Determinants of Customer Satisfaction in Malaysian Retail Industry: A Case of 7-Eleven Malaysia Holdings Berhad

This literature review investigates the key determinants of customer satisfaction in the Malaysian retail industry, with a focus on 7-Eleven Malaysia Holdings Berhad. The review covers quality of products and services, corporate social responsibility, customer trust and loyalty, and store quality image.

Running head: LITERATURE EVIDENCE REVIEW
An Investigation of Determinants of Customer Satisfaction in Malaysian Retail Industry: A case
of 7-Eleven Malaysia Holdings Berhad
Component 1:
Literature Evidence Review
Name of the Student
Student’s Number
Master of Business Administration
University of Wales Trinity Saint David
(Day Month Year)

1LITERATURE EVIDENCE REVIEW
Table of Contents
1.0 Introduction................................................................................................................................2
1.1 Background of the Industry and Company............................................................................2
1.2 Purpose and Problem Statement............................................................................................2
1.3 Significance of Research.......................................................................................................3
2.0 Literature Review......................................................................................................................3
2.1 Quality of Products and Services...........................................................................................4
2.2 Corporate Social Responsibilities (CSR)...............................................................................6
2.3 Customer Trust and Loyalty..................................................................................................7
2.4 Store Quality Image...............................................................................................................9
3.0 Conclusion...............................................................................................................................10
3.1 Implication of Further Research..........................................................................................10
3.2 Research Questions..............................................................................................................10
3.3 Research Objectives.............................................................................................................11
3.4 Research Framework...........................................................................................................12
References......................................................................................................................................13

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1.0 Introduction
1.1 Background of the Industry and Company
Malaysian Retain Industry is considered as one of the major industries in the country
contributing effectively towards the Malaysian economy. Malaysia is considered as the middle
class income county (Mohamed and Borhan 2014). The Malaysian retain industry has been well
maintaining its momentum; the main drivers of the growth of this industry are economic as well
as social development along with growth in population, rise in the purchase power of the
consumers, trend in the needs of the customers and penetration of international retail companies
in the industry. The presence of many large retain corporations can be seen in this industry
(Mohamed and Borhan 2014). It has been speculated that there will be a growth of CAGR of
11% in the retail market of Malaysia from the year 2013 to 2018.
The research is based on 7-Eleven Malaysia Holdings Berhard, a leading retain
company in the Malaysian retain industry. 7-Eleven Malaysia Holdings Berhard is considered as
the owner and operator of the stores of 7-Eleven in Malaysia (7eleven.com.my 2018). The
company was established in the year of 1984 and it has become the single largest retain and
convenience store chain in Malaysia having more than 1905 stores in Malaysia that are serving
more than 900,000 customers on daily basis (7eleven.com.my 2018).
1.2 Purpose and Problem Statement
The main purpose of this research is the investigation of the key determinants or the
factors that contribute towards the customers satisfaction in the Malaysian retail industry. It can
be observed that there are various crucial factors that help the retail companies to gain

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satisfaction from the customers. Investigating about these factors is the main purpose of this
research.
The retail companies of Malaysia have to face many obstacles for gaining customers’
satisfaction. It can also be observed that the retail companies of Malaysia operate under a highly
competitive environment in the presence of many national as well as international companies.
Thus, the problem of this research lies in the identification of the main determinants of customer
satisfaction by the Malaysian retail companies. The result of this research will help the retail
companies to retain their customers by satisfying them with products and services.
1.3 Significance of Research
This research will play a significant role in the identification of the key determinants of
the customer satisfaction in the retail industry of Malaysia. On a more precise note, the retail
companies of Malaysia will be able to identify and analyze the factors that will help them in
retaining their customers by fulfilling their satisfaction with various aspects like products,
services and others. After the identification of these determinants, the retail companies will be
able to put more focus on improving these determinants or factors for gaining customer
satisfaction.
2.0 Literature Review
The present study aims towards the identification of the major determinants of customer
satisfaction in the retail industry of Malaysia. The business organizations are required to be
customer oriented as a result of the increasingly competitive business environment. In the
modern business environment, customer satisfaction is considered as a major base for the
performance of the business organizations and there is not exception of this fact in case of the

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Malaysian retail industry. The following discussion includes the discussion of the four major
determinants of the retail industry in Malaysia.
2.1 Quality of Products and Services
From the above discussion, it can be observed that there are different determinants or
factors that contribute towards customer satisfaction in the retail industry of Malaysia. Among all
these determinants, the quality of retail products and services can be considered as two of the
major factors for customer satisfaction. For the customers, quality of the retail products is
regarded as a single measure for judging the products of the companies (Singh 2013). For the
customers, quality is less about the artifact itself and about the brand of the company. One a
more specific note, the retail products of the companies must be of good quality so that they can
be able to fulfill the needs of the customers. For this reason, it can be seen that there is a positive
conncetion between the qualities of the products and customer satisfaction. At the same time,
deep connection can be seen between the aspects of customer satisfaction and the service quality
offered by the retail companies in Malaysia. It can be observed that there is a direct connection
between the attitude of the customers related to the service quality of the stores and their
intention to select that store for their retail shipping needs (Al-Ali, Bazin and Shamsuddin 2015).
It can be observed that the large retain companies create major influence on the changing
preferences of the customers. For example, the large retail corporations like 7-Eleven provides
the customers with the quality products and services in order to satisfy their needs related to the
retail products. One important aspect in this context is that the customers do not always prefer
the quality of the products alone as the also compare the quality in relation to the price of the
products (Paul, Sankaranarayanan and Mekoth 2016). It implies that the large retail organizations
are required to provide the quality products in affordable price as this is a major aspect for

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gaining the satisfaction of the customers. For this reason, quality and price both play dominant
part in the satisfaction of the customers.
It is needed for the retail companies in Malaysia to maintain superior level of the quality
of services as it is considered as a major determinant for retaining the customers; and it is
possible for the companies to retain customers when they are able in satisfying the needs of the
customers. The service quality in the Malaysian retail sector largely depends on the functional as
well as technical qualities of the retail companies (Hill and Brierley 2017). The functional
qualities put concentration on the behavior of the customers along with the delivery of the
products and services. On the other hand, the technical qualities largely depend on the outcome
as well as delivery of the products and services (Annamalah et al. 2013).
For all these reason, the idea to provide pre and post sale services is regarded as a
winning factor for the retail companies in Malaysia. With the help of different kinds of services,
it become possible for the companies in the Malaysia retail sector to attract and retain the
customers by satisfying the needs of them in a well manner (Raja et al. 2013). In the recent
business era, customers use the service of the retail companies for distinguishing between the
qualities of two or more than two retail companies. There are five major dimensions that can be
used for measuring the service quality of the retain concerns; they are assurance, empathy,
responsiveness, tangibility and reliability. In the presence of quality services, it is possible for the
retail companies in Malaysia to get the necessary competitive edge that helps them to satisfy the
needs of the customers in the most effective manner (Amin et al. 2013).
In the presence of all of these factors, the perception of quality service has a core
connection with the customer satisfaction (Khan and Fasih 2014). Thus, it can be mentioned that

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the quality products and quality services are the threshold factors in the retail industry of
Malaysia for maintaining the satisfied customers. The main reason is that quality products and
services increases the satisfaction as well as convenience of the customers that lead them to
purchase and repurchase the products of the companies (Khan and Fasih 2014). For this reason,
it is one of the major needs for the retail companies in Malaysia to take into consideration these
two aspects for increasing the satisfaction of their customers as both of these aspects helps the
customers to get the comfort from the products and services of the business organizations. This is
the main reason of preferring the modern retail outlets as they can get both quality products as
well as quality services from those retail stores (Suki 2014).
2.2 Corporate Social Responsibilities (CSR)
Retail business organizations in Malaysia consider customer satisfaction as a major tool
for the development of business strategies as it is a key driver for the business profitability in the
long-run. In today’s business era, the customers are satisfied with the products and services of
the company and they become also satisfied with the social activities performed by the retail
companies (Hassan and Nareeman 2013). For this reason, the customers not only put their focus
on the products and services of the companies, but also on the procedures and activities by which
the companies involve themselves in the socio-economic activities. For this reason, after the
quality of products and services, the CSR activities of the retail companies is considered as a
major determinants of customer satisfaction (Suki, Suki and Azman 2016). For this reason,
several researchers have been paying major attention to the CSR activities of the retail industries
in Malaysia. At the time of the measurement of the CSR activation or notions of the retail
companies, the companies are required to detach themselves from the economic accountability as
they are required to view this aspect from the perspectives of the stakeholders. In this context, it

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needs to be mentioned that the growing demand of the customers towards the environment
friendly products and services has make CSR as driving forces of customer satisfaction n the
retail industry of Malaysia (Yusof et al. 2015).
In the presence of all of these aspects, CSR in retail industry has attracted the attention of
many scholars all over the world as a major determinant of customer satisfaction. This aspect has
put the obligation on the retail companies of Malaysia to engage them into the CSR practice for
customer satisfaction (Abdullah and Aziz 2013). The CSR activities have created major positive
influence on the customers of retail sector as it provides assistance to them to face the growing
customer expectations along with gaining the required completive edge. For this reason, the
retail companies of Malaysia can attract and retain large number of customers with the help of
their CSR activities as the customers will be satisfied with the CSR initiatives of those
companies (Nareeman and Hassan 2013). This aspect is also helpful in increasing the loyalty of
the customers. It can be observed that the retail companies have to spend large amount of
resources for engaging themselves in the CSR actions and this aspect creates a positive image of
the company to the customers (Abdullah and Aziz 2013). For this reason, CSR activities can be
considered as a key determinant for the customer satisfaction in the Malaysian retail sector.
2.3 Customer Trust and Loyalty
Apart from the above factors, there are two other crucial determinants of customer
satisfaction in the retail industry in Malaysia; they are customer trust and customer loyalty. There
are many studies that have put their emphasis on the importance of trust for satisfying the needs
of the customers as it has strong influence on the customer satisfaction aspect in the retail
industry (Abd-El-Salam, Shawky and El-Nahas 2013). For this reason, there is required to be
trust between the customers and companies in the retail sector. The trust factor has major impact

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in the behavioral intention of the customers that is related to the purchase as well as repurchase
of the products of the retail companies. There are certain factors in the business organizations
that lead to the development of trust for the customers; they are identity of the brand, brand
image, corporate reputation of the retail companies and others (Osman and Sentosa 2013). Thus,
trust can be considered as a major determinant of customer satisfaction in the retail companies of
Malaysia.
Another major determinate of customer satisfaction in the Malaysian retain industry is
customer loyalty. Customer loyalty can be considered as the concept that is developed from the
associated benefits that the customers can obtain from the products and services of the
companies (Thomas 2013). For this reason, the retail sectors of the Malaysia can well use
customer loyalty in order to gain the required competitive advantage in the presence of growing
expectation of the customers. Customer loyalty can be considered as the situation where the
customers buy the products and services again from one company rather than buying them from
other companies (Jan and Abdullah 2014). The intention to remain loyal to a particular
organization is constant in case the products and services of the companies provide satisfaction
to the customers. Thus, on a more simple note, customer loyalty can be defined as the behavior
of the customers to re-purchase the products of a single company in the presence of positive
influence on the intention of the customers towards the same brand (Peng and Moghavvemi
2015).
In this context, it needs to be mentioned that the positive attitude of the customers
towards the company does not always lead to the re-purchase the products of the products of the
company as the company is required to fulfill the needs of the customers with their products and
services. In the presence of all these aspects, customer loyalty can be regarded as the key factor

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for satisfying the needs of the customers as the loyal customers are less sensitive to the price
fluctuation in the price of the products and this aspect increases the purchase power of the
customers (Hassan and Nareeman 2013). One aspect is required to be mentioned that the
profitability of the retail organizations can influence the loyalty of the customers.
2.4 Store Quality Image
Apart from the above-discussed three factors, there is another major determinant of
customer satisfaction that is store quality image. It needs to be mentioned that the positive image
of the retail store along with the good value merchandise are considered as the key factors for the
Malaysian retail companies to gain the customer satisfaction and this aspect helps them in
sustaining their position in the market (Hosseini, Jayashree and Malarvizhi 2014). Customer can
get the chance to differentiate one retail company to another retail company in the presence of
effective image of the quality of store. It can be observed that the most of the customers use the
image of the quality of the store to as a major criterion in the decision-making process related to
the purchase of products or services from any particular retail company (Neupane 2015). The
name of the retail store and quality of merchandise has major influence on the perceived image
of the retail company. Apart from this, higher estimation of the quality of the store image creates
positive effects on the customers to purchase the retail products from the company. Apart from
this, it can be observed that the store quality image has major positive effects on the brand and
personal labels of the retail companies. There are many studies that have indicated that there is a
positive relation between the store quality image and perceived quality of the customers as it
leads to the satisfaction of the needs of the customers (Hosseini and Jayashree 2014).

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3.0 Conclusion
3.1 Implication of Further Research
In this context, it needs to be mentioned that the main aim of this research involves in the
identification of the key determinants of customer satisfaction in 7-Eleven Malaysia Holdings
Berhard. For this reason, the researcher will consider four factors or determinants; they are
quality of product and services, CSR, store image quality and customer trust and loyalty.
However, there is wide scope of doing further research where the researcher can take into
consideration some of the other determinants of customer satisfaction like atmosphere or
ambiance of the retail store and others. Apart from this, the questionnaire does not provide the
respondents to give their answers in more elaborated manner as the questions limit the
respondents in answering within the provided options. These are the major areas of further
research on this research topic.
3.2 Research Questions
The research questions for this research proposal can be stated as follows:
1. How do the quality of the products and services of 7-Eleven Malaysia Holdings Berhard
satisfy the needs of the customers?
2. Can Corporate Social Responsibilities (CSR) be considered as a major determinant of
customer satisfaction in 7-Eleven Malaysia Holdings Berhard?
3. Are customer trust and loyalty major determinants of customer satisfaction in 7-Eleven
Malaysia Holdings Berhard?
4. Is store quality image a key determinant of customer satisfaction in 7-Eleven Malaysia
Holdings Berhard?

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These reserahgc questions will play an integral part for the identification of the key
determinants of customer satisfaction in Malaysian retain industry.
3.3 Research Objectives
Research objectives provide the researcher with the necessery direction to carry on the
research program. The research objectives of this research are shown below:
o To conduct investigation on the aspects that how the quality of the services and products
of 7-Eleven Malaysia Holdings Berhard contribute to customer satisfaction.
o To conduct an analysis on the effects and impacts of CSR of 7-Eleven Malaysia Holdings
Berhard on customer satisfaction.
o To analyze the effects of customer trust and the loyalty program of 7-Eleven Malaysia
Holdings Berhard on the satisfaction of the customers.
o To examine store quality image as the key determinants of customer satisfaction in 7-
Eleven Malaysia Holdings Berhard.

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3.4 Research Framework
Figure 1: Research Framework
From the above figure, it can be observed that the research framework involves four
major aspects and these aspects can be regarded as the crucial determinants of customer
satisfaction of 7-Eleven Malaysia Holdings Berhard. More specifically, the major aim of this
research framework aims to investigate on the aspect that whether these four aspects are the
major determinants of customer satisfaction in Malaysian retail industry and in 7-Eleven
Malaysia Holdings Berhard.
CUSTOMERSATISFACTIONQualityofServiceandProductCustomerTrustandLoyaltyCSRStoreQualityImpage

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