parking

2. Hospitality of locker personnel

3. Agility of locker personnel

4. Quality of merchandise

5. Variety of product lines

6. Variety of brand names and varieties for each product line

7. Introduction of new products

8. Unique products which customers cannot find somewhere else

9. Store size

10. Convenience of products arrangement for finding

11. Attractiveness of products display

12. Air condition

13. Price level compared with other supermarkets

14. Hospitality of salesperson

15. Expertise of salesperson in product information

16. Helpfulness of salesperson in finding

17. Flexibility of paying method (credit card, check…)

18. Hospitality of cashier

19. Accuracy of cashier

20. Agility of cashier

21. Returning unqualified products policy

22. Attractiveness of promotion campaigns

23. Convenience of open hours

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Based on this list of attributes, both two questionnaires A and B were developed. In addition, these attributes could be classified by two ways, by process and by category, for analysis. There are three main processes: shopping preparation, self-shopping, and billing. The attributes which are not classified into any process are considered as general attributes. Attributes are also classified into four categories: facility, goods, personnel, and policy.

Table 4.2: Attributes classification

Facility Goods Personnel Policy

Shopping preparation 1 2, 3

Self-shopping 9, 12 4, 5, 6, 7, 8, 10, 11

14, 15, 16 13

Billing 18, 19, 20 17

General 21, 22, 23

4.3.2 Pilot surveyBefore launching the surveys, a pilot survey was conducted to test the questionnaire in order to uncover possible problems and check the validity of the expected information. For this purpose, a convenient sample of 20 customers was invited to answer the initial questionnaires then giving their feedbacks.

Based on the pilot result, both questionnaires A and B were modified. Wordings of some questions and the question arrangement were changed to be more appropriate. In addition, the numbers were added to check boxes for more transparency (-3 for strongly disagree, 3 for strongly agree, -2, -1, 0, 1, 2 in between). Moreover, the survey method was changed from questionnaire distribution to structured interview with the support of questionnaire to facilitate the accuracy of data.

4.4 SAMPLING PROCEDURE

Since we cannot determine the whole population in detail (so we can not reach each customer with the same probability), the probability sampling (random sampling) is infeasible (Holbert and Speece, 1993, p.79, 81). Therefore, the convenience sampling was used and the sample size was determined by the rule of thumb (minimum sample size is 30 for each item), the bigger the sample size the more precise the statistics.

The sample size of survey A is 320 (NA= 320) and this survey was conducted in 8 randomly chosen supermarkets (appendix C) in Ho Chi Minh City (40 interviews per supermarket) to capture the opinions of customers in Ho Chi Minh City.

The pre-determined sample size of survey B is 350 but only 302 (NB= 302) interviews were actually conducted due to the difficulty at the end of open hours. Based on the average distribution of bill quantity in a day, the survey B’s interviews were conducted (appendix C) but at the end of working hour (after 21:00), most of the customer refused the interview because they are very hurry. The reason for this arrangement is that the assimilation of the interview’s distribution with the bill quantity’s distribution may increase the representative property of the sample.

A pre-determined procedure to choose interviewee was established to eliminate the personal preference of field interviewers which is the source of bias. All the interviews were conducted at the pre-determined time in the schedule (appendix C). The customers

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who firstly finished billing process after these points of time in the schedule were chosen for the interview. In the cases they refused the interview or they are not in the scope of the research, the next customer would be the interviewee. For excluding customers who visit supermarket less than 4 times in the year or who are under 15, the interviewer must ask each customer before the interview.

4.5 SAMPLE CHARACTERISTICS

4.5.1 Sample A

Figure 4.1: Respondents’ age of sample A

Figure 4.2: Respondents’ frequency of shopping in supermarket of sample A

Figure 4.3: Respondents’ average spending for each shopping of sample A

Respondents in sample A are mostly (90.6%) in the age of 21 to 45 years old. The range of 26-30 is the biggest group, accounts for 27% of the sample. 70% of the respondents are

28

female. In average, more than 78% of respondents go to supermarket from 1 per month to 1 per week and more than 91% of them spend less than 500,000VND for each shopping. Particularly, more than 62% of them spend less than 200,000VND for each shopping (exchange rate: 14,500VND = 1USD). Therefore, the buying power of customer at supermarket in Ho Chi Minh City is not much.

4.5.2 Sample B

Figure 4.4: Respondents’ age of sample B

Figure 4.5: Respondents’ frequency of shopping in supermarket of sample B

Figure 4.6: Respondents’ average spending for each shopping of sample B

Respondents in sample B are mostly (91.4%) in the age of 21 to 45 years old. Nearly 70% of the respondents are female. In average, nearly 78% of respondents go to supermarket

29

from 1 per month to 1 per week and more than 92% of them spend less than 500,000VND for each shopping. Particularly, more than 54% of them spend less than 200,000VND for each shopping. The pattern of sample B is similar with sample A. Hence, the customer of Co-op Mart Nguyen Dinh Chieu is not so different to supermarket’s customer in Ho Chi Minh City.

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CHAPTER 5: FINDINGS ANALYSIS AND DISCUSSION

As discussion in chapter 4, all of the studied attributes are classified into 4 categories: facility, goods, personnel, and policy. These attributes will be analyzed by Two-factor model as discussion in chapter 3. Each attribute is presented in two-dimensional co-ordinates by characteristic curve. The horizontal axis represents performance level of an attribute and the vertical axis represents the shopping preference of customers contributed by this performance level. There are three critical points on the curve, one on the left is negative point, one on the right is positive point, and one another in between is current point.

Moreover, preference gap and improvement efficiency are also used to analyze quality attributes. On one hand, the larger the preference gap is, the more benefits the firm can gain in term of shopping preference of customer toward its product or service by improving the attribute performance. On the other hand, the higher the improvement efficiency is, the more shopping preference amount the firm gains by improving a certain amount of attribute performance.

Based on the statistical analysis results (table D.2, D.3, D.4, D.5 in appendix D) and testing (table D.6, D.7, D.8, D.9 in appendix D), the characteristic curves’ co-ordinates, shopping preferences, and improvement efficiencies of studied attributes are summarized (table D.10 in appendix D). All characteristic curves’ information and coefficients in this chapter are extracted from this table.

5.1 FACILITY ATTRIBUTES ANALYSIS

There are 3 attributes which belong to facility attribute category: convenience of parking, store size, and air condition. The characteristic curves of air condition attribute (figure 5.2) and store size attribute (figure 5.3) are similar. They are nearly absolute linear and symmetric. The characteristic curve of convenience of parking attribute (figure 5.1) is slightly negative convex.

Table 5.1: Facility attributes

Attributes Preference gapImprovement

efficiency

1. Convenience of parking 1.50 0.74

Significant at 0.00*

12. Air condition 0.81 0.51

9. Store size 0.72 0.45

From table 5.1, the improvement efficiency of convenience of parking attribute is significant higher than those of the others. Hence, the improvement of parking convenience is most desirable. In addition, preference gap of this attribute is also higher than those of others. It means that there is more room for improvement. As a result, we should focus more on parking attribute rather than air condition and store size attributes.

* Tested by Monte Carlo simulation (table D.13 in appendix D)

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The improvement efficiency and preference gap of air condition attribute and store size attribute are not so different. Therefore, they are similar in terms of benefits from improvement as well as room for improvement.

5.1.1 Convenience of parkingCustomers’ response reveals that parking area of Co-op Mart Nguyen Dinh Chieu is somewhat convenient but this convenience contributes very little (just above neutral) to current shopping preference of customers. However, there are many rooms for increasing shopping preference of customers by improving this attribute thanks to high preference gap and negative convexity. The investment in improving this attribute is also highly beneficial due to the high improvement efficiency.

The expansion of parking areas is especially expensive and the trade off with operating areas restricts this option. Rearrangement areas and way in, way out for more convenience may be a more feasible option. For more convenient to customer, some entries should be opened to connect parking area with supermarket so customers can go from parking area to supermarket and vice versa directly. Recently, customer must go out of the parking area before enter to supermarket and vice versa.

Figure 5.1: Convenience of parking

5.1.2 Air conditionSince the characteristic curve of air condition attribute degenerates to be a straight line, the improvement efficiency is also the regular co-efficient of the line. Hence, the improvement of shopping preference of customers is linear with improvement of air condition performance.

Air condition attribute of Co-op Mart Nguyen Dinh Chieu is evaluated quite well. Customer’s response uncovers that air condition is rather good. However, its contribution to current shopping preference is above neutral. In addition, the improvement efficiency is low (table 5.1). Therefore, we should not focus on air condition improvement because customers do not appreciate this attribute so much. The improvement on this attribute will not contribute significantly to shopping preference of customers. However, the rather high

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preference gap reveals that there is room for shopping preference improvement by improving this attribute in future.

For improving air condition significantly, the recent distributed 10 small air-conditioners system must be changed by a central air-conditioner. This replacement project will consume a lot of resources which could not be compensated by such an improvement of shopping preference of customers. Hence, the old system is recommended to continue in place. The other advantage of the old system is that it can be easy modified by adding some small air-conditioners. This incremental improvement is reasonable for such an attribute.

Figure 5.2: Air condition

5.1.3 Store sizeFigure 5.3: Store size

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Similarity with air condition attribute, characteristic curve of store size attribute degenerates to be a straight line. The only difference of the two is that characteristic line of air condition attribute is slightly steeper than that of store size attribute. It implies that the improvement of shopping preference of customers caused by expanding store size is less than by improving air condition. In addition, the cost for store size expansion is much larger than that for air condition. Therefore, the option of store size expansion is less beneficial than improving air condition.

However, it is worth to consider this attribute when designing a new store in Co-op Mart chain. Remember that these surveys were conducted when the average store size in customer perception is about the size of Co-op Mart Nguyen Dinh Chieu store. This perceived average store size will increase very fast when customers realize the advantages of many new larger stores which have been opened for a year. Moreover, the larger store is the common trend. The size of future will be much larger and the customer perception will change. The decision for the new store size must be based on updated careful researches.

5.2 GOODS ATTRIBUTES ANALYSIS

Seven attributes are classified into this category. Among them, quality of merchandise attribute has the highest improvement efficiency, and then the variety of product lines follows after. The next three attributes, which have high improvement efficiency, are variety of brand names and varieties for each product line, attractiveness of products display, and introduction of new products. At the bottom of the list, in order of improvement efficiency, lays the convenience of products arrangement for finding attribute and unique products which customers cannot find somewhere else attribute.

Table 5.2: Goods attributes

AttributesPreference

gapImprovement

efficiency

4. Quality of merchandise 1.32 1.07

Significant at 0.24*

5. Variety of product lines 0.88 0.96

Significant at 0.12*

6. Variety of brand names and varieties for each product line 0.71 0.77

11. Attractiveness of products display 1.24 0.75

7. Introduction of new products 1.33 0.73

Significant at 0.02*

10. Convenience of products arrangement for finding 0.90 0.56

8. Unique products which customers cannot find somewhere else 1.35 0.54

* Tested by Monte Carlo simulation (table D.13 in appendix D)

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5.2.1 Quality of merchandiseThe characteristic curve of quality of merchandise attribute is slightly negative convex but it could be considered as linear. This curve is also nearly symmetric with angular co-efficient of 1.07 (table 5.2). Reported customer perception indicates that quality of merchandise is good and its contribution to current shopping preference of customers is rather high. In despite of this high performance and contribution to shopping preference, quality of merchandise is a promising attribute for improvement due to its higher than 1 improvement efficiency. From current performance to very good performance, any increase in performance will create the faster increase in shopping preference. This result is not surprised. The quality of merchandise is always the most concerned issue in the perception of customer, the quality first.

Figure 5.4: Quality of merchandise

High quality leads to high price. Yes, but there are some ways to improve the quality of merchandise with a reasonable price. By choosing good suppliers, checking date and quality of merchandises before putting on the shelf, and periodical checking date to weed out-of-date merchandises out, the perception of customer about quality of merchandises in the store will increase. An out-of-date product on the shelf will damage the quality image of the whole store. Co-op Mart Nguyen Dinh Chieu has a quite good policy of quality control inside the supermarket (quality and date checking at the beginning, weeding out products 6 months before the date for 2-5 years dated product and 2 days for 1-2 weeks dated products). Moreover, quality control should go up stream to the suppliers.

5.2.2 Variety of product lines, brand names, and varietiesCharacteristic curves of variety of product lines attribute and variety of brand names and varieties attribute are nearly the same and both of them are nearly linear. Similar to the pattern of quality of merchandise attribute, they are symmetric linear attributes. Customers agree that there are many product lines and there are many brand names and varieties for each product line. Then these good performances contribute rather high portions to current shopping preference of customers.

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Having a look at the list of items in Co-op Mart Nguyen Dinh Chieu, we will understand why customers grade high score for these attributes performance. Product lines, brand names and varieties for each product line in the store are so varied as a supermarket in Ho Chi Minh City. It has all common product lines in supermarket in Ho Chi Minh City such as household amenities and personal care products, cosmetics, ready-to-eat as well as fresh foods, confectionary and cooking materials, footwear, clothing, some durable products, and also some products which are not common in other supermarkets such as children toys, etc. On average, each product line has 10 to 20 brand names; especially, for cosmetics, each product line has more than 20 brand names.

Figure 5.5: Variety of product lines, variety of brand names and varieties for each product line

Both of them are worth to improve due to high improvement efficiency. However, the difference between these two attributes is the higher improvement efficiency of variety of product lines attribute (table 5.2). Therefore, from current performance to very good performance, the improvement of variety of product lines attribute has more contribution to shopping preference of customers than that of variety of brand names and varieties for each product line attribute. The management should focus more on improving the variety of product lines attribute than improving the variety of brand names and varieties for each product line.

5.2.3 Products arrangement and products displayCustomers’ response indicates that performances of convenience of products arrangement for finding attribute and attractiveness of products display attribute are rather good. However, contribution of attractiveness of products display to current shopping preference of customers is just above neutral and the convenience of products arrangement contributes to shopping preference of customers a little better.

While the characteristic curve of convenience of products arrangement for finding attribute is linear, characteristic curve of attractiveness of products display attribute is slightly negative convex. Although the former lays higher than the latter in the co-ordinates expressing the higher contribution to shopping preference of customers, the latter should

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has higher priority for improvement because it has a higher angular co-efficient at current point convinced by higher improvement efficiency (table 5.2) and negative convexity. In addition, the preference gap of attractiveness of products display attribute is higher. Therefore, it is more room to improve shopping preference of customers by increasing the attractiveness of product display.

We have an interesting remark in figure 5.6. When performances are low, customer focus more on convenience for finding but when performances reach an acceptable level, they move their attention to attractiveness of products display.

Figure 5.6: Convenience of products arrangement for finding and attractiveness of products display

5.2.4 Introduction of new productsCo-op Mart Nguyen Dinh Chieu introduces 1 or 2 new products every week, mainly from the proposition of suppliers and customer perceives that introduction of new products attribute is somewhat good. However, the contribution of this frequency to current shopping preference of customers is just above neutral.

The improvement efficiency of this attribute is nearly equal with those of attractiveness of products display attribute and variety of brand names and varieties attribute. In addition, with one of the highest preference gap in goods category (table 5.2) and the slightly negative convexity, new products introduction is worth to invest. Co-op Mart Nguyen Dinh Chieu could make it better by actively involving into new products searching process rather than just relying on suppliers.

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Figure 5.7: Introduction of new products

5.2.5 Unique productsIn the perception of customers, there is nearly no unique product in Co-op Mart Nguyen Dinh Chieu which they cannot find in other store and contribution to current shopping preference of customers of this attribute is below neutral.

Figure 5.8: Unique products which customers cannot find somewhere else

The highly negative convex characteristic curve reveals that customer will not feel worse even if there is no unique product in the store. Customers do not find unique products in supermarket. Getting some unique products in supermarket by chance will make them happy but they do not expect to have that. The combination of lowest improvement efficiency and the highest preference gap in goods category (table 5.2) reveals that this

38

attribute is less worth to invest in short-term but has potential for improvement in future after all of high improvement efficiency attributes reach their potential.

5.3 PERSONNEL ATTRIBUTES ANALYSIS

Eight personnel attributes belong to three kinds of personnel: locker personnel, salesperson, and cashier. Among them, agility and hospitality of locker personnel have the highest improvement efficiencies and then hospitality of cashier. The next three attributes, which have high improvement efficiency, are hospitality of salesperson, expertise of salesperson in product information, and agility of cashier. At the bottom of the list, in order of improvement efficiency, are helpfulness of salesperson for finding and accuracy of cashier.

There is an interesting thing that hospitality attributes are most effective to improve from current performance. It is proved by their highest improvement efficiencies in the list of personnel attributes, if agility of locker personnel attribute is excluded.

Table 5.3: Personnel attributes

Attributes Preference gapImprovement

efficiency

3. Agility of locker personnel 2.00 1.05

Significant at 0.17*

2. Hospitality of locker personnel 1.96 0.98

Significant at 0.00*

18. Hospitality of cashier 1.15 0.71

Significant at 0.14*

14. Hospitality of salesperson 0.88 0.61

Significant at 0.30*

15. Expertise of salesperson in product information 0.80 0.56

20. Agility of cashier 0.82 0.52

Significant at 0.17*

16. Helpfulness of salesperson in finding 0.64 0.45

19. Accuracy of cashier 0.57 0.43

Currently, the recruitment process in Co-op Mart is quite good. All personnel of Co-op Mart will be selected according to their positions and trained for 3 months before working. However, their performance could be improved by some efforts such as periodical training, special training to improve specific skills and attitudes. In addition, the motivation in working is an important aspect which should be considered.

* Tested by Monte Carlo simulation (table D.13 in appendix D)

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5.3.1 Locker personnelReported customer perception indicates that locker personnel’s attributes are somewhat good but these levels of performance do not contribute positively to shopping preference of customers. However, with their negative convex characteristic curves and high improvement efficiencies as well as very high preference gap (table 5.3), these attributes are the valuable sources to increase shopping preference of customers. From the current performance to very good performance, the improvement of locker personnel will increase shopping preference of customers very fast.

There is the slightly difference between agility and hospitality of locker personnel attributes. The former attribute has higher improvement efficiency and preference gap (table 5.3). Therefore, the management should pay more attention on locker personnel’s agility than hospitality.

Figure 5.9: Agility and hospitality of locker personnel

5.3.2 SalespersonAll of three attributes of salesperson are evaluated the same. Reported customer perception uncovers that their performance are rather good and their contribution to current shopping preference of customers is somewhat high. This high performance of salesperson attributes is the result of a special training program in which the information of products and products arrangement is updated every day for salespeople at the beginning of the day and salespeople in the second work shift are imparted by salespeople in the first work shift.

While characteristic curves of hospitality and expertise in product information of salesperson attributes are linear, characteristic curve of helpfulness of salesperson in finding attribute is slightly positive convex. It reveals that helpfulness of salesperson in finding attribute is less worthy of improvement than other two. The low improvement efficiency and preference gap of this attribute (table 5.3) also affirm this fact.

The difference between hospitality and expertise in product information of salesperson attributes is the former has slightly higher improvement efficiency and preference gap

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(table 5.3). Hence, the former has the highest priority to improve among salesperson attributes.

Figure 5.10: Hospitality, expertise in product information, and helpfulness in finding of salesperson

5.3.3 CashierCustomers’ response indicates that three cashier attributes are rather good. Among them, accuracy of cashier is evaluated a little bit better. As a result, the contribution to current shopping preference of customers of accuracy of cashier attribute is rather high while the contribution of the other two is just somewhat high.

Figure 5.11: Hospitality, accuracy, and agility of cashier

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Although shopping preference of customers contributed by accuracy attribute is more sensitive (characteristic curve is steeper) to the movement of performance than those of others in general. The negative convexity makes it less sensitive to performance improvement after current point. This fact is proved by the lowest improvement efficiency in personnel attributes list (table 5.3). Therefore, the improvement after current point of accuracy of cashier attribute will not contribute significantly to shopping preference of customers. In addition, the lowest preference gap (table 5.3) indicates that there is less room for improvement by this attribute.

Compared with hospitality attribute, agility attribute has lower improvement efficiency (table 5.3). In addition, agility of cashier characteristic curve is slightly positive convex. Hence, it has lower priority to improve than hospitality of cashier attribute.

5.4 POLICY ATTRIBUTES ANALYSIS

Among five policy attributes, price level compared with other supermarkets attribute has highest improvement efficiency. Two next attributes are returning unqualified products policy and attractiveness of promotion campaigns. At the bottom of the list, in order of improvement efficiency, are flexibility of paying method attribute and convenience of open hours attribute.

Table 5.4: Policy attributes

Attributes Preference gapImprovement

efficiency

13. Price level compared with other supermarkets 1.04 0.83

Significant at 0.00*

21. Returning unqualified products policy 1.38 0.50

22. Attractiveness of promotion campaigns 1.12 0.48

Significant at 0.01*

17. Flexibility of paying method 0.65 0.31

23. Convenience of open hours 0.52 0.31

5.4.1 Price levelCustomers’ response reveals that price level of Co-op Mart Nguyen Dinh Chieu is rather low compared with other supermarkets. Moreover, it is one of the attributes which have highest contribution to current shopping preference of customers even though its performance is not good as those of quality of merchandise attribute or variety of products attributes. It indicates the importance of price factor in customers’ mind.

The rather high performance in the perception of customer is not an accidental gift but the result of a strategic policy. Price of merchandise is set equal to lower than that of other supermarkets. The management tries to position Co-op Mart as a low price supermarket chain.

The characteristic curve of price level attribute is symmetric linear. It means that its effect on shopping preference of customers is symmetric. The shopping preference of customers

* Tested by Monte Carlo simulation (table D.13 in appendix D)

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increased when lower the price is equal to the shopping preference of customers decreased when higher the price. Although price level attribute has the highest improvement efficiency and high preference gap (table 5.4), the lower price is not recommended because of the direct trade off with profits of the store. The result of this research is used to uncover the current performance as well as the contribution of this attribute to customer rather than for improvement recommendation. For the latter purpose, a price elasticity research should be conducted.

Figure 5.12: Price level compared with other supermarkets

5.4.2 Returning unqualified productsSince any quality problem is responsible by suppliers, Co-op Mart is ready to change a new one to any unqualified product. However, reported customer perception indicates that returning unqualified product policy and its contribution to current shopping preference of customers are just above neutral. The reason may be the prejudice that customers are unwelcome when they complain about quality and it is not worth to complain. Therefore, the perceived performance of this attribute may be improved by simply inform customer the policy of the store clearly through advertisement or other ways. A small incentive for unqualified product disclosure in one special period may be a good way to educate customer this policy.

The slightly positive convex characteristic curve of this attribute reveals that the decrease in performance will affect shopping preference of customers more than the increase in performance. Although the improvement efficiency of this attribute is low, this attribute is worth to improve due to the low cost for performance improvement (the performance is already good but the perceived performance is not as good due to information problem, the cost to improve perceive performance is the cost to inform customer) and high preference gap (table 5.4).

Figure 5.13: Returning unqualified products policy

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5.4.3 Promotion campaignsReported customers’ response indicates that attractiveness of promotion campaigns is just above neutral and its contribution to current shopping preference of customers is neutral. This result reveals the fact that promotion campaigns of Co-op Mart Nguyen Dinh Chieu are similar to those of other supermarkets (most of promotion campaigns are sponsored by suppliers) and this level of performance does not affect current shopping preference of customers.

Figure 5.14: Attractiveness of promotion campaigns

The slightly negative convex characteristic curve of this attribute indicates that the increase in performance will affect shopping preference of customers more than the decrease in performance. With the low improvement efficiency, it is recommended to keep this

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performance. However, for long-term strategy, this attribute should be considered due to high preference gap (table 5.4).

5.4.4 Paying methodAlthough Co-op Mart accepts many kinds of paying method including Visa card, Master card, and domestic credit card such as ACB card, customer perception indicates that paying method attribute is somewhat flexibility. However, its contribution to current shopping preference of customers is neutral. It uncovers that customers are not interested in this flexibility and other paying methods (rather than cash) is not popular in Ho Chi Minh City.

The very low improvement efficiency and preference gap (table 5.4) convince that it is not worth to improve this attribute. Although the negative convex characteristic curve of this attribute reveals that removing all additional paying methods will not decrease shopping preference of customers significantly, this attribute is recommended to be unchanged because the cost to maintain this flexibility is not much and this flexibility will be beneficial in future when those paying methods become popular in Ho Chi Minh City.

Figure 5.15: Flexibility of paying method

5.4.5 Open hoursCo-op Mart opens from 8:00am to 10:00pm. These open hours are rather convenient as the response of customers. Although the contribution of this convenience to current shopping preference of customers is somewhat high, the improvement of convenience of open hours attribute from current performance is not worth because it is convenient enough for customer. This conclusion is proved by the lowest improvement efficiency and preference gap among 23 studied attributes (table D.11 and table D.12 in appendix D).

In addition, a positive convex characteristic curve of convenience of open hours attribute reveals that the decrease of shopping preference of customers caused by the decrease of this attribute performance is much more significant while the increase in shopping preference of customers caused by performance improvement is not significant. Therefore, the open hours should be unchanged.

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Figure 5.16: Convenience of open hours

5.5 TWO-FACTOR MODEL VS. SERVQUAL

The third critique of Servqual in chapter 3 raises a critical problem of Servqual’s managerial implication. The findings of this research will illustrate this problem by using Two-factor analysis.

Servqual measures service quality based on the gap between current performance and customer expectation and sets up improvement priority based on the magnitude of this gap. The implication of this model is that the improvement of an attribute which has bigger P-E gap will provide more benefits than improvement of an attribute which has smaller P-E gap so the former has higher priority to improve.

The analysis results of this research uncover that the implication above is flawed. For example, the performance gaps of unique product, returning unqualified product policy, attractiveness of promotion campaigns, flexibility of paying method, and convenience of open hours attributes are large but their performance improvement will not contribute significantly to shopping preference of customers (sections 5.2.5, 5.4.2, 5.4.3, 5.4.4, 5.4.5). The reason is that this implication is based on two flawed assumptions: the relationship between attribute performance and a benefit related factor (such as shopping preference, purchase intension, etc) is linear and this benefit related factor has the same sensitivity (angular co-efficient) with performance of every attribute.

The findings of this research reveal that the later assumption is not correct. The sensitivity of shopping preference with attributes performance is different from attribute to attribute (figures 5.1 to 5.16). However, this problem could be somewhat overcome by using important level in addition to Servqual. The important level of each attribute could be considered as its sensitivity. The more important the attribute is, the more sensitive the benefit related factor with this attribute is. However, how to combine performance gap and important level into one measure to set up the improvement priorities is not an easy problem. Between an attribute which has higher important level and an attribute which has bigger performance gap, which one has more priority to improve?

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Figure 5.17: Convenience of open hours and quality of merchandise

Moreover, the biggest pitfall of Servqual may be the linearity assumption. The result of this research proves that the relationship of shopping preference of customers (one of benefit related factors) and attribute performance does not only vary in term of sensitivity but may be also convex. For example, the gap between current performance and very good performance of convenience of open hours attribute is larger than that of quality of merchandise attribute, but the improvement of open hours attribute from current performance will not contribute significantly to shopping preference of customers (figure 5.17). In contrast, a little improvement in quality of merchandise attribute will cause significant improvement in shopping preference of customers. The reason is that the positive convexity of convenience of open hours characteristic curve (figure 5.17) makes it less sensitive to improvement after the current point. Other characteristic curves also reveal that this example is not an exceptional case, many characteristic curve are not linear but may be negative convex or positive convex (figures 5.1 to 5.16).

Besides, Two-factor model provides more information than Servqual such as: contribution of current performance to shopping preference of customers, preference gap, how shopping preference of customers will behave if performance increases, and how shopping preference of customers will behave if performance decreases. These kinds of information are also helpful for quality management as discussion in previous sections of this chapter.

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CHAPTER 6: CONCLUSION

6.1 PRESENT CUSTOMER PERCEPTION

By using Two-factor model to examine the quality of Co-op Mart Nguyen Dinh Chieu, the research study provides the current perceived performances of 23 studied attributes and their contributions to shopping preference of customers as following:

Table 6.1: Present customer perception

Performance level

Above neutral0.25 – 0.75

Somewhat good0.75 – 1.25

Rather good1.25 – 1.75

Good1.75 – 2.25

Rat

her h

igh

1.25

– 1

.75

13. Price level compared with other supermarkets19. Accuracy of cashier

4. Quality of merchandise5. Variety of product lines6. Variety of brand names and varieties for each product line

Som

ewha

t hig

h

0.75

– 1

.25

10. Convenience of products arrangement for finding14. Hospitality of salesperson15. Expertise of salesperson in product information16. Helpfulness of salesperson in finding18. Hospitality of cashier20. Agility of cashier23. Convenience of open hours

Abo

ve n

eutra

l

0.25

– 0

.75

21. Returning unqualified products policy

1. Convenience of parking7. Introduction of new products

9. Store size11. Attractiveness of products display12. Air condition

48

Con

trib

utio

n to

shop

ping

pre

fere

nce

of

Neu

tral

(-0.

25) –

0.2

5

22. Attractiveness of promotion campaigns

2. Hospitality of locker personnel3. Agility of locker personnel17. Flexibility of paying method

Bel

ow n

eutra

l

(-0.

75) –

(-0.

25) 8. Unique

products which customers cannot find somewhere else

Note: -3= strongly disagree; 3= strongly agree

Among all, quality of merchandise attribute, variety of product lines attribute, variety of brand names and varieties for each product line attribute are the best performance attributes. These well performed attributes, price level compared with other supermarkets attribute, and accuracy of cashier attribute together contribute the highest portions to shopping preference of customers towards Co-op Mart Nguyen Dinh Chieu.

In contrast, returning unqualified products policy, attractiveness of promotion campaigns, and unique products which customers cannot find somewhere else attributes have lowest performance. Among them, unique products attribute contributes the lowest portion (even negative) to shopping preference of customers.

6.2 IMPROVEMENT STRATEGY

Based on current perception of customers and characteristics of studied attributes expressed by characteristic curve, improvement efficiency, and preference gap, 23 studied attributes are classified into 3 groups for improvement implementation: improving performance, reserving for improvement, and keeping current performance.

6.2.1 Improving performanceThe first group includes attributes which are needed to improve their performance and these improvements will contribute significantly to shopping preference of customers. They are:

Attributes which have high improvement efficiency because shopping preference of customers is very highly sensitive to attribute performance (steepest characteristic curves): quality of merchandise, variety of product lines, and variety of brand names and varieties for each product line.

Attributes which have high improvement efficiency because of negative convex characteristic curve and low current performance: agility of locker personnel, hospitality of locker personnel, attractiveness of products display, convenience of parking, and introduction of new products.

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Attribute which has high improvement efficiency because current performance is low and shopping preference of customers is rather highly sensitive to attribute performance (steep characteristic curve): hospitality of cashier.

Attribute which has low improvement efficiency but high preference gap and could be improved simultaneously with other attributes in this group: hospitality of salesperson (improved simultaneously with hospitality of locker personnel and hospitality of cashier by personnel training).

Attribute which has low improvement efficiency but high preference gap and the cost for improving is low: returning unqualified products policy (the policy itself is good, the cost for improvement is the cost to inform customer this policy).

6.2.2 Reserving for improvementThe second group includes attributes which are not necessary to improve in short-term and they are less efficient for improvement than those in the first group. However, they are the potential sources for improving shopping preference of customers when all of attributes in the first group reach their potential. They are:

Attributes which have low improvement efficiency but high preference gap. The reason is that the distance between contribution to shopping preference of customers of current performance and of very good performance is high but current performance is far behind very good performance: attractiveness of promotion campaigns, unique products which customers cannot find somewhere else, convenience of products arrangement for finding, agility of cashier, air condition, and expertise of salesperson in product information.

6.2.3 Keeping current performanceAttributes in the third group are not necessary to improve the performances. Their current performances are good enough and should be maintained. This group includes:

Attributes which have low improvement efficiency and low preference gap because shopping preference of customers is less sensitive to attribute performance (flat characteristic curve): flexibility of paying method and store size (this attribute is also very difficult to improve).

Attributes which have low improvement efficiency and low preference gap because of positive convex characteristic curve and current performance is at the threshold, additional improvement is not necessary: convenience of open hours, accuracy of cashier, and helpfulness of salesperson in finding.

Attribute which has high improvement efficiency but there is the direct trade off with profits: price level compared with other supermarkets.

6.2.4 Improvement prioritiesPerformances of attributes in the third group are maintained as current levels. Attributes in the first group will be improved firstly. When they reach their potential, supermarket cannot gain more shopping preference of customers by improving these attributes. After that, attributes in the second group will be improved to gain more shopping preference of customers. In addition, there are the priorities for improvement within each group, in the order of improvement efficiency.

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The highest priority attributes for improvement are quality of merchandise, agility of locker personnel, hospitality of personnel and variety of product lines attributes. They are the keys to improve perceived quality (perceived performance and shopping preference) of Co-op Mart Nguyen Dinh Chieu in the perception of customers. The management should focus resources to improve these attributes then improve other attributes according to the priorities in table 6.2 and table 6.3.

Table 6.2: Improvement priorities of the first group

PrioritiesAttributes

Improvement efficiency

1 4. Quality of merchandise 1.07

2 3. Agility of locker personnel 1.05

3 2, 14, 18. Hospitality of personnel 0.984

4 5. Variety of product lines 0.96

5 6. Variety of brand names and varieties for each product line 0.77

6 11. Attractiveness of products display 0.75

7 1. Convenience of parking 0.74

8 7. Introduction of new products 0.73

9 21. Returning unqualified products policy 0.505

Table 6.3: Improvement priorities of the second group

PrioritiesAttributes

Improvement efficiency

1 10. Convenience of products arrangement for finding 0.56

2 15. Expertise of salesperson in product information 0.56

3 8. Unique products which customers cannot find somewhere else 0.54

4 20. Agility of cashier 0.52

5 12. Air condition 0.51

6 22. Attractiveness of promotion campaigns 0.48

However, as mentioned earlier, this research focuses mostly on benefit side. These priorities should be implemented in the integration with cost analysis.

6.3 TWO-FACTOR MODEL

Based on Kano’s concept, Two-factor model is developed to examine the quality of a service (it is also applicable to product quality) and set up priorities for quality

4 Improvement efficiency of hospitality of locker personnel attribute, the highest improvement efficiency of hospitality of personnel attributes.5 Low improvement efficiency but high preference gap and low cost for improving.

51

improvement. The concept of Two-factor model is that quality is measured through performance level of a set of attributes and the contribution of these attributes to shopping preference of customers (or other benefits related factors such as purchase intension). The relationship of these two measures of each attribute is presented by a characteristic curve in which current point represents the current situation of the attribute and negative, positive points represent the worst and the best case of this attribute, respectively.

Findings of this research study reveal that the relationships of performance and contribution to shopping preference of customers of attributes are different from attribute to attribute. These relationships are represented by characteristic curves which vary in convexity and steepness. Therefore, using performance gap to set up the priorities for quality improvement as in Servqual model is not accurate. Closing a large performance gap may not increase the shopping preference of customers significantly. The quality improvement priorities should be decided by the contribution of closing the performance gap to shopping preference of customers in an incremental manner (represented by improvement efficiency and preference gap) rather than the performance gap itself.

In addition to the accuracy in setting up the priorities for quality improvement, Two-factor model provides more useful information for quality management such as: contribution of current performance to shopping preference of customers, how shopping preference of customers will behave if performance increases, and how shopping preference of customers will behave if performance decreases. These kinds of information add predictive power to the model.

However, it is too soon to conclude that Two-factor model is better than other models which were well developed through many years. Two-factor model is introduced as a new approach to measure service or product quality rather than a superior model. Additional theoretical and empirical researches are needed to further examine the strengths as well as the weaknesses of this model.

52

APPENDIX A: QUESTIONNAIRE A

Place: ____________________

QUESTIONNAIRE

Notice: All of the following questions are for self-service store of supermarket only. The term “supermarket” should be understood as this store, not the whole supermarket.

Question 1: A supermarket is my favorite shopping center if it has following attributes: Strongly disagree

Strongly agree

1. The parking is very convenient -3 -2 -1 0 1 2 3

2. Locker personnel is very hospitable -3 -2 -1 0 1 2 3

3. Locker personnel is very agile -3 -2 -1 0 1 2 3

4. Quality of merchandise is very good -3 -2 -1 0 1 2 3

5. There are lots of product lines -3 -2 -1 0 1 2 3

6. There are lots of brand names and varieties for each product line

-3 -2 -1 0 1 2 3

7. New products are introduced very frequently -3 -2 -1 0 1 2 3

8. There are many unique products which you cannot find somewhere else

-3 -2 -1 0 1 2 3

9. The store size is very large -3 -2 -1 0 1 2 3

10. Products arrangement is very convenient for finding

-3 -2 -1 0 1 2 3

11. Products display is very attractive -3 -2 -1 0 1 2 3

12. Air condition is very good -3 -2 -1 0 1 2 3

13. Price level is very cheap compared with other supermarkets

-3 -2 -1 0 1 2 3

14. Salesperson is very hospitable -3 -2 -1 0 1 2 3

15. Salesperson can provide product information very exactly

-3 -2 -1 0 1 2 3

16. Salesperson can help you find what you need immediately

-3 -2 -1 0 1 2 3

17. Paying method is very flexible (credit card, check…)

-3 -2 -1 0 1 2 3

18. Cashier is very hospitable -3 -2 -1 0 1 2 3

19. Cashier is very accurate -3 -2 -1 0 1 2 3

53

20. Cashier is very agile -3 -2 -1 0 1 2 3

21. Returning unqualified products is very welcome -3 -2 -1 0 1 2 3

22. Promotion campaigns are very attractive -3 -2 -1 0 1 2 3

23. Open hours are very convenient -3 -2 -1 0 1 2 3

Question 2: From the list of attributes above, could you please specify the three most important attributes?

Question 3: A supermarket is still my favorite shopping center even though it has following attributes:(When considering each attribute, other attributes are normal)

Strongly disagree

Strongly agree

1. The parking is very inconvenient -3 -2 -1 0 1 2 3

2. Locker personnel is very cross-grained -3 -2 -1 0 1 2 3

3. Locker personnel is very slow -3 -2 -1 0 1 2 3

4. Quality of merchandise is very bad -3 -2 -1 0 1 2 3

5. There are only some product lines -3 -2 -1 0 1 2 3

6. There is only one brand name and variety for each product line

-3 -2 -1 0 1 2 3

7. New products are introduced rarely -3 -2 -1 0 1 2 3

8. There is no unique products which you cannot find somewhere else

-3 -2 -1 0 1 2 3

9. The store size is very small -3 -2 -1 0 1 2 3

10. Products arrangement is very inconvenient for finding

-3 -2 -1 0 1 2 3

11. Products display is very gloomy -3 -2 -1 0 1 2 3

12. There is no air condition -3 -2 -1 0 1 2 3

13. Price level is very expensive compared with other supermarkets

-3 -2 -1 0 1 2 3

14. Salesperson is very cross-grained -3 -2 -1 0 1 2 3

15. Salesperson cannot provide product information -3 -2 -1 0 1 2 3

16. Salesperson cannot help you find what you need -3 -2 -1 0 1 2 3

17. The only paying method is cash -3 -2 -1 0 1 2 3

18. Cashier is very cross-grained -3 -2 -1 0 1 2 3

54

19. Cashier is very inaccurate -3 -2 -1 0 1 2 3

20. Cashier is very slow -3 -2 -1 0 1 2 3

21. Returning unqualified products is not allowed -3 -2 -1 0 1 2 3

22. There is no promotion -3 -2 -1 0 1 2 3

23. Open hours are very inconvenient -3 -2 -1 0 1 2 3

Question 4: Personal information

Gender: Male Female

Age: ______________

How often do you go to supermarket (wherever)?

many per week 1 per week 1 per 2 weeks

1 per month rarely (less than 1 per month)

How much is average spending each time you go to supermarket?

less than 200,000 200,000 – 500,000 500,000 – 1,000,000

more than 1,000,000 sometimes not much, some times very big amount

THANK YOU FOR YOUR HELP !

55

APPENDIX B: QUESTIONNAIRE B

Time: __________ Date: ___________

QUESTIONNAIRE

Notice: All of the following questions are for self-service store of supermarket only. The term “supermarket” should be understood as this store, not the whole supermarket.

Question 1: Please evaluate Co-op Mart Nguyen Dinh Chieu by following attributes: Strongly disagree

Strongly agree

1. The parking is convenient -3 -2 -1 0 1 2 3

2. Locker personnel is hospitable -3 -2 -1 0 1 2 3

3. Locker personnel is agile -3 -2 -1 0 1 2 3

4. Quality of merchandise is good -3 -2 -1 0 1 2 3

5. There are many product lines -3 -2 -1 0 1 2 3

6. There are many brand names and varieties for each product line

-3 -2 -1 0 1 2 3

7. New products are introduced frequently -3 -2 -1 0 1 2 3

8. There are some unique products which you cannot find somewhere else

-3 -2 -1 0 1 2 3

9. The store size is large -3 -2 -1 0 1 2 3

10. Products arrangement is convenient for finding -3 -2 -1 0 1 2 3

11. Products display is attractive -3 -2 -1 0 1 2 3

12. Air condition is good -3 -2 -1 0 1 2 3

13. Price level is cheap compared with other supermarkets

-3 -2 -1 0 1 2 3

14. Salesperson is hospitable -3 -2 -1 0 1 2 3

15. Salesperson can provide product information exactly

-3 -2 -1 0 1 2 3

16. Salesperson can help you find what you need quickly

-3 -2 -1 0 1 2 3

17. Paying method is flexible (credit card, check…) -3 -2 -1 0 1 2 3

18. Cashier is hospitable -3 -2 -1 0 1 2 3

19. Cashier is accurate -3 -2 -1 0 1 2 3

20. Cashier is agile -3 -2 -1 0 1 2 3

56

21. Returning unqualified products is welcome -3 -2 -1 0 1 2 3

22. Promotion campaigns are attractive -3 -2 -1 0 1 2 3

23. Open hours are convenient -3 -2 -1 0 1 2 3

Question 2: Therefore, Co-op Mart Nguyen Dinh Chieu is chosen as your shopping center rather than other supermarkets because of:

Strongly disagree

Strongly agree

1. Convenience of parking -3 -2 -1 0 1 2 3

2. Hospitality of locker personnel -3 -2 -1 0 1 2 3

3. Agility of locker personnel -3 -2 -1 0 1 2 3

4. Quality of merchandise -3 -2 -1 0 1 2 3

5. Variety of product lines -3 -2 -1 0 1 2 3

6. Variety of brand names and varieties for each product line

-3 -2 -1 0 1 2 3

7. Introduction of new products -3 -2 -1 0 1 2 3

8. Unique products which you cannot find somewhere else

-3 -2 -1 0 1 2 3

9. Store size -3 -2 -1 0 1 2 3

10. Convenience of products arrangement for finding -3 -2 -1 0 1 2 3

11. Attractiveness of products display -3 -2 -1 0 1 2 3

12. Air condition -3 -2 -1 0 1 2 3

13. Price level compared with other supermarkets -3 -2 -1 0 1 2 3

14. Hospitality of salesperson -3 -2 -1 0 1 2 3

15. Expertise of salesperson in product information -3 -2 -1 0 1 2 3

16. Helpfulness of salesperson in finding what you need

-3 -2 -1 0 1 2 3

17. Flexibility of paying method (credit card, check…) -3 -2 -1 0 1 2 3

18. Hospitality of cashier -3 -2 -1 0 1 2 3

19. Accuracy of cashier -3 -2 -1 0 1 2 3

20. Agility of cashier -3 -2 -1 0 1 2 3

21. Returning unqualified products policy -3 -2 -1 0 1 2 3

22. Attractiveness of promotion campaigns -3 -2 -1 0 1 2 3

23. Convenience of open hours -3 -2 -1 0 1 2 3

57

Question 3: From the list of attributes above, could you please specify three attributes which you want Co-op Mart Nguyen Dinh Chieu improve mostly?

Question 4: Personal information

Gender: Male Female

Age: ______________

How often do you go to supermarket (wherever)?

many per week 1 per week 1 per 2 weeks

1 per month rarely (less than 1 per month)

How much is average spending each time you go to supermarket?

less than 200,000 200,000 – 500,000 500,000 – 1,000,000

more than 1,000,000 sometimes not much, some times very big amount

THANK YOU FOR YOUR HELP !

58

APPENDIX C: INTERVIEW SCHEDULE

Table C.1: Schedule of survey A

Date Place No. Questionnaire No. Interviewer

13/1 1. Co-op Mart Dam Sen 40 2

14/1 2. Co-op Mart Hau Giang 40 1

15/1 3. Mien Dong 40 1

16/1 4. Co-op Mart Nguyen Dinh Chieu 40 1

17/1 5. Pacific Mart 40 1

18/1 6. Saigon Tenmart 40 1

19/1 7. Foodcomart 40 1

20/1 8. Maximart 40 1

From 9:00 to 21:00, every interview for each 15-minute,

break time: 12:00 to 13:00 and 18:00 to 19:00

Except 13/1, from 16:00 to 21:00, every 2 interviews for each 15-minute,no break time.

Table C.2: Schedule of survey B

From 15/1 to 21/1, in Co-op Mart-op Nguyen Dinh Chieu (1 interviewer):

No. Time No. Time No. Time No. Time No. Time

1 10:00 11 11:40 21 15:30 31 17:40 41 20:20

2 10:10 12 11:50 22 15:45 32 17:50 42 20:30

3 10:20 13 13:00 23 16:00 33 19:00 43 20:40

4 10:30 14 13:20 24 16:15 34 19:10 44 20:50

5 10:40 15 13:40 25 16:30 35 19:20 45 21:00

6 10:50 16 14:00 26 16:45 36 19:30 46 21:10

7 11:00 17 14:20 27 17:00 37 19:40 47 21:20

8 11:10 18 14:40 28 17:10 38 19:50 48 21:30

9 11:20 19 15:00 29 17:20 39 20:00 49 21:40

10 11:30 20 15:15 30 17:30 40 20:10 50 21:50

Break time: 12:00 to 13:00 and 18:00 to 19:00

59

APPENDIX D: DATA ANALYSIS

Table D.1: Variables coding

Attribute

Shopping preference contributed

by very good performance

Shopping preference contributed by very bad performance

Current performance

Shopping preference contributed by current

performance

1. Convenience of parking POS1 NEG1 PER1 PRE1

2. Hospitality of locker personnel POS2 NEG2 PER2 PRE2

3. Agility of locker personnel POS3 NEG3 PER3 PRE3

4. Quality of merchandise POS4 NEG4 PER4 PRE4

5. Variety of product lines POS5 NEG5 PER5 PRE5

6. Variety of brand names and varieties for each product line POS6 NEG6 PER6 PRE6

7. Introduction of new products POS7 NEG7 PER7 PRE7

8. Unique products which customers cannot find somewhere else POS8 NEG8 PER8 PRE8

9. Store size POS9 NEG9 PER9 PRE9

10.Convenience of products arrangement for finding POS10 NEG10 PER10 PRE10

11.Attractiveness of products display POS11 NEG11 PER11 PRE11

12.Air condition POS12 NEG12 PER12 PRE12

13.Price level compared with other supermarkets POS13 NEG13 PER13 PRE13

14.Hospitality of salesperson POS14 NEG14 PER14 PRE14

15.Expertise of salesperson in product information POS15 NEG15 PER15 PRE15

16.Helpfulness of salesperson in finding POS16 NEG16 PER16 PRE16

17.Flexibility of paying method (credit card, check…) POS17 NEG17 PER17 PRE17

18.Hospitality of cashier POS18 NEG18 PER18 PRE18

19.Accuracy of cashier POS19 NEG19 PER19 PRE19

20.Agility of cashier POS20 NEG20 PER20 PRE20

21.Returning unqualified products policy POS21 NEG21 PER21 PRE21

60

22.Attractiveness of promotion campaigns POS22 NEG22 PER22 PRE22

23.Convenience of open hours POS23 NEG23 PER23 PRE23

Table D.2: Shopping preference contributed by very good performance

N Min Max Lower Mean Upper Std. Dev

POS1 320 -1 3 1.67 1.78 1.90 1.04

POS2 320 -1 3 1.66 1.75 1.84 0.79

POS3 320 -1 3 1.84 1.93 2.01 0.79

POS4 320 0 3 2.65 2.71 2.77 0.56

POS5 320 0 3 2.44 2.50 2.57 0.61

POS6 320 0 3 2.25 2.33 2.41 0.73

POS7 320 -1 3 1.75 1.86 1.96 0.95

POS8 320 -2 3 0.88 1.00 1.13 1.15

POS9 320 -1 3 1.24 1.35 1.46 1.00

POS10 320 -1 3 1.72 1.80 1.87 0.70

POS11 320 0 3 1.78 1.85 1.93 0.70

POS12 320 -1 3 1.39 1.49 1.58 0.87

POS13 320 -1 3 2.39 2.47 2.55 0.75

POS14 320 -1 3 1.91 2.00 2.09 0.81

POS15 320 -1 3 1.93 2.00 2.08 0.69

POS16 320 -1 3 1.76 1.85 1.93 0.79

POS17 320 -2 3 0.49 0.63 0.76 1.25

POS18 320 -1 3 1.88 1.96 2.04 0.72

POS19 320 -2 3 1.76 1.86 1.96 0.91

POS20 320 -3 3 1.71 1.80 1.90 0.88

POS21 320 -3 3 1.60 1.71 1.82 1.00

POS22 320 -3 3 1.12 1.26 1.40 1.28

POS23 320 -3 3 1.60 1.71 1.81 0.92

Note: -3= strongly disagree; 3= strongly agree Confidence level of 95%

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Table D.3: Shopping preference contributed by very bad performance

N Min Max Lower Mean Upper Std. Dev

NEG1 320 -3 2 -1.59 -1.49 -1.38 0.95

NEG2 320 -3 2 -1.60 -1.51 -1.41 0.83

NEG3 320 -3 2 -1.88 -1.79 -1.69 0.88

NEG4 320 -3 0 -2.66 -2.59 -2.52 0.64

NEG5 320 -3 1 -2.35 -2.26 -2.17 0.80

NEG6 320 -3 1 -2.18 -2.09 -2.00 0.83

NEG7 320 -3 2 -1.72 -1.61 -1.51 0.94

NEG8 320 -3 2 -0.93 -0.79 -0.66 1.21

NEG9 320 -3 2 -1.37 -1.27 -1.16 0.95

NEG10 320 -3 0 -1.78 -1.69 -1.61 0.75

NEG11 320 -3 1 -1.78 -1.70 -1.61 0.79

NEG12 320 -3 1 -1.75 -1.67 -1.58 0.79

NEG13 320 -3 0 -2.61 -2.53 -2.46 0.68

NEG14 320 -3 0 -2.10 -2.02 -1.93 0.75

NEG15 320 -3 0 -1.99 -1.91 -1.82 0.75

NEG16 320 -3 0 -1.88 -1.80 -1.72 0.77

NEG17 320 -3 2 -0.59 -0.45 -0.30 1.34

NEG18 320 -3 1 -1.84 -1.77 -1.69 0.70

NEG19 320 -3 0 -2.23 -2.15 -2.07 0.72

NEG20 320 -3 0 -2.02 -1.94 -1.86 0.74

NEG21 320 -3 1 -1.82 -1.71 -1.60 1.01

NEG22 320 -3 2 -1.24 -1.08 -0.93 1.39

NEG23 320 -3 1 -1.82 -1.73 -1.65 0.78

Note: -3= strongly disagree; 3= strongly agree Confidence level of 95%

62

Table D.4: Current attributes' performance

N Min Max Lower Mean Upper Std. Dev

PER1 302 -2 3 0.85 0.98 1.12 1.20

PER2 302 -2 3 0.88 1.00 1.12 1.05

PER3 302 -3 3 0.97 1.10 1.22 1.11

PER4 302 -1 3 1.64 1.76 1.88 1.06

PER5 302 -2 3 1.96 2.08 2.21 1.12

PER6 302 -3 3 1.97 2.09 2.21 1.07

PER7 302 -3 3 1.02 1.18 1.33 1.36

PER8 302 -3 3 0.36 0.51 0.67 1.39

PER9 302 -3 3 1.26 1.38 1.51 1.10

PER10 302 -2 3 1.28 1.40 1.52 1.03

PER11 302 -2 3 1.22 1.34 1.46 1.07

PER12 302 -1 3 1.32 1.43 1.54 0.96

PER13 302 -2 3 1.62 1.75 1.87 1.15

PER14 302 -1 3 1.44 1.56 1.67 1.04

PER15 302 -3 3 1.45 1.58 1.71 1.13

PER16 302 -2 3 1.45 1.57 1.68 1.03

PER17 302 -2 3 0.79 0.91 1.03 1.05

PER18 302 -2 3 1.26 1.37 1.49 1.01

PER19 302 -2 3 1.56 1.67 1.77 0.94

PER20 302 -2 3 1.34 1.44 1.55 0.92

PER21 302 -3 3 0.12 0.25 0.38 1.16

PER22 302 -2 3 0.54 0.67 0.80 1.15

PER23 302 -2 3 1.24 1.34 1.45 0.95

Note: -3= strongly disagree; 3= strongly agree Confidence level of 95%

63

Table D.5: Shopping preference contributed by current attributes' performance

N Min Max Lower Mean Upper Std. Dev

PRE1 302 -3 3 0.13 0.29 0.45 1.39

PRE2 302 -2 3 -0.35 -0.21 -0.07 1.24

PRE3 302 -3 3 -0.22 -0.08 0.07 1.26

PRE4 302 -3 3 1.23 1.39 1.55 1.42

PRE5 302 -3 3 1.46 1.62 1.78 1.45

PRE6 302 -3 3 1.46 1.62 1.78 1.43

PRE7 302 -2 3 0.36 0.53 0.69 1.45

PRE8 302 -3 3 -0.51 -0.35 -0.19 1.44

PRE9 302 -3 3 0.47 0.62 0.77 1.32

PRE10 302 -2 3 0.76 0.89 1.03 1.18

PRE11 302 -2 3 0.46 0.61 0.75 1.28

PRE12 302 -2 3 0.53 0.68 0.83 1.32

PRE13 302 -2 3 1.27 1.43 1.59 1.41

PRE14 302 -2 3 0.97 1.12 1.27 1.34

PRE15 302 -2 3 1.06 1.21 1.35 1.31

PRE16 302 -2 3 1.07 1.21 1.35 1.27

PRE17 302 -3 3 -0.17 -0.02 0.12 1.26

PRE18 302 -2 3 0.68 0.81 0.95 1.16

PRE19 302 -2 3 1.15 1.28 1.42 1.16

PRE20 302 -2 3 0.86 0.99 1.11 1.12

PRE21 302 -3 3 0.19 0.33 0.48 1.27

PRE22 302 -3 3 -0.02 0.14 0.29 1.37

PRE23 302 -3 3 1.07 1.19 1.30 1.03

Note: -3= strongly disagree; 3= strongly agree Confidence level of 95%

64

Table D.6: Difference between current attributes' performance and very good performance

Attribute t df Sig. Lower Mean Upper

(2-tailed)

1 -29.15 301 0.000 -2.15 -2.02 -1.88

2 -32.99 301 0.000 -2.12 -2.00 -1.88

3 -29.75 301 0.000 -2.03 -1.90 -1.78

4 -20.25 301 0.000 -1.36 -1.24 -1.12

5 -14.28 301 0.000 -1.04 -0.92 -0.79

6 -14.90 301 0.000 -1.03 -0.91 -0.79

7 -23.24 301 0.000 -1.98 -1.82 -1.67

8 -31.15 301 0.000 -2.64 -2.49 -2.33

9 -25.63 301 0.000 -1.74 -1.62 -1.49

10 -27.02 301 0.000 -1.72 -1.60 -1.48

11 -27.05 301 0.000 -1.78 -1.66 -1.54

12 -28.21 301 0.000 -1.68 -1.57 -1.46

13 -19.03 301 0.000 -1.38 -1.25 -1.13

14 -24.24 301 0.000 -1.56 -1.44 -1.33

15 -21.87 301 0.000 -1.55 -1.42 -1.29

16 -24.16 301 0.000 -1.55 -1.43 -1.32

17 -34.44 301 0.000 -2.21 -2.09 -1.97

18 -27.90 301 0.000 -1.74 -1.63 -1.51

19 -24.80 301 0.000 -1.44 -1.33 -1.23

20 -29.30 301 0.000 -1.66 -1.56 -1.45

21 -41.28 301 0.000 -2.88 -2.75 -2.62

22 -35.31 301 0.000 -2.46 -2.33 -2.20

23 -30.15 301 0.000 -1.76 -1.66 -1.55

Note: Confidence level of 95%

65

Table D.7: Difference between current attributes' performance and very bad performance

Attribute t df Sig. Lower Mean Upper

(2-tailed)

1 57.59 301 0.000 3.98 3.85 4.12

2 65.99 301 0.000 4.00 3.88 4.12

3 64.01 301 0.000 4.10 3.97 4.22

4 78.11 301 0.000 4.76 4.64 4.88

5 79.14 301 0.000 5.08 4.96 5.21

6 82.95 301 0.000 5.09 4.97 5.21

7 53.32 301 0.000 4.18 4.02 4.33

8 44.00 301 0.000 3.51 3.36 3.67

9 69.53 301 0.000 4.38 4.26 4.51

10 74.34 301 0.000 4.40 4.28 4.52

11 70.79 301 0.000 4.34 4.22 4.46

12 79.86 301 0.000 4.43 4.32 4.54

13 71.95 301 0.000 4.75 4.62 4.87

14 76.49 301 0.000 4.56 4.44 4.67

15 70.50 301 0.000 4.58 4.45 4.71

16 76.94 301 0.000 4.57 4.45 4.68

17 64.46 301 0.000 3.91 3.79 4.03

18 75.06 301 0.000 4.37 4.26 4.49

19 86.70 301 0.000 4.67 4.56 4.77

20 83.65 301 0.000 4.44 4.34 4.55

21 48.84 301 0.000 3.25 3.12 3.38

22 55.45 301 0.000 3.67 3.54 3.80

23 79.10 301 0.000 4.34 4.24 4.45

Note: Confidence level of 95%

66

Table D.8: Difference between shopping preference contributed by very good performance and shopping preference contributed by current performance

Levene's Test for Equality of Variances t-test for Equality of Means

Attribute F Sig. t df Sig. Lower Mean Upper

(2-tailed)

1 58.60 0.000 15.23 620 0.000 1.30 1.50 1.69

2 93.89 0.000 23.70 620 0.000 1.80 1.96 2.12

3 86.71 0.000 23.92 620 0.000 1.84 2.00 2.17

4 285.00 0.000 15.36 620 0.000 1.15 1.32 1.49

5 243.62 0.000 10.04 620 0.000 0.71 0.88 1.06

6 188.64 0.000 7.80 620 0.000 0.53 0.71 0.88

7 94.38 0.000 13.60 620 0.000 1.14 1.33 1.52

8 41.20 0.000 13.01 620 0.000 1.15 1.35 1.56

9 29.93 0.000 7.76 620 0.000 0.54 0.72 0.91

10 88.95 0.000 11.63 620 0.000 0.75 0.90 1.06

11 189.54 0.000 15.17 620 0.000 1.08 1.24 1.40

12 67.13 0.000 9.02 620 0.000 0.63 0.81 0.98

13 159.27 0.000 11.54 620 0.000 0.86 1.04 1.21

14 118.60 0.000 10.01 620 0.000 0.71 0.88 1.06

15 178.12 0.000 9.56 620 0.000 0.63 0.80 0.96

16 81.66 0.000 7.57 620 0.000 0.47 0.64 0.80

17 4.74 0.030 6.43 620 0.000 0.45 0.65 0.85

18 98.24 0.000 14.91 620 0.000 1.00 1.15 1.30

19 37.57 0.000 6.90 620 0.000 0.41 0.57 0.74

20 20.04 0.000 10.14 620 0.000 0.66 0.82 0.97

21 25.17 0.000 15.08 620 0.000 1.20 1.38 1.56

22* 1.27 0.261 10.55 610 0.000 0.91 1.12 1.33

23 9.99 0.002 6.63 620 0.000 0.36 0.52 0.67

Note: Confidence level of 95%*: Using t-test for unequal variance samples

67

Table D.9: Difference between shopping preference contributed by current performance and shopping preference contributed by very bad performance

Levene's Test for Equality of Variances

t-test for Equality of Means

Attribute F Sig. t df Sig. Lower Mean Upper

(2-tailed)

1 89.39 0.000 18.71 620 0.000 1.59 1.78 1.96

2 70.96 0.000 15.42 620 0.000 1.13 1.30 1.46

3 44.81 0.000 19.67 620 0.000 1.54 1.71 1.88

4 214.64 0.000 45.48 620 0.000 3.81 3.98 4.16

5 138.78 0.000 41.79 620 0.000 3.70 3.88 4.06

6 143.90 0.000 39.72 620 0.000 3.53 3.71 3.89

7 86.33 0.000 21.92 620 0.000 1.95 2.14 2.33

8 20.00 0.000 4.16 620 0.000 0.23 0.44 0.65

9 47.14 0.000 20.55 620 0.000 1.71 1.89 2.07

10 56.91 0.000 32.72 620 0.000 2.43 2.59 2.74

11 119.89 0.000 27.26 620 0.000 2.14 2.31 2.47

12 98.97 0.000 26.99 620 0.000 2.18 2.35 2.52

13 202.23 0.000 45.06 620 0.000 3.79 3.96 4.14

14 136.03 0.000 36.24 620 0.000 2.96 3.13 3.30

15 122.31 0.000 36.59 620 0.000 2.94 3.11 3.28

16 84.90 0.000 36.05 620 0.000 2.84 3.01 3.17

17 7.76 0.006 4.05 620 0.000 0.22 0.42 0.63

18 74.21 0.000 33.81 620 0.000 2.43 2.58 2.73

19 67.41 0.000 44.58 620 0.000 3.29 3.44 3.59

20 34.91 0.000 38.61 620 0.000 2.78 2.92 3.07

21 13.03 0.000 22.15 620 0.000 1.86 2.04 2.22

22* 0.70 0.403 11.05 618 0.000 1.01 1.22 1.44

23 19.14 0.000 40.15 620 0.000 2.78 2.92 3.07

Note: Confidence level of 95%*: Using t-test for unequal variance samples

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Table D.10: Attributes' characteristics

Attribute PerformanceShopping preference Points

Preference gap

Improvement efficiency

1 -3.00 -1.49 Negative 1.50 0.74

0.98 0.29 Current

3.00 1.78 Positive

2 -3.00 -1.51 Negative 1.96 0.98

1.00 -0.21 Current

3.00 1.75 Positive

3 -3.00 -1.79 Negative 2.00 1.05

1.10 -0.08 Current

3.00 1.93 Positive

4 -3.00 -2.59 Negative 1.32 1.07

1.76 1.39 Current

3.00 2.71 Positive

5 -3.00 -2.26 Negative 0.88 0.96

2.08 1.62 Current

3.00 2.50 Positive

6 -3.00 -2.09 Negative 0.71 0.77

2.09 1.62 Current

3.00 2.33 Positive

7 -3.00 -1.61 Negative 1.33 0.73

1.18 0.53 Current

3.00 1.86 Positive

8 -3.00 -0.79 Negative 1.35 0.54

0.51 -0.35 Current

3.00 1.00 Positive

9 -3.00 -1.27 Negative 0.72 0.45

1.38 0.62 Current

3.00 1.35 Positive

10 -3.00 -1.69 Negative 0.90 0.56

1.40 0.89 Current

3.00 1.80 Positive

11 -3.00 -1.70 Negative 1.24 0.75

1.34 0.61 Current

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3.00 1.85 Positive

12 -3.00 -1.67 Negative 0.81 0.51

1.43 0.68 Current

3.00 1.49 Positive

13 -3.00 -2.53 Negative 1.04 0.83

1.75 1.43 Current

3.00 2.47 Positive

14 -3.00 -2.02 Negative 0.88 0.61

1.56 1.12 Current

3.00 2.00 Positive

15 -3.00 -1.91 Negative 0.80 0.56

1.58 1.21 Current

3.00 2.00 Positive

16 -3.00 -1.80 Negative 0.64 0.45

1.57 1.21 Current

3.00 1.85 Positive

17 -3.00 -0.45 Negative 0.65 0.31

0.91 -0.02 Current

3.00 0.63 Positive

18 -3.00 -1.77 Negative 1.15 0.71

1.37 0.81 Current

3.00 1.96 Positive

19 -3.00 -2.15 Negative 0.57 0.43

1.67 1.28 Current

3.00 1.86 Positive

20 -3.00 -1.94 Negative 0.82 0.52

1.44 0.99 Current

3.00 1.80 Positive

21 -3.00 -1.71 Negative 1.38 0.50

0.25 0.33 Current

3.00 1.71 Positive

22 -3.00 -1.08 Negative 1.12 0.48

0.67 0.14 Current

3.00 1.26 Positive

23 -3.00 -1.73 Negative 0.52 0.31

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1.34 1.19 Current

3.00 1.71 Positive

Note: -3= strongly disagree; 3= strongly agree

Table D.11: List of attributes in the order of preference gap

Preference gap

Attribute Mean St. Dev

3 2.00 0.08

2 1.96 0.08

1 1.50 0.10

21 1.38 0.09

8 1.35 0.10

7 1.33 0.10

4 1.32 0.09

11 1.24 0.08

18 1.15 0.08

22 1.12 0.11

13 1.04 0.09

10 0.90 0.08

5 0.88 0.09

14 0.88 0.09

20 0.82 0.08

12 0.81 0.09

15 0.80 0.08

9 0.72 0.09

6 0.71 0.09

17 0.65 0.10

16 0.64 0.08

19 0.57 0.08

23 0.52 0.08

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Table D.12: List of attributes in the order of improvement efficiency

Attribute Improvement efficiency

4 1.07

3 1.05

2 0.98

5 0.96

13 0.83

6 0.77

11 0.75

1 0.74

7 0.73

18 0.71

14 0.61

10 0.56

15 0.56

8 0.54

20 0.52

12 0.51

21 0.50

22 0.48

9 0.45

16 0.45

19 0.43

23 0.31

17 0.31

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Table D.13: Pair test for difference in improvement efficiency

Pairs of Simulation

attributes Difference Significant

1-12 0.22778758 0.00

4-5 0.10379745 0.24

5-6 0.19161704 0.12

7-10 0.1656534 0.02

3-2 0.07338015 0.17

2-18 0.27324557 0.00

18-14 0.09380276 0.14

14-15 0.05061586 0.30

20-16 0.07939662 0.17

13-21 0.32472121 0.00

22-17 0.17101926 0.01

Note: Tested by 10,000 Monte Carlo simulations, confidence level of inputs is 95%

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APPENDIX E: QUALITY ATTRIBUTES OF A SUPERMARKET

General1. Are the open hours convenient for you?2. Is the store location convenient for you?

Parking6

3. Is the parking area monitored by security guards?4. Do the staffs help you in parking?5. Do they serve you with smile?6. Is the arrangement appropriate?7. Do you wait when you take your vehicle in/out the parking?8. Is it easy to go to the super market from the parking?9. Is the parking fee expensive?10. Is there adequately parking, even for the hot time?

Welcome6

11. Are there enough entries to go into the super market?12. Are the watchmen willing to guide?13. Are there enough lockers?14. Is the locker large enough?15. Is the locker safe?16. Is the locker near the entries?17. Do the staffs serve you with a smile?18. Do you wait when you take your bag in/out the locker?19. Are there the shopping trolleys/baskets?20. Is there the layout map?

Layout6

21. Are the stalls arranged suitable?22. Is it easy to find the goods?23. Is it easy to take the goods?24. Are the goods arranged attractively?25. Are the staffs willing to guide?26. Is their information helpful?27. What do they do when you are confused?28. Is the spacing (between the stalls) large enough? 29. Is the floor clean? 30. Is there enough light? 31. How is the atmosphere of the super market?32. Is the price posted clearly?

6 Source: Nga, H.D.N., Thanh, T.D., and Hanh, T.M., Quality of Co-op Mart Cong Quynh, 2000, Swiss-AIT-Vietnam Management Development Programme (SAV), Viet Nam.

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Goods (in self-service area only) 6

33. Do the supermarket offer a wide range of categories of goods?34. Are goods are availability 35. Are models of goods good looking? 36. How reasonable are the goods prices comparing with others?37. Do the goods have clear origin?38. Do you believe in quality of goods39. How often they introduce new goods?40. Do they have some special goods?41. Do the staffs introduce the specification of the goods to you?42. Do the staffs introduce the appropriate goods to you?43. Do the staffs serve you with a smile?44. Have you ever seen an out-of-date product in this place?45. Are the goods maintained in the right condition?

Billing 6

46. Are there enough counters?47. Do the staffs serve you with a smile?48. Are billing staffs trained on equipment?49. Is the billing believable?

Post shopping 6

50. Is it acceptable to return goods?51. How do they guarantee products?52. Do you know where to complain?53. Is your complaint responsively resolved?54. Are their solutions satisfied?55. Do they offer convenient facilities to make a complaint (phone line, mail box)? 56. Do the staffs serve you with a smile?

Sales Promotion6

57. Do they have sales promotion campaign?58. How about their credibility?59. How effective are the media using in sales promotion?60. Do they have something especially cheaper than others do?61. Do the staffs explain clearly to you about their campaign?62. Do the staffs serve you with a smile?

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REFERENCES

1. Noriaki Kano, Guide to TQM in Service Industries, 1996, Asian Productivity Organization, Tokyo.

2. Ashok Rao, Lawrence P. Carr, Ismael Dambolena, Robert J. Kopp, John Martin, Farshad Rafii, Phyllis Fineman Schlesinger, Total Quality Management: A Cross Functional Perspective, 1996, John Wiley & Sons, Inc., U.S.A.

3. Neil Bruce Holbert and Mark W. Speece, Practical Marketing Research – An Integrated Global Perspective, 1993, Prentice Hall, Singapore.

4. Eugene W. Anderson, Claes Fornell, and Donald R. Lehmann, “Customer Satisfaction, Market Share, and Profitability: Findings From Sweden”, Journal of Marketing, Vol. 58 (July 1994), p.53-66.

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6. X.X. Shen, K.C. Tan, and M. Xie, “An Integrated Approach to Innovative Product Development Using Kano’s Model and QFD”, European Journal of Innovation Management, Volume 3, Number 2, 2000, MCB University Press, p. 91-99.

7. Parasuraman, A., Valarie Zeithaml, and Leonard Berry, “A Conceptual Model of Service Quality and Its Implications for Future Research”, Journal of Marketing, 49 (Fall), 1985, p.41-50.

8. Parasuraman, A., Leonard Berry, and Valarie Zeithaml, “Servqual: A Multiple-Item Scale for Measuring Customer Perceptions of Service Quality”, Journal of Retailing, 64, 1(1988), p.12-40.

9. Parasuraman, A., Leonard Berry, and Valarie Zeithaml, “Refinement and Reassessment of the Servqual Scale”, Journal of Retailing, 67 (Winter 1991), p.420-450.

10. Carmines, E. G., and Zeller, R. A., “Reliability and Validity Assessment”, Sage Publications, Series Number 07-017, 1979, Newbury Park, Sage Publications, Inc.

11. Cronin, J. J., Taylor, S. A., “Measuring Service Quality: A Reexamination and Extension”, Journal of Marketing, Vol. 56 (July 1992), p.55-68.

12. Teas, R. K., “Expectation, Performance Evaluation, and Consumers’ Perception of Quality”, Journal of Marketing, Vol. 57 (October 1993), p.18-34.

13. Peak, H.S., Supermarket: merchandising & management, 1977, Prentice Hall, New Jersey.

14. Lewison, D.M., Retailing, Fifth edition, 1994, Macmillan, New York.

15. Charvar, F.J., Supermarketing, 1961, Macmillan, London.

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16. McCleland, W.G., Studies in Retailing, 1963, Blackwell, Oxford.

17. Khalifa Othman, Patterns of Supermarket Use in Malaysia, 1990. (In Findlay, A. M., Paddition, R., and Dawson, T.A., Retailing Environments in Developing Countries, p.205-2113, 1990.)

18. Luc Thi Thu Huong, Assessment The Long-Term Viability of Supermarkets: A Customer Survey in Hanoi, 1997, Asian Institute of Technology, Bangkok, Thailand.

19. Tu Giang, “Di Mua Sam o Sieu Thi”, Dau Tu, 11/11/1999, Viet Nam, p.15.

20. Chanh Khai, “Sieu Thi Tro Minh”, Thoi Bao Kinh Te Sai Gon, 18/01/2001, Vol. 4-2001 (525), Viet Nam, p.11-12.

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