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Retail service.ppt

  1. 1. The Management of Service and Quality in Retailing Dr. Gopal Thapa Tribhuvan University
  2. 2. What constitutes Retailing  Tangible features  Intangible services 2/5/2023 Prepared by Dr. Gopal Thapa 2
  3. 3. Service components in retailing  Transaction with merchandise  Owned-goods service would be the traditional outright purchase and ownership of a good from a retailer.  Rental-goods service would deliver a tangible good, such as a car, for the personal use of the customer.  No ownership exists and the good has to be returned.  Service with bought goods indicates that the retailer performs/supplies extra services.  These could include delivery, wrapping, providing credit, etc. 2/5/2023 Prepared by Dr. Gopal Thapa 3
  4. 4. Transaction without merchandise  In retailing there is also service without goods: pure services without goods.  Pure services are provided by a wide range of retailers who are involved in arranging or organizing travel, financial transactions and services, or providing personal services such as dry cleaning, a haircut or shoe repairs. 2/5/2023 Prepared by Dr. Gopal Thapa 4
  5. 5. Service Characteristics  intangibility;  perishability;  inseparability 2/5/2023 Prepared by Dr. Gopal Thapa 5
  6. 6. Service Quality Management 2/5/2023 Prepared by Dr. Gopal Thapa 6  Product-attribute approach  Consumer-oriented approach
  7. 7. Product-attribute approach  The product-attribute approach is based upon trying to match the product’s conformance to standardized requirements which have been set by reference to what company managers think the failure point to be.  Product-attribute approaches rely on trying to control the company’s output by using an internal standard-setting perspective.  This relies on an inward-looking and trading-led management style, rather than a marketing-led approach. 2/5/2023 Prepared by Dr. Gopal Thapa 7
  8. 8. Consumer-oriented approach  It recognizes that the holistic process of service delivery has to be controlled by taking into consideration the expectations and attitudes of retail customers.  If the starting point for management is the understanding of how quality is judged by customers then the perception processes of this judgment, as to whether a service is good or bad, can be managed. 2/5/2023 Prepared by Dr. Gopal Thapa 8
  9. 9. The Gronroos model (1982) of perceived quality management 2/5/2023 Prepared by Dr. Gopal Thapa 9
  10. 10. Technical Quality (What?)  Technical solutions  Know-how  Computerized systems  Machines 2/5/2023 Prepared by Dr. Gopal Thapa 10
  11. 11. Functional Quality (How?)  Customer contact  Attitudes  Internal relations  Behavior  Service-mindedness  Appearance  Accessibility 2/5/2023 Prepared by Dr. Gopal Thapa 11
  12. 12. 2/5/2023 Prepared by Dr. Gopal Thapa 12
  13. 13. Model of Service Quality: Ziethaml (1985)  Gap 1: Ignorance of the customer’s expectations  Gap 2: Requirement for service design standards  Gap 3: Not delivering to service standards  Gap 4: Inconsistency between performance and promises  Gap 5: The service shortfalls 2/5/2023 Prepared by Dr. Gopal Thapa 13
  14. 14. Implementation of Service Management  Leadership and commitment by senior management,  The focus of all changes and objectives should be defined by the customer  The orientation of the organization needs to adopt a process and systems approach to match or exceed customer expectations  Human resource management is required to motivate, reward, train and educate staff  to understand and deliver the concepts of quality. 2/5/2023 Prepared by Dr. Gopal Thapa 14
  15. 15. Implementation of Service Management ( contd…)  Assessment needs to be made of the added value and benefit of any change rather than there being an emphasis on costs and profit implications.  That is, the long-term benefits of any change need to be the focus of decision-making.  A need for quality audits and control to ensure the service meets or exceeds customer expectations must be recognized. 2/5/2023 Prepared by Dr. Gopal Thapa 15
  16. 16. Factors with potential for prompting complaints and compliments 2/5/2023 Prepared by Dr. Gopal Thapa 16
  17. 17. Growing emphasis on quality control  Companies need to find new ways of creating differential advantage by providing better service levels than their competitors.  Retail competition has increased because services and goods are available from a wide range of channels and manufacturers are creating technically satisfactory goods that require little after-sales service. 2/5/2023 Prepared by Dr. Gopal Thapa 17
  18. 18. Growing emphasis on quality control (Contd..)  The increased levels of consumerism and the greater media attention on quality have meant that companies have to be more responsive to quality issues.  Consumers are far more aware of their rights and are less likely to suffer quietly from the results of poor quality. 2/5/2023 Prepared by Dr. Gopal Thapa 18
  19. 19. Growing emphasis on quality control (Contd..)  There has been a growing sophistication of consumer markets, with the non-price factors of image, retail offer positioning and service delivery processes becoming more important.  Technology is one of the new applications to quality enhancement.  It can aid service by providing higher levels of convenience:  for example, automatic vending or ticketing machines, bar code checkout systems to improve accuracy and speed of transaction, or smart card developments – all of which provide memory of purchases. 2/5/2023 Prepared by Dr. Gopal Thapa 19
  20. 20. Key Terms For Quality  Quality is the totality of relationships between service providers (functional aspects) and the features of retailing (technical aspects) which are related to the delivery of satisfaction.  Quality control checks, and also monitoring processes to ensure that measurement of service delivery is taking place 2/5/2023 Prepared by Dr. Gopal Thapa 20
  21. 21. Key Terms For Quality (Contd…)  Total quality management (TQM) is a holistic organizational approach which systematically attempts to improve customer satisfaction by focusing on continuous quality improvements without incurring unacceptable cost increases.  TQM is managed by quality assurance arrangements; that is, a system is instituted to allocate responsibility for planned and systematic activities which will ensure that the product will provide the right levels of satisfaction for all concerned. 2/5/2023 Prepared by Dr. Gopal Thapa 21
  22. 22. Key Terms For Quality (Contd…)  In order to measure whether the quality delivery complies with the planned delivery of the service a quality audit needs to take place to judge the effectiveness of the total service delivery arrangements.  For a system to be audited correctly a method of creating unbiased feedback must be found. 2/5/2023 Prepared by Dr. Gopal Thapa 22
  23. 23. Characteristics of Quality  Merchandise  Service 2/5/2023 Prepared by Dr. Gopal Thapa 23
  24. 24. Merchandise categories  performance based upon inherent operating characteristics, such as the sound and clarity of a hi-fi system;  features which add to the basic function of the product;  reliability of the product not to break down in normal use;  conformance to standards of safety or operating performance needs; 2/5/2023 Prepared by Dr. Gopal Thapa 24
  25. 25. Merchandise categories (Contd..)  durability based upon the length of time a product will last;  serviceability – relating to the after-sales service and ability to be repaired;  aesthetics of the look, feel, design, sound and smell of the product;  image of the brand association, reputation and personality of the product. 2/5/2023 Prepared by Dr. Gopal Thapa 25
  26. 26. Service categories  Tangibles  Reliability  Responsiveness  Competence  Empathy 2/5/2023 Prepared by Dr. Gopal Thapa 26
  27. 27. QUALITY AUDITING SYSTEMS (Based on Customers Preferences)  external appearance of the branch;  merchandise pricing in window display;  greeting upon entry;  staff approachability;  staff availability to help;  manager availability;  whether the manager is recognizable;  the number of customers served simultaneously by one staff member; 2/5/2023 Prepared by Dr. Gopal Thapa 27
  28. 28. QUALITY AUDITING SYSTEMS (Based on Customers Preferences)  efficiency/promptness of enquiry handling;  branch stock levels;  staff awareness of fashion trends;  speed of stock location;  staff awareness of advertised lines;  helpfulness of staff advice;  honesty of staff advice;  standard of fitting rooms; 2/5/2023 Prepared by Dr. Gopal Thapa 28
  29. 29. QUALITY AUDITING SYSTEMS (Based on Customers Preferences)  availability of advertised stock;  colour/size availability;  selection within size;  availability of alterations advice;  availability of garment reservation;  eye-catching quality of window displays;  eye-catching quality of interior displays;  speed of till transaction;  comparability of service in other Jaeger branches. 2/5/2023 Prepared by Dr. Gopal Thapa 29
  30. 30. Benchmarking  A method now widely used for assessment of the service standards of a company is to compare them with those which are deemed to be the best available  It is a continuous process of selecting the best practices and services against which to judge.  It is based upon the Japanese concept dantotsu, meaning ‘best of the best’  If you seek out and match the best practice there is the possibility of the attainment of superiority 2/5/2023 Prepared by Dr. Gopal Thapa 30
  31. 31. Four Types of Benchmarking  Internal: where the best internal company examples are utilized  Competitive: based upon external directly competing retailers and their merchandise  Functional: which measures against the best external market leaders or functional operations  Generic: which is to take measures of the best practices regardless of what sectors or industry is represented 2/5/2023 Prepared by Dr. Gopal Thapa 31
  32. 32. Service Recovery  Service recovery relates to the planned systems and effort that a firm provides to correct a problem following a service failure with the specific objective of retaining a customer’s goodwill.  Given that the estimated cost of finding a new customer is five times that of retaining an existing one,  there is growing emphasis on customer retention and relationship marketing.. 2/5/2023 Prepared by Dr. Gopal Thapa 32
  33. 33. Service Recovery  When a dissatisfied customer defects, the lifetime value of that individual and anyone else who switches due to negative comments is affected  Long-term revenue can be enhanced by service recovery strategies. 2/5/2023 Prepared by Dr. Gopal Thapa 33
  34. 34. Service Recovery  Good service recovery procedures allow a customer to refocus on the satisfactions received from the service delivery process rather than to question why corrective action was not taken.  A problem tests the system and if a customer complaint is dealt with appropriately the customer is likely to become more loyal. 2/5/2023 Prepared by Dr. Gopal Thapa 34
  35. 35. Effective recovery requires  Acting fast  Admitting mistakes  Empathy  Relationship  Informing and clarifying  Remedial action 2/5/2023 Prepared by Dr. Gopal Thapa 35
  36. 36. Individual service recovery strategies  Watching for sign language  Preplanning  Training  Empowerment 2/5/2023 Prepared by Dr. Gopal Thapa 36
  37. 37. Any Queries? Thank you 2/5/2023 Prepared by Dr. Gopal Thapa 37