A Study on the Influence of International Freight Forwarders' Service Quality and Price Competitiveness on Customer Loyalty: the Case of South Korea

Abstract

There are very few studies on the causal relationship of international freight forwarders’ service quality, dealing with service value together. The purpose of this study is to find out which of service quality and price competitiveness has a greater effect on customer loyalty, and how different effect service quality factors have on customer loyalty. The measures of various variables have been selected through literature review. Korean importing and exporting companies were requested for online and phone survey and 200 companies responded. The collected data has been analyzed using the AMOS 18.0. The key findings of this study are: (1) international freight forwarders’ service quality and price competitiveness influence on customer loyalty positively with service value and customer satisfaction as mediating variables; (2) the service quality influences on customer loyalty more than the price competitiveness does; and (3) the customer orientation as a service quality factor influences on customer loyalty more than the operation characteristics factor does. The implications of this study are: (1) international freight forwarders need to have more competitive advantage in service quality than in price competitiveness, especially in the customer orientation factor in order to obtain customer loyalty; and (2) they need to invest in their resources, especially in IT resources and human resources as a way to gain such competitive advantages.