A Review of the Effect of the Role of Purchase Rewards to Customers, as a Purchase Intention Mediator, on the Profitability of SMEs (Small and Medium-sized Enterprises) in Sanandaj City

Arezoo Nazari,Parastoo Sedaghat

doi:10.5901/mjss.2015.v6n6s6p261

Abstract

The present research study intended to investigate the impact of the Role of Purchase Rewards to Companies’ Customers, as a Purchase Intention Mediator, on the Profitability of SMEs in Sanandaj City in 2014. Three different types of variables, including Independent, Dependent and Intervening variables, are specified in this study; Purchase Rewards to Customers is the Independent Variable, Profitability is the Dependent Variable and the Purchase Intention Mediator is the Intervening Variable. The ultimate research application of the current study is that of Applied Research implementations based on the descriptive research methods. To this end, correlational research and survey research methods were selected as the branches of descriptive research. The study’s statistical population consists of 444 companies’ Managers and an unlimited number of Customers of SMEs in Sanandaj city among which 206 managers and 384 clients were selected as sample population based on Cochran’s Sample Size Formula. Moreover, Likert Scale Questionnaire was employed to accomplish the survey research in order to collect research data required. The research data were analyzed both descriptively and inferentially, using LISREL8.7 and SPSS18 softwares, based on Pearson Correlation Coefficient test and Structural Equation Modeling (SEM). To estimate the reliability of the Questionnaire, Cronbach Alpha Reliability measure of estimation was adopted; accordingly, the reliability of the questionnaires of the research three different variables such as Purchase Rewards to Customers Variable, Profitability variable and Purchase Intention Mediator variable were estimated as 0.841, 0.747 and 0.839 successively. Furthermore, the research hypotheses were confirmed at %95 confidence level. Consequently, it was concluded that, based on the research results, the role of purchase rewards to customers had a statistically significant effect on the profitability of SMEs in Sanandaj city. The type of rewards and the time of the rewardings were ranked accordingly; the former got the first rank while the latter got the second rank. It was concluded that the more the purchase intentions of the customers, the lesser the relationship between the role of purchase rewards and the profitability of SMEs. DOI: 10.5901/mjss.2015.v6n6s6p261

Highlights

The role of customers in companies’ customer service processes is the utmost influential factor on the organizational efficiency, performance and profitability of the service providing firms; customer services are considered as value and quality resources and staff; and, play a crucial role in determining service delivery time and service capacities of the service providing firms
Regarding the survey research objectives, the present study describe, predict and analyse the variables’ relationships; and considering the time of the research data collection, this study is accounted as a cross-sectional research
To accomplish the purpose of this study, the following research questions was addressed: RQ1: Does purchase rewards to customers have any statistically significant effect on the profitability of SMEs in Sanandaj? In the analytical model of the research, the variables were specified as being Rewards, Profitability and Purchase

Summary

Introduction

The role of customers in companies’ customer service processes is the utmost influential factor on the organizational efficiency, performance and profitability of the service providing firms; customer services are considered as value and quality resources and staff; and, play a crucial role in determining service delivery time and service capacities of the service providing firms. Service managers eventually attempt to encourage customers’ behaviours by providing customers services particularily in cases clients’ demand capacity increases. If such customer behaviours continue to occur voluntarily, the potential negative effects of the customer behaviours possibly remain insignificant. As one can categorize the staff’s expected behaviours into Duty Behaviours (Task Behaviours) and Off-duty Behaviours (Organizational Citizenship Behaviours), customers’ behaviours are classified in the same order. Customers’ duty behaviours are defined as their expected behaviours in order to assist companies fulfil successful production and service providing, their off-duty behaviours are defined as those behaviours customers perform optionally and voluntarily and which are appreciated by demonsterating the behaviours’ tenderness, usefulness and solidarity on the behalf of service companies’ administrators

Objectives

Methods

Results