Impact of Service Quality on Customer Satisfaction: Evidence from Boiler Water and Cooling Tower Water Treatment Chemical Industry in Sri Lanka

Abstract

Boiler water and cooling tower water treatment chemical industry is one of the markets where high competitive rivalry exists. Therefore, increasing the market share even by a very small percentage is a considerable challenge. Also, retaining the existing customers is a difficult task since the bargaining power of the buyer is high in this market. Therefore, operational cost that has to be borne by the supplier to retain their customers is a considerable cost. Hence, it is important to identify the factors that affect the customer satisfaction in this particular industry since it will enable to make decisions on how and to what extent that investment should be made to enhance the customer satisfaction and thereby increase the market share. This study is dedicated to understand the relationship between the service quality and customer satisfaction in the above mentioned industry. A customer feedback survey was carried out using a standard questionnaire distributed among 50 customers who contribute more than LKR80,000 per year to the revenue of XYZ company. The SERVQUAL model was used to measure the service quality. After data was collected and treated with statistics, it revealed that there is a strong positive relationship between the service quality and customer satisfaction. And the five dimensions of the service quality also have relationships with the customer satisfaction independently.