The aim of this study was to identify the relationship between customer satisfaction and service quality and product quality of PNJ stores in HCMC. Besides that, it tries to examine the impact of four factors (tangibles, assurance, empathy and price) as well as the factor of service quality and product quality on customer satisfaction. As a result, the empirical information found in this thesis provides a general view about assessment of customer about product quality and service quality of PNJ stores in HCMC in order to make appropriate adjustments and effective improvement for running a good business.
Based on the results of the path analysis exploring the direct and indirect effects of four independent and two dependent variables on customer satisfaction, this study argues that in order to achieve high customer satisfaction, PNJ company should have high level of service quality, product quality, better tangibles in stores, better assurance and empathy to customers and better price. Moreover, from the result of this research, the findings indicate that the factor of empathy plays crucial role for customer satisfaction.
In conclusion, from the experiences in process of conducting research, it points out limitations of this study and provides helpful recommendations for further dissertation. And according to the research findings, this study gives some recommendations to PNJ company in order to take adjustment and improve the level of service quality, product quality and customer satisfaction.
CHAPTER I
Introduction
1.1 Background
Jewelry industry of Vietnam is one of the developing sectors of Vietnamese economy. And most of enterprises in the field do not have the organizational system. There are more than 12,000 business enterprises in the industry, most of them are small jewelry store and the rest are a number of organized retail business. Domestic jewelry market develops in all segments, including gold, platinum, silver and precious stones, where gold is the preferred choice of most customers. According to Updating Report of Sacombank-SBS in first quarter of 2013, from 2005 to 2011, the value of gold jewelry in Vietnam compounds annual growth rate of 6-8%, increases from 399 million USD to 634 million USD. In 2011, the demand for gold jewelry in Vietnam increased by 14%, which is 634 million USD, accounting for 13% of total gold demand. Jewelry market decreased 10% to 13 tonnes in 2011. The increase in gold prices helped to increase the value by 14%, even if production reduced by 10% in the same period.
In Quarter 1/2012, production of consumed gold jewelry fell by 9% to 5 tons, the domestic gold price increases from last year which leads to decrease in demand because customers have to face with high inflation. Gold jewelry demand in Vietnam in quarter 1/2012 has made positive changes, with the value of 269 USD million (up 9.8%) and mass consumption of 5 tonnes (down 9%) .
In the future, growth rate in Vietnam jewelry market is expected to be positive, which is driven by the increase in domestic demand and income. And as a result of this trend, customers with higher income will have higher requirements. For jewelry products industry, this is an opportunity as well as a challenge. Now that more and more enterprises start this kind of business with products of competitive quality and price, how can old enterprises attract more new customers and retain the old ones? The enterprises should not only concentrate on improving products quality and design, they should also attach special importance to enhance service quality in their stores.
In order to achieve this, a method should be usually implemented is to do research about customer satisfaction about product quality and sale service quality of their distribution system. By doing these studies, the companies can have more knowledge about customer desire and evaluation, so they can give methods to improve the quality of product as well as service, satisfy their customers in best ways, and contribute to gain customer loyalty.
1.2 Problem statement
Many researchers have looked into the importance of customer satisfaction. Kotler (2000) defined satisfaction as: “a person’s feelings of pleasure or disappointment resulting from comparing a product’s perceived performance (or outcome) in relation to his or her expectationsâ€. Hoyer and MacInnis (2001) said that satisfaction can be associated with feelings of acceptance, happiness, relief, excitement, and delight.
In addition, to be a strong brand with high reputation and credibility, Phu Nhuan Jewelry Joint Stock Company (PNJ) is considered to be one of the enterprises with significant contributions to the growth of the jewelery industry in Vietnam. It can be seen as the market leader among domestic jewelry company with 20% gold jewelry market share and upto 70% silver jewelry market share in Vietnam. Hence, to keep the leader position in jewelry industry in Vietnam, research on customer satisfaction on product quality as well as sales service quality is a necessary method to attract more new customers and retain the existing ones.
Thus, I would like to do my thesis about ‘Evaluate customer satisfaction on product quality and sales service quality of PNJ stores in Ho Chi Minh City’
1.3 Introduction of Phu Nhuan Jewelry Joint Stock Company
Phu Nhuan Jewelry Joint Stock Company is a firm operating in fields of verifying diamond and gemstone service; manufacturing, trading gold, silver and gemstone jewelry, gold bullion; house renting according to real estate trading law.
1.3.1 Foundation and development history
In April 28th, 1988, Phu Nhuan Jewelry Trading Store was founded with an investment of only VND 14 million – equivalent to only 9.0 ounces of gold at that time – and its first 20 employees.
In 1990, this founding store became Phu Nhuan Jewelry, Fine Arts and Currency Exchange Company, being under direct control of Financial Administration of Ho Chi Minh City Committee. Phuong Hoang Gold Bar was also launched then.
In 1992, the company was renamed Phu Nhuan Jewelry Joint Stock Company. This stage witnesses great changes with bold investment in Italian technology production line. In the same year, the company also co-founded Dong A Bank and formed a joint venture with Phu Nhuan House Trading and Development Company.