INDEX

CONTENT PAGE NO.

1. Introduction 2
1.1 Executive Summary
1.2 Objectives of the Study
1.3 Methodology used to collect Data
1.4 Scope of the study
1.5 Limitations of the study

2. Literature Overview 9
2.1 Introduction
2.2 Literature Review

3. Conceptual Framework 14

4. Research Methodology 25
4.1 Primary/ Secondary
4.2 Questionnaire

5. Data Interpretation 38

6. Findings and Recommendations 64

6.1 Introduction
6.2 Suggestions
6.3 Conclusions

7. Bibliography and Annexures 72

1
A STUDY ON LOGISTICS SERVICE QUALITY OF SHIPPING
INDUSTRY

INTRODUCTION

Executive Summary

It has been widely recognized that the quality of order is the basis of transport companies and
the level of transportation service provided by those businesses determines customer
satisfaction, thus determining their competitive edge over other competitors. This is
acknowledged by Bowersox et al., (1995), and Bowersox et al. (1992) that utilizing the power
of the transport service is an effective tool for building close relationships between a company
and its customers. Therefore, improving the quality of transportation service should be an
ongoing focus on transportation service providers and should never avoid haste for customer
satisfaction by providing a better and better transportation service (Stank et al. 1999).
However, transport experts and experts have never agreed on a global approach to the
definition of quality in the transport service and its associated dimensions. Although several
authors have commented on the subject, their conclusions and suggestions are very different in
terms of size and quality of service delivery. It also appears that there has been very little
research done in logistics service on how its quality is defined and it is said. The incorporation
of concepts such as service quality and affiliate marketing has dramatically changed both the
academic subject and the transportation business model. Logistics is traditionally considered 2
requirements for linking production and use. From this perspective, the function of the
transport company is seen only as a generator of non-discriminatory costs (Ballou, 2004). This
began to change during the 1990s as transportation research based on marketing principles
began to analyze performance potential to deliver quality and thus produce greater customer
satisfaction and reliability (Mentzeret al., 2004; Richey et al., 2007). The transport industry
today is a classic example of service-based industry development (Chapman et al., 2003) and
in-depth performance studies are needed from the perspective of supply chain relationships
(Lambertet al., 2004; Knemeyer and Murphy, 2004, 2005; Fogginet al., 2004). Customer
2
satisfaction is considered an important factor in determining the success of an organization in
today's competitive market environment. Knowing the level of customer satisfaction can help
an organization evaluate the effectiveness of its operations, set future goals, and take
appropriate steps to maintain or grow it. In scientific literature (Cassel, Eklöf, 2001; Yew-
Wing, Bellman, 2008 et al.), Customer satisfaction is often measured and analyzed as a
precursor to customer loyalty; in addition, to measure satisfaction, its features (factors that
influence customer satisfaction) should be evaluated. Therefore, I. Ferreira et al. (2010)
suggest that it is necessary to develop reliable and independent methods of assessing customer
satisfaction, allowing for comparisons between companies within the same sector and / or
operating in the same country, or at the macroeconomic level. In scientific research one of the
The most widely used and analyzed methods for assessing customer satisfaction are the
Customer 3 Satisfaction Index (CSI). According to H. Lopes et al. (2009), attention to
customer satisfaction arose with the establishment of the Swedish Customer Satisfaction Index
(SCSI) in 1980; many countries such as Germany, Israel, Taiwan or New Zealand are
beginning to develop national indicators of customer satisfaction. Today, the most well-known
and widely used customer satisfaction indicators are the American Customer Satisfaction
Index (ACSI) developed in 1994 and the European Customer Satisfaction Index (ECSI)
launched in 1999. profit rather than attracting young people. Therefore, creating customer
loyalty has become a major goal for many businesses, especially those in the service sector.
Integrity can be divided into four categories according to the level of satisfaction, honesty and
purpose of repurchase. These categories are reliable; error; mercenary; and the captive.
Therefore, measuring customer loyalty should include not only the purpose of re-purchase but
also other consumer-oriented responses as the purpose of spreading good word-for-word
communication.

> Need for Research:

In recent years, Logistics has played a key role in consolidating the shipping industry. Because
the market is becoming global, transportation is now seen as an important area where
industries can reduce costs and improve their customer service quality (Akman and Baynal,
2014). Organizational planning 4 played an important role in the supply chain sector which
was an element of business sector (Razak, Rowling, White, and Mason-Jones, 2016). Logistics
was seemed to be an important factor in business around the world, because small and medium
The business and industry sector has been used to further their objectives as follows: reduce
3
operating costs, save on delivery times, improve customer service quality, corporate image and
corporate reputation. Logistics businesses participate in the ability to provide the owner with
organized and professional services, as well as transportation services. Logistics services are a
basic provision for transportation businesses; their excellent level of service is an important
advantage in today's competition. Logistics businesses in Mumbai started late, with most of
the logistics businesses shifted from standard storage and transportation. Single-service
services, poor service feeling, low service quality are the bottleneck of these logistics
companies in Mumbai. But now there is no standard test system for service quality service
companies, the lack of the same system makes companies still rely on past experience during
the development of their service quality, therefore, designing a service evaluation system is
essential. The Global Ranking of the World Bank’s 2016 Logistics Performance Index shows
that India jumped to 35th place in 2016 from 54th place in 2014 in terms of total assets. To a
large extent, India's transport sector remains unorganized, he said, adding that the industry is
facing challenges such as high transportation costs that contribute to competition in the
domestic and international markets, underdeveloped logistics infrastructure, 5 pieces of
storage and a lack of logistics. in every way, among other things. Improving the transport
sector had a significant impact on exports and it is estimated that a 10 per cent reduction in the
cost of indirect transport could increase by 5-8 per cent. Without further trade, better transport
performance will improve programs such as Make in India, and make India an integral part of
the global supply chain. India's transport industry, which provides employment to more than
22 million people, has grown at a combined annual growth rate (CAGR) of 7.8 percent over
the past five years. Therefore, the current study aims to investigate the quality of transport
service in the transport industry in Mumbai.

> Problem Statement:

In our changing world, the way we do business changes from time to time and the introduction
of new technologies takes a huge contribution to this development. Now, businesses are more
focused on customers and trying to meet their customer needs before their competitors do,
otherwise, they will be out of the market as customers have the options to get what they want.
Delivering goods to customers is an important task in any business (Huang, Kuo and Xu,
2009). And how to do this basic job is important to the customer. Today, people want more
comfort and convenience in their shopping experience, and market strategies are constantly
changing to meet these customer needs. Digital technology has given a new paradigm to our
4
society and changed our lives to connect with the internet. Shopping online is much easier for
consumers than 6-way, as there is a chance to order what they need in their office or home.
Online shoppers expect faster delivery than offline shopping, as well as timely delivery at
convenient times (Huang et al., 2009). There are a few factors that contribute to good
performance in e-shop online availability: luxury, product availability and diversity,
management and payment conditions, reimbursement policies in case of non - conformity .
Effective logistics service is required to meet the customer need and satisfy the customer.
Hence, the researchers have has made an effort to study the quality of transport service in the
transport industry in Mumbai.

> Logistics

Logistics is usually a very detailed organization with a complex task implementation. In the
general business sense, transportation is the movement of goods between the place of origin
and the place of use to meet the needs of customers or companies.

> Logistics Service Quality

Material Service Quality can be defined in terms of two measurement bases, namely, Physical
Distribution Service and Advertising Customer Service. From the point of view of
transportation provider, Transport Service Quality is measured by the ability to fulfill client
orders. From a customer perspective, the most comprehensive courses that determine service
quality are based on discussion and research studies. One of the most commonly used surveys
is the Service Quality of Transportation SERVQUAL model.

> Research Sample Framework

The research sample framework consists of determining the sample size and the sample
sampling process.

5
> Sample Size Determination

ss = Z² * (p) * (1-p)
C²

Where:

Z = Z = Z (eg 1.96 with 95% confidence level)

p = percentage selection option, expressed as decimal
(.5 is used for the required sample size)
c = confidence interval, expressed as decimal
(e.g., .04 = ± 4)
Population = 88,820
Confirmation Time = 4.31
Confidence Rate = 95%
Sample size = 514

In this study, the researcher took 514 samples from people.

> Research Sample Process

The largest number of surveys are 88,820 transport service providers. Of the 514 transport
service providers were considered as a sample in the current study using a sample size
formula. The researcher used a simple random sample to select transport service providers. As
a result, only 514 sets of questionnaires were obtained and used for further analysis using the
SPSS version 21 software.

6
 Objectives of the Study

The objectives of the current study are:

i. Disclosure of respondent statistics statistics.

ii. Study the differences between the statistical profiles of respondents in terms of
transportation service quality, customer satisfaction, customer loyalty, problems and
development.
iii. To measure the relationship between the various dimensions of the quality of transportation
service.
iv. To study the impact of various sizes of transportation service quality on achieving customer
satisfaction.
v. Study the planning problems customers face in the transportation industry.
vi. To provide appropriate recommendations for improving the quality of transport service in
the transport industry on the basis of research results.

Methodology used to collect Data

The current study is based entirely on primary data. Secondary data collected from books,
journals, magazines and websites was used to create theory framework of the study and the
review of literature. The primary data was collected personally with the help of structured
questionnaire. The present study is completely based on the primary data collected from the
shipping and logistics companies in Mumbai. A special care was taken to draft the
questionnaire. The questionnaire was divided into four parts. The first part of questionnaire
includes the demographic profile of the respondents. They are size of the company, number of
years of industry experience, type of service, main service / region / countries, type of ship,
frequency of annual travel and aspect of eight essentials. The second part of the questionnaire
contains twenty-five variables for quality service delivery, two variables for customer
satisfaction and two variations for customer loyalty. The variability is measured by a Likert
7
rating of five points. The third part of the questionnaire contains ten different problems. The
variability is measured by five Likert Scale points (SA-I strongly agree, A-Agree, N-Neutral,
DA-negative, SDA-strongly negative). The fourth part of the 16 questionnaire covers fifteen
development variables. The variable is measured by five Likert Scale points. Appropriate
variations of the above-mentioned concepts are taken from a review of previous studies. An
exploratory study was conducted among 50 shipping and shipping companies in Mumbai.
Based on feedback from previous tests, specific modifications, additions, deletions and
simplifications were made. A draft questionnaire has been prepared for data collection at
shipping and transport companies in Mumbai.

Scope of the Study

The scope of the current study is limited to the quality of transportation service in the
transportation industry in Mumbai. The study will only involve transport service providers
who do the same business worth testing because it is very helpful in determining the impact of
transport service quality on the shipping industry in Mumbai.

Limitations of the Study

The current study is subject to the following limitations:

• The current study involves respondents to transport service providers in Mumbai.

• Responses provided to respondents regarding the quality of shipping service in the shipping
industry may be affected by the value proposition.
• The characteristics of the service of transport, customer satisfaction, customer loyalty,
problems and improvements in the quality of transport service in the transport industry are
measured with the help of the variables taken from previous studies.
• All descriptive variables are likert by five points scale.

8
 LITERATURE OVERVIEW

Introduction

Review of related studies is an indispensable task of every researcher in his or her area of research. The
researcher has the responsibility of compiling all work done by previous researchers. Moreover, a review
of studies helps an individual to gain more insight into the problem. It enables the researcher to decide the
course objectives and hypotheses. In this chapter, an exhaustive attempt has been made to present
exhaustively about the previous researches conducted in the respective areas. This has been done based
on the key concepts identified in chapter one. This chapter provides an understanding of how customer
service quality and satisfaction are viewed from a logistics perspective. Accordingly, it reviews related
literature on customer service, satisfaction and service quality in logistics. It also demonstrates various
ways in which measuring customer satisfaction has evolved in the literature. Hence this research work
intends to find out the logistics service quality of shipping industry in Mumbai.

Literature Review

Perreault (1973) argued that understanding perceptions of physical distribution service from a
customer‘s point of view, was an essential input in management decisions. They maintained that
logistics activities create time, place, and form utility, thereby enhancing product value. This assertion
was extended by Coyle et al., Shapiro and Heskett and Stock and Lambert.

Christian Gronroos (1982) believes the essence of service quality is a kind of perception, which can
be perceived by compression of the customer service expectations to actual service experience. That,
SQ = PS-ES (SQ = service quality; PS = customer perception of service level; ES = customer
expectations of service levels).

Zeithalm, Parasuraman, and Berry (1990) explained Service-quality perceptions stem from how
well a provider performs customers‘ expectations about how the provider should perform. Service
quality is a focused evaluation that reflects the customer's perception of specific dimensions of service
namely reliability, responsiveness, assurance, empathy, tangibles.

9
Daugherty (1992) complements declaring that it is important to customize the customer‘s services
and to answer rapidly to their demands. However, these actions will only transform into competitive
advantages if the company‘s margins and profitability are not sacrificed. To attend the client‘s
expectations in an indiscriminate form and without established standards would not necessarily be
beneficial, especially if the costs are not taken into consideration.

Parasuraman, Berry and Zeithaml (1993) given SERVQUAL model and its emphasizing on the
concept that service quality can be defined as a gap between the consumer‘s expectation (of services
to be received) and consumer‘s perceptions (of services actually received). A multi-item scale
instrument SERVQUAL was developed on the basis of five dimensions, that is, tangibles, reliability,
responsiveness, assurance and empathy. In an alternative, SERVPERF model was given by Cronin
and Taylor (1992) which considers only performance measures of the service quality. Many
researchers revised the service quality models as per the requirement of study from time to time.
Some authors upgraded the previous models in accordance with latest advancements in technology
and market dynamics. 4 Tompson M.B. and Daugherty, C.H. 1992. Living a lie: New Zealand's
tuatara, Australian Natural History,23(12):928-935. 5 Parasuraman, A., Berry, L.L., Zeithaml, V.A.
(1993). More on improving service quality management. Journal of Retailing, 69(1), 140–147. 27

Novack et al, (1994) study revealed that Order quality addresses the damage levels of the products
ordered from the suppliers or service providers due to manufacturing of the products as opposed to
damage due to handling. It reflects the degree to which the products provided by the suppliers or
service providers meet the product specifications set by the customers.

Sharma, Grewal and Levy (1995) declare that the high level of services, create a sustainable
competitive advantage, since the improvement introduced in the distribution services of a company
are not easily equalized as much as the relative improvement of the other components of the
marketing mix.

Fawcett (1996) through the logistic processes management it is possible to obtain differentiated
results of the customer‘s satisfaction with cost reduction. For this author, logistic represents an
important option, not only because it increases operational efficiency but it also because it can
increase, in a consistent form, the client‘s loyalty through the improvement of services. 6 Novack, R.
A., Rinehart, L. M. and Langley Jr., C. J. (1994). An Internal Assessment of Logistics Value, Journal
of Business logistics, 15(1), pp. 113-152. 7 SHARMA, A., GREWAL, D., LEVY, M. The
Breakthrough Thinking in Logistics.In Journal of Business Logistics, vol. 16, no. 2, 1995. 8 Fawcett,
10
A. J., Nicolson, R. I. & Dean, P. (1996). Impaired performance of children with dyslexia on a range of
cerebellar tasks. Annals of Dyslexia, 46, 259-283. 28

Bienstock et al., (1997) developed an instrument to measure logistics service quality (LSQ) called
Physical Distribution Service Quality.

Bienstock et al., (1997) includes this development by identifying objective variables measured
through customers‘ perceptions in relation to their expectations (subjective components) as the main
components of Logistics Service Quality.

Kotler and Scheff (1997) define service as ―any act of performance that one party can offer to
another that is essentially intangible and does not result in the ownership of anything. Its production
may or may not be tied to a physical product.‖

Juran (1998) defines quality as factors of products which meet customer requirements and therefore
provide client satisfaction. Quality also means ―freedom from deficiencies – freedom from errors
that require doing work over again (rework) or that result in field failures, customer dissatisfaction,
customer claims, and so on‖. Thus, any product, no matter how 9 C. Bienstock, J. Mentzer, M. Bird,
Measuring physical distribution service quality, J. Acad. Mark. Sci. 25 (1997) 31–44. 10 Bienstock,
C. C., Mentzer, J. T. and Bird, M.1997. Measuring Physical Distribution Service Quality. Journal of
Academy of Marketing Science,Vol. 25(1), pp. 31-44. 11 Kotler, P. and Scheff, J., 1997. Standing
Room Only: Strategies for Marketing the Performing Arts. Massachusetts: Harvard Business Press. 12
Juran, J. and Godfrey, A., 1998. Juran‘s quality handbook. New York: McGraw-Hill. 29 durable or
well-packaged but not satisfying the customer demand, is considered to have unsatisfactory quality.
This is an important awareness to help companies to plan for the quality of products and services. In
order to satisfy the needs, firms must ensure quality in all stages of the production and distribution of
products and services. For example, just one disappointment with the attitude of warranty staff might
damage the whole earlier stages. In other words, quality is formed through several stages and
influenced by many different factors.

Lambert (1998) the service‘s level is the best translation when meeting the customer‘s expectations is
in focus. The logistic service, according to the author, would be a function resulting from the
management of several operational variables of the logistic systems, such as: order processing,
transport and storage, outlining together with price positioning, the promotion and product and the
combination of the organization‘s marketing.

11
Mentzer et al., (1998) defined the quality in logistics service in terms of two complementary
elements, i.e. marketing customer service and physical distribution service. This definition is shared
by others and is seen as an intelligent base for the integration of marketing and logistics activities. 13
LAMBERT, D. M., STOCK, J.R., VANTINE, J.G. Administração Estratégica da Logística.São
Paulo: Vantine, 1998. 14 J.T. Mentzer, R. Gomes, R.E. Krapfel, Physical distribution service: a
fundamental marketing concept, J. Acad. Mark. Sci. 17 (1989) 53–62. Previously, this concept was
referred to as technical quality and functional quality, where technical quality refers to the service
outcomes and functional quality refers to the process of service delivery.

Chistopher (1999) the key factor to have success in a profitable and long lasting relation with a
client, is to have a good performance in the main interface areas between the organization and its
target public, which suggests the necessity of having integration between Marketing and Logistics. In
this context, the customer service is an ample concept which includes the tangible and the intangible
elements of the customer / supplier relationship, being that the logistics performance is a possible
antecedent of the customer‘s satisfaction and loyalty.

John T Mentzer (1999) who proposed to build LSQ scale with integration of PDSQ factors and the
factors affecting customer service. Later, based on the research in 1999, Mentzer et al proposed to use
the time course of occurrence of logistics services as customer-oriented model of LSQ.

Coto, Banos and Rodriguez (2000) to measure efficiency of Spanish Ports. Their focus being on
effect of port size and type of management on the efficiency of ports, they used regression to analyze
the relation by having a dummy variable of autonomous ports as 0 or 1 on number of linear meters of
depth over 4 m of quays to indicate the size of port. These indices resulted in a conclusion that
efficiency and size are not related and that autonomous ports are less efficient than the rest.

Dantas (2000) logistics is a fundamental tool for the industries‘ strategic success, for it contributes to
increase flexibility, improvement in services and cost reduction, these factors being indispensable for
any company that wants to compete in today‘s scenario. Against this new context, the companies
should implement strategies that take into consideration this reality and which allows them to
distinguish themselves from their competitors.

Fleury (2000) the rapid development in telecommunication, transport, information processing and
information diffusion, have increased the client‘s possibilities of choice, transforming issues like
availability, after sale support, 17 Coto-Millan. P., Banos-Pino. J., and Rodriguez-Alvarez. A, (2000),

12
Economic Efficiency in Spanish Ports: Some Empirical Evidence, Maritime Policy Management,
27(2), pp 169-174. 18 ―Theo FleUury singing a new tune after life of pain: DiManno Toronto Star”,
thestar.com. Retrieved 2017-03-16. 32 aggregated service, flexibility and reliability into issues which
have a bigger impact in the purchasing decision process.

Notteboom, Coeck and Van den Broeck (2000) used a similar study and methodology for
measuring efficiency of 36 European container terminals. Their study concluded that hub ports were
more efficient than feeder ports. It also came to the conclusion that efficiency and size relationship
was a function of type of port and there was no relationship between type of ownership of port or
terminal and the efficiency level.

Ballou (2001), Bowersox and Closs (2001) and Christopher (1997) point out that the function of
the customer service is to supply the ―time and place availability‖ in the transfer of merchandise
between the purchaser and the vendor. According to the authors, the value of a determined product
elapses from the moment in which it is available, or ―in the hands‖ of the customer.

Mentzer et al., (2001) and has been seen as the most comprehensive and distinguished because apart
from the physical distribution aspects of service included in previous models, it also includes the
elements from the customer service aspects.

Rosenbloom (2002) completes, pointing out that to make the product ―available is, in its essence,
everything that one expects of the distribution function in a business.

CEL (2003) confirm this new reality. According to this research‘s data, the price factor is a variable
of extreme importance in the retailers‘ purchasing decision, however other variables, as the product‘s
quality and the service offered to the customer, has been showing an increasing weight in the retailers‘
purchasing decision process, with reference to consumer‘s goods.

Gustafsson (2003) suggests that the rendering of a logistic service to a customer, done with precision
and efficiency, is a significant source of competitive advantage and for this reason, the desired result
of a logistic service has to be planned in a strategic level. According to the author, there are three
dimensions in the logistic service that need to be considered. The first and the most basic dimension is
the functional, in the level of activity and process. The second dimension is related to performance
and quantifies the specified service level. The third is related to philosophy and in the emphasis to
orientation with respect to the manner and the importance of serving all of the company‘s customers
as one.
13
 CONCEPTUAL FRAMEWORK

Introduction

The importance of customer service was recognised over 50 years ago (Kyj, 1987) while logistics,
then known as physical distribution had been one of the longest standing subjects of study in
marketing (Kent and Flint, 1997). However, the focus on logistics customer service and the related
concept of customer satisfaction and service quality has only increasingly developed in the early
1970s (Kent and Flint, 1997; Mentzer et al, 1989) and been seen as a key part of future research in the
logistics discipline (Grant, 2004). Since then, more work has shifted the focus of customer service
definition from a supplier's viewpoint to a customer perspective Padzie et al, 2005; Wilding and
Juriado, 2004; Mentzer et a15 2001; 1999; 1997; Maltz and Maltz, 1998; Harding, 1998; Bienstock et
al, 1997; Daugherty et al, 1996; Emerson and Grimm, 1996; Innis and La Londe, 1994; Sterling and
Lambert, 1989; Christopher, 1986). This was due to the fact that firms that provide innovative
customer service would benefit from increased customer satisfaction, closer customer- supplier
relationships, increased customer loyalty, and profitability and a differential competitive advantage
(Grant, 2004; Stank et al, 2003; Daugherty et al, 1998; Emerson and Grimm, 1998).

The Importance of Customer Service and Satisfaction in Logistics

Since it was given attention in the early 1970s, the concept of logistics customer service remains
important until today (Stock and Lambert, 2001; Miyazaki et al, 1999; Kent and Flint, 1997). Much of
the influence in developing the concept in the early 1970s to Mid 1980s came from the operations
management, management science, and to some extent, marketing (Kent and Flint, 1997). The
importance of customer service and satisfaction in logistics can be viewed from chronological
perspectives.

14
Logistics Leads to Competitive

Advantage In the early years of the "customer focus" era, companies realised that in order to be
successful in business, they must integrate the ideas of having the right product, at the right price,
combined with the right promotion and available at the right place, which are the four Ps of the
marketing mix (Stock and Lambert, 2001; Mentzer et al, 2001; Lambert, 1990). A company may
improve their competitive position by allocating resources more effectively and efficiently to these
components of the marketing mix to create a market offering, which is attractive to target customers
and advances the long-run profit objectives of the company. Thus, customer satisfaction is the output
of the marketing efforts of the firm in which it occurs if the firm's overall marketing effort is
successful (Lambert and Stock, 1993). Similarly, customer service represents the total output of the
logistics system and the key to integrating marketing and logistics (see Figure 2.1). It acts as the
binding and unifying force for the total logistics supply chain of warehousing, transportation,
inventory management, order processing, and related information flows Padzie et al, 2005; Stock and
Lambert, 2001; Lambert and Stock, 1993; Mentzer et al, 1989).

Logistics Adds Time and Place Utility

Concurrently, a crucial aspect of marketing customer service is the ability to provide time and place
utility, termed "physical distribution service" 48 (Mentzer et al, 1989; Perrault and Russ, 1974). It
clarifies the role of physical distribution service in the marketing mix by getting the product available
to the customers when and where it is needed. To allow an efficient movement of products to the
customers, the improvement and expansion of logistics services create other utilities that describe the
marketing features of the company's product/service offering. They include the company's ability to
deliver the right amount of the right product at the right place at the tight time in the right condition at
the right price with the right information (Coyle et al, 1996; Stock and Lambert, 1987; Shapiro and
Heskett, 1985). This explains how logistics services enhance the value of the product/service and how
it adds up the cost of a product. As the customers became more demanding, logistics services were
extended to include several value-added tasks such as breaking bulk and product mixing, packaging,
bar coding, information systems and third party inventory management, which typically take place at
distribution centres, change a product's form by changing its shipment size and packaging
characteristics. Hence, these activities provide form utility (Coyle et al, 1996; Ackerman, 1989;

15
Mentzer, 1993; Mentzer and Firman, 1994; Witt, 1991). Another form of utility is possession utility. It
is the value added to a product by allowing the customer to take ownership of the item (Stock and
Lambert, 2001). This form of utility is not created by logistics, instead it is primarily created through
the basic marketing activities such as the offering of credit, 49 quantity discounts, and delayed
payments that enable the customer to assume possession of the product. However, the role of logistics
depends upon the existence of possession utility, for time or place utility makes sense only if demand
for the product exists. It is also true that marketing depends upon logistics, since possession utility
cannot be acted upon unless time and place utility are provided (Coyle et al, 1996). Hence, the degree
to which these utilities are fulfilled reflects the degree of customer satisfaction. As the logisticians
began to understand how logistics activities constituted the very essence of their business, they then
viewed logistics as a critical component in developing the strategy of the firm. This is when the
following era of "logistics as differentiator" came in (Kent and Flint, 1997). During this period (from
Mid- 1980s toward the end of 1990s), the main interest on the customer continued with an increasing
emphasis on the creation of customer value through integrated supply chain management; logistics
channel management, inter-organisational efficiency and globalisation. Information technology and
strategy concepts began to play their role as a means of effective and efficient movement of products
/materials. As a result, a great deal of studies has been conducted in an attempt to assess the value
created by logistics services for the customers. The following section discusses various ways in which
researchers measure logistics service performance.

Measuring Logistics Service Performance

A considerable number of authors have recognised the importance of logistics service performance as
a key marketing component in creating customer satisfaction Padzie et al, 2005; Mentzer et al, 2001;
1989; Min and Mentzer, 2000; Blenstock et al, 1997, Innis and La Londe, 1994; Perrault and Russ,
1974). Since then, the number of studies focusing on the definitions and descriptions of how logistics
creates customer satisfaction (Mentzer et al, 2001; 1989; Novack et al, 1994; Mentzer and Firman,
1994; Mentzer, 1993; Coyle et al, 1996; Ackerman, 1989; Stock and Lambert, 1987; Shapiro and
Heskett, 1985; La Londe and Zinszer, 1976; Perrault and Russ, 1974) and how service firms can
create a competitive advantage (Mentzer et al, 2001; Mentzer and Williams, 2001; Morash et al, 1996;
Bowersox et al, 1995; Kyj and Kyj, 1994; Innis and La Londe, 1994) have increased. As a result)
various methods were used to measure logistics service performance, such as service quality (Mentzer
16
et al, 1999; Harding, 1998; Fransceschini and Rafele, 2000; Blenstock et al, 1997; Novack et al,
1994), the marketing mix (Lambert and Harrington, 1989; Innis and La Londe, 1994), hard and soft
customer measures (Maltz and Maltz, 1998) and the general measures such as based on the suppliers'
capabilities. Both single and multiple-firms of a single industry approaches have been used.
According to La Londe and Zinszer (1976), customer service can be categorised into three distinct
elements: (1) pre-transaction elements that 51 include written statement policy, customer receives
policy statement, organisational structure, system flexibility and management services; (2) transaction
elements that include stock-out levels, order information,, elements of order cycle, expedite
shipments, transhipment, system accuracy, order convenience, product substitution, and (3) post-
transaction elements, which installation, warranty, alterations, repairs, parts; product tracing; customer
claims, complaints, returns; temporary replacement of products. They emphasise that customer
satisfaction may only be deduced from these elements. Consequently, several researchers have used
all or some of La Londe and Zinszer's (1976) constructs in many different perspectives of their studies
(Grant, 2003; Donaldson, 1995; Morris and Davis, 1992; Sterling and Lambert, 1987; 1989; Lambert
and Harrington, 1989; Rinehart et al, 1989; Gilmour, 1982). One of the significant findings resulting
from these applications was that Gilmour (1982) found differences as to which elements were
required and important to different market segments. His study was on several market segments for
scientific equipment. Similarly, Lambert and Harrington (1989), who replicated a methodology by
Sterling and Lambert (1987), produced similar findings for the two industries involved in both studies.
In fact, Sterling and Lambert (1987) stressed that customer service requires an integrative approach
with other marketing components. Rhea and Shrock (1987) made it clear that distribution
effectiveness is the desired outcome of the distribution programmes. Collectively, these 52 outcomes
represent "effectiveness indicators" against which logistics performance is to be assessed by the
customers. They suggest that customer service policy should be designed to an extent that logistics
services should be able to satisfy customers. However, these studies have focused on customer service
from the supplier's perspectives and did not imply the customer's evaluation of value created by the
suppliers or service providers (Grant, 2004; Mentzer et al, 2001). Even the way some authors and
logistics executives quantify the logistics value that they create for the customers by considering both
suppliers and customers' viewpoints (Johnson et al, 2001; Novack et al, 1994; Lambert and Stock,
1993) may not be appropriate to justify their customers' satisfaction level because it is the customers'
perspective of service that determines their satisfaction level. Mentzer et al (2001) argue that focus
should be placed on the customers' evaluation of value created by the suppliers or service providers to
allow the quantification of customer satisfaction and service quality. In an integrative review of
17
marketing and logistics, Mentzer et al (1989) and Rinehart et al (1989) argue that two elements exist
in service delivery, namely marketing customer service and physical distribution service. These two
elements have different dimensions that should be integrated with each other. They demonstrated that
across multiple products and industries, physical distribution remains an important element in supplier
evaluation, customer 53 perception/ satisfaction, and the resulting purchase decision. However, they
stressed that buyers have a more accurate perception of the level of the physical distribution service
they receive than their suppliers. They found that the benefits or utilities that the customers desired
were availability, timeliness and quality of physical distribution service, which is similar to the value
of product quality. In a further attempt to measure customer satisfaction, several researchers have
explored the service quality literature and tested the use of the five dimensions (tangibles,
responsiveness, empathy, reliability and assurance) of the original service quality instrument,
SERVQUAL by Parasuraman et al (1985) and Technical/Functional framework by Gronroos (1984)
in many contexts of consumer studies including appliance repair and maintenance, retail banking,
long-distance telephone service, securities brokers, credit card services, retail consumers of health
care . residential utilities, job placement, pest control, dry cleaning, financial services, and fast food
services (e. g. Brown et al, 1993; Carmen, 1993; Cronin and Taylor, 1992; Babakus and Boller, 1992;
Babakus and Mangold, 1992; Parasuraman et al, 1994; 1993; 1991; 1988). This has resulted in the use
of a range of one to eight dimensions of SERVQUAL when some researchers argue for some
additions of items and dimensions.

The SERVQUAL instrument (Parasuraman et al, 1985) consists of a set of 22 items that are used to
measure perceptions of the actual service provided by a company and a similar set of 22 items that are
used to measure the level of service expected (i. e. expectations) from the company. It is the 22-item.
gap score that is known as the SERVQUAL scale. These perceptions and expectations items represent
five dimensions of SERVQUAL, namely tangibles, reliability, responsiveness) assurance, and
empathy. On the other hand, in the Technical/Functional Quality framework, Gronroos (1984)
underlines that technical quality involves "what" is provided and functional quality considers "how" it
is provided. Technical quality is obtained from the customer's evaluation of the technical outcome of
the process. Hence, it can be measured in a rather objective manner. The consumer gets functional
quality from his/her assessment on how he/she receives an outcome of the production process, which
is perceived in a very subjective way.

In the organisational context, the use of the SERVQUAL instrument (Parasuraman et al, 1985) in
measuring the logistics service (Mentzer et al, 2001; 1999; Blenstock et al, 1997; Brensinger and
18
Lambert, 1990) has also been investigated. In fact, several attempts have been made to define logistics
quality. In a study on the quality and productivity in the logistics process by The Council of Logistics
Management (CLNI), Byrne and Markham (1991) define quality in logistics as the "means meeting
agreed to customer requirements and expectations, including the following dimensions; (1) ease of 55
inquiry, order placement and order transmission, (2) timely, reliable, order delivery and
communication, (3) accurate, complete, undamaged orders and error-free paperwork, (4) timely and
responsive post-sales support, (5) accurate, timely generation and transmission of information among
the functions of business and with external parties to support the planning, management and execution
of the activities". From this definition, the focus was given to the ease of ordering procedures,
timeliness of delivery and communication, accuracy of orders and information as well as
responsiveness. Based on the SERVQUAL approach (Parasuraman et al. 1985; 1988), Stock and
Lambert (1992) View logistics quality in terms of performance "gaps". They measure logistics quality
based on the ability to distribute a product or materials in conformance with customer requirements
and standards. Specifically, logistics quality measures the ability to deliver products, materials and
services without errors, defects, mistakes,, or other gaps from customers' expectations. They refer to
"customers" as both the internal and external customers. The developments of these definitions form
the starting point of using a service quality approach to measure customer satisfaction. Although in
other organisational marketing, there is evidence of largely failed attempts either to integrate
SERVQUAL (Brady and Cronin, 2001) or to replicate its conceptual structure, Bienstock et al (1997)
successfully developed the Physical Distribution Service Quality (PDSQ) by taking into consideration
Lovelock's (1983) service classification scheme. Under the nature of service 56 act, Lovelock (1983)
classifies people and things as two different categories of logistics service recipients and that logistics
service should be managed differently. They found that the difficulties encountered in replicating
SERVQUAL's dimensions in the previous logistics research (Brensinger and Lambert, 1990) were
because SERVQUAL emphasises functional/process dimensions that may be only applicable to
"people", rather than technical/ outcome dimensions that may be necessary for a distribution service.
Consequently, based on the technical quahty criteria for physical distribution, Bienstock et al (1997)
conceptualise PDSQ as a second-order construct composed of three first-order technical dimensions
comprising of timeliness, availability and condition of orders. They call for further research to include
the functional dimensions of service quality

The following section explains how the concepts of service quality were expanded to the logistics
context.

19
Logistics Service Quality (LSQ)

By taking into consideration SERVQUAL and other service quality research in marketing, Mentzer et
al (1999) expanded the use of the service quality concept into the logistics context. They argue that
customer service should be combined with PDSQ (Bienstock et al, 1997) to conceptualise Logistics
Service Quality (LSQ). Thus, PDSQ, which consists of timeliness, availability and order condition,
are viewed as the cr1tical aspects of the 57 customer's perception of LSQ. Other components comprise
of marketing customer service components that were developed in line with traditional service quality
research in marketing, which was based on the notion that logistics services involve people who often
take orders and deliver products and procedures for placing orders and handling discrepancies. The
interactions that the customers have with these people and procedures should affect their perceptions
of overall logistics services.

Empirically validated on the customers of a single large logistics provider firm, Defense Logistics
Agency PLA) in the United States, LSQ is a scale for measuring logistics service quality that is
conceptualised as nine dimensions: information quality, ordering procedures, order release quantities,
personnel contact quality, order quality, order condition, order accuracy, timeliness and order
discrepancy handling. Mentzer et al (2001) extended Mentzer et al's (1999) study by conceptualising
the nine dimensions of LSQ as a process, by which perceptions of logistics service components affect
one another and eventually lead to customer satisfaction across order placement, order receipt and
satisfaction.

Personnel Contact Quality

Personnel contact quality refers to the customer orientation of the supplier's logistics contact people
(Mentzer et al, 2001). Having considered the fact that logistics services involve personnel who often
take orders and deliver 58 products, and are involved in procedures for placing orders and handling
discrepancies, personnel contact quality becomes one of the most vital variables in delivering service.
Mentzer et al (2001) highlight the positive influence of personnel contact quality on perceptions of
timeliness in all four segments (general, textiles, electronics and construction) in their study. Most
authors recognise that customers care about whether customer service personnel are knowledgeable,

20
empathise with their situation, and help them resolve their problems (Bitner, 1990; Bitner et al, 1994;
Gronroos, 1982; Hardine and Ferrel, 1996; Parasuraman et al, 1985). Parasuraman et al (1985) argue
that in most service encounters, quality perceptions are formed during the service delivery. Similarly,
Suprenant and Solomon (1987) suggest service quality perceptions are tied more to the service
process, which involves personnel contact, than to the resulting service outcome. As such, personnel
contact quality is an important aspect of the employee-customer interface (Hardine and Ferrel, 1996;
Hardine et al, 2000).

Order Release Quantities

Order release quantities are associated with the concept of product availability, which means TPL
companies have the flexibility to deliver certain order sizes (Mentzer et A 2001). The importance of
product availability has long been realised as a key component of logistics excellence (Mentzer et al,
2001; 1989; Novack et al, 1994; Perrault and Russ, 1974). Customers are most 59 satisfied when they
are able to obtain their required quantities. Failure to deliver the required quantities leads to stock-outs
followed by financial losses due to insufficient materials for production leading to dissatisfied and
disloyal customers (Keebler et A 1999).

Information Quality

The way customers perceive the information given by the suppliers /service providers with regard to
the variety of products that the customer may choose, forms the information quality construct
(Mentzer et al, 2001; 1999; 1997; Novack et al, 1994; Rinehart et al, 1989). The quality of the
information especially in terms of adequacy and availability of the products is very important to
customers so that they are able to use the information to make decisions (Mentzer et al, 2001).

Ordering Procedures

Several researchers found that customers are concerned about effective and simple procedures
provided by the suppliers or service providers (Mentzer et al, 2001; 1997; 1989; Bienstock et al, 1997;
Rinehart et al, 1989). 'Ilius, they view ordering procedures as efficient and effective procedures of
ordering products /materials on the part of the suppliers or service providers.

21
Order Accuracy

In a qualitative research study, Mentzer et al (2001) underline that customers concern themselves with
order accuracy, order condition and order quality when they assess orders as complete. However,
Mentzer et al (2001) emphasise that these three constructs are different to each other. Order accuracy
refers to the ability of the suppliers or service providers to deliver the right item/product at the
required number as ordered and none of the orders being substituted with other items (Mentzer et al,
2001; 1999; 1989; Bienstock et al, 1997; Novack et al, 1994; Rinehart, Cooper and Wagenheim,
1989).

Order Condition

Order condition addresses the damage levels of the products due to handling throughout the
transportation process. Damaged products are unusable to the customers. Customers have to go
through certain procedures to obtain the replacement of the damaged products from the suppliers or
service providers depending on the source and level of damage. Specifically, it refers to the lack of
damage of the orders (Mentzer et al, 2001; 1999; 1989; Bienstock et al, 1997; Rinehart et al, 1989).

Order Quality

Order quality addresses the damage levels of the products ordered from the suppliers or service
providers due to manufacturing of the products as 61 opposed to damage due to handling. It reflects
the degree to which the products provided by the suppliers or service providers meet the product
specifications set by the customers (Novack et al, 1994).

Order Discrepancy

Handling The degree to which the suppliers or service providers deal with any discrepancies upon the
arrival of orders reflects the order discrepancy-handling dimension (Novack et al, 1994; Rinehart et al,
1989). When the orders received from the suppliers or service providers are not accurate, in a poor
condition, or of poor quality, customers have to go through certain procedures to correct the orders.
Thus, the way the suppliers or service providers handle these problems forms customer perceptions on
the quality of services provided.

22
Timeliness Customers

Timeliness Customers care most that the orders must arrive at the customer's premises as promised. In
a broader perspective, it refers to the length of time between order placement and receipt (Hult, 1998;
Hult et al, 2000). These situations are represented by the timeliness dimension. This delivery time can
be affected by the problems during transportation that may delay the transportation time. It could also
be influenced by back-order time when products ordered are not available in stock (Mentzer et al,
2001; 1999; 1989; Bienstock et al, 1997; Novack et al, 1994; Rinehart et al, 1989).

Customer satisfaction

In the LSQ process model, Mentzer et al (2001) positioned satisfaction as the outcome variable of the
model. They argue that by including the satisfaction construct, certain weight could be placed on each
construct and hence the importance of each dimension in the model could be measured. The
satisfaction dimension reflects the customers' general evaluation toward the logistics service provider
organisation, i. e. DLA. Mentzer et al (2001) emphasised that the limitation of previous research was
that the respondents (i. e. the customers) were required to provide their agreement or disagreement on
the importance of each logistics activity and/or dimensions of logistics services. And, those
researchers did not demonstrate the process or the causal effects of the constructs being tested that
lead to satisfaction. In Mentzer et al's (1999) study, for example, each of the nine dimensions of the
model was given equal weight and treated as if they occurred simultaneously. This has resulted in the
failure to link significantly to customer satisfaction. However, it is important to note that the LSQ
process model was limited to the purchasing process that was experienced by the customers of a
single organisation, i. e. DLA in the United States. Thus, it lacks other customer service dimensions
that may have more influence on customer satisfaction or the existing dimensions that may not reflect
other industries or companies (Grant, 2004; Mentzer et al, 2001; 1999). 63 Mentzer et al (2001; 1999)
highlight that further research that concentrates on generalising the LSQ process model across
industrial sectors is worth consideration. The purpose is to investigate the robustness of the LSQ
measures. In response to this call, this study is conducted to replicate and test the generalisation of the
LSQ measures in the context of customers of TPL providers across industrial sectors in the UK.
Hennig-Thurau and Klee (1997) and Hennig-Thurau (2000) argued that to operationalise the
satisfaction-retention relationship, the service-related quality perception should be integrated with
relationship marketing elements. Furthermore, the service quality component in the LSQ model
(which consists of the functional and technical quality) is insufficient for a condition of relationship
23
quality (Crosby et al, Evans and Cowles, 1990). As such, it is argued that the relationship marketing
elements, particularly relationship quality that has gained considerable attention in inter-
organisational, industrial marketing and channel relationships context, need to be added in the model.
In addition, the satisfaction dimension in the LSQ process model may not necessarily lead to customer
retention. A few empirical investigations indicate weak or non-existent relationships between
customer satisfaction and customer retention (Anderson et al, 1994; Bitner, 1990; La Barbera and
Mazursky, 1983; Newman and Werbel, 1973; Oliver, 1980; Oliver and Swan, 1989; Richheld and
Sasser, 1990).

Summary

The present chapter review of literature and theoretical framework of the study illustrates how the
concepts of customer service, satisfaction and service quality are developing in logistics. Specifically,
it highlights how service quality concepts are evolving in logistics, and finally highlights the
importance of LSQ process model in measuring customer satisfaction. More importantly, it
demonstrates how this study fits in and extends the existing literature through the replication of the
LSQ process model.

24
 RESEARCH METHODOLOGY

Primary/Secondary

The current study is based entirely on primary data. Secondary data collected from books, journals,
magazines and websites was used to create theory framework of the study and the review of
literature. The primary data was collected personally with the help of structured questionnaire. The
present study is completely based on the primary data collected from the shipping and logistics
companies in Mumbai. A special care was taken to draft the questionnaire. The questionnaire was
divided into four parts. The first part of questionnaire includes the demographic profile of the
respondents. They are size of the company, number of years of industry experience, type of service,
main service / region / countries, type of ship, frequency of annual travel and aspect of eight
essentials. The second part of the questionnaire contains twenty-five variables for quality service
delivery, two variables for customer satisfaction and two variations for customer loyalty. The
variability is measured by a Likert rating of five points. The third part of the questionnaire contains
ten different problems. The variability is measured by five Likert Scale points (SA-I strongly agree,
A-Agree, N-Neutral, DA-negative, SDA-strongly negative). The fourth part of the 16 questionnaire
covers fifteen development variables. The variable is measured by five Likert Scale points.
Appropriate variations of the above-mentioned concepts are taken from a review of previous studies.
An exploratory study was conducted among 50 shipping and shipping companies in Mumbai. Based
on feedback from previous tests, specific modifications, additions, deletions and simplifications were
made. A draft questionnaire has been prepared for data collection at shipping and transport companies
in Mumbai.

Questionnaire

Part One – Demographic Profile

1. Name of the Organisation ________________

25
2. Type of Industry____________

3. Products Used________________

4. Size of the company

Small____ Medium ____ Large ____

5. Number of years experience in the industry

Below 5 years____ 5 to 10 years____ Above 10 years____

6. Nature of Service

Domestic____ International____

7. Main Service/Trading Region /countries

Asia____ USA____ Europe____

8. Type of Ships

Coastal Ships_____ Foreign Ships_____

9. Frequency of Voyage per year

Below 3 times____ 5 times____ Above 5 times____

10.Which logistics factor is more important? Rate the given variables at five point scale.

(VHI – Very Highly Important, HI – Highly Important, N – Neutral, NI – Not Important, NAI – Not
at all Important)

Sr. No. Factors VHI HI N NI NAI

1 Price
2 Delivery
Speed
3 Service
Attitude

26
4 Range of
Services
5 The
problem
handling
capacity
6 Service
Reputation
7 Service
Security
8 Order
Tracking
Information

Part Two – Logistics Service Quality

Rate the given Logistics Service Quality variables at five point scale on two dimensions namely

(E-Expectation; P-Perception) (SA-Strongly Agree, A-Agree, N-Neutral, DA-disagree, SDA-

strongly disagree)

Sr. No. Tangibility SA A N DA SDA

1 Proper safety E
and security P
in deliver of
goods (Protect
the goods)

27
2 Number of E
branches with P
wide network
(Office)
3 Modern E
equipment / P
technology
utilized for
handling the
goods
(Loading and
Unloading)
4 Application of E
IT and EDI P
systems for
Logistics
customer
service
5 Staffs – E
Competence P
Quality

Sr. No. Reliability SA A N DA SDA

1 Reliability E
of order P
information
2 Timeliness E
of shipment P
pickup and
delivery

28
 (Shipment
tracking
capabilities)

3 Providing E
services P
without
problems or
Delivering
Goods
without
damage
4 Providing E
accurate P
Information
/ service
5 Service E
time P
available
fits to
customers’
needs

Sr. No. Responsiveness SA A N DA SDA

1 Employees E
attitude and P
behaviour for
meeting
customers’
satisfaction
2 Employees E
29
 attitude and P
behaviour for
meeting
customers’
satisfaction
3 Providing cargo E
intimation P
service to
customers
regarding
position /
conditions of
cargo through
service portals
(IT innovations),
Softwares,
Mobile
Applications,
SMS and Mail.
4 Solving the E
problems in least P
possible time.

5 Responsiveness E
to customers’ P
needs and r

30
Sr. No. Assurance SA A N DA SDA
1 Company’s E
record in terms P
of
professionalism
and
consistency in
achieving
customers’
requirements.
2 Socially E
responsible P
behaviour and
concern for
human safety.
3 Making the E
customers’ feel P
secured about
the service.
4 Company’s E
reputation for P
matching
words with
action.
5 Employing E
designated P
staff’s with
expertise
requirements

31
Sr. No. Empathy SA A N DA SDA
1 Providing E
attractive P
promotion
2 Making E
customer feel P
relieved with
individual
designated
attention
3 The staff’s are E
knowledgeable, P
respectful and
polite.
4 Understanding E
customer needs P
and
requirements
5 Consistency in E
order to handle P

32
Sr. No. Customer SA A N DA SDA
Satisfaction
1 We are
delighted
with the
overall
logistics
service and
relationship
with the
service
provider
2 We wish
more of our
service
providers
were like
this one

33
Sr. No Customer SA A N DA SDA
Loyalty
1 Consider
this service
provider
your first
choice
2 If all the
other
attributes
are similar
(price,
product
quality), we
will always
seek for this
service
provider for
their
logistics
service

34
 Part Three – Problems

Rate the given statements at five point scale

(SA-Strongly agree, A-Agree, N-Neutral, DA-disagree, SDA-strongly disagree)

Sr. No Problems SA A N DA SDA

1 Staff not Co-operative
(Non-Competent)
2 Delay in product
delivery time.
3 Tracking Issues
4 Protection of product
5 Advance information
systems
6 Handling the customer
complaints (Delay)
7 Advance equipments
8 Difficulties in
Communicating with
service provider and
problems with the
process.
9 Efficiency in the
requisition procedures
(request)
10 Employees’ capacity to
solve problems

35
 Part Four – Improvements

Rate the given statements at five point scale

(SA-Strongly agree, A-Agree, N-Neutral, DA-disagree, SDA-strongly disagree)

Sr. No. Improvements SA A N DA SDA

1 Customer focus quality

2 Order fulfillment quality

3 Timeliness
4 Information quality
5 Corporate image
6 Protecting the goods without damage

7 Safety and security

8 Staffs attitude and behaviour

9 Handling customers’ complaints

10 Modern Equipments and facility

11 Proper records maintenance

12 Delivery of goods’ properly

13 Insurance – if any damage

14 Personalized attention

36
15 Proper guidance and counseling to
their customers regarding logistics
problems

37
 DATA INTERPRETATION

1. Demographic Profile

Size of the company wise classification of respondents

In this study Size of the company is classified into three Small, Medium and Large. Studying the
Logistics Service Quality of Shipping Industry based on Size of the company is required for this
study.

The distribution of respondents on the basis of Size of the company is shown in the table below.

Table 1.1

Size of the company wise classification of respondents

Size of the company Frequency Percent

Small 122 23.7
Medium 272 52.9
Large 120 23.4
Total 514 100.0

38
 Chart 1.1

Size of the company wise classification of respondents

60 52.9

50

40

30 Small
23.7 23.4
Percentage

20
Large

Small Medium Large

Size of the company

From the above table it can be seen that 23.7% of respondents are small, 52.9% of respondents are
medium and 23.4% of respondents are large. This indicates that majority of the respondents company
are medium.

Number of years experience in the industry wise classification of respondents

In this study Number of years experience in the industry is classified into three Below 5 years, 5 to 10
years and Above 10 years. Studying the Logistics Service Quality of Shipping Industry in Mumbai
based on Number of years experience in the industry is essential for this study. The distribution of
respondents on the basis of Number of years experience in the industry is shown in the table
below.

39
 Table 1.2

Number of years experience in the industry wise classification of respondents

Number of years
experience in the Frequency Percent

industry

Below 5 years 120 23.3

5 to 10 years 272 52.9

Above 10 years 122 23.8

Total 514 100.0

Chart 1.2

Number of years experience in the industry wise classification of

respondents

60 52.9

50
Percentage

40
Below 5 years
23.3 23.8
30
5 to 10 years
20
Above 10
years

Below 5 years 5 to 10 years Above 10 years

Number of years experience in the industry

40
From the above table it can be seen that 23.3% of respondents are below 5 years, 52.9% of
respondents are 5 to 10 years and 23.8% of respondents are above 10 years. This indicates that
majority of the respondents are 5 to 10 years.

Nature of Service wise classification of respondents

In this study Nature of Service is classified into two, Domestic and International. Studying the
Logistics Service Quality of Shipping Industry based on Nature of Service is required for this study.
The distribution of respondents on the basis of Nature of Service is shown in the table below.

Table 1.3

Nature of Service wise classification of respondents

Nature of Service Frequency Percent

Domestic 262 51.0

International 252 49.0

Total 514 100.0

41
 Chart 1.3

Nature of Service wise classification of respondents

51

51

50.5

50
Percentage

49
49.5 Domestic

International

48.5

Domestic International
Nature of Service

From the above table it can be seen that 51% of respondents are domestic and 49% of respondents are
international. This indicates that majority of the respondents are domestic.

Main Service/Trading Region /countries wise classification of respondents

In this study, Main Service/Trading Region/countries classified into three Asia, USA and Europe.
Studying the Logistics Service Quality of Shipping Industry in Mumbai based on Main
Service/Trading Region/countries is required for this study. The distribution of respondents on the
basis of Main Service/Trading Region /countries is shown in the table below.

42
 Table 1.4

Main Service/Trading Region /countries wise classification of respondents

Main Service/Trading
Frequency Percent
Region /countries

Asia 220 42.8

USA 151 29.4

Europe 143 27.8

Total 514 100.0

Chart 1.4

Main Service/Trading Region /countries wise classification of respondents

42.8

29.4
27.8
Percentage

Asia

USA

Europe

Asia USA Europe

43
Main Service/Trading Region /countries
From the above table it can be seen that 42.8% of respondents are Asia, 29.4% of respondents are
USA and 27.8% of respondents are Europe. This indicates that majority of the respondents are Asia.

Type of Ships wise classification of respondents

In this study Type of Ships classified into two Coastal Ships and Foreign Ships. Studying the
Logistics Service Quality of Shipping Industry based on Type of Ships is important for this study. The
distribution of respondents on the basis of Main Service/Trading Region /countries is shown in the
table below.

Table 1.5

Type of Ships wise classification of respondents

Type of Ships Frequency Percent

Coastal Ships 170 33.1

Foreign Ships 344 66.9

Total 514 100.0

44
 Chart 1.5

Type of Ships wise classification of respondents

66.9

70

60

50
33.1
40
Percentage

Coastal Ships
30 Foreign Ships

10

Coastal Ships Foreign Ships

Type of Ships

From the above table it can be seen that 33.1% of respondents are Coastal ships and 66.9% of
respondents are Foreign ships. This indicates that majority of the respondents are foreign ships.

Frequency of Voyage per year wise classification of respondents

In this study Frequency of Voyage per year classified into three Below 3 times, 5 times and Above 5
times. Studying the Logistics Service Quality of Shipping Industry in Mumbai based on Frequency of
Voyage per year is important for this study. The distribution of respondents on the basis of Frequency
of Voyage per year is shown in the table below.

45
 Table 1.6

Frequency of Voyage per year wise classification of respondents

Frequency of Voyage
per year Frequency Percent

Below 3 times 192 37.4

5 times 202 39.3

Above 5 times 120 23.3

Total 514 100.0

Chart 1.6

Frequency of Voyage per year wise classification of respondents

39.3
37.4

23.3
Percentage

Below 3 times

5 times

Above 5 times

Below 3 times 5 times Above 5 times

Frequency of Voyage per year

46
From the above table it can be seen that 37.4% of respondents are below 3 times, 39.3% of
respondents are 5 times and 23.3% of respondents are above 5 times. This indicates that majority of
the respondents are 5 times

2.Opinion of the respondents

Ranking for Logistics Factor
In this study, Logistics consist of eight factors that measure Delivery Speed, Price, Service Attitude,
Range of Services, Order Tracking Information, The problem handling capacity, Service Reputation
and Service Security. The table below shows the ranking for the items comprising the Logistics factor
which constitutes 8 items. Items were responded to on a 5 point Likert scale ranging from „Very
Highly Important‟ to „Not at all Important‟. Ranking has been done based on the mean values.

Table 2.1

Ranking for Logistics Factor

Logistics Mean Std. Deviation Skewness Kurtosis

Delivery Speed 4.06 .826 -.325 -.954

Price 4.06 .802 -.113 -1.437

Service Attitude 3.98 .896 -.459 -.690

Range of Services 3.98 .897 -.454 -.702

Order Tracking
Information 3.81 .741 -.252 -.163

The problem handling

capacity 3.75 .738 -.146 -.269

Service Reputation 3.61 .843 .050 -.656

Service Security 3.59 .868 -.005 -.692

47
The above table shows that “Delivery Speed” is the top ranked Logistics factor with a mean value of
4.06, “Price” is the second ranked Logistics factor with a mean value of 4.06, “Service Attitude” is the
third ranked Logistics factor with a mean value of 3.98, “Range of Services” is the fourth ranked
Logistics factor with a mean value of 3.98, “Order Tracking Information” is the fifth ranked Logistics
factor with a mean value of 3.81, “The problem handling capacity” is the sixth ranked Logistics factor
with a mean value of 3.75, “Service Reputation” is the seventh ranked Logistics factor with a mean
value of 3.61 and “Service Security” is the eighth ranked Logistics factor with a mean value of 3.59.

Ranking for Tangibility Factor

In this study, Tangibility consist of five factors that measure Modern equipment / technology utilized
for handling the goods (Loading and Unloading), Staffs – Competence Quality, Application of IT and
EDI systems for Logistics customer service, Number of branches with wide network (Office) and
Proper safety and security in deliver of goods (Protect the goods). The table below shows the ranking
for the items comprising the Tangibility factor which constitutes 5 items. Items were responded to on
a 5 point Likert scale ranging from „Strongly Agree‟ to „Strongly Disagree‟. Ranking has been done
based on the mean values.

48
 Table 2.2

Ranking for Tangibility Factor

Tangibility Mean Std. Deviation Skewness Kurtosis

Modern equipment /
technology utilized for
4.00 1.010 -.795 .018
handling the goods
(Loading and Unloading)

Staffs – Competence
Quality 3.96 1.030 -.674 -.697

Application of IT and EDI

systems for Logistics 3.92 .859 -.213 -.902

customer service

Number of branches with

wide network (Office) 3.76 .941 -.360 -.741

Proper safety and security

in deliver of goods (Protect 3.67 .809 -.209 -.407

the goods)

The above table shows that “Modern equipment / technology utilized for handling the goods (Loading
and Unloading)” is the top ranked Tangibility factor with a mean value of 4.00, “Staffs – Competence
Quality” is the second ranked Tangibility factor with a mean value of 3.96, “Application of IT and
EDI systems for Logistics customer service” is the third ranked Tangibility factor with a mean value
of 3.92, “Number of branches with wide network (Office)” is the fourth ranked Tangibility factor with
a mean value of 3.76, “Proper safety and security in deliver of goods (Protect the goods)” is the fifth
ranked Tangibility factor with a mean value of 3.67.

49
Ranking for Reliability Factor

In this study, Reliability consist of five factors that measure Service time available fits to customers‟
needs, Providing services without problems or Delivering Goods without damage, Providing accurate
Information / service, Timeliness of shipment pickup and delivery (Shipment tracking capabilities)
and Reliability of order information. The table below shows the ranking for the items comprising the
Reliability factor which constitutes 5 items. Items were responded to on a 5 point Likert scale
ranging from “Strongly Agree‟ to “Strongly Disagree‟. Ranking has been done based on the mean
values.

Table 2.3

Ranking for Reliability Factor

Reliability Mean Std. Deviation Skewness Kurtosis

Service time available fits

to customers‟ needs 4.24 .853 -1.232 2.074

Providing services without

problems or Delivering 4.19 .768 -.607 -.286

Goods without damage

Providing accurate
Information / service 4.16 .870 -1.203 1.934

Timeliness of shipment
pickup and delivery
4.14 .845 -.671 -.313
(Shipment tracking
capabilities)

Reliability of order
information 4.04 .973 -.729 -.489

50
The above table shows that “Service time available fits to customers‟ needs” is the top ranked
Reliability factor with a mean value of 4.24, “Providing services without problems or Delivering
Goods without damage” is the second ranked Reliability factor with a mean value of 4.19, “Providing
accurate Information / service” is the third ranked Reliability factor with a mean value of 4.16,
“Timeliness of shipment pickup and delivery (Shipment tracking capabilities)” is the fourth ranked
Reliability factor with a mean value of 4.14, “Reliability of order information” is the fifth ranked
Reliability factor with a mean value of 4.04.

Ranking for Responsiveness Factor

In this study, Responsiveness consist of five factors that measure Responsiveness to customers‟ needs
and requirements, Solving the problems in least possible time, Providing cargo intimation service to
customers regarding position / conditions of cargo through service portals (IT innovations), Softwares,
Mobile Applications, SMS and Mail, Handling and solving customers‟ claim / complaints and
Employees attitude and behaviour for meeting customers‟ satisfaction. The table below shows the
ranking for the items comprising the Responsiveness factor which constitutes 5 items. Items were
responded to on a 5 point Likert scale ranging from “Strongly Agree‟ to “Strongly Disagree‟.
Ranking has been done based on the mean values.

51
 Table 2.4

Ranking for Responsiveness Factor

Responsiveness Mean Std. Deviation Skewness Kurtosis

Responsiveness to
customers‟ needs and 4.21 .827 -.624 -.690
requirements

Solving the problems in

4.11 .784 -.444 -.581
least possible time.

Providing cargo intimation

service to customers
regarding position /
conditions of cargo through
4.10 .893 -.522 -.833
service portals (IT
innovations), Softwares,
Mobile Applications, SMS
and Mail.

Handling and solving

customers‟ claim / 4.08 .883 -.498 -.797
complaints

Employees attitude and

behaviour for meeting 4.04 .818 -.508 -.351
customers‟ satisfaction

52
The above table shows that “Responsiveness to customers‟ needs and requirements” is the top
ranked Responsiveness factor with a mean value of 4.21, “Solving the problems in least possible
time” is the second ranked Responsiveness factor with a mean value of 4.11, “Providing cargo
intimation service to customers regarding position / conditions of cargo through service portals
(IT innovations), Softwares, Mobile Applications, SMS and Mail” is the third ranked
Responsiveness factor with a mean value of 4.10, “Handling and solving customers‟ claim /
complaints” is the fourth ranked Responsiveness factor with a mean value of 4.08, “Employees
attitude and behaviour for meeting customers‟ satisfaction” is the fifth ranked Responsiveness
factor with a mean value of 4.04.

Ranking for Assurance Factor

In this study, Assurance consist of five factors that measure Company‟s record in terms of
professionalism and consistency in achieving customers‟ requirements, Making the customers‟ feel
secured about the service, Company‟s reputation for matching words with action Employing
designated staff‟s with expertise and Socially responsible behavior and concern for human safety. The
table below shows the ranking for the items comprising the Assurance factor which constitutes 5
items. Items were responded to on a 5 point Likert scale ranging from “Strongly Agree‟ to
“Strongly Disagree‟. Ranking has been done based on the mean value

53
 Table 2.5

Ranking for Assurance Factor

Assurance Mean Std. Deviation Skewness Kurtosis

Company‟s record in terms

of professionalism and
4.14 .841 -.857 .269
consistency in achieving
customers‟ requirements

Making the customers‟

feel secured about the 4.06 .878 -.656 -.308
service

Company‟s reputation for

matching words with action 4.06 .784 -.374 -.591

Employing designated staff‟s

4.06 1.001 -.831 -.394
with expertise

Socially responsible
behaviour and concern for 4.00 .792 -.479 -.195
human safety.

54
The above table shows that “Company‟s record in terms of professionalism and consistency in
achieving customers‟ requirements” is the top ranked Assurance factor with a mean value of 4.14,
“Making the customers‟ feel secured about the service” is the second ranked Assurance factor with a
mean value of 4.06, “Company’s reputation for matching words with action” is the third ranked
Assurance factor with a mean value of 4.06, “Employing designated staff‟s with expertise” is the
fourth ranked Assurance factor with a mean value of 4.06, “Socially responsible behaviour and
concern for human safety” is the fifth ranked Assurance factor with a mean value of 4.00.

Ranking for Empathy Factor

In this study, Empathy consist of five factors that measure Understanding customer needs and
requirements, The staff‟s are knowledgeable, respectful and polite, Consistency in order to handling
process., Making customer feel relieved with individual designated attention and Providing attractive
promotion. The table below shows the ranking for the items comprising the Empathy factor which
constitutes 5 items. Items were responded to on a 5 point Likert scale ranging from “Strongly
Agree‟ to “Strongly Disagree‟. Ranking has been done based on the meanvalues

55
 Table 2.6

Ranking for Empathy Factor

Empathy Mean Std. Deviation Skewness Kurtosis

Understanding customer
4.10 .934 -.918 .652
needs and requirements

The staff‟s are

knowledgeable, respectful 4.02 .918 -.649 -.430
and polite

Consistency in order to
3.96 .886 -.773 .828
handling process.

Making customer feel

relieved with individual 3.92 .925 -.438 -.725
designated attention

Providing attractive
3.78 .998 -.868 .604
promotion

The above table shows that “Understanding customer needs and requirements” is the top ranked Empathy
factor with a mean value of 4.10, “The staff‟s are knowledgeable, respectful and polite” is the second
ranked Empathy factor with a mean value of 4.02, “Consistency in order to handling process” is the third
ranked Empathy factor with a mean value of 3.96, “Making customer feel relieved with individual
designated attention” is the fourth ranked Empathy factor with a mean value of 3.92, “Providing attractive
promotion” is the fifth ranked Empathy factor with a mean value of 3.78.

56
Ranking for Customer Satisfaction Factor

In this study, Customer Satisfaction consist of two factors that measure We are delighted with the overall
logistics service and relationship with the service provider and We wish more of our service providers were
like this one. The table below shows the ranking for the items comprising the Customer Satisfaction factor
which constitutes 2 items. Items were responded to on a 5 point Likert scale ranging from „Strongly
Agree‟ to „Strongly Disagree‟. Ranking has been done based on the mean values.

Table 2.7

Ranking for Customer Satisfaction Factor

Customer Satisfaction Mean Std. Deviation Skewness Kurtosis

We are delighted with the

overall logistics service and
4.02 .850 -1.187 2.125
relationship with the service
provider

We wish more of our service

providers were like this one 3.94 .828 -.309 -.638

The above table shows that “We are delighted with the overall logistics service and relationship with the
service provider” is the top ranked Customer Satisfaction factor with a mean value of 4.02 and “We wish
more of our service providers were like this one” is the second ranked Customer Satisfaction factor with a
mean value of 3.94.

57
Ranking for Customer Loyalty Factor

In this study, Customer Loyalty consist of two factors that measure Consider this service provider your first
choice and If all the other attributes are similar (price, product quality), we will always seek for this service
provider for their logistics service. The table below shows the ranking for the items comprising the
Customer Loyalty factor which constitutes 2 items. Items were responded to on a 5 point Likert scale
ranging from “Strongly Agree” to “Strongly Disagree‟. Ranking has been done based on the mean values.

Table 2.8

Ranking for Customer Loyalty Factor

Customer Loyalty Mean Std. Deviation Skewness Kurtosis

Consider this service provider

your first choice 4.20 .740 -.910 1.075

If all the other attributes are

similar (price, product quality),
we will always seek for this 4.10 .821 -.397 -.870
service provider for their
logistics service

58
The above table shows that “Consider this service provider your first choice” is the top ranked Customer
Loyalty factor with a mean value of 4.20, “If all the other attributes are similar (price, product quality), we
will always seek for this service provider for their logistics service” is the second ranked Customer Loyalty
factor with a mean value of 4.10.

Ranking for Problems Factor

In this study, Problems consist of ten factors that measure Handling the customer complaints (Delay),
Advance information systems, Protection of product, Tracking Issues, Staff not Co-operative (Non-
Competent), Delay in product delivery time, Efficiency in the requisition procedures (request), Advance
equipments, Difficulties in Communicating with service provider and problems with the process and
Employees‟ capacity to solve problems. The table below shows the ranking for the items comprising the
Problems which constitutes 10 items. Items were responded to on a 5 point Likert scale ranging from
“Strongly Agree” to “Strongly Disagree”. Ranking has been done based on the mean values.

59
 Table 2.9

Ranking for Problems Factor

Problems Mean Std. Deviation Skewness Kurtosis

Handling the customer

4.10 .923 -.860 -.071
complaints (Delay)

Advance information systems

3.98 .922 -.899 .736

Protection of product 3.91 1.011 -.844 .083

Tracking Issues 3.87 .932 -.525 -.543

Staff not Co-operative (Non-

3.87 1.133 -.827 -.239
Competent)

Delay in product delivery time.

3.83 1.104 -.822 -.131

Efficiency in the requisition

procedures (request) 3.79 1.085 -.641 -.571

Advance equipments 3.78 1.140 -.417 -1.251

Difficulties in Communicating
with service provider and
3.59 1.303 -.497 -1.017
problems with the process.

Employees‟ capacity to solve

3.57 1.089 -.462 -.885
problems

60
The above table shows that “Handling the customer complaints (Delay)” is the top ranked Problems factor
with a mean value of 4.10, “Advance information systems” is the second ranked Problems factor with a
mean value of 3.98, “Protection of product” is the third ranked Problems factor with a mean value of 3.91,
“Tracking Issues” is the fourth ranked Problems factor with a mean value of 3.87, “Staff not Co-operative
(Non-Competent)” is the fifth ranked Problems factor with a mean value of 3.87, “Delay in product
delivery time.” is the sixth ranked Problems factor with a mean value of 3.83, “Efficiency in the requisition
procedures (request)” is the seventh ranked Problems factor with a mean value of 3.79, “Advance
equipments” is the eighth ranked Problems factor with a mean value of 3.78, “Difficulties in
Communicating with service provider and problems with the process” is the ninth ranked Problems factor
with a mean value of 3.59 and “Employees‟ capacity to solve problems” is the tenth ranked Problems
factor with a mean value of 3.57.

Ranking for Improvements Factor

In this study, Improvements consist of fifteen factors that measure Staffs attitude and behavior, Corporate
image, Safety and security, Modern Equipments and facility, Customer focus quality, Protecting the goods
without damage, Delivery of goods‟ properly, Personalized attention, Information quality, Proper guidance
and counseling to their customers regarding logistics problems, Insurance – if any damage, Proper records
maintenance, Timeliness and Order fulfillment quality. The table below shows the ranking for the items
comprising the Improvements factor which constitutes 8 items. Items were responded to on a 5 point
Likert scale ranging from “Strongly Agree‟ to “Strongly Disagree‟. Ranking has been done based on the
mean values.

61
 Table 2.10

Ranking for Improvements Factor

Improvements Mean Std. Deviation Skewness Kurtosis

Staffs attitude and behaviour

4.27 .990 -1.220 .869

Corporate image 4.26 .820 -.510 -1.327

Handling customers‟ complaints

4.23 .659 -.736 1.255

Safety and security 4.21 1.011 -1.026 -.204

Modern Equipments and facility

4.19 .873 -.574 -.967

Customer focus quality 4.07 1.079 -.822 -.682

Protecting the goods without

4.03 .848 -.653 -.103
damage

Delivery of goods properly

3.91 .958 -.651 -.457

62
 Personalized attention 3.88 .937 -.956 1.423

Information quality 3.84 .705 -.469 .394

Proper guidance and counseling

to their customers regarding
3.83 .842 -.758 1.245
logistics problems

Insurance – if any damage 3.83 .842 -.758 1.245

Proper records maintenance

3.80 1.008 -.681 -.087

Timeliness 3.76 .961 -.366 -.185

Order fulfillment quality 3.74 1.140 -.442 -1.219

The above table shows that “Staffs attitude and behaviour” is the top ranked Improvements factor with a
mean value of 4.27, “Corporate image” is the second ranked Improvements factor with a mean value of
4.26, “Handling customers‟ complaints” is the third ranked Improvements factor with a mean value of 4.23,
“Safety and security” is the fourth ranked Improvements factor with a mean value of 4.21, “Modern
Equipments and facility” is the fifth ranked Improvements factor with a mean value of 4.19, “Customer
focus quality” is the sixth ranked Improvements factor with a mean value of 4.07, “Protecting the goods
without damage” is the seventh ranked Improvements factor with a mean value of 4.03, “Delivery of
goods‟ properly” is the eighth ranked Improvements factor with a mean value of 3.91, ”Personalized
attention” is the ninth ranked Improvements factor with a mean value of 3.88, “Information quality” is the
tenth ranked Improvements factor with a mean value of 3.84, “Proper guidance and counseling to their
customers regarding logistics problems” is the eleventh ranked Improvements factor with a mean value of
3.83, “Insurance – if any damage” is the twelfth ranked Improvements factor with a mean value of 3.83,
“Proper records maintenance” is the thirteenth ranked Improvements factor with a mean value of 3.80,
“Timeliness” is the fourteenth ranked Improvements factor with a mean value of 3.76 and “Order
fulfillment quality” is the fifteenth ranked factor with a mean value of 3.74.
63
 FINDINGS AND RECOMMENDATIONS

Introduction
The study focuses on logistics service quality of shipping industry in Mumbai. This is classified into four
important parts. The first part discusses the overview of shipping industry. The second part analyses the
demographic profile of the respondents. The third part analyses the differences between demographic
profiles of the respondents with respect to various dimensions of logistics factor, logistics service quality,
customer satisfaction, customer loyalty, problems and improvements. The fourth part analyses the
relationship among various dimensions of logistics service quality.

The objectives of the present study are as follows

(1) To reveal the demographic profile of the respondents.

(2) To study the differences between demographic profile of respondents with various dimensions of
logistics service quality, customer satisfaction, customer loyalty, problems and improvements.

(3) To measure the relationship among various dimensions of logistics service quality.

(4) To study the impact of various dimensions of logistics service quality towards customer satisfaction.

(5) To study the logistics problems faced by the customers in shipping industry.

(6) To offer suitable suggestions for enhancing the logistics service quality of shipping industry on the basis
of findings of the study. The study area is confined to the logistics service quality of shipping industry in
Mumbai. The present chapter discusses the summary of findings, suggestions, conclusion and scope for
further research.

Demographic Profile of the Respondents

i. 23.7% of respondents are small, 52.9% of respondents are medium and 23.4% of respondents are large.
This indicates that majority of the respondents company are medium.

ii. 23.3% of respondents are below 5 years, 52.9% of respondents are 5 to 10 years and 23.8% of respondents
are above 10 years. This indicates that majority of the respondents are 5 to 10 years.

iii. 51% of respondents are domestic and 49% of respondents are international. This indicates that majority of
the respondents are domestic.

64
iv. 42.8% of respondents are Asia, 29.4% of respondents are USA and 27.8% of respondents are Europe. This
indicates that majority of the respondents are Asia.

v. 33.1% of respondents are Coastal ships and 66.9% of respondents are Foreign ships. This indicates that
majority of the respondents are foreign ships.

vi. 37.4% of respondents are below 3 times, 39.3% of respondents are 5 times and 23.3% of respondents are
above 5 times. This indicates that majority of the respondents are 5 times.

Opinion of the Respondents

i. “Delivery Speed” is the top ranked Logistics factor with a mean value of 4.06, “Price” is the second ranked
Logistics factor with a mean value of 4.06, “Service Attitude” is the third ranked Logistics factor with a
mean value of 3.98, “Range of Services” is the fourth ranked Logistics factor with a mean value of 3.98,
“Order Tracking Information” is the fifth ranked Logistics factor with a mean value of 3.81, “The problem
handling capacity” is the sixth ranked Logistics factor with a mean value of 3.75, “Service Reputation” is
the seventh ranked Logistics factor with a mean value of 3.61 and “Service Security” is the eighth ranked
Logistics factor with a mean value of 3.59.

ii. “Modern equipment / technology utilized for handling the goods (Loading and Unloading)” is the top
ranked Tangibility factor with a mean value of 4.00, “Staffs – Competence Quality” is the second ranked
Tangibility factor with a mean value of 3.96, “Application of IT and EDI systems for Logistics customer
service” is the third ranked Tangibility factor with a mean value of 3.92, “Number of branches with wide
network (Office)” is the fourth ranked Tangibility factor with a mean value of 3.76, “Proper safety and
security in deliver of goods (Protect the goods)” is the fifth ranked Tangibility factor with a mean value of
3.67.

iii. “Service time available fits to customers’ needs” is the top ranked Reliability factor with a mean value of
4.24, “Providing services without problems or Delivering Goods without damage” is the second ranked
Reliability factor with a mean value of 4.19, “Providing accurate Information / service” is the third ranked
Reliability factor with a mean value of 4.16, “Timeliness of shipment pickup and delivery (Shipment
tracking capabilities)” is the fourth ranked Reliability factor with a mean value of 4.14, “Reliability of order
information” is the fifth ranked Reliability factor with a mean value of 4.04.

iv. “Responsiveness to customers’ needs and requirements” is the top ranked Responsiveness factor with a
mean value of 4.21, “Solving the problems in least possible time” is the second ranked Responsiveness
factor with a mean value of 4.11, “Providing cargo intimation service to customers regarding position /
conditions of cargo through service portals (IT innovations), Softwares, Mobile Applications, SMS and
65
 Mail” is the third ranked Responsiveness factor with a mean value of 4.10, “Handling and solving
customers’ claim / complaints” is the fourth ranked Responsiveness factor with a mean value of 4.08,
“Employees attitude and behaviour for meeting customers’ satisfaction” is the fifth ranked Responsiveness
factor with a mean value of 4.04.

v. “Company’s record in terms of professionalism and consistency in achieving customers’ requirements” is

the top ranked Assurance factor with a mean value of 4.14, “Making the customers’ feel secured about the
service” is the second ranked Assurance factor with a mean value of 4.06, “Company’s reputation for
matching words with action” is the third ranked Assurance factor with a mean value of 4.06, “Employing
designated staff’s with expertise” is the fourth ranked Assurance factor with a mean value of 4.06, “Socially
responsible behaviour and concern for human safety” is the fifth ranked Assurance factor with a mean value
of 4.00.

vi. “Understanding customer needs and requirements” is the top ranked Empathy factor with a mean value of
4.10, “The staff’s are knowledgeable, respectful and polite” is the second ranked Empathy factor with a
mean value of 4.02, “Consistency in order to handling process” is the third ranked Empathy factor with a
mean value of 3.96, “Making customer feel relieved with individual designated attention” is the fourth
ranked Empathy factor with a mean value of 3.92, “Providing attractive promotion” is the fifth ranked
Empathy factor with a mean value of 3.78.

vii. “We are delighted with the overall logistics service and relationship with the service provider” is the top
ranked Customer Satisfaction factor with a mean value of 4.02 and “We wish more of our service providers
were like this one” is the second ranked Customer Satisfaction factor with a mean value of 3.94.

viii. “Consider this service provider your first choice” is the top ranked Customer Loyalty factor with a mean
value of 4.20, “If all the other attributes are similar (price, product quality), we will always seek for this
service provider for their logistics service” is the second ranked Customer Loyalty factor with a mean value
of 4.10.

ix. “Handling the customer complaints (Delay)” is the top ranked Problems factor with a mean value of 4.10,
“Advance information systems” is the second ranked Problems factor with a mean value of 3.98,
“Protection of product” is the third ranked Problems factor with a mean value of 3.91, “Tracking Issues” is
the fourth ranked Problems factor with a mean value of 3.87, “Staff not Co-operative (Non-Competent)” is
the fifth ranked Problems factor with a mean value of 3.87, “Delay in product delivery time.” is the sixth
ranked Problems factor with a mean value of 3.83, “Efficiency in the requisition procedures (request)” is
the seventh ranked Problems factor with a mean value of 3.79, “Advance equipments” is the eighth ranked
Problems factor with a mean value of 3.78, “Difficulties in Communicating with service provider and

66
 problems with the process” is the ninth ranked Problems factor with a mean value of 3.59 and “Employees’
capacity to solve problems” is the tenth ranked Problems factor with a mean value of 3.57.

x. “Staffs attitude and behaviour” is the top ranked Improvements factor with a mean value of 4.27,
“Corporate image” is the second ranked Improvements factor with a mean value of 4.26, “Handling
customers’ complaints” is the third ranked Improvements factor with a mean value of 4.23, “Safety and
security” is the fourth ranked Improvements factor with a mean value of 4.21, “Modern Equipments and
facility” is the fifth ranked Improvements factor with a mean value of 4.19, “Customer focus quality” is the
sixth ranked Improvements factor with a mean value of 4.07, “Protecting the goods without damage” is the
seventh ranked Improvements factor with a mean value of 4.03, “Delivery of goods’ properly” is the eighth
ranked Improvements factor with a mean value of 3.91, ”Personalized attention” is the ninth ranked
Improvements factor with a mean value of 3.88, “Information quality” is the tenth ranked Improvements
factor with a mean value of 3.84, “Proper guidance and counseling to their customers regarding logistics
problems” is the eleventh ranked Improvements factor with a mean value of 3.83, “Insurance – if any
damage” is the twelfth ranked Improvements factor with a mean value of 3.83, “Proper records
maintenance” is the thirteenth ranked Improvements factor with a mean value of 3.80, “Timeliness” is the
fourteenth ranked Improvements factor with a mean value of 3.76 and “Order fulfillment quality” is the
fifteenth ranked factor with a mean value of 3.74.

Suggestions
1. A first set of solutions that need to be developed are solutions that improve the customer relation in the
sales cycle. A first solution (“guided solutioning”) is a set of questions, which helps the sales staff to
systematically ask questions to identify the customers' needs, before the salesperson proposes a particular
solution. This enables the sales representatives to spend time on a smaller number of opportunities. The
next solution is to increase logistics knowledge, ensuring that a combination of the technical knowledge
about the services provided is achieved, with the objective of reducing the necessity of involving other staff
members in the procedures. Moreover, if the sales representatives can exhibit detailed information about the
logistics solutions, it will be easier to convince the customers and correspondingly customers will have
more confidence in the service.

2. The logistic services providers should include sales policies in their IT framework. When policies such as
minimum acceptable prices or minimum acceptable margins are defined, the IT framework triggers a work
flow to a sales manager to approve it. The tool will guide salespersons into the acceptable price and margin
range so that the sales manager will not have to be involved. This enables considerable timing savings from
both the sales manager and customer perspective.

67
3. The “on-time delivery” factor is very important in logistics industry, so companies must assure that they
have enough and stable modes of transportation in order to keep the punctual delivery commitment. They
should sign a long-term contract with carriers so that cargo will not be abandoned in peak season.

4. “Track and trace” is a vital tool for customers to obtain information of their cargo. Almost every logistics
firms all over the world have this tool; on the contrary, majority of Mumbai companies do not even have
their own website. “Track and trace” is so convenient that it helps to reduce extra communication between
customers and companies. Both sides will easily take the initiative and save time.

5. Building brand image is a difficult task, which cannot be completed in one day but in a long term through
consistent marketing campaigns. Among them, logo and slogan are the first two things that enterprises
must consider. They can be printed on all transportation modes, envelops, uniform, gift for clients
(raincoats, hats, pens, notebooks…) so that customers can recognise and memorise company’ image easily.
Besides, staff uniform is another way to promote company’s image. Not only should it be neat, polite and
discreet, but it also should demonstrate unity and professionalism. Employees must feel comfortable to
wear it too so that they can effectively work and communicate with clients. The colour should be well-
harmonised and catches good impression from customers.

6. Findings from this paper provide facts on how prevention can be implemented in logistics. The results
give practitioners in the supply chain management and marine cargo insurance industry a deeper
understanding of current transportation risks and how to address them by creating innovative value added
services to differentiate logistics and insurance solutions effectively from competitors. A lot of cargo
damage occurs due to negligence, lack of knowledge, lack of will and people employing shortcuts to save
costs. Ensuring that the shipment destined to a location arrives in a good, safe and sound condition means
that all parties involved in the shipment must exercise due diligence and follow best practices in terms of
packing, stowage, movement and documentation of the cargo.

7. World-wide, high-resolution (i.e., down to street levels) self-contained localization of containers, trailers
and other transportation vehicles based on satellite or mobile phone networks featuring a real-time
positioning and tracking. Sensor technology that is capable to monitor temperature, humidity, shocks and
gases inside the containers or transport vehicles, and which records the conditions in dedicated intervals.
Motion and light detectors as well as door sensors improve transport security and contribute to threat
protection. Communication systems that allow sending sensor and positioning data in case of an exception
or alarm. Communication is usually carried out by common mobile phone network derivates or satellite
networks. Server or integrated enterprise applications receive the data packages and visualize the raw data
user-oriented in web-based portals.

68
8. Motivate employees: Leaders must help employees realise that the work they are doing is totally suitable
for their expertise as well as skills, and can help them develop their future career. It also makes important
contributions to the development of the business. Besides, managers must know how to reward employees
in order to motivate them. Train and coach employees: Organise training sessions that help employees
understand better the importance and benefits of customer care service. Employees must master and apply
both specialised knowledge and soft skills to satisfy customer. In addition, attitudes and behaviour of the
employees must always be gentle, considerate, courteous and professional. Businesses need to connect both
customer care culture and corporate culture together to create a long-term sustainable development.

9. In terms of research and development, the main area of innovation is based on the development and roll-
out of information and communication technologies (ICT), which have the capacity to impact
organizational structure, firm strategy, operational procedures and buyer-supplier relationships. In this
regard, efforts towards ICT-enabled innovation should be promoted. After all, the implementation of new
ICT and complementary investments can lead to innovations, and innovative firms are more likely to grow.
Policy makers should envisage the creation of lead programs in fields of excellence such as logistics and
transport. Developing standards for e-business, facilitating the process of interoperability: Standards allow
reducing transaction cost and increasing competitiveness and interoperability. Policy measures may include
active dialogue with industry on challenges in formation of value networks and potential barriers.

10.Document automation enables the optimisation of information communication. If the sales

representative can use IT do automatically generate and transfer all the bidding documents required, error
rates and process times decrease.

11.Apply Just-in-time (JIT) management method so as to reduce all extra costs and deliver goods on time.
JIT method helps to move material into manufacturing process, warehouse or to the customer just in time to
be used. This concept has appeared for a long time but it seems that local firms still underestimate its
importance. However, if they manage to handle it successfully, there is no doubt that service quality and
customer loyalty will be improved significantly.

12.The insurance companies whenever framing new health insurance products or modifying existing health
insurance products should consider these factors from the perceptive of their clients. Similar schemes
COBRA should be introduced in the Indian health insurance sector. As health insurance policies are
categorized according to the states in the USA, a similar kind of categorization should be done in India
which will lead to better services. Besides adding customer value the technology improves internal
processes of each company’s value chain as well. The insurance companies can further optimize their risk
portfolio including the new given transparency into the police management and in terms of risk transfer.
Higher resolution concerning cargo conditions also helps to speed up the claims management process. For

69
logistics companies the proposed solution has the potential to optimize e.g. asset management or the whole
product management such as better coordinated timetables between air or ocean freight and land
transportation.

13.A portal should be designed by logistics service providers to facilitate handling online grievances of
individual exporters. They can provide free technical training in packaging of goods and documentation of
export trade. Logistics service providers should conduct more seminars / classes / meetings to educate
exporters regarding the recent development in logistics management. It can also help the exporters to
promote their business ideas and comply with statutory formalities. Besides, a Customer Care program
should be developed. For each customer an account should be created when he/she uses a logistics service.
The LSP should record client details in a Customer Relationship Management (CRM) database. Besides,
the company needs to encourage ideas, suggestions and observations from all staff and establish an
anonymous staff suggestion box. Review recruitment practices to ensure the company employs the right
front-line staff.

14.Customer demand is the application of information technology (IT) to the enterprise. IT is growing
strongly all over the world and helps to handle the job efficiently. The software helps to create and process
documents quickly, accurately and systematically so that it will prevent errors causing losses for customers
and carriers, and ultimately reduce the cost of management, personnel and time for business. The entire
operation is computerized and avoid the loss of information; thereby improving the quality of services and
global competitiveness. Some examples to consider are Transportation management system (TMS),
Warehouse management system, etc.

15.Planning and upgrading infrastructure are the most important priorities. Logistics operations cannot
develop if infrastructure, ports, warehouses, etc. are not invested properly. Therefore, the government
should improve infrastructure to meet the rising needs of logistics, reduce logistics cost and increase
competitiveness for Mumbai freight forwarders. The narrow road system and traffic jams everywhere are
one the worst problems at the moment.

16.The government should complete the implementation of e-customs to speed up the procedures. Besides,
investing in modern equipment such as container scanners, baggage scanners, surveillance camera systems,
the tool support, etc. can help shorten the waiting time for enterprises and avoid cargo congestion. It is very
essential to increase the handling of cargo traffic in the Port. With rising consumer demand and the
resulting growth in global trade, the role of infrastructure support in terms of rails, roads, ports &
warehouses hold the key to the success of the economy. In this section we provide a quick overview of the
status of the logistics infrastructure in India and the current initiatives, both private and public, in that area.

70
17.The government should consider using financial incentives to promote the logistics development. The
government’s leadership in Mumbai should provide subsidies for critical logistics infrastructure
development. These subsidies should not come with conditions that interfere with business operations.
Investment in logistics parks should come from the private sector, and foreign investments should be
encouraged. A special fund for inland waterway transport infrastructure development should be set up.
Bonds, fees, and special central government allocations are possible source of funding. Since logistics
enterprises should be the main driver of logistics industry development, government should create
incentives, such as tax relief and funding assistance, to support the logistics industry, based on actual needs.

18.Industry associations should encourage collaboration among members on the basis of each business
advantage (facilities, equipment, information systems ...) and to perform full service. The government
should encourage public-private partnership to build and maintain ports.

19.The logistics of physical items usually involves the integration of information flow, material handling,
production, packaging, inventory, transportation, warehousing, and often security. The complexity of
logistics can be modeled, analyzed, visualized, and optimized by dedicated simulation software. The
minimization of the use of resources is a common motivation in logistics for import and export.

Conclusion
Shipping industry is a vital part of the global logistics (Freight Transportation) system. The shipping
industry accounts for transporting 90% of the import and export of the world trade. It is the most affordable
and efficient mode of logistics (Freight Transportation) compares to cost of rail, road and air transport. To
provide high-quality services, Logistics Service Providers must first understand customers’ needs and
expectations. In this study, the service quality scale of logistics providers in Mumbai is conceptualized by
five dimensions: tangibles, reliability, responsiveness, assurance and empathy. The empirical results show
that the expected values of customers are considerably different from the perceived values, indicating that
customers are not satisfied with the service quality of logistics providers. Besides, this study also finds that
Logistics Service Quality is a process, where customers’ perceptions begin to form and develop from the
order placement to service completion, and they may place difference emphasis on the service quality.
Therefore, Logistics Service Providers should pay more attention to the Customer focus quality, Order
fulfillment quality, Timeliness, Information quality, Corporate image, Protecting the goods without
damage, Safety and security, Staffs attitude and behaviour, Handling customers’ complaints, Modern
Equipments and facility, Proper records maintenance, Delivery of goods’ properly, Insurance – if any
damage, Personalized attention and Proper guidance and counseling to their customers regarding logistics
problems. Furthermore, Logistics Service Providers need to invest in ICT (Information and Communication
Technologies) to improve information flow management both internal.
71
 BIBLIOGRAPHY AND ANNEXURES

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Annexures
1. Name of the Organisation ________________

2. Type of Industry____________

3. Products Used________________

4. Size of the company

Small____ Medium ____ Large ____

5. Number of years experience in the industry

Below 5 years____ 5 to 10 years____ Above 10 years____

6. Nature of Service

Domestic____ International____

7. Main Service/Trading Region /countries

Asia____ USA____ Europe____

8. Type of Ships

Coastal Ships_____ Foreign Ships_____

9. Frequency of Voyage per year

Below 3 times____ 5 times____ Above 5 times____

10.Which logistics factor is more important? Rate the given variables at five point scale.

(VHI – Very Highly Important, HI – Highly Important, N – Neutral, NI – Not Important, NAI – Not
at all Important)

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Sr. No. Factors VHI HI N NI NAI
1 Price
2 Delivery
Speed
3 Service
Attitude
4 Range of
Services
5 The
problem
handling
capacity
6 Service
Reputation
7 Service
Security
8 Order
Tracking
Information

Part Two – Logistics Service Quality

Rate the given Logistics Service Quality variables at five point scale on two dimensions namely

(E-Expectation; P-Perception) (SA-Strongly Agree, A-Agree, N-Neutral, DA-disagree, SDA-

strongly disagree)

78
Sr. No. Tangibility SA A N DA SDA
1 Proper safety E
and security P
in deliver of
goods (Protect
the goods)
2 Number of E
branches with P
wide network
(Office)
3 Modern E
equipment / P
technology
utilized for
handling the
goods
(Loading and
Unloading)
4 Application of E
IT and EDI P
systems for
Logistics
customer
service
5 Staffs – E
Competence P
Quality

79
Sr. No. Reliability SA A N DA SDA
1 Reliability E
of order P
information
2 Timeliness E
of shipment P
pickup and
delivery
(Shipment
tracking
capabilities)
3 Providing E
services P
without
problems or
Delivering
Goods
without
damage
4 Providing E
accurate P
Information
/ service
5 Service E
time P
available
fits to
customers’
needs

80
Sr. No. Responsiveness SA A N DA SDA
1 Employees E
attitude and P
behaviour for
meeting
customers’
satisfaction
2 Employees E
attitude and P
behaviour for
meeting
customers’
satisfaction
3 Providing cargo E
intimation service P
to customers
regarding
position /
conditions of
cargo through
service portals
(IT innovations),
Softwares, Mobile
Applications,
SMS and Mail.
4 Solving the E
problems in least P
possible time.
5 Responsiveness to E
customers’ needs P
and requirements

81
Sr. No. Assurance SA A N DA SDA
1 Company’s E
record in terms P
of
professionalism
and
consistency in
achieving
customers’
requirements.
2 Socially E
responsible P
behaviour and
concern for
human safety.
3 Making the E
customers’ feel P
secured about
the service.
4 Company’s E
reputation for P
matching
words with
action.
5 Employing E
designated P
staff’s with
expertise

82
Sr. No. Empathy SA A N DA SDA
1 Providing E
attractive P
promotion
2 Making E
customer feel P
relieved with
individual
designated
attention
3 The staff’s are E
knowledgeable, P
respectful and
polite.
4 Understanding E
customer needs P
and
requirements
5 Consistency in E
order to handle P

83
Sr. No. Customer SA A N DA SDA
Satisfaction
1 We are
delighted
with the
overall
logistics
service and
relationship
with the
service
provider
2 We wish
more of our
service
providers
were like
this one

84
Sr. No Customer SA A N DA SDA
Loyalty
1 Consider
this service
provider
your first
choice
2 If all the
other
attributes
are similar
(price,
product
quality), we
will always
seek for this
service
provider for
their
logistics
service

85
 Part Three – Problems

Rate the given statements at five point scale

(SA-Strongly agree, A-Agree, N-Neutral, DA-disagree, SDA-strongly disagree)

Sr. No Problems SA A N DA SDA

1 Staff not Co-
operative (Non-
Competent)
2 Delay in product
delivery time.
3 Tracking Issues
4 Protection of product
5 Advance information
systems
6 Handling the
customer complaints
(Delay)
7 Advance equipments
8 Difficulties in
Communicating with
service provider and
problems with the
process.
9 Efficiency in the
requisition
procedures (request)
10 Employees’ capacity
to solve problems

86
 Part Four – Improvements

Rate the given statements at five point scale

(SA-Strongly agree, A-Agree, N-Neutral, DA-disagree, SDA-strongly disagree)

Sr. No. Improvements SA A N DA SDA

1 Customer focus quality

2 Order fulfillment quality

3 Timeliness
4 Information quality
5 Corporate image
6 Protecting the goods without
damage

7 Safety and security

8 Staffs attitude and behaviour

9 Handling customers’ complaints

10 Modern Equipments and facility

11 Proper records maintenance

12 Delivery of goods’ properly

13 Insurance – if any damage

14 Personalized attention

15 Proper guidance and counseling

to their customers regarding
logistics problems

87