The Impact of a Customer Service Intervention and Facility Design on Firm Performance

Abstract

The purpose of this research was to investigate the impact of a customer service intervention and store design on store performance within a regional food retailing chain. A longitudinal study examines the organization’s implementation of a customer service intervention which utilized new service standards and customer feedback mechanisms. Moreover, the chain provided a natural experiment, since the forty-six stores in this chain represented three levels of facility design ranging from the traditional supermarket to the extended “store of the future” format. A theoretical model relating the customer service intervention, variations in store design, and customer satisfaction to sales performance was developed. Using both operational performance data from each of the stores and 1,537 responses from customer satisfaction surveys, a LISREL model was used to test the predictive fit of the model. The results indicate that both the store design and the customer service intervention had a significant, positive impact on customer satisfaction which, in turn, significantly affected sales performance (sales per labor hour). In addition, the customer service intervention had a direct effect on sales performance, although there was no support for a direct relationship between store design and sales performance. This research provides a theoretical basis in helping management understand how to leverage customer service for improved sales performance.