SERVICE QUALITY AND CUSTOMER SATISFACTION IN SMES IN BENIN CITY
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SERVICE QUALITY AND CUSTOMER SATISFACTION IN SMES IN BENIN CITY
Abstract
Customer satisfaction and service quality are crucial components in tackling global concerns such as customer satisfaction and service quality. Service quality promotes customer satisfaction because when consumers receive outstanding service, their requirements and expectations are met,
which enhances customer satisfaction and helps establish a positive picture of the organisation in the minds of potential customers. Despite this interest, little empirical study on relationship-marketing practises among SMEs,
particularly those in developing countries, has been conducted. The purpose of this study is to look at the effects of service quality on customer satisfaction in Benin City.
Chapter One
Introduction
1.1 Background of the Study
Despite the importance of ensuring customer happiness, several academics (Harwood and Garry, 2006) believe that current research has mostly focused on customer relationships in major corporations. There are few empirical research on customer satisfaction in small and medium-sized businesses (Simpson et al., 2006).
Furthermore, the majority of previous disputes have taken place in the setting of Western subculture (Yau et al., 2000). As a result, customer satisfaction developed in the Western world may not necessarily apply to Small and Medium Enterprises (SMEs) in diverse socio-cultural contexts.
SMEs have the power to accelerate monetary growth and create jobs in the majority of developing countries. In Nigeria, SMEs generate 250,000 jobs per year and contribute roughly 30% of the country’s Gross Domestic Product (GDP).
They are the source of new jobs in the country and contribute significantly to income generation, particularly among the poor (Small and Medium Enterprises), Business Guide, 2008).
If SMEs are to contribute to the growth of national economies, they must be handled efficiently. As a result, it is critical for researchers and policymakers to thoroughly understand the marketing operations of SMEs.
This will encourage diagram management to enhance customer satisfaction, allowing SMEs to succeed in creating good customer connections (Boag and Dastmalchian, 1988, as cited in Davis, 1997, p.32).
Despite the fact that SMEs have been considered as a bastion for job creation and technical growth in Nigeria, the sector has seen its fair share of neglect, with negative consequences for the economy.
In a seminar titled “Career Crisis and Financial Distress- The Way Out,” Mr. Oluseyi Oluboba, General Manager of Enterprise and Financial Support Company Limited, identified in his paper the following as the fundamental problems of SMEs,
which are alternatively not insurmountable: low degree of entrepreneurial skills, poor administration practises, constrained access to cash and capital markets, low equity participation from promoters due to insufficient person resources.
Despite these efforts, there is little understanding of how service quality contributes to customer satisfaction in SMEs, necessitating the need for this study to determine Service quality as a catalyst for customer satisfaction in SMEs with a better understanding of the relationship between the two in order to better tailor stimulation programmes to target SME competence needs. Storey (1997)
1.2 Statement of the Problem
Without a doubt, a nation’s ability to create and successfully bring invention to market will be a critical driver of its global competitiveness in the future decade. Policymakers are becoming more aware that innovative activity is the primary driver of economic success and well-being, as well as a potential role in tackling global challenges in fields such as industry and academia.
Even governments that have mostly avoided active industrial policy in recent years are looking for new methods to improve the climate for innovation in order to boost productivity and growth. The United States, for example, proposed the “Innovate America” plan.
Customer satisfaction is driving the growing speed of innovation, in addition to significant improvements in scientific discoveries and general-purpose technology. This is the motivation behind this research. SMEs have faced greater competition as well as ongoing price constraints.
Globally, SMEs have been looking for innovative strategies to survive and grow in this competitive environment. Over the last decade, a variety of marketing tactics have been created to deal with these shifts.
Among them, achieving customer satisfaction has received the most attention from academics (Wang, 2006) and practitioners. Because the corporate environment has become more dynamic and customers have become more demanding, enterprises have shifted their focus to RM in order to remain competitive (Boyd et al., 2002).
1.3 Aim The study
The study’s goal is to evaluate service quality and customer satisfaction in SMEs in Benin City. The precise goals are as follows:
To determine whether service quality has any effect on customer satisfaction in Benin City SMEs.
To investigate which aspects of service quality in Benin City SMEs may be enhanced.
To determine the significance of customer satisfaction in Benin City SMEs.
1.4 Research Questions
Is there any relationship between service quality and customer happiness in Benin City SMEs?
Does the quality of services in Benin City SMEs improve?
Is client happiness important in SMEs in Benin City?
1.5 research Hypotheses
The researcher developed the following research hypotheses in order to successfully complete the study:
H0: service quality has little impact on customer satisfaction in Benin City SMEs.
H1: Service quality influences customer satisfaction in Benin City SMEs.
H02: The quality of services provided by SMEs in Benin City may not be enhanced.
H2: The quality of services provided by SMEs in Benin City might be improved.
H03: Customer satisfaction is unimportant in Benin City SMEs.
H3: Customer satisfaction is important in Benin City SMEs.
1.6 Importance of the research
The purpose of this research is to educate the general public, SMEs, and the government on service quality and customer satisfaction in Benin City SMEs. It is intended to educate the SME on the need of accompanying their consumers in order to provide them with the necessary satisfaction.
Furthermore, the study is intended to inform SMEs that various service quality issues on their clients can damage their patronage. However, the purpose of this study is to draw to the government’s attention the fact that SMEs might assist in reducing service quality for customers.
This study will be extremely useful to other researchers who want to learn more about this topic, and it can also be utilised by non-researchers to expand on their work. This study adds to information and could be used as a guide for future work or study.
1.7 scope of The study
The study’s scope includes work on service quality and customer satisfaction in SMEs in Benin City. The survey will only include selected SMEs in Benin City.
1.7 Limitations of the Study
Financial constraint- A lack of funds tends to restrict the researcher’s efficiency in locating relevant materials, literature, or information, as well as in the data collection procedure (internet, questionnaire, and interview).
Time constraint- The researcher will conduct this investigation alongside other academic activities. As a result, the amount of time spent on research will be reduced.
Availability of research materials: The researcher’s research materials are insufficient, restricting the scope of the investigation.
1.9 Definition of Terms
Service quality: In its modern definition, service quality is a comparison of perceived expectations of a service with perceived performance, giving rise to the equation
Customer satisfaction is described as a metric that determines how satisfied customers are with a company’s products, services, and capabilities. Customer satisfaction data, such as surveys and ratings, can assist a firm in determining how to enhance or adjust its products and services.
SME: Small and medium-sized enterprises, often known as small and medium-sized firms, are companies with less than 100 employees.
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