Service Quality As Antecedent of Customer Loyalty in Casual Dining Restaurants in Surigao Del Norte Final

SERVICE QUALITY AS ANTECEDENT OF CUSTOMER LOYALTY IN
CASUAL DINING RESTAURANTS IN SURIGAO DEL NORTE
A Thesis Presented to
The Faculty of the Graduate School
Lourdes College, Cagayan de Oro City
In Partial Fulfillment
of the Requirements for the Degree
Master of Science in Hospitality Management
(MSHM)
HANNAH REJOICE N. ERLINA
March 2020
ii
APPROVAL SHEET
This thesis entitled “SERVICE QUALITY AS ANTECEDENT OF

CUSTOMER LOYALTY IN CASUAL DINING RESTAURANTS IN SURIGAO
DEL NORTE” prepared and submitted by HANNAH REJOICE N. ERLINA in
partial fulfillment of the requirements for the degree of Master of Science in
Hospitality Management (MSHM) has been examined and is recommended for
acceptance and approval for ORAL EXAMINATION.
CYRIL C. CHAVEZ, DM-HRM

Mentor
PANEL OF EXAMINERS
Approved by the committee on Oral Examination with the grade of ___________.
JUDITH C. CHAVEZ, DM-HRM

Chair
RAQUEL A. SAAB, DM RAQUEL J. DAEL, DM

Member Member
MIGUELA B. NAPIERE, Ph.D.

Member
________________________________________________________________
Accepted and approved in partial fulfillment of the requirements for the
degree of Master of Science in Hospitality Management (MSHM).
JUDITH C. CHAVEZ, DM- HRM

Dean, Graduate School
March 2020
iii
ACKNOWLEDGEMENT
The researcher is very thankful to God Almighty for without His unending
graces and blessings, this study would not have been possible.
Immeasurable appreciation and deepest gratitude for the help and support
are extended to the following persons, institutions who, in one way or another,
have contributed in making this study possible.
Lourdes College institution for the opportunities afforded to its
students to grow professionally and personally; the thesis panel: Dr. Judith C.
Chavez, Dr. Miguela B. Napiere, Dr. Raquel A. Saab, and Dr. Raquel J. Dael for
their valuable insights in the refinement of this study;
Dr. Cyril C. Chavez, her mentor, for his support, advices, dedication, time
and effort in checking the manuscript, for sharing his knowledge and guidance;
Dr. Judith C. Chavez, Dean of the Graduate School, for her support,
valuable comments, suggestions, and provisions and for her good disciplining
that helped the researcher in many areas and in finishing the manuscript;
Dr. Miguela B. Napiere, for her assistance not just with statistical analysis
of the data but even extending her help and compassionate heart on the success
of this study;
Dr. Ralph Jay Magsalay, for his expertise in extracting the data;
Ms. Doris Dee M. Maisa, Graduate School Secretary for her kindness and
assistance;
The management and staff and the customers of the casual dining
restaurants in Surigao City for allowing the researcher to conduct the study in
their respective restaurant. Special acknowledgement is also due to Ms. Roselyn
Armida B. Merlin, Supervising Tourism Operations Officer of Surigao City,
Surigao del Norte.
The researcher’s parents, siblings and relatives, for their endless report,
trust, guidance, worthy encouragement and for being the researcher’s sole and
main inspiration for the accomplishment of this manuscript.
Hannah Rejoice N. Erlina

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DEDICATION
I can do all things through Christ, who strengthens me
- Philippians 4:13
To
Jesus Christ, my Lord and Saviour,
Nancy N. Erlina,my mother,
Eduardo A. Erlina Sr, my father,
Jerameel N. Erlina, James N. Erlina, and Eduardo N. Erlina Jr,
and to my students, this humble work is dedicated.
- Hannah-
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Abstract
This study conceptualized to analyze the best predictors of the customers’
intention to repeat patronage of the services provided by the casual dining
restaurants. To achieve the aim of this study, a survey type of research
questionnaire-checklist developed by Stevens et.al. (1995) which was based on
the SERVQUAL contains five dimensions of service quality such as tangibility,
reliability, responsiveness, assurance, and empathy, while food quality was
adopted from Namkung & Jang (2008), and price was adopted from Kotler and
Keller (2016) utilized with 100 customers from the casual dining restaurants in
Surigao del Norte. The research design used was descriptive correlation which
utilized the following statistical tools: mean, standard deviation, multiple
regression analysis. The findings of this study revealed that service quality
predict customer loyalty. Moreover, price, as a dimension of service quality was
found to be the strongest predictor of customer loyalty with a high multiple
correlation (R= .711). The higher the participants’ regards of the dimensions of
service quality, the greater is their tendency to get satisfied and be a loyal
customer.
Key Words: Service Quality, Customer Loyalty

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TABLE OF CONTENTS
PAGE
Approval Sheet i
Acknowledgment ii
Dedication iv
Abstract v
Table of Contents vi
List of Tables and Figures viii
CHAPTER
1 THE PROBLEM
Introduction 1
Conceptual Framework 3
Statement of the Problem 10
Significance of the Study 11
Scope and Delimitation of the Study 12
Definition of Terms 12
2 REVIEW OF RELATED STUDIES AND LITERATURE 14
3 RESEARCH METHOD
Research Design 26
Participants of the Study 26
Research Instrument 26
Validity and Reliability of the Instrument 27

Data Gathering Procedures 28
Scoring Procedure 29
Statistical Treatment of the Data 30
4 PRESENTATION ANALYSIS AND INTERPRETATION OF DATA
Problem 1 31
Problem 2 45
Problem 3 47
Problem 4 48
5 SUMMARY, CONCLUSION AND RECOMMENDATION
Summary 50
Findings 51
Conclusions 51
Recommendations 52
REFERENCES
APPENDICES
A. Letter to Participants
B. Letter to the Casual Dining Restaurants
C. Questionnaire
D. Letter to Tourism Office

LIST OF TABLES
Table
1 Frequency, Percentage and Mean Distribution of

Service Quality Considering Tangibility 32
2 Frequency, Percentage and Mean Distribution of 34

Service Quality Considering Reliability

Service Quality Considering Responsiveness

Service Quality Considering Assurance

Service Quality Considering Empathy

Service Quality Considering Price

Service Quality Considering Food Quality

Customer Loyalty
9 Regression Analysis for Customer Loyalty 47
10 Proposed Action Plan 49
Figure
1 Schematic Presentation of the Interplay of Variables 9

in the Study
Chapter 1
THE PROBLEM
Introduction
Service quality has always been important to the success of a business.
Big establishments, hotels and restaurants spend large amount of money and
exert much effort to improve the quality of their products and services. Providing
services of great quality is an important pursuit for service providers that are
trying to find to create and provide value to their customers (Grönroos and
Ravald, 2011). Through the delivery of high levels of service quality, companies
can attain increased customer satisfaction, loyalty and therefore long-term
profitability (Zeithaml and Bitner, 2000).
The restaurant industry has not been exempted from either extended
competition or patron demand for excessive service quality. Nowadays,
customers have a wide choice of restaurant services to choose from, and service
quality conditions positively impact a restaurant competitive advantage (Bojanic
& Rosen, 1994; Soriano, 2002; Yüksel & Yüksel, 2002; Sulek & Hensley, 2004;
Chow et al, 2007; Chavez, 2014). The researcher believes that individual
restaurateurs must find ways to make their products and services stand out
among the others. To attain this, restaurant’s management and staffs must
understand their patrons’ needs and wants. This means that the management
must show excellence in all the operations of the restaurant from accompanying
2
guests to their table, to the setting of the guests, to the provision of food and
beverage and to other areas that customers come in contact with.
Admittedly, the progress of the restaurant industry may be paralleled with
the growth of tourism. Hardly one can talk about tourism industry without the
partnership of restaurants, cafes, bistros, and other forms of food and beverages.
Surigao City tagged as “The City of Island Adventures”; it is known all over
because of its beaches, caves, falls, and islands. Surigao boasts of 17 islands
and islets and 21 villages, scattered in northeastern Mindanao (Supetran, April
2017, businessmirror.com.ph). As stated by the city tourism office of Surigao,
299,977 tourists visited the city, of which, 13,327 were foreign visitors. Amidst the
earthquake that struck the city, Surigao was slowly recovering and had tourists’
arrivals of 288,219 in 2018 (Mascarinas, 2018, Inquirer.Net).
According to the city officials in the fast- rising tourism of the place, they
are working to transform it into a major destination in the Philippines by the year
2020 (Mike Crismundo, November 2019, Manila Bulletin). With this possible
growth, the need for quality service in the food industry is a must specifically the
restaurant which is the focus of the study. A casual dining restaurant refers to a
dining establishment that has a cozy atmosphere which offers food and beverage
that is moderately-priced (Jones, 2014).
The researcher delved into selected casual dining restaurants in Surigao
del Norte because hardly are there studies that looked into the service quality of
restaurants in that particular area. The researcher hopes that the findings
generated from this study could be an important input for the improvement or
3
enhancement on the restaurant’s physical characteristics, and the management’s
way of doing things which may eventually lead to customer satisfaction and
customer loyalty. A proposed action plan will be recommended by the researcher
to help translate the results of the study into concrete programs to help improve
the industry.
Conceptual Framework
This study is built on the premise that service quality is a key component
to the success of any organization; and the more capable the organization
delivers the services desired by its customers; the greater are the opportunities
for an organization to gain competitive advantage Cronin et.al (2000);
Dabholkan et.al ( 2000); Olorunniwo et.al (2006).
This study is anchored on Homans’ Social Exchange Theory (1961) that
espoused social behavior or the result of an exchange process. This exchange is
to maximize profits and can reduce cost. When there is a close interaction
between a service employee and a customer, the way in which the service is
performed is often more important than what is actually delivered (Ozment and
Morash, 1994). Behaviors and attitudes of employees can influence a customer’s
view of quality for the offering of service (Brady and Cronin, 2001). .
The exchange process is dynamic in service encounters, due to the
changing interaction between service providers and their patrons. Service
providers have an opportunity to offer something special that stand out in a
customer’s mind, thereby increasing the likelihood of that customer returning
(Crosby and Johnson, 2002; Mitchell, 1998; Shostack, 1977). Thus, businesses
4
should benefit from a better understanding of what leads to customer loyalty in
services.
Moreover, this study indirectly suggests that service quality is linked to
customer loyalty. Akbaba (2006) defined service quality as the result of a
comparison established between the expectation of customers about the service
and their perception of the actual services or the way such services are being
provided. When the customers feel that they received a superior dining
experience, they become satisfied and this satisfaction generates positive
behavioral intentions. They tend to reflect it through their behavior by revisiting,
recommending to other customers, repurchasing, and sharing positive comments
through word of mouth communication (Shahzadi, Malik, Ahmad, & Shabir,
2018;Jin, Line, & Ann; Chen et al., 2015;Durna et al., 2015;Bujisic, Hutchinson, &
Parsa, 2014;Ryu, Lee, & Kim, 2012;Ha & Jang, 2012;Lin & Mattila,
2010;Namkung & Jang, 2008).
In this study covered Parasuraman’s dimensions of service quality which
as discussed in the succeeding paragraph.
Tangibility. This dimension refers to the appearance of equipment,
physical facilities, written materials and personnel which are also major factors in
making customer to feel delighted and ownership towards the company’s brand
image
Reliability. This dimension is the most important factor which is related to
handling service problems of customers, performing services at the right time
such as delivering services at the promised time and keeping error free records
5
of each activity. Furthermore, reliability is all about accurate order fulfillment as
accurate quote, accurate record, accurate in billing, and maintain service promise
(Parsauraman et al., 1991).
Responsiveness. Is another quality dimension of service playing vital role
to exceed customer’s expectation, which is the readiness and willingness of
employees to offer service encompasses timeliness of services (Kumar and
Charles, 2010). It further includes understanding attention to customer’s safety
and problems in their transaction, individual attention given by employee, and
convenient operating hours. These are vital in satisfying customer’s expectation
that responsiveness will delight customers and increase their likelihood for the
organization.
Assurance (inclusive of security, credibility, courtesy, and competence). It
is associated with good manners and information of workers as well as their skills
and traits to provide confidence and ensure trust to the consumers.
Empathy (including understanding, communication, and access of
consumer). It refers to individualized attention, caring, and understanding that
the company gives to its clients. Based on Franchuk (2012), empathy is all
about how the company cares and gives individual, personal attention to their
guests; how the company tries to understand the needs and preferences of their
customer in order to make them special and extra valued. Customers should be
treated as they are unique and special. According to Toorawa and Naiko (2012),
empathy is the capacity to recognize feelings that are being experienced by

6
another person. Some may need to have a certain amount of empathy before
they are able to feel compassion and some may need a little empathy to that they
are valued.
The concept of service quality can be regarded as a precursor to customer
loyalty (Wieringa, et.al, Journal of Service Research, 2007). This variable is also
regarded as a powerful agent of competitive advantage and organizational
success (Wang,2004). Loyalty is seen as driven mainly by service quality (Liao,
et.al, 2009) thus, good service quality (Cronin Jr., et.al, The Journal of Marketing,
1992), reciprocally offers customer loyalty. Service quality is linked to customers’
behaviors in the direction of service supplier as well as their willingness to
remain with the service provider (Ishaq, I. M., Serbian Journal of Management,
2012). Furthermore, service quality has been revealed to be a powerful predictor
of customer loyalty (McKenzie, S., et.al, International Journal of Bank Marketing,
2011).
Thus, it is suggested to mean that, service quality has a direct and
positive outcome on customer loyalty (Aydin, S.,et.al, 2005). Better still,
service quality constitutes a potent and illustrative component for explaining
future customer loyalty (Boohene, R., et.al, International Business Research,
2011). Many researchers have discovered that, great service quality has a
relationship with considerably high customer loyalty (Akroush, M. N., et al,
2011). In addition, service quality is perceived as a main factor influencing
customer loyalty [A. H. MutiaSobihah, et.al, 2015; Kim, Y.-E. et.al, 2010).
7
Price furthermore plays a huge role for restaurants. Price perception
greatly affects a consumer's decision to purchase a product. The perception of
price explains information about a product and provides a deep meaning for the
consumers (Kotler and Keller, 2016). Therefore, price is an important influence in
the purchasing decision, especially for products that are frequently purchased,
and in turn, influences the choices of which store, product, and brand to
patronize (Faith and Agwu, 2014). Consumers are very rational when it comes to
judging what benefits they wish to get from buying products or services they pay
for (Al-Mamun and Rahman, 2014).
Research by Komaladewi and Indika (2017) indicated that most
respondents consider price as an important factor influencing their purchase
decisions, similar to the finding of Djatmiko and Pradana (2015) and
Termsnguanwong (2015). Apparently, food quality is a key determinant in
building customer loyalty through satisfaction (Clark & Wood, 1999) especially in
restaurant. Similarly, previous researchers (Ha & Jang, 2010; Namkung & Jang,
2007; Sulek & Hensley, 2004) agreed that food quality is an important
component for customer loyalty. Ha and Jang (2010) found that food quality has
a positive relationship with customer loyalty.
Supporting the findings, previous researchers agreed that food quality is
one of many factors identified as an important factor for restaurants (Qu, 1998;
Ha & Jang, 2010; Ma, Qu & Njite, 2011). Ma et al. (2010) claimed that food
quality can outweigh other determinants such as environment and service
attributes, emphasizing the importance of food quality.

8
This study assumes service quality is an antecedent of customer loyalty.
Customer loyalty is an important factor in the customer strategy of any
organization. Increasing customer loyalty has become a hot topic among
managers, consultants, and academic scholars Keiningham et.al (2007). The
importance of this issue is due to the fact that it leads to purchase of goods and
services by the customers. Organizations and institutions that are successful in
gaining customer loyalty have a major competitive advantage, Aksu (2006).
Anderson and Narus (2004) believe that retaining existing customers is a
much more effective strategy for the organization than attempting to attract new
customers to replace the lost ones Gee et.al. (2008). Restaurant owners,
therefore, need to understand specific decision-making criteria customers use for
restaurant selection in order to be able to affect customers’ selection decisions.
According to Kotler et al. (2011), customers seek “a set of benefits” with
various capabilities for satisfying their needs.
The good quality of service will convincingly client to repeat the demand of
service. It show customer behavioral towards service provider. The quality of
service that fulfills customer expectation will gain the customer loyalty. This
intention will make customers' favorable inclination a service relative to other
firms offering the same service (Kaura, Prasad & Sharma 2015).
Figure 1 shows the interplay of variables in this study. The independent
variables study ascertained the status of customer loyalty in the identified
restaurant. The customers’ assessment of the restaurants’ service quality is also
assumed to be an antecedent of customers’ loyalty.

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Service Quality
 Reliability
 Assurance
Proposed
 Tangibles Customer Loyalty Action Plan for
the
 Empathy Enhancement
 Responsiveness of Restaurant
Service
 Price
 Food Quality
Figure 1. Schematic Presentation of Variables in the Study

10
Statement of the Problem
This study aimed to identify the service quality of selected restaurants in
Surigao del Norte in relation to customer loyalty. Specifically, the researcher
sought to answer the following questions.
1. What is the assessment on the service quality of selected restaurants in
Surigao del Norte in terms of:
1.1 Reliability;
1.2 Assurance;
1.3 Tangibles;
1.4 Empathy;
1.5 Responsiveness;
1.6 Price; and
1.7 Food quality
2. How are the participants characterized in their loyalty?
3. Does service quality predict customer loyalty?
4. On the basis of the findings, what action plan may be proposed?
Hypotheses
The following alternative hypothesis is tested in the study.
H01: Service quality does not predict customer loyalty.

11
Significance of the Study
A restaurant that guarantees standard quality of products and services is
more likely to run the business efficiently and gain competitive advantage that is
beneficial to their business operations. This study can be used in evaluating the
factors that influence the dimensions of service quality that would have
implications on customer’s loyalty; hence, this study would be beneficial to the
following sectors.
Restaurant Operators. The outcome of this study will serve as an
evaluation of service quality on their operations based on Parasuraman’s service
dimensions of service quality; reliability, assurance, tangibles, empathy, and
responsiveness, price and food quality from Stevens, et.al. This will also serve as
basis for possible improvements and corrective actions if difficulties may be
identified. Furthermore, this will also be a reference for the restaurants to cater to
the rising demands in this industry, thus making them as potential loyal patrons
of the restaurants.
Future Restaurant Owners. This study provides important guidelines on
how to operate casual dining establishments in ensuring that customers are
satisfied through quality service, thus, building a strong customer loyalty.
Students in the Hospitality Management. The study would provide a
deeper understanding of the dimensions of service quality which are essential in
their future career.

12
Future Researchers. The study will serve as the basis for another
endeavor of pursuing similar study but with consideration of improving the
population size as ell as investigating the variable of customer delight in relation
to customer loyalty.
Scope and Delimitation of the Study
The study focused on assessing the service quality on service dimensions
namely: reliability, assurance, tangibles, empathy, and assurance, price and
food quality as antecedent of customer loyalty among the selected casual dining
restaurants in Surigao del Norte. This study also assessed the loyalty of
customers.
Definition of Terms
The following key terms were used for a better assimilation of the study.
Customer Loyalty. It is the result of consistently positive emotional experience,
physical attribute-based satisfaction and perceived value of an experience, which
include the product or services (Shaw, 2016).
Service Quality. This term refers to the ability of the organization to meet or
exceed customer expectations (Parasuraman, 1998).In this study, it includes the
following dimensions:
Tangibility. It implies communication material, employees, equipment,
employees and physical facilities of the company.

13
Reliability. It refers to the capacity to perform given service accurately
and dependably such as records and billing.
Responsiveness. This term refers to the readiness of the staff to provide
constant and prompt service to help customers.
Assurance .It is associated with good manners and information of
workers as well as their skills and traits to provide confidence and ensure
trust to the consumers.
Empathy. It refers to individualized attention, caring, and understanding
that the company gives to its clients.
Price. In this study, this dimension is used to describe the amount that a
customer’s pay for a certain food or beverages ordered.
Food Quality. Is the quality characteristics of food that is acceptable to
consumers. This includes external factors as appearance, texture, and
flavor; factors such as federal grade standards and internal.
Casual Dining Restaurant. It refers to a dining establishment that has a
cozy atmosphere and which offers food and beverage that is moderately-
priced.
Chapter 2
REVIEW OF RELATED STUDIES LITERATURE
This chapter reviews the studies and literatures which are related to quality
service and customer loyalty. The insights generated from these literatures had
firmed up the researcher’s assumptions that the dimensions of service quality
have bearing on customer loyalty. Likewise, the review provides enhancement to
the concepts used in the study.
Service Quality
Restaurants face different challenges which include uncertainty of
economic status, competition, demographic change in markets and changes in
habits of the employees. Due to intense competition in food and beverage
industry, restaurants should provide service effectively and efficiently to their
customers to retain and acquire continuous brand advocacy and level of
customer satisfaction, Espino, A.G.B (2017).
Service quality is an important factor in customer’s restaurant
selection Soriano (2002) and is regarded as an important strategy in in
restaurant positioning Chow, Lau, Lo, Sha & Yun (2007). Importantly, restaurant
customers desire unique and memorable service experiences. Walls, Okumus,
Wang & Kwun (2011) and might serve as a point of competitive advantage in the
increasingly competitive restaurant industry. SERVQUAL is often used as a scale
to measure the concept of service quality Parasuraman, Zeithaml & Berry (1988).
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Superior service quality has the aptitude to improve customer loyalty
(Manhas & Tukamushaba, 2015). Evidently, empirical studies in restaurant
setting demonstrate that improving service quality positively influences customer
loyalty, Carranza, Díaz, & Martín-Consuegra (2018); Mhlanga (2018); Hyun
(2010). It highlights the importance of service quality in determining
customer loyalty in restaurant context.
The SERVQUAL survey instrument was developed to measure the service
quality attribute in different service environments according to five different
dimensions: reliability, assurance, tangibles, empathy, and responsiveness
(Bojanic and Rosen, 1994; Cronin and Taylor, 1994; Lee and Hing, 1995;
Parasuraman et al., 1988). Different measurement tools and techniques are used
in assessing customer satisfaction. DINESERV is the most popular and widely
used instrument. In restaurant, customer satisfaction is usually measured with an
adapted version of SERVQUAL, called DINESERV (Stevens et al., 1995).
Modified DINESERV was also applied in this study.
As mentioned in the study of Diab et al. (2016), the SERVQUAL model is
the commonly used instrument more than others, but many researchers have
criticized the model for its unsuitability for measuring all types of services. For not
taking into consideration the restaurant industry, the original authors criticized the
model. DINESERV is based on the LODGSERV model Stevens et al. (1995).
This model is created to evaluate the customer expectation to quality service in
fine dining, quick service, and casual restaurant. At first, DINESERV instrument
contained 40 service quality items, but after it was modified, the final version of
16
DINESERV contained 29 items only and divided into seven dining service
dimensions. These attributes represent five dimensions: tangibles, reliability,
responsiveness, assurance, and empathy. The remaining six and seventh
attributes were selected from Andaleeb and Conway’s (2006) research. The
additional two dimensions are price and satisfaction. The level of agreement was
assessed using a seven-point Likert-type scale, with description such a “strongly
disagree” as 1 and “strongly agree” as 7 (Hansen, 2014). DINESERV dimensions
are similar to SERVQUAL; the only difference is that tangibles are in fourth place
in Parasuraman et al.’s (1988) SERVQUAL research.
Many studies have used DINESERV to measure quality service. The
works of Kim et al., (2003, 2009), Vanniarajan (2009); Markovic et al., (2010),
and many others came up with different factors, as against the DINESERV
factors, suggesting the limitation of the DINESERV model.
Since DINESERV framework is directly involved in restaurant service
quality, different emphasis on the measurements in relation to the original
SERVQUAL dimensions is being applied to match the nature of the service
encounter Hanks et al. (2017). DINESERV focused on the tangible aspects of
service quality like cleanliness, comfort and visual attractiveness. According to
Markovic et al. (2010), DINESERV model is a reliable and relatively simple tool to
measure customers view in restaurant’s service quality and operations.
Furthermore, to assist in finding the problems and how to solve it (Kuo et al.,
2016; Wu and Mohi, 2015) confirmed the validity of the approach in their study.
The items from the DINESERV model will be used in this paper.
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Tangibility
A tangible is any asset that the company has in a physical form -- they are
workers in the company who can actually touch and see. According to Harr
(2008), tangibles transform the restaurants’ interiors, the appearance and
condition of the cutlery, table wares, and uniform of the staffs. It should be
applied to the customers to be attracted to their restaurant. The restaurants’
signage, advertisements, design of the menu, and appearance should also be
able to catch the attention of the possible customers.
Every restaurant should have modern equipment, physical facility,
employees are well dressed and materials are visually appealing was referred as
tangibility. Saghier& Nathan (2013). Shafiq, Din, and Cheema (2012) specified
that, tangibles are all the things and physical facilities including personal,
equipment’s, building and renovation. Based on Yang (2011), tangibles are not
only the meals but also the elements of a restaurant which are significant when
one delivers service to the customers. Consumers would feel good when they
have the dinner in a good, clean, and comfortable venue with well-groomed
employees who wear neat and clean dresses, and they must have disposable
gloves and they should also wear hair nets which genuinely assess service
quality.
Zeithaml et al. (1990) and Aksoydan (2007) that food service
establishments that failed to meet the standards of food hygiene and cleanliness
expected by customers would be assessed as having poor or low quality service.
The cleanliness of the restroom was also found to be an important criterion when
18
a customer evaluates the overall quality of a foodservice establishment (Klara
2004; Barber and Scarcelli 2009).
Reliability
Cudjoe, Anim, and Nyanyofio (2015) stated that, reliability is the ability to
perform the promised service dependably and accurately or delivering on its
promises. According to Yang (2011), reliability also stands for correct order
fulfillment, exact record, accurate billing, and calculation of commission and save
services oath. It is the basic service needed to and promise to provide to the
customer in a good way. Bryman, A., & Bell, E. (2003) defined reliability as the
primary concern with issues of consistency of measures. Moreover, it is the
ability to deliver expected standard at all time, how the organization handles
customer services problem, how they perform right services for the first time, and
how they provide services within promised time and maintaining error free
record. “In its broadest sense, reliability means that the company delivers on its
promises—promises about delivery, service provision, problem resolution, and
pricing”. Customers need to do business with companies that keep their
promises, Gupta, S., & Zeithaml, V. (2006).
Responsiveness
Shafiq, Din, and Cheema (2012) said that responsiveness describes the
intentions of the firms and its willingness toward customer’s help. It is the quality
of being responsive; reacting quickly; as a quality of people, it involves
responding with emotion to people and events, and it also refers to the
willingness of the company to help its customers in providing them with a good,
19
quality and fast service. Zeithaml & Bitner (2003) added that responsiveness is
communicated to customers by the length of time they have to wait for
assistance, their manner of answering to questions, or attention to problems.
Service quality may be enhanced through responsiveness if, for example,
patrons are timely assisted with wine list and menu or if staff responds
appropriately to customer’s request for prompt service.
Moreover, (MISA, 2011) postulated that a well-behaved and educated
staff with proper knowledge of menu and food ingredients and promptness of
service persuades consumers to favor the restaurant.
Assurance
The study of Franchuk (2012) pointed out that assurance involves the
knowledge and courtesy of employees and their ability to render trust and
confidence. This refers that the customers of the restaurant who can trust the
recommendations of the restaurant's service men. The customers can be
confident that the food the restaurant offers is free from contamination which
means that it’s safe for them to eat and would not damage their health. The
customers could express their thoughts and concerns without fear and
hesitations. As indicated by Naik, Gantasala, and Prabhakar (2010), customers
could develop trust through asking questions and the employees' knowledge to
answer those questions. Based on the employees' performance, the customers
could determine if the service men can be trusted and if they can do financial
transactions safely when the employees are around them.

20
Marković, Raspor, and Šegarić (2010) posited that assurance means that
the service persons of the restaurant are well-trained, competent and are
experienced individuals. This refers to service of men as professionals especially
when it comes to their field of work. They show positive qualities to every
customer. Assurance means that the restaurant gives to their customers the
statement of "We are sure of what we say and do", Mansori, Vaz, and Isamil
(2014).
Empathy
Empathy (including access, communication, and understanding the
customer) is defined as the caring, individualized attention the firm provides to its
customers. In showing empathy to customers, it does not only take more than
words but it also takes imagination. People who work in customer service need to
make mental stretch and try to imagine what it is like to travel in the customers’
shoes. There are several ways that one can provide empathy: knowing
customers by name, their preferences and their needs (Harr, 2008).
Marković, Raspor, & Šegarić (2010) stated that, in the setting of quick
service restaurant, empathy may not be applicable due to customers look for
quick service, however, in a fine dining restaurant, empathy is important to
ensure customer loyalty as the server knows how the customer likes his or her
customers’ food to be prepared.
Price
In the selection of a product, price plays an important role. Price is a value
or reward provided in exchange for need satisfaction to the organization. Price

21
and perceived consumer wants should be compatible. It is not easy to decide
pricing for a product or service because the core values of the available goods
are used to evaluate price which is crucial for consumer satisfaction because the
price is the most prominent factor to help customer estimate the good or service
value. Price also determines, for a customer, to decide on a purchase or not
(Khan 2011). From consumer’s viewpoint, price functions as an indicator to
determine consumer experience with goods or service (Mattila & O'Neill, 2003,
324). Customers, therefore, are more inclined to base their purchase decision on
price factor than on anything else (Khan 2011).
The price of a product is divided into three dimensions: fair price, fixed
price, and relative price. Fair price refers to the adjustment of a price that offers a
combination of quality and appropriate services at a reasonable price (Kotler and
Keller, 2012). Fixed price is a set price for all buyers (Kotler and Keller, 2012).
Relative price is the price set in accordance with the quality and service provided
by the seller (Kotler and Armstrong, 2014).
Furthermore, as suggested by Andaleeb and Conway (2006, 7), the style
of the restaurant also impacts the cost or price associated with the restaurant.
Service excellence and merchandise quality help customers to know the price
associated with the restaurant.
Food Quality
Various food quality attributes, such as taste, presentation, and
temperature have been investigated by researchers Hyun (2010); Namkung &
Jang (2008); Raajpoot (2002); Ryu &Han (2010); Sulek & Hensley (2004). The
22
results indicate that food quality is one of the main factors used by customers in
choosing to visit a restaurant. When customers evaluate food quality, they judge
not only the taste but also the presentation of food (Sulek & Hensley, 2004).
Presentation describes the process of enhancing food’s aesthetic appeal by
arranging, modifying, or decorating it. Presentation is not as critical as food taste
or flavor in customers’ restaurant selection criteria, but it can still generate either
favorable or unfavorable customer preferences (Raajpoot, 2002). Delwiche
(2004); temperature also influences how to get the flavor of food; this will be
interacting with other sensory properties such as taste, smell and sight.
Moreover, freshness, according to Shaharudin et al. (2011, 199), has
become one important element of customer purchasing intentions. It is because
the trend is set these days that consumers look for fresh foods or foods served in
a fresh manner which they find hygienic. Therefore, to ensure freshness, food
should be served in a timely method. If consumers get satisfaction and achieve
good experience, they will continuously spread the positive and good word of
mouth to other potential users to stimulate their intent to retry the fast-food
service providers.
Furthermore, out of the various food quality attributes, it is not surprising
that the taste of the food is one of the most important criteria in customer
restaurant selection because having tasty food provides customers with both a
positive sensory experience and emotional satisfaction during their dining
experience, Hyun-Woo Jung et.al (2017).

23
With people’s increased attention toward healthy lifestyles, food quality
has come to include not only food taste but also nutrition and food safety issues
Choi & Zhao (2014); Knight, Worosz, & Todd (2007) because nutritional and safe
food is directly connected with customers ‘health and safety concerns. Eckel et
al. (2009) investigated customers ‘awareness of nutritional issues and found that
more restaurant customers changed their favorite restaurant due to concerns
over the healthiness of the menu in 2007 compared to 2006. Choi and Zhao
(2010) reported that 62% of their respondents were concerned about health
issues when eating out. They also indicated that 60% of their research
participants considered nutritional value important when selecting a restaurant.
Customer Loyalty
Customer loyalty is often related to as the willingness of customers to
repeatedly purchase a good or service that is accompanied by psychological
bond and hold favorable attitudes toward a good or toward the organization
supplying the goods or services, Deng et al. (2010); Wong & Sohal (2003); Gede
Mahatma Yuda Bakti & Sumaedi (2013); Prakash (2011); Yeo et al. (2015). The
restaurateur environment is a globally competitive marketplace which pushes
food and drink outlets to offer quality products or services, maintain productivity
and consistency, and ensure customer satisfaction in order to remain in
existence and to continue to progress. Moreover, the need to create and retain
customer loyalty has also been recognized as the most salient requirement for
organizational success in this competitive market. Loyal customers not only buy
24
the products or services frequently, but also recommend others to visit and buy
the same or similar products (Liu et al, 2011).
Customer loyalty has been identified as the basis for a company in any
industry to gain a competitive advantage. It is measured based on returning
customers, referrals, and word of mouth. The improvement and retention of
loyalty amongst customers is a crucial factor for the organization’s sales
performance and growth (Reicheld, 1996; Liu et al, 2011). Weiner (2000) argues
that the desire of the service providers is to have loyal customers because a
customer that has an “attitudinal and behavioral commitment” to a service
business may have repeat purchase even if they are dissatisfied with the last
experience.
Service Quality and Customer Loyalty
The quality of service can bring customer intention to use the service
again. These will bring the loyalty of the customer to the business. Service quality
came as a superior quality to customer and brings the customer loyalty Zeithaml,
Berry & Pasuraman (1996) and there are strong relationships between service
quality and customer loyalty Kuo, Wu & Deng (2009); Saura et al. (2008). The
good quality of service will convince client to repeat the demand of service. It
shows customer behavioral towards service provider. The quality of service that
fulfills customer expectation will gain the customer loyalty. This intention will
make customers' favorable inclination a service relative to other firms offering the
same service Kaura, Prasad & Sharma (2015). According to Chen and
25
Myagmarsuren (2013), customers intend to be loyal to the company if they find
that the service is practiced.
Based on research Mahmud, et al (2014), prices have a significant
influence on customer loyalty. Price is a variable that can be controlled and
determine whether or not a product is accepted by consumer. To gain customer
loyalty, one needs to understand customer wants and needs. Biswas et al.
(2002) posited that price of a product directly affects the customer’s buying
intention and customer’s value awareness. Price can be considered as the
important factor that influences buying behavior among the various offerings in
the different categories of products (Romaniuk and Dawes, 2005).
Additionally, Yavas (2003) declared that product’s price as an imperative
indicator affects store choice and customer buying behavior. Generally,
customers stay loyal if the product’s price offers by the retail firms meets the
expectations of the customers, therefore, retail firms should provide affordable or
reasonable product’s price in order to increase and to retain loyal customers.
The information and concepts obtained from readings provided insights
which are related in the study. All of the materials reviewed for the purpose of the
study gave useful insights and inferences to value the contribution of service
quality in the casual dining restaurants. It provides a foundation for the
researcher for this piece of work.
Chapter 3
RESEARCH METHOD
This chapter presents the research design, respondents of the study,
research instrument, validity and reliability of the instrument, data gathering
procedures, scoring procedure and statistical treatment.
The Research Design
This study utilized a quantitative method specifically descriptive
correlational design that identified the relationship of service quality to customer’s
loyalty. According to Cone & Foster (2006); Cooper & Schindler (2007); Neuman
(2006), a quantitative method is suitable when the objective of the study is to
compare relationships among variables. This type of research was deemed
appropriate in this researcher’s study because it determined the influence of
service quality as a predictor of customer’s loyalty.
Participants of the Study
In selecting the total participants, the researcher utilized quota sampling
where the survey population was divided into equally exclusive subgroups. Ten
restaurants were identified as subjects of this study with then guests in a week.
Research Instruments
A survey type of research questionnaire- checklist was used as an
instrument for data collection. Specifically, the DINESRV questionnaire which
was developed by Stevens et. al. (1995) which was based on the SERVQUAL. It
contains five dimensions of service quality such as tangibility, reliability,

27
responsiveness, assurance, and empathy, while food quality was adopted from
Namkung & Jang (2008), and price was adopted from Kotler and Keller (2016).
Customer loyalty from Deng et al. (2010); Wong & Sohal (2003); Gede Mahatma
Yuda Bakti & Sumaedi (2013); Prakash (2011); Yeo et al. (2015).
The questionnaire was answered by the customers of the said casual
dining restaurants. It had 39 items and these items were clustered into seven (6)
dimensions of service quality and customer loyalty. The following items
comprising the said dimensions are as follows 1-5 are for Tangibility, items 6-10
for Reliability; items 10-15 for Responsiveness; items 16-20 for Assurance, items
21-25 for Empathy; items 26-29 for Price, items 30-34 for Food Quality, and
items 35-39 for Customer Loyalty.
Validity and Reliability of the Instrument
The instrument underwent a content validation and reliability testing to
ensure the reliability of the research instrument. The instrument used in the study
was reviewed by the members of the panel and experts in the field. After their
comments and suggestions, corrections were integrated into the research
instrument. After which, the researcher conducted a pilot test to the non-
participants of the study. In order to test the reliability of the instrument, the
Cronbach Alpha Coefficient was used. The “widely accepted cut-off Cronbach
alpha for social science research should be .70 or higher, nevertheless, some
use. 75 or.80 while others use. 60”( Cronbach,1951 as cited by Garson, 2007). In
this study, the dimensions of service quality had the following alpha coefficients:
28
Dimensions of Service Quality Cronbach’s Alpha
Tangibility . 87
Reliability .801
Responsiveness .765
Assurance .744
Empathy .851
Price .957
Food .875
Customer Loyalty .908
These figures show that the items in all dimensions which were
investigated were internally consistent; hence the items in the instrument were
highly reliable.
Data Gathering Procedures and Ethical Considerations
Certain protocols were observed in gathering the data. First, the
researcher secured a written permit to the Supervising Tourism Operations
Officer of Surigao City to inform that there will be a conduct of survey to the ten
(10) best restaurants in the city. The researcher also wrote a letter from the
owners of the restaurants through their Human Resource Department asking
permission to conduct a survey and guaranteed that the information gathered
from the assessment of customers will be confidentially kept and would be used
only for academic purposes. When permission was granted the researcher
29
directly communicated with the manager in-charge who then gave instructions to
the staff to distribute the survey questionnaire to the customer and as gratitude,
guest will be given a complimentary chocolate. After the time frame of data
gathering, the researcher encoded the data for organization and interpretation.
Scoring Procedure
As regards scoring procedure, the following scale description was utilized.
This five point scale continuum was adopted from Stromgren (2007) and
developed by Parasuraman et al.
Service Quality Scale Description
Range Description Customer’s Assessment on
the Service Quality
4.21- 5.0 Strongly Agree Very high
3.41- 4.20 Agree High
2.61- 3.40 Somewhat Agree Moderate
1.81 -2.60 Disagree Low
1.00- 1.80 Strongly Disagree Very Low
Range Description Customer’s Assessment on
the level of their Loyalty
4.21- 5.0 Strongly Agree Very High 30
3.41- 4.20 Somewhat Agree High

2.61- 3.40 Agree Moderate
1.81 -2.60 Slightly Agree Low
1.00- 1.80 Strongly Disagree Very Low
Statistical Treatment of the Data
To obtain a better understanding of the data, the following statistical tools
were used: descriptive statistics such as means, frequency, percentages and
standard deviation were employed to determine the assessment of the
participants as regards the dimensions of service quality as well as customer
loyalty. To determine if service quality influences customer loyalty, regression
analysis was used.
Chapter 4
PRESENTATION ANALYSIS AND INTERPRETATION OF DATA
This chapter presents the findings and interpretation based on the data gathered
from the study. The order of the presentation follows the sequence of the outline
problems presented in Chapter 1 of the study.
Problem 1. What is the customers’m assessment of service quality among
selected restaurants in Surigao del Norte in terms of:
1.1 Tangibility;
1.2 Reliability;
1.3 Responsiveness;
1.4 Assurance;
1.5 Empathy;
1.6 Price; and
1.7 Food quality
Table 1 presents the customers’ assessment of the casual dining
restaurants’ dimensions of service quality considering tangibility. It can be
gleaned from the table that the customers rated the restaurants with a mean of
M= 4. 45 interpreted as “Very High”. This further means that the customers were
generally very satisfied of the physical appearance of the restaurant and staff
during their visit. The researcher also observed that the restaurant staffs were
good, well-dressed, neat, and the customers were provided with comfortable,
complete, and functional facilities. Shafiq, Din, and Cheema (2012) specified
that, tangibles are all the things and physical facilities including personal
appearance, equipment, building and renovation. Based on Yang (2011),
tangibles are not only the meals but also the elements of a restaurant where
32
significant when one delivers service to the customers. Consumers would feel
good when they have the dinner in a good, clean, and comfortable venue with
well-groomed employees who wear neat and clean dresses with gloves and hair
nets which are manifestation of service quality.
Table 1. Frequency, Percentage and Mean Distribution of
Participants’ Assessment of Tangibility
Range Interpretation Frequency Percentage

4.20 – 5.00 Very High 79 79.00
3.40 – 4.19 High 21 21.00
2.60 – 3.39 Moderate 0 0.00
1.80 – 2.59 Low 0 0.00
1.00 – 1.79 Very Low 0 0.00
Total 100 100. 0
Overall Mean 4.45
Interpretation Very High
SD 0.39
The restaurant has… Mea Interpretatio SD

n n
1 Visually appealing facilities 0.5
4.69 Very High 1
2 Neat, professionally looking staff 0.5
4.49 Very High 8
3 Attractive documentation, such as signs, menus 0.5
4.47 Very High 2
4 Sanitized table appointments 0.5
4.44 Very High 7
5 Clean Comfort Room 0.6
4.18 High 3
In this current study, visually appealing facilities stood out as having the
highest assessment (M= 4.69) which means that customers were “highly
satisfied” of the facilities of the establishments implying that the restaurant’s
facilities were appreciated by the customers. The findings find consonance with
the concepts presented by Saghier & Nathan (2013) that every restaurant should
33
have modern equipment, physical facility, well dressed employees and materials
which are visually appealing. However, worth noting in the table is the area on
comfort room, which was assessed as the lowest item with a mean of 4.18
although it was still assessed as “highly satisfactory”.
Even if this was rated high, the management considers this finding as a
concern needing attention. The researcher believes that no matter how much
effort the management exerted to make a good food and provide a timely
service, customers will look into the status of the restrooms, which is one of their
bases to become loyal. When the customers found out during their dining
experience that the comfort room is dirty, they will never patronize the
establishment again and share what they know about their bad experience.
Unclean restrooms, however, might destroy the management’s reputation.
The findings of this study is in consonance with the postulation of Zeithaml et al.
(1990) and Aksoydan(2007) that food service establishments that failed to meet
the standards of food hygiene and cleanliness expected by customers would be
assessed as having poor or low quality service. The cleanliness of the restroom
was also found to be an important criterion when a customer evaluates the
overall quality of a foodservice establishment (Klara 2004; Barber and Scarcelli
2009).
restaurants’ dimensions of service quality considering reliability. It can be seen
from the table that the customers rated the restaurants’ staff with a mean of M=
4. 37 described as “Very High”. This finding features the ability of the staff to
34
perform the promised service dependably and accurately. The researcher
observed that the restaurants’ staffs show kindness and cheerfulness in
rendering services to the customers. They also keep services dependently,
accurately, and with sincere interest in providing customers’ needs resulting to
customers’ very high satisfaction.
This result is also in accordance with the study of Cudjoe, Anim, and
Nyanyofio (2015) that, reliability is the ability to perform the promised service
dependably and accurately or delivering on its promises.
Table 2. Frequency, Percentage and Mean Distribution of Participants’
Assessment of Reliability

4.20 – 5.00 Very High 60 60.00
3.40 – 4.19 High 40 40.00
2.60 – 3.39 Moderate 0 0.00
1.80 – 2.59 Low 0 0.00
1.00 – 1.79 Very Low 0 0.00
Total 100 100
Overall Mean 4.37
SD 0.45
The restaurant staff… Mea Interpretatio SD

n n
1 Provides service as promised 0.5
4.41 Very High 1
2 Handles guest service problems reliably 0.5
4.38 Very High 6
3 Performs service right the first time 0.5
4.41 Very High 7
4 Provides service at the promised time 0.5
4.38 Very High 5
5 Maintains error-free records 0.5
4.25 Very High 9
In the results presented in Table 2, it can be gleaned from the table that
35
the provision of service as promised and the appropriate manner of performing
the service were rated by the customers as the highest with a mean of 4.41
interpreted as “very high”. This implies that the customers want to be treated in
an honest and appropriate manner. The researcher considers that providing
service with honesty is one of the bridges in building trust between the
restaurants’ staffs and customers. This is in consonance with the postulation of
Gupta, S., & Zeithaml, V. (2006) that customers need to do business with
companies that keep their promises. Saylor (2012) noted that once promised
something to guests especially the time the food will be served; it must be fulfilled
and served promptly.
However, worth noting in the table is the area on maintaining error-free
records, which was assessed as the lowest item with a mean of 4.25 although it
was still assessed as “very high”. Even if this dimension was rated a very
satisfactory, the management considers this finding as a concern needing
emphasis. The researcher observes that accuracy in taking orders and billing
were somehow manifested in the restaurant. Furthermore, orders must be taken
completely in accordance with the establishment’s standard procedures. Special
requests and requirements from the guests will be accurately recorded.
According to Yang (2011), reliability also stands for correct order fulfillment, exact
record, accurate billing, and calculation of commission and save services oath.
The participants’ assessment of the casual dining restaurants’ in the
dimension of responsiveness is reflected in Table 3. The dimension on

responsiveness was assessed “very high” by customers as supported by the
36
overall mean of 4. 43. This further means that the staff has shown readiness to
provide constant and prompt service to help customers resulting to the
customers’ “very high” satisfaction to this dimension.
The researcher observed that the restaurant service providers manifested
the willingness to serve and help the guests by providing good and quality
services. The foregoing finding is in consonance with the result of Shafiq, Din,
and Cheema (2012) that responsiveness describes the intentions of the firms
and its willingness toward customer’s help. It is the quality of being responsive;
reacting quickly; as a quality of people, it involves responding with emotion to
people and events, and it also refers to the willingness of the company to help its
customers in providing them with a good, quality and fast service.
In this current study, the readiness to respond to customers’ requests
stood out as having the highest assessment (M= 4.51) interpreted as “very high”.
These data further show that the staffs’ availability to respond to
customers’ request was appreciated by the customers. The researcher believes
that the restaurants’ staffs must deliver additional levels of service beyond the
customer’s immediate request recognized and acted upon.

Assessment of Responsiveness

4.20 – 5.00 Very High 64 64.00
3.40 – 4.19 High 36 36.00
2.60 – 3.39 Moderate 0 0.00
1.80 – 2.59 Low 0 0.00
1.00 – 1.79 Very Low 0 0.00
Total 100 100
Overall Mean 4.43
SD 0.42
Mea Interpretatio SD
n n
1 Keeps guests informed when services will be 0.5
performed 4.38 Very High 5
2 Provides Prompt service to guests 0.5
4.43 Very High 7
3 Is willing to assist guests 0.5
4.47 Very High 6
4 Is ready to respond to guest’s requests 0.5
4.51 Very High 0 37
5 Gives immediate solution to guests’ concerns 0.5
4.34 Very High 4
TheHowever,
restaurant staff…
worth noting in the table is the area on the restaurant staff giving
immediate solution to guests’ concerns, which was assessed as the lowest item
(M= 4.34) yet still interpreted as “very high”
The researcher believes that customers will more likely to repeat the
patronage of the restaurant service if the staffs addressed guests concern
immediately. The finding of this study is in consonance with the postulation of
Thompson (2019) that the restaurant staff must show complete attention on
unhappy customers and allow them to express complaints without interruption
and there is a need to empathize and listen fully to what customers say.
restaurants’ dimensions of service quality considering assurance. It can be seen
from the table that the customers rated the restaurants’ staff with a mean of M=
4. 43 interpreted as “very high” which means that the customers were very highy
satisfied of the restaurants’ dimension of assurance. This further shows that the
knowledge and courtesy of employees and their ability to inspire trust and
confidence were appreciated by the customers. The researcher observed that

the restaurant staffs convey trust, confidence, courtesy, and politeness towards
38
restaurant’s customers. In addition, the staffs show positive and inspiring
behavior in dealing or serving to the customers. The foregoing finding resonated
with the study of Franchuk (2012) that assurance involves the knowledge and
courtesy of employees and their ability to render trust and confidence.
Furthermore, Marković et.al (2010) also added that assurance means that
the service persons of the restaurant are well-trained, competent and are
experienced individuals and that the service men show professionalism
especially when it comes to their field of work and act as a well- educated person
when treating customers.

Assessment of Assurance

4.20 – 5.00 Very High 69 69.00
3.40 – 4.19 High 31 31.00
2.60 – 3.39 Moderate 0 0.00
1.80 – 2.59 Low 0 0.00
1.00 – 1.79 Very Low 0 0.00
Total 100 100
Overall Mean 4.43
SD 0.41

n n
1 Courteous Staff 0.5
4.43 Very High 2
2 Staff who instills confidence in guests 0.5
4.36 Very High 6
3 Staff who makes guests feel secure in their 0.5
transaction 4.46 Very High 4
4 Staff who have the knowledge to answer guests’ 0.5
queries 4.53 Very High 0
5 Well trained, competent and experienced staff 4.37 Very High 0.5
4
In this current study, the provision of the knowledge of staff in answering
guests’ queries stood out as having the highest assessment (M=4.53) interpreted
as “very high”. These data show that the staff’s effort in answering queries 39
is
appreciated by the customers making them satisfied with the appropriate
response of the staff. The findings of the current study resonated with the
concept presented by MISA (2011) which posited that a well- behaved and
educated staff have proper knowledge of menu and food ingredients and
demonstrate promptness of services resulting to persuasion of consumers to
favor the restaurant. These findings signify that a staff must be knowledgeable to
the queries of the customers which are noticeable of this study.
However, worth noting in the table is the area on staff that instills
confidence in guests, which was assessed as the lowest item with a Mean of
4.36 and interpreted as “very high”. The researcher believes that customers’
demands from a restaurant don’t just stop at the speed of service but extend to
the way the staffs talk to them, address their complaints and even serve the food.
Thus, these are some of the ways in building confidence to the customers. The
foregoing finding resonated with the study of Naik, Gantasala, and Prabhakar
(2010) that espoused that customers could develop trust through asking
questions and the employees' knowledge to answer those questions.
The participants’ assessment of the casual dining restaurants in the
dimension empathy is reflected in Table 5. The dimension on empathy was
assessed “very high” satisfaction by the participant with a mean of 4.23. This
further means that staffs had shown care and individual attention to the
customers. The researcher observed that restaurants’ staffs showed empathy in
dealing with customers by being kind, approachable, understanding, and

40
sensitive to their needs. The foregoing finding resonated with the study of
Franchuk (2012), who concluded that empathy is all about how the company
cares and gives individual, personal attention to their guests; how the company
tries to understand the needs and preferences of their customer in order to make
them special and extra valued. This description is confirmed in the finding.

Assessment of Empathy

4.20 – 5.00 Very High 48 48.00
3.40 – 4.19 High 51 51.00
2.60 – 3.39 Moderate 1 1.00
1.80 – 2.59 Low 0 0.00
1.00 – 1.79 Very Low 0 0.00
Total 100 100
Overall Mean 4.23
SD 0.43

n n
1 Staff who provides guests with individual attention 0.5
4.30 Very High 8
2 Staff who have the guests’ best interest at heart 0.4
4.23 Very High 9
3 Staff who deals with guests in a caring fashion 0.6
4.19 High 0
4 Staff who understands the needs of guests 0.5
4.21 Very High 2
5 Convenient hours of operation 0.5
Very High
4.24 7
In this current study, the provision of individual attention to guests stood
out as having the highest assessment (M=4.30) interpreted as “very high”. This
result implies that the customers were delighted of the individual attention given
by the restaurants’ staff during their visit. As observed by the researcher, the staff
really gave their utmost attention when they attend to their customers. Empathy
is shown to the guest through the staffs’ gestures of genuine concern and
consideration. The findings of this study is in consonance with the article of

41
Restaurant Engine (2015) that great service is essential to one’s success, thus it
is imperative for stuff to communicate and give genuine attention to diners.
Everybody wants to feel welcome when visiting a restaurant. When staffs treat
guests with care and respect while providing an excellent meal, they will return to
the restaurant frequently.
However, worth noting in the table is the area on dealing guests in a
caring fashion, which was assessed as the lowest item with a mean of 4.19
although it was still assessed as satisfactory. Even if this is rated as satisfied, the
management considers this finding as a concern needing attention.
Customers will more likely to have repeat patronage if they are greeted
warmly and treated with care and respect by the staff. It is the responsibility of
management and staff to ensure that the customers are treated well and given
the overall positive impression of their dining service.
Table 6 shows the customers’ assessment of the casual dining
restaurants’ dimensions considering price. As reflected in the table, customers
rated the price of the food with a mean of M= 4.50 interpreted as “very high”
implying that the customers were very satisfied of the price of the services
offered by the restaurants. This finding was also confirmed by the researcher that
the portion size of the menu, the service provided, and the menu price were just
enough to the amount of the product and service afforded to the customers. This
result finds consonance with the postulation of Mattila & O'Neill (2003) that based
from consumer’s viewpoint, price functions as an indicator to determine

42
consumer experience with goods or service (Mattila & O'Neill, 2003, 324).
Customers, therefore, are more inclined to base their purchase decision on price
factor than on anything else (Khan 2011). According to the study, customers are
concerned about the value of the food they received.

Assessment of Price

4.20 – 5.00 Very High 69 69.00
3.40 – 4.19 High 29 29.00
2.60 – 3.39 Moderate 2 2.00
1.80 – 2.59 Low 0 0.00
1.00 – 1.79 Very Low 0 0.00
Total 100 100
Overall Mean 4.50
SD 0.49
Price Mea Interpretatio SD

n n
1 The menu price is fair enough given the portion size 0.5
4.50 Very High 8
2 The food has a good value for the money given 0.5
4.57 Very High 7
3 The price of the food is appropriate to the services 0.5
provided 4.42 Very High 7
4 The menu price is fair for the quality of dishes 0.5
4.50 Very High 4
In the result shown in Table 6, it can be gleaned that the item on
good value for the money given was rated by the customers as the highest with a
mean of 4.57 interpreted as “very satisfied” This result implies that the customers
were delighted because of the good value for the amount given. The researcher
confirms in the study that the customers can attest to the value for money when
they feel that they have received services and products that were worth the price
they paid for. Consumers are very rational when it comes to judging what
benefits they wish to get from buying products or services they pay for (Al-
Mamun and Rahman, 2014). 43
However, worth noting in the table is the area on the price of the food that
is appropriate to the services provided, which was assessed as the lowest item
with a mean of 4.42 although it was still assessed as “very high”. Soriano (2003)
found that the customers’ quality expectations depend on the price they pay for
receiving the service and when this price increases the quality expectations will
increase consequently.
The participants’ assessment of the casual dining restaurants’ in the
dimension of Food Quality is reflected in Table 7. The data reveal that customers
were “very satisfied” of the food quality as supported by the overall mean of 4.55.
This means that the customers were “very highly” satisfied with the quality
of the foods that the restaurant offers. The researcher observed that the
restaurants offered foods that are beyond the customers’ expectation. Supporting
the findings of the study, previous researchers agreed that food quality is one of
many factors that are identified as an important factor for restaurants (Qu, 1998;
Ha & Jang, 2010; Ma, Qu & Njite, 2011).

Assessment of Food Quality
4.20 – 5.00 Very High 76 76.00
3.40 – 4.19 High 24 24.00
2.60 – 3.39 Moderate 0 0.00
1.80 – 2.59 Low 0 0.00
1.00 – 1.79 Very Low 0 0.00
Total 100 100
Overall Mean 4.55
SD 0.45 44
No The food… Mea Interpretatio SD

. n n
1 Is well-presented and appetizing 0.5
4.56 Very High 2
2 Is served with appropriate temperature 0.5
4.51 Very High 6
3 Is served fresh 0.5
4.61 Very High 3
4 Is tasty and flavorful 0.5
4.62 Very High 3
5 Served is nutritionally balanced 0.6
4.44 Very High 1
In this current study, the tastiness and flavor of the food is denoted as
having the highest assessment (M= 4. 62). This means that the customers were
delighted with the taste of the food. This finding is in line with the postulation
Hyun-Woo Jung et.al (2017) that, the taste of the food is one of the most
important criteria in customer restaurant selection because having tasty food
provides customers with both a positive sensory experience and emotional
satisfaction during their dining experience.
Many customers have become food savvy, so the taste of food in
restaurant has become increasingly important.
However, worth noting in the table is the area on the food served that
nutritionally balanced , which was assessed as the lowest item with a mean of
4.44 although it was still assessed as “very high”. This result finds consonance
with the postulation of Choi & Zhao (2014); Knight, Worosz, & Todd (2007) that,
people’s increased attention toward healthy lifestyles, food quality has come to
include not only food taste but also nutrition and food safety issues. Furthermore,
Knight, Worosz, & Todd (2007) stated that nutritional and safe food is directly
connected with customers ‘health and safety concerns. Eckel et al. (2009)
45
investigated customers ‘awareness of nutritional issues and found that more
restaurant customers changed their favorite restaurant due to concerns over the
healthiness of the menu in 2007 compared to 2006.
Problem 2. How are the participants characterized on their loyalty?
Table 8 presents the customers’ evaluation of the casual dining
restaurants in terms of their customer loyalty. As shown in the overall mean of
4.46, the customers rated their loyalty as very high. This means that there is a
potential of these customers to become loyal. The findings of this study is in
consonance to the postulation of Deng et al. (2010); Wong & Sohal (2003);
Gede Mahatma Yuda Bakti & Sumaedi (2013); Prakash (2011); Yeo et al. (2015).
Wieringa, et.al (2007) expound, customer loyalty is often related to as the
willingness of customers to repeatedly purchase a good or service that is
accompanied by psychological bond and hold favorable attitudes toward a good
or toward the organization supplying the goods or services. This variable is also
regarded as a powerful agent of competitive advantage and organizational
success (Wang, 2004). Loyalty is seen as driven mainly by service quality (Liao,
et.al, 2009) thus, good service quality (Cronin Jr., et.al, The Journal of Marketing,
1992), reciprocally offers customer loyalty.
The results presented in Table 8 showed that the item I will dine in the
restaurant again because of the quality of its foods ranked to be the highest with
a mean of 4.51 as interpreted Very High. This implies that the customers would
be confident to recommend the restaurant to the people that they know since
they have already experienced the quality of the foods. This foregoing result is in
46
consonance with the result of the study of Namkung & Jang (2007); Sulek &
Hensley (2004) agreed that food quality is an important component for customer
loyalty. Ha & Jang (2010) found that food quality has a positive relationship with
customer loyalty. Hence, identifying the key elements such as food quality in
determining customer loyalty is considered crucial.

Assessment of Customer Loyalty

4.20 – 5.00 Very High 61 61.00
3.40 – 4.19 High 38 38.00
2.60 – 3.39 Moderate 1 1.00
1.80 – 2.59 Low 0 0.00
1.00 – 1.79 Very Low 0 0.00
Total 100 100
Overall Mean 4.46
SD 0.51
No Customer Loyalty Mea Interpretatio SD

. n n
1 I will dine in the restaurant again because of the 0.5
quality of its foods. 4.51 Very High 8
2 I will dine in the restaurant again because of its 0.5
satisfying services. 4.39 Very High 8
3 I will visit the restaurant because of its 0.5
reasonably priced menu. 4.45 Very High 9
4 I say positive feedback about the services of the 4.46 Very High 0.5
restaurant to other people 4
5 I will recommend the restaurant to the potential
customers because I am extremely satisfied with 0.6
my dining experience. 4.47 Very High 1
However, worth noting in the table is the area on I will dine in the
restaurant again because of its satisfying services , which was assessed as the
lowest item with a mean of 4.39 although it was still assessed as very high. Even
if this is rated as high, the management considers this finding as a concern

47
needing attention. The finding of this study is in consonance with the postulation
of Chen and Myagmarsuren (2013) that customers intend to be loyal to the
company if they find that the service is practiced.
Problem 3. Does service quality predict of customer loyalty?
H01: Service quality does not predict customer loyalty.
Table 9 shows the results of regression analysis on the specific
dimensions of service quality as predictors of overall customer loyalty. Findings
shows that the model is significant (F= 13.419, p= .000) with a high multiple
correlation (R= .711). Thus, the null hypothesis is rejected. Furthermore, 46.8
percent of the variability in customer loyalty is accounted for by a combination of
the dimensions of service quality (Adj. R2= .468). This finding implies that service
quality is an antecedent to customer loyalty.
Table 9. Regression Analysis on Dimension of Service Quality as Predictor

of Customer Loyalty
Unstandardized Standardized
Coefficients Coefficients
Model B Std. Error Beta T Sig.
1 (Constant) -.513 .568 -.904 .369
Tangibles .039 .122 .030 .319 .750
Reliability .050 .113 .045 .445 .657
Responsiveness .188 .107 .155 1.753 .083
Assurance .123 .123 .099 1.007 .317
Empathy .127 .113 .106 1.125 .264
Price .435 .096 .412 4.518** .000
Food Quality .154 .106 .136 1.460 .148
Model Summary
2
R = .711 Adjusted R = .468 F = 13.419** p = .000
**Significant at the .01
level (two-tailed)
Examining the specific dimensions, price stood as the best predictor of
48
customer loyalty. This result of the study is supported by the study of Mahmud, et
al (2014) which stated that prices have a significant influence on customer loyalty
with a positive relationship. Price is a variable that can be controlled and
determined whether or not a product is accepted by consumers. To gain
customer loyalty, one needs to understand customers’ wants and needs.
Biswas et al. (2002) also posited that price of a product directly affects the
customer’s buying intention and customer’s value awareness. Price can be
considered as the important factor that influences buying behavior among the
various offerings in the different category of products (Romaniuk and Dawes,
2005). Additionally, Yavas (2003) declared that product’s price as an imperative
indicator that affects store choice and customer buying behavior.
Problem 4. On the basis of the findings, what action plan may be
proposed?
Based on the result of the study, the researcher has proposed an Action
Plan which will help for the enhancement of services of the casual dining
restaurants in Surigao del Norte.
Rationale
Maintaining good service quality and products are important factors to
attract more customers. That is why established food businesses conduct regular
monitoring and evaluation to find out how customers tell about their dining
experience. Their assessments are very salient input, as managements of
restaurants develop strategies for customer satisfaction and customer loyalty,
hence, this action plan is being proposed.
49
Objectives:
1. To give convenience to the customers by giving better facilities,
specially the cleanliness of the comfort rooms.
2. To help improve the quality service of the restaurants’ staffs by
establishing skills enhancement training on customer service.
3. To maintain reasonable price without losing its quality.
Table 10. Proposed Action Plan
Propos Reference Rating Proposed Corrective Action Persons Time

al No. Responsible Frame
Table 1 The Satisfied Establish Standard Owners/ Branch
Item 5 restaurant Operating Procedures for Manager April
has clean maintenance of cleanliness 2020
comfort in comfort room
room
Evaluate chemicals used Branch
in cleaning the comfort Manager
rooms
Conduct Bi-annual Owners/ Branch

performance evaluation to Manager
staffs
Table 5 The Satisfied Create Standard HR Manager
Item 3 restaurant Operating Procedure of the
has staff Establishment
who deals
with Conduct Customer Service Branch
guests in survey Manager April
a caring 2020
fashion Establish Skills Branch
enhancement training on Manager
customer service
Table 5 Price Predictor Purchase raw ingredients Purchase
All to in bulk to reduce the Manager
Items Customer expenses
Loyalty
Look for other suppliers Purchase April
that has the same quality Manager 2020
but the price is low.
Utilization of Standardized
Recipe w/ Recipe Costing Owners/ Branch
Manager
Conduct Recipe Costing
Chapter 5
SUMMARY, CONCLUSION AND RECOMMENDATION
This chapter contains the summary, findings and conclusions of the study;
the findings of which were used as basis for generating the recommendations
endorsed by the study.
Summary
The Problem. This study intended to determine the significant relationship
of service quality as a predictor of customer’s loyalty. Specifically, this study
focused on the assessment of service quality in terms of the dimensions that
include: tangibility, reliability, responsiveness, assurance, empathy, price, and
food quality in relation to customers’ loyalty.
Method. The study employed a descriptive correlational research design
that gave summaries about the sample data in quantitative descriptions which
included, mean, standard deviation, frequencies and percentages. In this study,

the dimensions of DINESERV by Stevens et.al (1995) were used as measure of
determining customers’ assessment of the casual dining restaurants.
The participants of this study consisted of 100 customers of the casual
dining restaurants recommended by the Supervising Tourism Operations Officer
of Surigao City, Surigao del Norte. The instrument for data collection contained
five dimensions of service quality such as tangibility, reliability, responsiveness,
assurance, and empathy. The dimension of price was adopted from Kotler and
51
Keller (2016), food quality was adopted from (Namkung & Jang 2008), customer
loyalty from Deng et al. (2010); Wong & Sohal (2003); Gede Mahatma Yuda
Bakti & Sumaedi (2013); Prakash (2011); Yeo et al. (2015).
The items in all dimensions had acceptable levels of Cronbach
Alpha Coefficients implying that these items were internally consistent. To
organize the data, descriptive statistics, and multiple regression analysis were
used.
Findings. Based on the data gathered from the study, the following
findings are thus presented:
1. The customers of the casual dining restaurants in Surigao del Norte were
“very highly” satisfied on the seven dimensions of service quality namely:
tangibility, reliability, responsiveness, assurance, empathy, price, and food
quality.
2. Customers had “very high” level of loyalty to casual dining restaurants.
3. Price, as a dimension of service quality was found to be the strongest
predictor of customer loyalty.

Conclusions
Based on the findings of the study, the conclusions and implications can
be postulated.
This study provides evidence that the seven dimensions of service quality
have bearing on customer loyalty. The higher the dimension of service quality,
there is a great likelihood that customers would be loyal to the establishment.
The finding in this study supports on Homans’ Social Exchange Theory (1961)
52
that espoused social behavior is the result of an exchange process. If services
are high, repeated behavior is also high which means that customers patronize
the services and products in exchange of the quality serviced defined for them.
Moreover, price stood as the best predictor of customer loyalty. When the
price offering of the casual dining restaurants in Surigao del Norte is much lower
than the other competitive market the higher the possibility that there will be an
increase of sales in the operation.Price is an important factor in the purchasing
decision, especially for products that are frequently purchased, and in turn,
influences the choices of which establishment, product, and brand to patronize.
Faith and Agwu (2014). Consumers are very rational when it comes to judging
what benefits they wish to get from buying products or services they pay for, Al-
Mamun and Rahman (2014). It is evident that customers of the casual dining
restaurants are very satisfied with the price offered by the casual dining
restaurants in Surigao del Norte, resulting to repeat patronage and positive
recommendations to potential customers.
Recommendations
The restaurants should continuously aspire for a high quality and
standardized products and services in order to respond efficiently and
professionally to the demands of this competitive and growing industry. Hence,
the seven mentioned dimensions should be the priority of management in order
to attain satisfied customers that will lead to be potential customers.
53
Based on the findings and conclusion in this study, the following
recommendations are thus presented:
1. That the academic institutions offering hospitality management courses
1.1That they emphasize the integration of the dimensions of quality
service in the instruction on the subjects that they offer;
2. The future researchers may;
2.1 Consider expanding and identifying other dimensions of service quality
in hospitality industry to gain more insights on the said concepts;
2.2 Explore other instruments that would best capture the customers’
assessment of the dimensions.
3. The restaurant manager may;
3.1 Implement the Proposed Action Plan

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LOURDES COLLEGE
Inc.
Gen. Capistrano Street, Cagayan de Oro City
APPENDIX A
Letter to Participants
Date: ________________
Madame/Sir:
The undersigned is presently conducting a study entitled “SERVICE QUALITY

AS ANTECEDENT OF CUSTOMER LOYALTY IN CASUAL DINING
RESTAURANTS IN SURIGAO DEL NORTE in partial fulfillment of the degree
Master of Science in Hospitality Management at Lourdes College, Cagayan de
Oro City.
In connection with this, may I ask a few minutes of your time to please fill up the
questionnaire accurately.
Therefore, may I appeal for your honest and sincere response to this
questionnaire and be assured that your answer and identity will be dealt with
strictest confidence.
Thank you!
Respectfully yours,
HANNAH REJOICE N.
ERLINA
Researcher
Noted:
LOURDES COLLEGE
Inc.
Gen. Capistrano Street, Cagayan de Oro City
APPENDIX B
LETTER TO THE CASUAL DINING RESTAURANTS
Sir/ Ma’am:
Good day!
I would like to ask for your permission to allow me to conduct a survey among the
customers in your respective restaurant. This is in view of my thesis, entitled,
“SERVICE QUALITY AS ANTECEDENT OF CUSTOMER LOYALTY IN
CASUAL DINING RESTAURANTS IN SURIGAO DEL NORTE”. I am
conducting the survey among the customers of casual dining restaurants in
General Luna, Surigao del Norte. Attached herewith is the survey questionnaire
of this study.
The survey would only last about 5-10 minutes. Participation in the survey is
entirely voluntary and there are no known or anticipated risks to participation in
this study. All information gathered will be kept in utmost confidentiality and
would be used only for academic purposes. The names of the participants and
the name of your establishment will not appear in any thesis publications
resulting from this study unless agreed to.
If you approve, kindly sign below acknowledging your consent and permission for
me to conduct this study/ survey at your restaurant and return the signed form.
Your approval to this study will be greatly appreciated. Thank you in advance for
your interest and assistance with this research.
Sincerely,
HANNAH REJOICE N. ERLINA

Researcher
Approved by:
___________________________ _______________ _______________

Printed Name and Designation Signature Date
Appendix C
SURVEY QUESTIONNAIRE
SERVICE QUALITY AS ANTECEDENT OF CUSTOMER LOYALTY IN
CASUAL DINING RESTAURANTS IN SURIGAO DEL NORTE
Direction: Please rate the extent of service quality of the restaurant by placing a
() mark in the relevant box below using the following scale:
SA- Strongly Agree AS- Agree Slightly SD- Strongly Disagree

A- Agree D- Disagree
Service Quality
No. Item SA A AS D SD
The restaurant has…

1 Visually appealing facilities
2 Neat, professionally looking staff
3 Attractive documentation, such as signs, menus

4 Sanitized table appointments
5 Clean Comfort Room
The restaurant staff…
6 Provides service as promised
7 Handles guest service problems reliably
8 Performs service right the first time
9 Provides service at the promised time
10 Maintains error-free records
The restaurant staff…
11 Keeps guests informed when services will be
performed
12 Provides Prompt service to guests
13 Is willing to assist guests
14 Is ready to respond to guest’s requests
15 Gives immediate solution to guests’ concerns
16 Courteous Staff
17 Staff who instills confidence in guests
18 Staff who makes guests feel secure in their
transaction
19 Staff who have the knowledge to answer guests’
queries
20 Well trained, competent and experienced staff
21 Staff who provides guests with individual attention
22 Staff who have the guests’ best interest at heart
23 Staff who deals with guests in a caring fashion
24 Staff who understands the needs of guests
25 Convenient hours of operation
Price
26 The menu price is fair enough given the portion size
27 The food has a good value for the money given
28 The price of the food is appropriate to the services
provided
29 The menu price is fair for the quality of dishes
The food…
30 Is well-presented and appetizing
31 Is served with appropriate temperature
32 Is served fresh
33 Is tasty and flavorful
34 Served is nutritionally balanced
Customer Loyalty
35 I will dine in the restaurant again because of the
quality of its foods.
36 I will dine in the restaurant again because of its
satisfying services.
37 I will visit the restaurant because of its reasonably
priced menu.
38 I say positive feedback about the services of the
restaurant to other people
39 I will recommend the restaurant
LOURDESto the COLLEGE
potential
customers because I am extremely satisfiedInc. with my
dining experience. Gen. Capistrano Street, Cagayan de Oro City
Thank you for your Cooperation!

APPENDIX D
January 31, 2020
ROSELYN ARMIDA B. MERLIN

Supervising Tourism Operations Officer
Surigao City, Surigao del Norte
Madam:
Good day!
I would like to ask for your approval and recommendation on the 10 Best
Restaurants in the city. This is in view of my thesis, entitled, “SERVICE
QUALITY AS ANTECEDENT OF CUSTOMER LOYALTY IN CASUAL DINING
RESTAURANTS IN SURIGAO DEL NORTE”. I am conducting the survey
among the customers of casual dining restaurants in Surigao City, Surigao del
Norte. Attached herewith is the survey questionnaire of this study.
All information gathered will be kept in utmost confidentiality and would be used
only for academic purposes. The names of the participants and the name of the
establishments will not appear in any thesis publications resulting from this study
unless agreed to.
Your approval to this study will be greatly appreciated. Thank you in advance for
your interest and assistance with this research.
Respectfully yours, Noted:
HANNAH REJOICE N. CYRIL C. CHAVEZ,

ERLINA DM-HRM
Researcher Adviser
Recommending
Approval:
JUDITH C. CHAVEZ,
DM-HRM
Approved by:
ROSELYN ARMIDA
B. MERLIN
Supervising Tourism
Operations Officer

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SERVICE QUALITY AS ANTECEDENT OF CUSTOMER LOYALTY IN

CASUAL DINING RESTAURANTS IN SURIGAO DEL NORTE

The Faculty of the Graduate School

Lourdes College, Cagayan de Oro City

of the Requirements for the Degree

Master of Science in Hospitality Management

HANNAH REJOICE N. ERLINA

This thesis entitled “SERVICE QUALITY AS ANTECEDENT OF

CYRIL C. CHAVEZ, DM-HRM

Approved by the committee on Oral Examination with the grade of ___________.

JUDITH C. CHAVEZ, DM-HRM

RAQUEL A. SAAB, DM RAQUEL J. DAEL, DM

MIGUELA B. NAPIERE, Ph.D.

Accepted and approved in partial fulfillment of the requirements for the

degree of Master of Science in Hospitality Management (MSHM).

JUDITH C. CHAVEZ, DM- HRM

have contributed in making this study possible.

Lourdes College institution for the opportunities afforded to its

their valuable insights in the refinement of this study;

their respective restaurant. Special acknowledgement is also due to Ms. Roselyn

Armida B. Merlin, Supervising Tourism Operations Officer of Surigao City,

Surigao del Norte.

main inspiration for the accomplishment of this manuscript.

Hannah Rejoice N. Erlina

I can do all things through Christ, who strengthens me

Jesus Christ, my Lord and Saviour,

Nancy N. Erlina,my mother,

Eduardo A. Erlina Sr, my father,

Jerameel N. Erlina, James N. Erlina, and Eduardo N. Erlina Jr,

and to my students, this humble work is dedicated.

Key Words: Service Quality, Customer Loyalty

List of Tables and Figures viii

Statement of the Problem 10

Significance of the Study 11

Scope and Delimitation of the Study 12

2 REVIEW OF RELATED STUDIES AND LITERATURE 14

Participants of the Study 26

Validity and Reliability of the Instrument 27

Statistical Treatment of the Data 30

4 PRESENTATION ANALYSIS AND INTERPRETATION OF DATA

5 SUMMARY, CONCLUSION AND RECOMMENDATION

B. Letter to the Casual Dining Restaurants

D. Letter to Tourism Office

1 Frequency, Percentage and Mean Distribution of

2 Frequency, Percentage and Mean Distribution of 34

3 Frequency, Percentage and Mean Distribution of 36

4 Frequency, Percentage and Mean Distribution of 38

5 Frequency, Percentage and Mean Distribution of 40

6 Frequency, Percentage and Mean Distribution of 42

7 Frequency, Percentage and Mean Distribution of 43

8 Frequency, Percentage and Mean Distribution of 46

9 Regression Analysis for Customer Loyalty 47

10 Proposed Action Plan 49

1 Schematic Presentation of the Interplay of Variables 9

Service quality has always been important to the success of a business.

can attain increased customer satisfaction, loyalty and therefore long-term

profitability (Zeithaml and Bitner, 2000).

competition or patron demand for excessive service quality. Nowadays,

quality conditions positively impact a restaurant competitive advantage (Bojanic