Factors Affecting Resto-bar Customer Satisfaction

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face-to-face customer satisfaction survey of 96 customers of a Philippine resto-bar, this study focuses on .... extant literature on customer satisfaction by focusing ...
Factors Affecting Resto-bar Customer Satisfaction: Imperatives for Philippine Restaurateurs Pursuing Repatronage Ma. Josephine E. Inocencioa, Jeanette Angeline B. Madambab, Loida E. Mojicac, Normito R. Zapata, Jr.d a

Ropali Corporation, Philippines Department of Agribusiness Management and Entrepreneurship, University of the Philippines Los Banos, Philippines c Department of Agribusiness Management and Entrepreneurship, University of the Philippines Los Banos, Philippines d Department of Agribusiness Management and Entrepreneurship, University of the Philippines Los Banos, Philippines b

Received 30 May 2016, Revised 13 June 2016, Accepted 22 June 2016

Abstract In a highly competitive sector such as the restaurant industry, entrepreneurs find it difficult to keep afloat as they encounter constantly changing customer tastes and preferences. Utilizing a face-to-face customer satisfaction survey of 96 customers of a Philippine resto-bar, this study focuses on evaluating the level of customer satisfaction in a Philippine resto-bar and determining which dining attributes or factors affect customer satisfaction. Results show that while the resto-bar customer satisfaction ratings were highest for variety of menu and for some food and beverage offerings factors such as food presentation and freshness and temperature of food items, customer satisfaction ratings were quite low for other factors such as coldness of beverages, food palatability, waiting time, appropriateness of price of food and beverage offerings and promotional discounts. With respect to dining attributes or factors which affect customer satisfaction, the study revealed that food and beverage offerings, value for money and service are significant factors which are positively associated with customer satisfaction while location and ambience in general are not significant factors affecting customer satisfaction. Keywords: Customer Satisfaction, Philippines, Repatronage, Resto-bar, Service Quality JEL Classifications: L83, M31

Ⅰ. Introduction Amidst a competitive market, firms strive for ways to hold on to market share or to even snag more of it. Considerable research has been

devoted to quality and customer satisfaction in view of their utmost importance in firm success and survival. Customer satisfaction and quality are among the global issues plaguing organizations and the restaurant industry is no

a

First Author, E‐mail: [email protected] Corresponding Author, E‐mail: [email protected] c Co‐Author, E‐mail: [email protected] d Co‐Author, E‐mail: [email protected] b

2016 The Korea International Trade Research Institute. All rights reserved.

Electronic copy available at: https://ssrn.com/abstract=2962410

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exception Yap and Kew, 2007 . The restaurant business is seen as a relevant yet neglected topic of study Kivela, Inbakaran and Reece, 1999 . In their study, Yap and Kew 2007 concluded that quality and customer satisfaction showed a direct positive effect on the repatronage intentions of customers patronizing restaurants in Malaysia. Results in a study conducted by Allegra Strategies Limited 2013 revealed that 10% of respondents identified bar or pub restaurants as one of the fastest growing food and beverage business types in 2020. The success of bar and restaurant enterprises is very evident especially in the Philippines where almost every town or city has one or more of this type of restaurant. A bar and restaurant, or resto‐bar, is a retail food service establishment that serves alcoholic, non‐alcoholic, and mixed drinks for consumption on the premises. Food and beverages can be served simultaneously or the drinks first before the food, or the other way around Rojo, 2008 . Similar to a bar, resto‐bars also have “happy hours” and mostly operate at late afternoon until dawn. “Happy hours” or late night programs are done in order to attract more customers and add revenues by reducing the prices of food and beverage offerings. Resto‐bars offer a full array of food options unlike that of a bar in which food options are limited to finger foods and snacks. Dining attributes in such resto‐bars essentially remain unexplored upon an examination of existing literature, most specifically as these relate to service quality and customer satisfaction. Service quality was perceived as a function covering the gaps between expectation and performance along with restaurant attributes like food quality, service transaction, environment, convenience issues and its overall images as

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Parasuraman, Zeithaml and Berry 1985 originally viewed this concept Yap and Kew, 2007 . Food safety and cleanliness, taste and freshness or food quality, value for money and clean preparation were the top attributes customers looked for in the case of off‐premise dining services Villamayor, 2007 . Other important attributes identified by Villamayor 2007 include availability of products, packaging, proximity and variety of food/beverage choices. Cruz 2003 and Quizon 2012 on the other hand stated in their respective studies on coffee shops that value for money, excellent coffee and food quality, convenient location and good ambience “homey” atmosphere were the dining attributes that customers looked for and prompted them to return.

1. The Global Restaurant Industry According to the data reported by ReportLinker 2013 gathered thru Data Monitor, the global restaurant industry was able to generate revenue of almost US $1.6 trillion in 2010. In the same report, the expected value of the global food and beverage service industry will reach US $992 billion in 2014 with a volume of 586 billion transactions. Projected growth of the global restaurant industry is expected to slow down yearly for five years, and in 2015, the expected revenue in the global restaurant industry is seen at US $1.8 trillion. The Asia‐Pacific region has the highest market share in the global food and beverage service industry, grabbing 43% of the market share. While the United States of America captured almost half of the global market share in terms of the fast‐food industry, it merges with the European Union and Asia‐Pacific regions to take hold of the market in the global mobile food services industry ReportLinker,

Electronic copy available at: https://ssrn.com/abstract=2962410

Factors Affecting Resto-bar Customer Satisfaction: Imperatives for Philippine Restaurateurs Pursuing Repatronage

2013 .

Ⅱ. Study Objectives and Methodology This study attempts to contribute to the extant literature on customer satisfaction by focusing on a specific type of restaurant a resto‐bar in another location: metropolitan Manila in the Philippines. A customer satis‐ faction survey was crafted to evaluate the level of satisfaction of resto‐bar customers and determine which dining attributes affect customer satisfaction and therefore, impact on customer retention though repatronage. This survey includes the demographic profile of the respondents, top dining attributes extracted from the review of related literature conducted, and measures of overall satisfaction of customers. Questions were of several types: close‐ and open‐ended questions, objective type of questions wherein the respondents have to rate from a specified scale, multiple‐choice questions, and subjective type of questions in which space in the questionnaire was provided for respondents to explain their answers and state suggestions or complaints. Since the study covered customer satis‐ faction, only the current customers of the resto‐bar served as survey respondents. The authors used a convenience sample to get survey responses. According to the owners of the business, with the average number of daily customers at half of their seating capacity, the resto bar’s seating capacity is 98, thus an average of 49 customers patronize the resto‐bar every day for six days. The total population is therefore estimated to be 1,176 customers. Using Slovin’s formula, though the sample

size is 92, the authors opted to use a total of 96 respondents who are current customers of the resto‐bar. Descriptive statistical analysis was used for the profile of the respondents and to determine the points for improvement relative to the different attributes. Frequency counts and percentage distribution were also utilized in order to evaluate the current market of the business and analyze the factors. Mean ratings were used in determining the standard responses for each question. These were utilized in determining the average mean rating for questions with a specified scale. Each scale has a corresponding weight, thus, 1 strongly disagree; 2 somewhat disagree; 3 neutral; 4 somewhat agree; and 5 strongly agree. For the ratings scale used from 1 to 10, the corresponding satisfaction levels were as follows: 1 extremely dissatisfied, 2 not at all satisfied, 3 very dissatisfied, 4 dissatisfied, 5 fairly dissatisfied, 6 neither satisfied nor dissatisfied, 7 fairly satisfied, 8 satisfied, 9 very satisfied, 10 extremely satisfied, as adapted from Happiness in Nations Veenhoven, 1993 . The formula for satisfaction rating, on the other hand, was adapted from a study conducted by Overseas Chinese Association for Institutional Research 2010 in anticipation of reporting the results by excluding the neutral responses. Satisfaction ratings were computed as follows: Satisfaction rating frequency of positive responses total number of respondents frequency of neutral responses frequency of negative responses total number of respondents frequency of neutral responses

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Spearman’s correlation coefficient and Cramer’s V were used to determine the relationship between the different dining attributes and customer satisfaction. In addition, Spearman’s correlation coefficient was used to determine the relationship of the attributes with customer satisfaction for the questions answered using scales. Spearman’s correlation coefficient was utilized because it was the most appropriate tool given the nature of the data which are mostly ordinal variables. It was also used since the ratings and the numbers of responses are not equal. The following interpretation for the level of association was utilized: if r 0, the association is positive; if r 0, the association is negative; |r| 0.2 very weak association; weak association; 0.2 |r| 0.4 0.4 |r| 0.6 moderate association; 0.6 |r| 0.8 strong association; very strong association. 0.8 |r| 1.0 In testing for the significance of association, let: Ho: The two variables are independent; Ha: The two variables are associated; and Decision Rule: Reject Ho if p‐value α α 0.05 . Otherwise, fail to reject Ho. Cramer’s V was used in determining the strength of relationship between questions answered using nominal variables and customer satisfaction. It was utilized since this is the most appropriate tool for evaluating nominal variables regardless of the number of responses and ratings. The following interpretation for the level of association was used: if V 0, the association is positive; if V 0, the association is negative; |V| 0.1 very weak association

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weak association; 0.1 |V| 0.19 0.2 |V| 0.29 moderate association and; |V| 0.30 strong association.

Ⅲ. Results and Discussion 1. Demographic Profile of the Respondents 1.1. Gender A total of 96 respondents comprised of 69 males and 27 females were interviewed. Clearly, the male respondents dominated in this category 72% compared to females 28% .

1.2. Age The respondents were asked to specify their age in the questionnaire and the lowest age recorded was 19 while the highest was 48. The median age is 26 years old. Majority of the respondents were 26 15.63% , 30 13.54% , and 28 12.50% years old, respectively, while only 1.04% of the respondents belonged to the 35 and 36 age groups. The mean age of the respondents is 28.9792 or 29 years old.

1.3. Civil Status Seventy‐four out of the 96 respondents were single while the rest were married. More than half of the respondents 77.08% were single while 22.92% are married. This means that most of the respondents utilizing the service of the resto‐bar do not have a family of their own yet which suggests the possibility that they will patronize the resto‐bar more often than those with spouses or families.

Factors Affecting Resto-bar Customer Satisfaction: Imperatives for Philippine Restaurateurs Pursuing Repatronage

1.4. Educational Attainment Respondents were either still in college or college graduates. Although more than half of the respondents were college graduates 56.25% , college undergraduates were also current customers of the resto‐bar, representing 43.75% of the respondents.

1.5. Occupation The authors decided to group the answers of the respondents into two occupation categories, which were business process outsourcing BPO and non‐BPO employees since BPO employees are perceived to keep late hours and therefore may be more in need of resto‐bar services. BPO employees include sales representatives, call center agents, sales associates, and Information Technology IT support employees. Non‐BPO employees include engineers, photographers, managers, entrepreneurs, bank tellers, dance instructors, teachers, web designers, pharmacist and consultant. Results revealed that the current customers of the resto‐bar were BPO employees. This was seen in the survey as 58 respondents 60.42% were BPO employees while only 38 respondents 39.58% were non‐BPO employees.

1.6. Monthly Income Bracket Among the respondents, the monthly income bracket of PhP 20,000‐24,999 US $465‐481 garnered the highest number of responses 33 respondents or 34.38% . The lowest recorded monthly income bracket is PhP 15,000‐19,999 US $ 348‐465 with 10 respondents 10.42% belonging to this bracket while only one respondent belonged to the highest recorded monthly income bracket of PhP 50,000‐54,999 US $ 1162‐1279 . The mean monthly income

of the respondents is PhP 27,968.25 which is within the PhP 25,000‐29,999 US $581‐697 bracket.

2. Patronage Pattern of the Respondents 2.1. Type of Customer The respondents were basically of two types, whether it was their first time to dine in the resto‐bar or they have tried and experienced the resto‐bar before. A total of 81 out of the 96 respondents or 84.38% were new customers as it was their first time to dine in the resto‐bar and avail of its offerings and service. Only 15 respondents 15.63% were former customers of the resto‐bar. Although the resto‐bar has a lot of new customers as suggested by the majority of the respondents, it was also alarming to note that only 16% of the customers return to them which insinuates a low level of customer satisfaction in a particular area or relative to the resto‐bar as a whole.

2.2. Frequency of Visit The frequency of visit was tabulated only for the 15 former customers. Five customers 33.33% at most visit and utilize the products and service of the resto‐bar once every two months, while four respondents visit once every three months 26.67% and another four respondents patronized the resto‐bar once every two weeks 26.67% . This is somehow a good indication that most of their former customers return given a specified period of time. On the other hand, only two respondents 13.33% said that they visit the resto‐bar once a week.

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2.3. Reservations Survey results showed that only nine of the respondents 9.38% made a reservation for every visit while 87 respondents 90.63% did not. Among those who made reservations for every visit, six respondents 66.67% answered that they made their reservations a day before; two respondents 22.22% made reservations the same day either in the morning or in the afternoon; and only one respondent 11.11% made reservation three days before. Experiences of the respondents when making reservations were different. Six respondents said that their experience was fast and very convenient. Another respondent said that even if they came late relative to the reserved time slot, the reserved number of seats was still available and the group was accommodated immediately despite the several number of customers on a Friday night. On the other hand, a respondent said that it several calls before someone from the resto‐bar picked up the phone. The one who answered the call seemed sleepy, according to one of the respondents. Eighty‐five percent of the total respondents who did not make a reservation were not aware that the resto‐bar accepts reservations while 15% were aware but did not make a reservation. Aside from making the respondents aware of the acceptance of reservations of the resto‐bar, the respondents were also asked if they would make a reservation on their next visit. Fifty‐five percent of the respondents answered that they still would not make a reservation despite of their awareness that they could do so while 45% will make a reservation on their next visit. This implies that awareness of accepting reservations does not

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necessarily mean that customers will make reservations.

3. Food and Beverage Offerings The respondents were asked to enumerate the food and beverages that they purchased on a certain visit. Most of the respondents ordered the common offerings and best‐sellers such as French fries, sizzling hotdog, crispy pata pork knuckles , sizzling spicy squid, breaded tofu, calamares squid rings which are deep‐fried in batter and onion rings. They also order signature dishes of the business, which are the resto‐bar’s duly formulated nachos and spare ribs. As for beverages, respondents ordered buckets of assorted alcoholic beverages or a bucket of Red Horse beer, fruit juices, iced tea, and soft drinks. Other respondents ordered beef tapa dried cured beef , grilled tilapia a type of fish , baked mussels, sisig sizzling pork jowl, ear and shoulder with calamansi and chili , sizzling bulalo a type of Filipino stew made consisting of beef shanks and marrow bones , tapsilog a breakfast meal made of tapa together with garlic rice and fried egg , pancit bihon a rice noodle dish and bangsilog a meal made of milkfish, garlic rice and fried egg .

3.1. On-time Availability of Food and Beverage Orders Around 34 respondents 35.42% out of the 96 respondents “somewhat agree” regarding the on‐time availability of food and beverages while 33 respondents 34.38% rated such as ‘strongly agree.’ However, there were 22 respondents 22.92% who were ‘neutral’ and seven respondents 7.29% answered ‘somewhat disagree.’ This significant number of respondents

Factors Affecting Resto-bar Customer Satisfaction: Imperatives for Philippine Restaurateurs Pursuing Repatronage

registering ‘neutral’ and ‘somewhat disagree’ responses put a downward pressure on the average mean rating which registered at 3.9688. Even though the responses for ‘somewhat disagree’ were minimal, these still have an effect against that of more positive measurements which means that these affect the satisfaction of customers concerning the availability of orders. Despite this, the average mean rating means that the business strives to provide all orders as possible to satisfy the customers. Overall, the satisfaction rating is 81.08% with respect to the on‐time availability of order. Most of the respondents said that the food they ordered were readily available and even those that they did not order were also available. On the contrary, other respondents commented that they were not able to order what they wanted because the waiters told them they cannot provide the order as of the moment, and that they lacked ingredients even on peak days. All the respondents who answered ‘somewhat disagree’ dined in at the resto‐bar on Thursday, Friday, and Saturday. While some of those who answered ‘neutral’ and ‘somewhat agree’ dined on the same days and others who responded otherwise dined during the rest of the days of the week.

3.2. Food and Beverage Quality Quality of food and beverages offerings was measured using five questions and these include freshness and temperature of food, coldness of drinks, food presentation, the food being palatable, and overall quality. Freshness means that the food is newly cooked, thus, the temperature of the food must be hot. Regarding freshness and temperature of food items, majority of the respondents 84.38% found the food being served to be

highly acceptable strongly agree meaning the products were freshly served or fresh from the grill with proper temperature. Only 12.50% of respondents answered ‘somewhat agree’ while 3% of the respondents replied that they ‘somewhat disagree’. These responses show a good indication that the resto‐bar is doing well in terms of serving good quality food with an average mean rating of 4.7813, as also seen in the 93.75% satisfaction rating. The respondents said that the food served was fresh from the grill and that it was hot upon serving. On the other hand, the respondents who answered ‘somewhat disagree’ had their food served late food was no longer hot . It appears from the results that temperature can be really considered as a factor of acceptability as well as customer satisfaction in terms of the beverage service. Beverages must be served very cold especially beer and soda to avoid skunking and oxidation. Majority of the respondents rated this criterion as ‘neutral’ 30.21% and ‘strongly agree’ 25% ; however, the number of respondents who answered ‘somewhat disagree’ was comparably high 21.88% as they cited the beer not being cold enough. Some bottles of beer in this case, were not served as cold as expected as customers want these to be “ice cold”. Customers said they need to request for more ice. The average mean rating registered at only 3.5521. There is a low level of satisfaction regarding the coldness of beverages 31.34% . Food presentation, which is done to enhance the aesthetic appeal of food, includes plating, arrangement and appearance of the food upon serving to customers. Forty‐six respondents 47.92% answered ‘strongly agree’ while 43 respondents 44.79% rated ‘somewhat agree.’ One respondent answered with ‘strongly disagree’ because the plate relative to its food

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presentation was too messy with all the sauces. The average mean rating computed was 4.3854, which means that the Resto‐bar is generally doing well in terms of food presentation. The satisfaction rating is 97.78% for food presentation. The food being palatable or acceptable to customer taste is one of the criteria in determining the quality of food. Approximately 41% of the respondents ‘somewhat agree’ about food being palatable at the resto‐bar and this is followed by 37% registering ‘neutral’ responses. The average mean rating was computed at 3.6458, which veers towards a more positive measurement. Only 16% of the respondents answered ‘strongly agree’ indicating that the food was agreeable to their taste. The results provided a satisfaction rating of 77.05% for palatability. According to the respondents, the food tastes good but it does not have that special flavor. Some said that certain food items had too much flavor, while some said the food they ordered lacked flavor. When the respondents were asked about the overall quality of food and beverages, around 34 respondents 35.42% answered ‘somewhat agree’ while 28 responses 29.17% were recorded each for both ‘strongly agree’ and ‘neutral’. Six respondents 6.25% ‘somewhat disagree’ with the overall quality of food and beverages at the resto‐bar. This reflected an average mean rating of 3.8750. The satisfaction rating for the overall quality of food and beverages is 82.35%.

4. Variety of Menu More than half of the respondents 58.33% said they ‘strongly agree’ with the wide variety of menu items. Twenty‐eight respondents 29.17% said they ‘somewhat agree’ with

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menu variety while only 12 respondents 12.50% gave ‘neutral’ responses. The average mean rating computed was 4.4583, meaning the respondents have a high level of satisfaction concerning the variety of menu which was also validated by the 100% satisfaction rating.

5. Waiting Time The scale for waiting time was grouped into three: “about what I expected,” “a little longer than I expected,” and “much longer than I expected.” Each scale was assigned weights of 3, 2, and 1, respectively. Forty‐one respondents 42.71% said that they waited much longer than they expected, while there were 36 respondents 37.50% who said they waited just a little longer that what they expected. Only 19 respondents 19.79% said their waiting time was “as what I expected.” Given the ratings and weights, the average mean rating was 1.7708, and the satisfaction rating is low at 20%, meaning that the business should focus on shortening the waiting time. In this case, majority of the respondents have a low level of satisfaction because their expectations were not met. The frequency and percentage distribution of responses in ‘much longer than I expected’ have the highest number compared to the two other options. This should not be the case since the business should be efficient in serving their customers. The results of this question about waiting time proved that they need more workers especially on peak days to cater to the demands and orders of the customers efficiently and effectively.

6. Willingness to Try Other Offerings The respondents were asked if they were

Factors Affecting Resto-bar Customer Satisfaction: Imperatives for Philippine Restaurateurs Pursuing Repatronage

Table 1. Ratings of Some Factors under Food and Beverage Offerings Factors Availability of orders Freshness and temperature of food items Coldness of beverages Quality of Food presentation food and Food being palatable beverages Overall quality Variety of menu Waiting time

Average Mean Rating 3.9688

Satisfaction Rating (%) 81.08

4.7813

93.75

3.5521 4.3854 3.6458 3.875 4.4583 1.7708

31.34 97.78 77.05 82.35 100 20

willing to try other offerings other than what they ordered. Majority of the respondents 82% said that they are willing to try while 18% of the respondents said that they would not try other items.

7. Serving Size The resto‐bar currently has serving sizes good for 2‐3 persons. More than half of the respondents favored this, as they prefer the current serving size instead of a serving size good for one person. Thus, about 41% chose this option.

8. Satisfaction with Food and Beverage Offerings As for the satisfaction of the respondents to food and beverage offerings of the resto‐bar as a whole, the responses are evenly distributed with most respondents 27.08% giving a rating of 9 or “very satisfied,” followed by 25% of the respondents who gave a rating of 7 or “fairly satisfied.” Only 8.33% of the respondents gave a rating of 6 which is neither satisfied nor dissatisfied. This means that the resto‐bar should at least maintain, if not, further improve its overall food and beverage offerings, including the factors under this

attribute since most of the respondents are generally satisfied in terms of the food and beverage offerings.

9. Points for Improvement The top three factors with the lowest average mean rating and satisfaction rating are as follows: the food being palatable, coldness of beverages, and waiting time Table 1 . These factors should be considered by the resto‐bar in order to meet the expectations of the customers, most particularly the waiting time since this has a negative relationship with customer satisfaction. The average service processing time should be shortened. Moreover, palatability and temperature of beverages are quite easy to address since they just need to adjust in terms of storage and flavor.

Ⅳ. Value for Money 1. Appropriateness of Price The respondents were asked three questions to identify if the prices for the food and beverages were appropriate for the target market. The first question tackled the appropriateness

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of price on food. About 45 respondents answered ‘strongly agree’ representing almost half of the sample which has an overall percentage distribution of 46.88%. This was followed by the 36 respondents 37.50% who answered ‘somewhat agree.’ Fewer representatives of the sample answered ‘neutral’ with 10 respondents; four answered ‘somewhat disagree’; and only one answered ‘strongly disagree.’ Customers were satisfied with the price of food as supported by the 88.37% satisfaction rating and 4.2500 average mean rating. Appropriateness of price for the drinks was also measured. Approximately 60.42% of the respondents answered ‘somewhat agree’ while 38.54% answered ‘strongly agree.’ A sole respondent answered ‘strongly disagree.’ With an average mean rating of 4.3542 and 97.92% satisfaction rating, customers are largely satisfied with the price of the drinks. The respondents were also asked how they would describe the food and beverage offerings considering value for money. Among the 96 respondents, 36 answered ‘very good’ while 24 answered “good”. Nineteen respondents answered ‘excellent;’ 16 respondents said such offerings were ‘fair;’ and one respondent answered ‘poor.’ The average mean rating of this factor is 3.5833 while the satisfaction rating is 53.28%. These figures imply that customers are somehow satisfied with the food and beverage offerings considering value for money.

2. Promotional Discounts Promotional discounts were measured in terms of whether customers are willing to spend and buy more if there are promotional discounts, as well as if the customers are satisfied with the offered promotional discounts

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of the resto‐bar. Approximately 81.25% of the respondents said that they are willing to buy more if there are promotional discounts while 18.75% said otherwise. The respondents said that promos are very attractive especially since they go out because they want to spend. On the other hand, the respondents who said that they are not willing to buy more if there are promotional discounts said that it depends on how much they can save and what type of promotional discount is offered. Around 54 respondents 56.25% said that they were satisfied with the offered promotional discounts of the resto‐bar while 42 respondents 43.75% said that they were not satisfied. Given this finding, the resto‐bar should review their promotions and come up with more attractive ones in order to delight the now satisfied customers, and satisfy those who were not.

3. Satisfaction with Value for Money The lowest rating given by 6 respondents on satisfaction with value for money is 4 representing “dissatisfied” customers. Most of the respondents 35.42% gave a rating of 7 or “fairly satisfied,” followed by 17.71% of the respondents who gave a rating of 9 or were “very satisfied.” Both ratings of 8 “satisfied” and 10 extremely satisfied have the same percentage of respondents who gave the said ratings, which is 12.50%. Given these ratings, around 21% of respondents exhibit a very low level of satisfaction in terms of value for money those who gave 4 or 5 in terms of rating satisfaction relative to value of money . The company must address this by evaluating and verifying whether the prices are indeed affordable within their current market.

Factors Affecting Resto-bar Customer Satisfaction: Imperatives for Philippine Restaurateurs Pursuing Repatronage

Table 2. Ratings for Some Factors under Value for Money Factors Food Appropriateness Beverages of price Both items considering value for money Satisfaction with current promotional discount offers

4. Points for Improvement All the factors under value for money need improvement considering the average mean rating and satisfaction rating. Appropriateness of price of food and beverage offerings considering value for money got the lowest average mean rating and satisfaction rating among all the factors Table 2 . Satisfaction with current promotional discount offers has the second lowest satisfaction rating 56% . On the other hand, appropriateness of beverage price obtained the highest average mean rating and satisfaction rating. Since the company cannot change immediately the prices of their products, they must review first their offerings in order to assess whether they should change the price or increase the servings a little more since they have a cushion of 400% mark‐up on food items.

Ⅴ. Location and Ambience 1. Familiarity with the Place of Business Results of the survey showed that 45 respondents 46.88% said that they were able to know the place because their friends referred the resto‐bar to them while 35 respondents 36.46% said that they were able to know about the resto‐bar because of online social media such as Facebook and

Average Mean 4.2500 4.3542 3.5833 -

Satisfaction 88.372 97.917 53.278 56

Foursquare. Only 16 respondents 16.67% passed by the place so they were able to go to the resto‐bar. This shows that referrals and social media play a big role in making the business known to the current and future customers of the resto‐bar. This also implies that the location of the business is strategically located since the share of the respondents who passed by the place was relatively significant. The respondents of the survey were asked if they were able to locate the business easily. About 83 respondents over 86% answered ‘strongly agree’ or ‘somewhat agree’ while 4 respondents 4.17% were ‘neutral.’ Thus, majority of the respondents were able to locate the business easily which accounts for 86% of the respondents. Nine respondents 9.38% answered ‘somewhat disagree.’ The satisfaction rating was computed at 80.44% while the average mean rating was 4.2604.

2. Proximity of Workplace Considering the distance of the resto‐bar from the respondents’ workplaces, the respondents were asked if the proximity of the workplace influences their decision to patronize the resto‐bar. About half or forty‐seven respondents said they ‘strongly agree’; 29 answered ‘somewhat agree’ 30.21% and 8 answered ‘neutral’ 8.33% . On the other hand, 12 respondents answered ‘somewhat disagree’ 12.50% . A small group

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of respondents who answered ‘somewhat disagree’ was also considered in a positive manner relative to the business since these customers still preferred the resto‐bar without the proximity of their workplace influencing their decision‐making. The average mean rating was computed at 4.1563 while the satisfaction rating for this factor is 72.73%.

3. Parking Among the 96 respondents, only 24 respondents used their own cars to go to the resto‐bar. Thirteen respondents were not able to find a parking space easily while the remaining 11 respondents found one easily. The 24 respondents who went to the resto‐bar using their own car were asked if they consider parking as a factor in determining where to dine. The results reflected that about 15 or about 62.5% of the 24 respondents said that they consider parking as a major factor in making decisions as to where to dine while the remaining 37.5% said otherwise.

4. Ambience About 54 respondents 56.25% answered ‘strongly agree’ on whether the resto‐bar has good ambience while 29 respondents 30.21% answered ‘somewhat agree.’ Thirteen respon‐ dents answered ‘neutral.’ The average mean rating of this factor is 4.4271 and the satisfaction rating is 100%, which means that customers are generally satisfied. When asked whether the internal decoration of the resto‐bar added to the ambience of the place, around 43 respondents 44.79% answered ‘somewhat agree’ while 41 respondents 42.71% answered ‘strongly agree’. Moreover, 12 respondents 12.50% answered ‘neutral.’ The

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computed average mean rating was 4.3021 with a 100% satisfaction rating, a good indicator that the resto‐bar really has good ambience and the internal decorations enhance such ambience.

5. Music Currently, the resto‐bar has a videoke which is used for playing music. The question posed to respondents had to do with their most preferred manner of playing music. In addition, if they answered that they preferred a playlist or a live band, the authors inquired as to which type of music they preferred. Results indicated that videoke had the highest number of respondents with 58 representing 60% , followed by “playlist only” with 23 respondents 23.96% . About 15 respondents 15.63% preferred a live band. This suggested that most customers would rather sing or hear other customers singing instead of listening to live bands or a playlist. Those who chose a playlist or live band, mentioned that they most preferred pop, followed by rock, Rhythm and Blues RnB , jazz, and ballad.

6. Cleanliness Asked whether the Wafu Grill and Resto and its comfort rooms were clean and dry, 65 res‐ pondents 67.61% answered ‘strongly agree’ while 23 respondents 23.96% answered ‘somewhat agree’. Only two respondents gave a ‘neutral’ response 2.08% but 6 respondents 6.25% answered ‘somewhat disagree.’ The average mean rating computed was 4.5313, which means that customers generally agreed that resto‐bar and its comfort rooms were clean and dry. On the other hand, the satisfaction rating for cleanliness is 87.23%.

Factors Affecting Resto-bar Customer Satisfaction: Imperatives for Philippine Restaurateurs Pursuing Repatronage

Table 3. Ratings for Some Factors under Location and Ambience Factors Locating the business easily Proximity of workplace Ambience itself Ambience Internal decoration Cleanliness

7. Satisfaction with Location and Ambience Relative to satisfaction with location and ambience, ratings given by the respondents range only from 7 to 10, with 7 “fairly satisfied” given only by one respondent. More than half of the respondents 55.21% gave a rating of 9 or “very satisfied,” followed by a rating of 10 or “extremely satisfied” given by 29.17% of the respondents. Almost 15% of the respondents gave a rating of 8 “satisfied” . The ratings indicate that the respondents were generally satisfied with the factors included in the location and ambience attribute.

8. Points for Improvement Generally, the restaurant’s location and ambience have high average mean ratings and satisfaction percentage ratings Table 3 . It will be noted that the proximity of workplace has the lowest average mean rating and satisfaction percentage rating among the factors included. The business can do nothing much about this factor since they cannot transfer to another location immediately, and considering that this factor has no significant association anyway relative to customer satisfaction. However, they can focus on other factors so as to improve the overall service quality of the resto‐bar, thus, making the customers return.

Average Mean 4.2604 4.1563 4.4271 4.3021 4.5313

Satisfaction Rating 80.435 72.727 100 100 87.234

Cleanliness had the third lowest satisfaction rating indicating that the management and its workers should keep and maintain the cleanliness of the place. Maintenance of the place is very important most specifically since this factor reflected the highest average mean rating.

Ⅵ. Service 1. Performance of Waiters The performance of waiters in terms of service quality was measured through questions categorized as attentiveness, clear speaking voice and politeness, friendliness and patience, and promptness. Attentiveness was measured in terms of immediately offering the customers seats and tables, and correctly getting the orders.

1.1. Attentiveness in Terms of Offering Customers Seats and Tables Around 63 respondents 65.63% ‘strongly agree’ on whether the waiters immediately offered tables and seats. Moreover, 31 respondents 32.20% answered ‘somewhat agree’ while only two respondents 2.08% gave ‘neutral’ responses. The average mean rating was 4.6354, which appears to indicate that the waiters were attentive in offering

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Table 4. Strength of Relationship of the Factors under Food and Beverage Offerings vis-à-vis Customer Satisfaction Factors

Measure of Association Used

Availability of Orders

Cramer’s V Value

Spearman’s Rho Value

Interpretation

P value

Conclusion

Spearman’s Rho

0.266

Very weak positive association

0.011

Significant association

Freshness and temperature of food items

Spearman’s Rho

0.367

Very weak positive association

0.000 2

Significant association

Coldness of beverages

Spearman’s Rho

0.258

Weak positive association

0.011

Significant association

Food presentation

Spearman’s Rho

0.413

Moderate positive association

0

Significant association

Food being palatable

Spearman’s Rho

0.371

Weak positive association

0

Significant association

Overall quality

Spearman’s Rho

0.436

Moderate positive association

0

Significant association

Variety of menu

Spearman’s Rho

0.298

Very weak positive association

0.003

Significant association

Waiting time

Spearman’s Rho

 

-0.208

Very weak negative association

0.042

Significant association

Willingness to try other items

Cramer’s V

0.1484

 

 

 

 

Serving size

Cramer’s V

0.3021

 

 

 

 

Quality of food and beverages

tables and seats to the customers and therefore, customers were generally satisfied. Overall, this factor fetched a 100% satisfaction rating.

1.2. Attentiveness in Terms of Correctly Getting Customer Orders The other measure of attentiveness was evaluated in terms of whether the waiters correctly got the orders of the customers or

not. Forty‐six respondents 47.92% answered “strongly agree,” 38 39.58% answered “somewhat agree,” and 11 or 11.46% said they were ‘neutral’ on the matter. Only one respondent answered ‘somewhat disagree.’ The average mean rating was 4.3438 and satisfaction rating is 97.65%, indicating that customers are generally satisfied in terms of waiters correctly getting orders from customers of the resto‐bar.

Factors Affecting Resto-bar Customer Satisfaction: Imperatives for Philippine Restaurateurs Pursuing Repatronage

Ⅶ. Strength of Relationships of Dining Attributes vis-à-vis Customer Satisfaction 1. Food and Beverage Offerings The strength of the relationship of the different factors under food and beverages offerings with respect to customer satisfaction was measured through Spearman’s correlation coefficient and Cramer’s V values Table 4 . The Spearman’s correlation coefficient re‐ vealed that availability of orders has a significant and positive association with customer satisfaction, but this relationship is very weak rs 96 0.266, p .011 . The same relationship has been observed with freshness and temperature of food items rs 96 0.367, p .0002 and variety of menu rs 96 0.298, p .003 . There is a weak, positive, and significant relationship between coldness of beverages rs 96 0.258, p .011 and the food being palatable rs 96 0.266, p 0.00 with respect to customer satisfaction. It was also shown that food presentation rs 96 0.413, p 0 and overall quality rs 96 0.436, p 0 has a moderate, positive and significant relationship with customer satisfaction. On the other hand, waiting time has a very weak negative, and significant association rs 96 ‐0.208, p .042 with customer satisfac‐ tion. This means that the longer the waiting time, the more dissatisfied a customer is. As for willingness to try other food/ beverage items/offerings and serving size, the authors used Cramer’s V to determine the strength of relationship of these items/ offerings vis‐a‐vis customer satisfaction. Find‐

ings showed that willingness to try other items/offerings has a weak positive association V 0.1484 with customer satisfaction. Serv‐ ing size, correspondingly, has a strong positive association V 0.3021 with customer satisfaction.

2. Value for Money Table 5 shows the strength of the relationship of the different factors under value for money measured through Spearman’s correlation coefficient and Cramer’s V values. The results showed that there was statisti‐ cally significant and a very weak, positive relationship between appropriateness of price for food items and customer satisfaction rs 96 0.211, p .039 . Quite the reverse was seen in the appropriateness of price for beverages as there was statistically significant and a very weak, negative relationship between appropriateness of price for beverages rs 96 ‐0.0062, p .01 and customer satisfaction. Considering appropriateness of price for both food and beverage items rs 96 ‐0.376, p 0 , there was also statistically significant and a very weak, negative relationship in relation to custo‐ mer satisfaction. The willingness of the respondents to buy more if there are more promotional discounts has a weak positive relationship V 0.174 with customer satisfaction while satisfaction with the current promotional discounts has a moderate positive association V 0.2781 against customer satisfaction.

3. Location and Ambience Table 6 shows the strength of the relationship of the different factors under location and ambience measured through

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Table 5. Strength of Relationship of the Factors under Value for Money vis-à-vis Customer Satisfaction Factors

Measure of Association Used

Cramer’s V Value

Spearman’s Rho Value

Interpretation

P value

Conclusion

0.03 9

Significant association

0.01

Significant association

0.00

Significant association

Appropriateness of Price Food

Spearman’s Rho

0.211

Beverages

Spearman’s Rho

-0.0062

Spearman’s Rho

-0.376

Both items considering value for money Promotional Discounts Willing to buy more

Cramer’s V

0.174

Satisfaction with current offers

Cramer’s V

0.2781

Very weak positive association Very weak negative association Very weak negative association

Weak positive association Moderate positive association

Table 6. Strength of Relationship of the Factors under Location and Ambience vis-à-vis Customer Satisfaction Factors

Measure of Association Used

Locating the business easily

Spearman’s Rho

-0.097

Proximity of workplace

Spearman’s Rho

-0.113

Parking

Cramer’s V

Cramer’s V Value

Spearman’s Rho Value

0.2421

Interpretation Very weak negative association Very weak negative association Moderate positive association

P value

0.3471

0.273

Conclusion No significant association No significant association

Ambience Ambience itself

Spearman’s Rho

-0.0519

Internal decoration

Spearman’s Rho

0.261

Music

Cramer’s V

Cleanliness

Spearman’s Rho

0.2703

-0.239

Very weak negative association Very weak positive association Moderate positive association Very weak negative association

0.00

Significant association

0.00

Significant association

0.019

Significant association

Factors Affecting Resto-bar Customer Satisfaction: Imperatives for Philippine Restaurateurs Pursuing Repatronage

Spearman’s correlation coefficient and Cramer’s V values. Using Spearman’s correlation coefficient, there was statistically significant and a very weak, positive relationship between customer satisfaction and internal decoration rs 96 0.261, p 0 . On the contrary, the ambience of the place rs 96 ‐0.0519, p 0 , and cleanliness rs 96 ‐0.239, p 0.019 have significant and very weak, negative relationships with customer satisfaction. No significant association was found on the factors in terms of locating the business easily rs 96 ‐0.097, p 0.3471 and proximity to workplace rs 96 ‐0.113, p 0.273 . In addition, the relationships of these variables relative to customer satisfaction were very weak and negative. This implies that these factors do not affect the satisfaction of customers. Parking has a moderate positive association V 0.2421 with customer satisfaction, and this is also true for music V 0.2703 .

4. Service The strength of the relationship of the different factors under service measured through Spearman’s correlation coefficient is shown in Table 7 . Immediately offering tables and seats to customers has a significant and weak, positive association rs 96 0.2153, p .035 with customer satisfaction. Moreover, a significant and very weak, positive relationship exists between clear speaking voice and politeness rs 96 0.31, p .002 and customer satisfaction. On the other hand, there was statistically significant and very weak, negative relation‐ ships between customer satisfaction and correctly getting the orders rs 96 ‐0.0638, p 0 ; friendliness and patience rs 96 ‐0.526, p 0 ; and promptness rs 96 ‐0.315, p .002 . These factors should be taken into consideration and be addressed imme‐ diately because it results to dissatisfied customers.

Table 7. Strength of Relationship of the Factors under Service vis-à-vis Customer Satisfaction Measure of Association Used

Spearman’s Rho Value

Spearman’s Rho

0.2153

Correctly getting the orders

Spearman’s Rho

-0.0638

Clear speaking voice and politeness

Spearman’s Rho

0.31

Friendliness and patience

Spearman’s Rho

-0.526

Promptness

Spearman’s Rho

-0.315

Factors Performance of waiters Attentiveness Immediately offering the customers tables and seats

Interpretation

Weak positive association Very weak negative association Very weak positive association Very weak negative association Very weak negative association

P value

Conclusion

0.035

Significant association

0.00

Significant association

0.002

Significant association

0.00

Significant association

0.002

Significant association

Journal of International Trade & Commerce

Ⅷ. Summary and Implications The different dining attributes discussed in this study are food and beverage offerings, value for money, location and ambience, and service. The relationship of these attributes were assessed with respect to customer satisfaction using Spearman’s correlation coefficient. Table 8 shows the summary of relationships of the dining attributes to customer satisfaction. Findings show that food and beverages have a significant and moderate, positive association with customer satisfaction rs 96 0.487, p 0 . Value for money has a significant and strong, positive association with customer satisfaction rs 96 0.611, p 0 . Moreover, service has a significant and weak, positive association with customer satisfaction rs 96 0.298, p 0.00319 .Generally, this means that each of these dining attributes positively affects customer satisfaction. These findings confirm past literature insofar as pointing out the significant factors of food quality and general service factors Parasuraman et al., 1985 . Unlike the coffee shop studies of Cruz 2003 and Quizon 2012 , however, location and ambience was not a significant factor affecting customer satisfaction in the case of resto‐bars. The factors under food and beverage offering,

Vol. 12, No. 3, June 2016

value for money and service attributes such as availability of orders, quality of food and beverage offerings, variety of menu, willingness to try other offerings and serving size attributes under the food and beverage offerings general attribute also positively affect customer satisfaction except for waiting time which has a very weak, negative association with customer satisfaction. Under the value for money attribute, appropriateness of food price and promotional discounts showed very weak to moderate positive association with customer satisfaction while the appropriateness of beverage prices as well as the appropriateness of both food and beverage prices taken together in ascertaining value for money registered very weak negative association with customer satisfaction. With respect to the service attribute, results indicated that performance of waiters in terms of attentiveness in offering immediately the customers seats and tables, using a clear speaking voice and showing politeness showed significant yet very weak to weak positive association with customer satisfaction while performance of waiters in terms of correctly getting orders, friendliness and patience and promptness indicated significant yet very weak negative association with customer satisfaction. Results indicate that these factors and attributes should be maintained if not, improved, in order

Table 8. Summary of Relationship between the Dining Attributes and Customer Satisfaction Attribute

Spearman’s rho value

Food and beverages

0.487

Value for money

0.611

Location and ambience

0.042

Service

0.298

Interpretation Moderate positive association Strong positive association Very weak positive association Weak positive association

P-value 0 0 0.68452 0.00319

Conclusion Significant association Significant association No significant association Significant association

Factors Affecting Resto-bar Customer Satisfaction: Imperatives for Philippine Restaurateurs Pursuing Repatronage

to satisfy or delight the customers thus encouraging repatronage. On the other hand, there was no significant relationship found between location and ambience including ability to locate the resto‐bar easily and proximity to workplace and customer satisfaction rs 96 0.042, p 68452 . This means that this attribute, as a whole, does not significantly affect customer satisfaction. According to the results of the study conducted, different points for improvement were identified based on the mean ratings and satisfaction ratings. These factors must be taken into consideration in order to improve the product and service quality of the resto‐bar.

1. Food and Beverage Offerings As previously discussed, the food being palatable, coldness of beverages, and waiting time are the identified points for improvement in terms of this attribute. In terms of the food being palatable, the resto‐bar should make the taste of their food distinct and unique so that they could establish a brand image or brand recall to their customers. This can be done by developing and providing the cooks standard recipes for the dishes. The coldness of beverages whether alcoholic or not is very important especially since these are intended to be cold. The resto‐barmust make sure that the alcoholic beverages and soft drinks are properly stored in a cool, dry place so as to maintain the temperature. Since the refrigerators are solely used to store food items, the management can consider adding more coolers and placing these inside the resto‐bar such that no intense heat or direct sunlight can affect the quality of the beverages. For both prepared and

alcoholic drinks, the business should always have sufficient stock of ice for the duration of its operating hours. In addition, waiting time should be taken into consideration most particularly since only 20% of the respondents are satisfied with the length of waiting time. They should have proper processes in preparing the orders. They could also consider adding an additional worker or workers during peak days or add additional equipment such as a stove so that even if there are many orders, the cook can still prepare the orders simultaneously. The workers can also prepare the ingredients hours before what they perceived as the peak time. They can do small jobs ahead of time like peeling, pre‐weighing, sorting, and mixing substantial amounts of sauces needed for certain dishes. This way, they can shorten the length of waiting time, thus meeting the expectation of customers. Managing the inventory efficiently should be done by the business by scheduling inventory checking and supplies procurement so they can avoid loss of sales specifically during peak days. The firm must take advantage of their good relationship with their suppliers. The business should also continuously improve the offerings and service tailored to the needs and wants of the customers so that they can continuously satisfy existing customers as well as attract more patrons. They can also consider the suggestions of the respondents regarding the additional food and beverage offerings like more finger foods and drinks in the morning such as hot chocolate to partner with the traditional Filipino breakfast meals.

2. Value for Money Although the prices for food and beverages

Journal of International Trade & Commerce

treated separately have good ratings, the business should look further into deliberating whether to reprice or not considering the prices suggested by the respondents and the profile or perceived affordability of the respondents. The management must review the current promotional discounts being offered by the resto‐bar. They can elicit promotional discounts by using their social networking account, Facebook. For example, they can have a promo by asking the customers to ‘like’the Facebook page, and share the page to their friends. By doing this, they will be entitled to a free beer given that they will go to the resto‐bar and bring5 or more friends. This way, they were able to increase awareness and customer traffic in the resto‐bar. Every time the resto‐bar owners decide to add more promotional discounts, they should align this with the comments or suggestions of the customers from whom they should get regular feedback. The management must also review the suggestions made by the survey respondents in terms of an acceptable price range.

3. Location and Ambience Cleanliness should be kept and maintained at all times. The management could assign employees to check the comfort rooms routinely and make sure that the whole place especially the dining area is clean. This can be a refreshing sight for the customers. The business can do nothing much about proximity of workplace since they cannot transfer to another location immediately. However, they can focus on other factors so as to improve the overall product and service quality of the resto‐bar. Such measures when properly implemented make customers return.

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4. Service Waiters should habitually verify the orders of the customers once completed. This way, loss of sales and dissatisfaction could be avoided. On the other hand, promptness of waiters in terms of bill settlement should be improved by being more expedient in attending to bill settlement.

5. Overall Satisfaction The management must take into consideration the strength of relationship of the different attributes to customer satisfaction. Those factors that have a positive association with customer satisfaction should be maintained and enhanced for the betterment of the company namely, quality of food and beverage offerings, value for money and service. This way, the company can develop a stronger brand recall in the minds of customers. Moreover, the management must continue asking for feedbacks from the customers so as to help them in continually improving the business. On the other hand, factors that have a negative association with customer satisfaction must be improved so that at some point, this will have a positive effect on customer satisfaction. The food being palatable, coldness of beverages, and waiting time are the identified points for improvement in terms of this attribute. Furthermore, waiting time should be taken into consideration most especially that only 20% of the respondents are satisfied with the length of waiting time. They should have proper procedures in preparing the orders. They could also consider adding additional worker during peak days or add additional

Factors Affecting Resto-bar Customer Satisfaction: Imperatives for Philippine Restaurateurs Pursuing Repatronage

equipment such as stove so that even there are many orders, the cook can still prepare the orders simultaneously. The workers can also prepare the ingredients hours before what they perceived to be as the peak time. They can do small but helpful jobs like peeling, pre‐weighing, sorting, and mixing substantial amounts of sauces needed for certain dishes. This way, they can shorten the length of waiting time, thus meeting the expectation of customers. The service quality assessment likewise revealed the factors that are in need of attention in order to improve the product and service quality. These factors are coldness of beverages, the food being palatable, waiting time, appro‐ priateness of price in terms of food and beverages offerings, promotional discounts, and correctly getting the orders. Such findings imply that these are the factors which must be addressed not only by the resto‐bar but by restaurateurs pursuing repatronage. With the customers of the food service industry becoming more aggressive and de‐ manding, establishments utilize different strategies in order to meet and understand the ever changing needs and wants of customers. There are many factors that may influence customers’ assessments of restaurant quality and restaurant operators should be aware each of these. They should pay attention to the key quality attributes that elicit customer satisfaction and enhance return visits in the restaurant business. In fact, according to Yap and Kew 2007 , service quality may change each time a customer visits a particular restaurant which may influence their repatro‐ nage intentions. Hence, it is in this light that restaurateurs must take notice of regularly conducting customer feedback surveys to constantly re‐evaluate how their business is

doing in terms of service quality and adapting periodically to changing customer tastes and preferences which translate into dining attri‐ butes valued by customers in order to become sustainable. This study has its limitations too. For one, the findings are confined to one resto‐bar alone and a convenience sample of customers. Thus, verification in terms of a wider sample of resto‐bars and customers is left for future researchers to ascertain its generalizability. Despite its limitations, however, this study was able to define significant and insignificant dining attributes which affect customer satisfaction in a resto‐bar in metropolitan Manila, Philippines. Another potential topic for future research therefore, has to do with how dining attributes influence customer satisfaction in resto‐bars and other types of restaurants in other countries. Finally, service quality improvement is often a key competitive differentiator that is sustainable. Moreover, service is always defined from a customer’s perspective. Ultimately, it is the delivery of promise of service that sells all aspects of a food business.

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