FACTORS AFFECTING THE SERVICES QUALITY AND REPURCHASE INTENTION

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International Journal of Civil Engineering and Technology (IJCIET)
Volume 9, Issue 11, November 2018, pp. 270–287, Article ID: IJCIET_09_11_027
Available online at http://www.iaeme.com/ijciet/issues.asp?JType=IJCIET&VType=9&IType=11
ISSN Print: 0976-6308 and ISSN Online: 0976-6316
© IAEME Publication Scopus Indexed
FACTORS AFFECTING THE SERVICES
QUALITY AND REPURCHASE INTENTION
Nugroho Bani Ismoyo*, Djumilah Hadiwidjojo, Fatchur Rahman and Mintarti Rahayu
Management Science Department, Economic and Business Faculty, Brawijaya University,
Malang, Indonesia
Corresponding author*
ABSTRACT
This study aim is to examine the factors effecting the consumer satisfaction and
repurchase intention. The population is consumer from all 22 branches of One Mart
mini market in Bengkulu Province. Samples are 200 respondents. Data were collected
using a five-point Likert scale. The data analysis tool used is Structural Equation
Model (SEM) using AMOS 22 software. The research shows the following results.
First, service quality does not affect on customer satisfaction. Second, good service
quality affects on customer value. Third, good customer value affect on customer
satisfaction. Fourth, customer satisfaction does not affect on repurchase intention.
Fifth, good customer satisfaction affects on brand choices. Sixth, a good brand choice
affect on consumer repurchase.
Keywords: consumer satisfaction and consumer repurchase
Cite this Article: Nugroho Bani Ismoyo, Djumilah Hadiwidjojo, Fatchur Rahman
and Mintarti Rahayu, Factors Affecting the Services Quality and Repurchase Intention,
International Journal of Civil Engineering and Technology, 9(11), 2018, pp. 270–287.
http://www.iaeme.com/IJCIET/issues.asp?JType=IJCIET&VType=9&IType=11
1. INTRODUCTION
Retailer's marketing strategies such as advertising and promotion can affect the consumer
decisions to shop. Marketing strategies can also affect the consumer's view to choose retail
stores and improving the image of retail stores. Satisfied consumers will return to shop and
become, but otherwise, unsatisfied consumers will switch to other retail stores because of low
quality of product or the service quality (Engel et al., 1995). Retail stores should create
customer satisfaction, it is expected that customers make repurchase intention and not switch
to other stores. Quality of products and services, customer satisfaction, and profitability of
company are three things that closely related. Higher goods and services quality will increase
the level of customer satisfaction (Kotler, 2009).

Nugroho Bani Ismoyo, Djumilah Hadiwidjojo, Fatchur Rahman and Mintarti Rahayu
Higher income or purchasing power of people is the most important factor to makes
consumers switch to modern retail stores such as mini markets, supermarkets and
hypermarkets (Bank Indonesia, 2003a). Definition of modern market in according to
Presidential Regulation of Republic of Indonesia No. 112 of 2007 on shopping malls and
stores Modern Chapter 1 chapter 1 Verse 5 is "modern stores are self-service retail shops,
selling various types of goods in retail form of mini markets, supermarkets, department
stores, hypermarkets or wholesalers in form of large transaction".
One Mart is most developed retailer in all of Bengkulu Province. It has different names
everywhere. Consumers do not know that a mini market with a different name is still a One
Mart branch that prioritizes prices, services and completeness of items compared to other
mini markets. Kotler (2009) said that marks are the names, terms, signs, symbols, designs or
combinations of them to identify the goods and services of a seller or sales group to
distinguish them from competitor's goods.
The goods should not only enough to meet the needs and desires of user but more
concerned with how to establish long-term relationships with customers (Veluotsou et al.,
2002; Morgant and Hunt, 1994: Grönroos, 1994). Long-term relationships with customers
have an important meaning to attract customers and building close relationships to achieve
economic goals relationship (Grönroos, 1994). The long-term relationship between the
customer and producer based on customer-oriented business (Tse, et al., 2003; Spake et al.,
2003; Zeithaml et al., 1996).
Customer satisfaction is affected by service quality as one main concern regarding to the
effect on repurchase intention (Choi and Kim, 2013; Hellier et al., 2002; Spais and Vasileiou,
2006). Service quality is a long-term process and cannot be achieved easily by company.
Grönross (2004) argued that customer value was the deepest source of confidence in
customer's importance and this creates a perception of honesty, fairness and willingness to
improve customer satisfaction. Hellier' et al. (2002), Hu et al. (2010), and Spais and Vasileiou
(2006) proved that service quality has a positive and significant effect on customer value.
Other studies of Choi and Kim (2013) proved that perceived quality has a significant effect
on three dimensions of customer value of: 1) perceived functional value; 2) perceived
emotional value, and; 3) perceived social value.
The description above shows many factors affecting customer satisfaction and repurchase
intention. Therefore, this research will examine the effect of service quality and customer
value on customer satisfaction. In addition, it also examines the effect of customer
satisfaction and brand choice on repurchase intention.
2. THEORETICAL REVIEW
2.1. Service Quality
Parasuraman et al. (1988) defined service quality as the difference between the reality and
expectations of customers for services they receive. Customers' expectations are basically the
same as what services the company should give to them. Customers' expectations can come
from information delivered by word of mouth, personal needs, past experience, and external
communication (advertisements and various other forms of corporate promotion).
Zeithaml (1988) said that service quality is a component of brand value; therefore high
service quality will encourage consumers to prefer these brands compared to competitors.
Hellier et al. (2003) and Spais and Vasileiou (2006) also suggest that service quality is as a
whole consumer assessment on all attributes of service products.

Factors Affecting the Services Quality and Repurchase Intention
2.2. Customer Value
Kotler (1994) explained the customer value as the customer's assessment on quality of goods
and services as a whole for superiority of a service or product that often inconsistent.
Therefore, customers use intrinsic cues (output and service delivery) and extrinsic cues
(complementary elements of service) as reference.
McDougall and Levesque (2000) said that customer value is the difference between the
benefits received and costs incurred. Values are very personal and may vary from one
customer to another. Customer value is benefit the customer receives in relation to total cost
(including the price paid, time sacrificed, energy and other costs associated with purchase).
2.3. Customer Satisfaction
Customer satisfaction is defined as a post-consumption evaluation to the chosen alternative to
meets or exceeds expectations (Engel et al., 1993). The hope confirmation model developed
by Oliver (1993) stated that overall satisfaction is determined by a discrepancy of
expectations, namely a comparison between perceived performance and expectations.
Gerson (2004) suggested that customer satisfaction is the perception of consumers that
their expectations have been met or exceeded. Satisfied customers will do more and more
business with you. More satisfied the consumer will spend more money. Usually it will get
more benefits; they will buy more all the time and will buy more often.
2.4. Brands Choice
A brand may be defined as a name, term, symbol or the combination to mark the goods or
services of a seller or group of sellers and to distinguish them from items produced by
competitors (Kotler, 2000). Brand choice was defined as consumer consideration based on
degree of consumer tendency to product given by company when compared with products of
other companies (Hellier et al. (2003) and Spais and Visileiou (2006)).
Kotler and Keller (2009) argued that brand also has a personality. The consumers define
brand personality as a specific mix of innate human traits owned by a particular brand.
Brands contain emotional bonds with consumers. To build a good brand, marketers should
understand the uniqueness of brand. One unique thing that brand owners have is the brand
personality. Brand personality becomes a kind of differentiator to makes it unique and easy to
remember by others. To differentiate the products produced by competitors, company added
personality values to brand. So the function of brand is not just a description of product,
brand is the personal representative of its users, and brand of change from instrumental to
symbolic that can express the user (Rangkuti, 2008).
2.5. Repurchase Intention
Repurchase intention can also be called purchasing intention. Repurchase intention can be
interpreted as consumer behavior that only buy a product repeatedly, without including the
aspect of feeling in it (Dharmesta, 2003). Espejel et al. (2007) said that purchase intention is
the future projection of consumer behavior that will shape the consumer attitudes.
Repurchase is one of behaviors after the previous purchase is based on satisfaction. The
satisfied customer will show a higher buying intention in next opportunity (Kotler, 1997).
Swastha (1997) said that repurchase intention is an attitude of consumer behavior that
only buy a product / service repeatedly without including favorite aspect in it. Therefore,
created consumer loyalty is a commitment to a certain brand or product, store, or a company

based on a positive attitude that is reflected in a consistent repurchase intention. Repurchase
affected by attitude of others, advertising, price and expected benefits (Private, 2003).
3. HYPOTHESES
3.1 The Effect of service quality on customer satisfaction
Hillier et al. (2003) said that service quality is an overall consumer assessment on product
attributes. Parasuraman et al. (1985) suggested that service quality is determined by
difference between expected service and perceived service. Empirical studies show that
product service quality has a positive effect on satisfaction (Anderson and Sullivan, 1993;
Formal et al., 1996; Spring and Mckoy, 1996). Perception of service quality is created from a
wide knowledge from individual experience in consuming the product. Furthermore,
knowledge is taken into consideration in individuals decision-making with aims to increase
satisfaction.
Spais and Vasileiou (2006) showed that perception of service quality significantly
affected by customer satisfaction. This finding supports the findings of Parasuraman et al.
(1988); Cronin & Taylor (1992); McDougall and Levesque (2000); Selnes Fred (1993) and
Andreassen et al. (1998). Perceived service quality factors as physical appearance
dimensions, reliability, responsiveness, assurance and empathy have an effect on customer
satisfaction.
The opinion and empirical studies above show better service quality increase the tendency
of customer satisfaction. Conversely, worse quality service will decrease the customer
satisfaction. Therefore, the first hypothesis is formulated below.
H1: Service quality affect on customer satisfaction
3.2. The Effect of service quality on customer value
Hellier et al. (2003); Spais and Vasileiou (2006) suggested that customer value is the
assessment of consumers on overall benefits of product based on consumer's assessment of
benefits derived from product provided by mini market and costs or sacrifices to get and use
the product. Sweeney and Soutar (2001); Choi and Kim (2013); Hu et al. (2010) and Sheth et
al. (2001) classify perceived value into four dimensions. They are: 1) emotional value; 2)
social value; 3) functional value, and; 4) quality value.
Previous research Spais and Vasileiou (2006); Fornell et al, 1996; Cronin et al., 2000;
Patterson et al., 1997; McDougal & Levesque, 2000; and Shoki (2012) show that service
quality affects on customer value. Therefore, the second hypothesis is formulated below.
H2: Service quality affect on customer value
3.3. The effect of customer value on customer satisfaction
The customer value is a value pertains to acquisition of customer value from product usage
obtained through value, convenience, technology or access. Engel et al. (1994) said that
consumer motivation to purchases is expressed through the evaluation of two benefits,
namely the functional benefits of product or service purchased as the basis of objective
assessment, and emotional hedonic benefits acquired during the purchase period (before-
while and after).
Functional value can affect customer satisfaction, because it contributes to an increase in
customer satisfaction (Fornell et al., 1996; Bojanic, 1996; Hallowell, 1996). Hellier et al
(2003); Fornell et al. (1996); Cronin et al. (2000); Patterson et al. (1997); McDougal &

Levesque (2000); Wang et al. (2004) showed that customer value affects on customer
satisfaction. This indicates that higher the customer value increase the customer satisfaction.
Conversely, lower the customer value decrease the level of customer satisfaction. Therefore,
the third hypothesis is formulated below.
H3: Customer value affect on customer satisfaction.
3.4. The Effect of customer satisfaction on repurchases intention
Law et al. (2004) argued that consumer purchasing decisions was affected by consumer
experience in previous product purchases. The comparison between the actual performance
and expected performance is a factor to affects the repurchase decision. Furthermore,
consumers who feel that the actual performance of product is equal to or more than expected
will be satisfied. Meanwhile, if the actual performance of products far below expectations,
consumers will feel dissatisfied. This indicates that satisfaction / dissatisfaction affect the
repurchase intention.
Customer satisfaction can increase the purchasing intensity of customer (Assael, 2001).
Physical quality, results quality and physical environment have a positive effect on service
quality, and service quality has a positive effect on customer satisfaction on purchase
intentions (Pollack, 2007). Satisfied customers are more likely to return to organization for
subsequent purchases of products or services (Heskett et al, 1990; Cronin and Taylor, 1992 ;
Anderson and Sullivan, 1993; Mollinari et al., 2008). The relationship between Consumer
satisfaction and repurchase intention differs between low-loyalty consumers and high loyalty
consumers. (Yi and La, 2004). This indicates that higher customer satisfaction will increase
repurchase intention. Conversely, lower the customer satisfaction will decrease the
repurchase intention. Therefore, the forth hypothesis is formulated below.
H4: Customers satisfaction affects on repurchase intention.
3.5. The effect of customer satisfaction on brand choice
Law et al. (2004) argued that repurchase decision by consumers was affected by consumer
experience of previous product. The comparison between the actual performance of product
and expected performance is a factor that to affects the repurchase decision. Hellier et al.
(2003) indicate a causal relationship between the disposition of customer value to brand
choice and desire and customer satisfaction with brand choice and consumer's desire to
repurchase the product from same supplier.
Furthermore, if consumers feel the actual performance of product is equal to or more than
expectation, consumers will be satisfied. Meanwhile, if the actual performance of products
far below expectations, consumers will feel dissatisfied. This indicates that satisfaction /
dissatisfaction affect the repurchase intention. Therefore, the fifth hypothesis is formulated
below.
H5: Customer satisfaction affect on brand choices
3.6. The Effect of brand choice on repurchases intention
Hellier et al. (2003); Spais and Vasileiou (2006) explained the consumer considerations based
on degree of tendency towards products provided by companies when compared to products
from other companies. Furthermore Hellier et al. (2003) indicates the presence of a causal
relationship between the consumer's disposition of brand choice and consumer's desire to
repurchase the product from same supplier. This disposition is described as the difference
between the expectations and actual performance of a brand that may affect the buying

behavior of brand. Higher brand choice can increase the repurchase intention towards the
same brand. This indicates that brand choice affects the repurchase intention. Conversely,
lower value of brand choice decrease the repurchase intention. Therefore, the sixth hypothesis
is formulated below.
H6: Brand choice affects on repurchase intention
The relationship between variables in this study is presented in form of research concept
framework at figure 1 below.
Figure 1 Research Conceptual Framework
4. RESEARCH METHODS
This explanatory research aims to analyze the relationship between one variable and another,
or explain how a variable affects other variables (Ferdinand, 2006). The research design of
this study includes conclusive research design with a causality research because its main
purpose is to get evidence of a causal relationship (Molhotra, 2004)
This research population is consumers of all 22 branch of One Mart mini market in
Bengkulu Province, including Bengkulu City, Kepahiyang Regency, North Bengkulu
Regency and Muko-Muko Regency. The samples are selected by non-probability sampling.
It does not give equal opportunity to each member to be taken as a sample. Data was
collected by purposive sampling. The data collection uses certain considerations with aim to
get more representative data (Sugiono, 2010). The criteria to become respondent in this study
are One Mart mini market customers with following conditions: (1) ever bought at One Mart
mini market more than 3 times in last 3 months from time the research was conducted (2) the
respondent have the opportunity to fill the questionnaire (3) the respondent is free to accept
or reject the survey. There is no kinship, intimidation or prizes in any form that can reduce
the degree of confidence in data quality.
The sample size according to Slovin (1960) was about 100 respondents. Kuncoro (2003)
suggested the sample for structural equation model (SEM) was between 100-200. This study
adds more 50 respondents, the total samples are 250 respondents. After data collected, there
are incomplete 50 questionnaires and only 200 respondents are processed. Every One Mart
mini market branch has the opportunity to take 10 to 12 samples. All the primary data
collected through the questionnaire taken in every branch of mini market One Mart directly
2 3

taken from respondents. The questionnaire measurement uses five point Likert scale from 1
(strongly disagree) to 5 (strongly agree). The collected data was analyzed by AMOS 22
software.
5. RESEARCH RESULTS AND DISCUSSION
Causality analysis is done to know the relationship between variables. It is expected that
causality testing can determine the effect between exogenous variables and endogenous
variables. The full results of each relationship is shown in table 1 below
Table 1 Structural Model of SEM Results
No Variables Relationships Coefficient P-Value Description
1 Customer satisfaction  Service Quality 0.170 0.397 Insignificant
2 Customer value  Service quality 0.630 0.025 Significant
3 Customer satisfaction  Customer value 0.630 0.022 Significant
4 Repurchase intention Customer satisfaction 0.050 0.070 Insignificant
5 Brand choice  Customer satisfaction 0.730 0.024 Significant
6 Repurchase intention  Brand choice 0.860 0.024 Significant
Source: primary data processed, 2015
Table 1 shows the test result for the relationship between independents and dependents
variables. The test results from table above can be explained below.
There is insignificant effect of service quality on customer satisfaction. This means that
the higher value of service quality decrease the consumer satisfaction. The results of service
quality testing with customer satisfaction are evidenced by the estimated value of the path
coefficient of 0.17 in negative direction. The negative path coefficient means that the
relationship between service quality and customer satisfaction is not proven by the critical
point value (CR) of 2003 and the p-value probability value of 0.070 <0.05. Therefore, the
first hypothesis is not accepted. The results of this study support several previous studies such
as: Hellier et al. (2003); Molinari et al. (2011) and Joel, Carmina (2009) who stated that the
service quality does not have a positive and significant effect on customer satisfaction
There is a significant and positive effect of service quality on customer value. This means
that the higher service quality will increase the customer value. It is evidenced by the
estimated value of the path coefficient of 0.63. Positive path coefficient means that the
relationship between service quality and functional value, emotional value and social value is
proven by the critical point value (CR) of 3.683. The p-value probability value is 0.027
<0.05. Therefore, the second hypothesis is accepted. This study results are consistent with
some previous studies of Hellier et al. (2003); Spais and Vasileiou (2006) and Choi and Kim
(2013) that service quality has a positive and significant impact on customer value.
There is a significant and positive effect between customer value to customer satisfaction.
This means that the higher the value of customers, the higher the value of customer
satisfaction. Test results of customer value with customer satisfaction. Testing of customer
value to customer satisfaction is proved by estimate value of path coefficient of 0.63. Positive
path coefficient means that the relationship between customer value and customer satisfaction
is proven by the critical point value (CR) of 5.381. The p-value probability value is 0.020
<0.05. So in this case the third hypothesis is accepted. The results of this study are consistent
with several Hellier studies et al., 2003; Fornell et al, 1996; Cronin et al, 2000; Patterson et
al., 1997; McDougal & Levesque, 2000; Spais & Vasileiou, 2006 and Shoki (2012) that
customer value positively and significantly effect to customer satisfaction.

There is a non-significant and non-positive effect of consumer satisfaction on repurchase
intention. This means that the higher consumer satisfaction decrease repurchase intention. It
is evidenced by the estimate value of the path coefficient of 0.05 with a negative direction.
Negative path coefficient means that the relationship between customer satisfaction and
repurchase is not proven by the critical point value (CR) of 3.903 and the p-value probability
value of 0.397 <0.05. Therefore, the fourth hypothesis is not accepted. These results are
consistent with Andreassen and Lindestad (1998); Colgate et al. (1996); Fornell (1992);
Liljander and Strandvik (1995); Srinivasan (1996); Stauss and Neuhaus (1997); Storbacka et
al. (1994); Hellier et al. (2003) and K. Seiders et al. ((2007) that customer satisfaction does
not affect on repurchase intention.
There is a significant and positive effect of consumer satisfaction on brand choice. This
means that the higher consumer satisfaction can increase the brand choice. It is proved by
estimate value of path coefficient of 0.73 with positive direction. Positive path coefficient
means that the relationship between customer satisfaction and brand choice is proven by the
value of the critical point (CR) of 2.969 and the probability value of p-value of 0.035 <0.05.
Therefore, the fifth hypothesis is accepted. This study results are consistent with Hellier et al.
(2003); Spais & Vasileiou (2006); Bloemer and Ruyter (1998) that there is a significant and
positive relationship between consumer satisfaction on brand choice
There is a significant and positive effect of brand choice on repeat purchases. This means
that the higher brand choice value can increase the repurchase. It is proved by estimate value
of path coefficient equal to 0.86 with positive direction. Positive path coefficient means that
the relationship between brand choice and repurchase intention is proved with value of
critical point (CR) equal to 3.115 and p-value probability of 0.036 <0.05. Therefore, the sixth
hypothesis is accepted. This study results are consistent with Hellier et al. (2003); Ayu and
Haryanto (2009) that the higher brands choice can increase the repeat purchase.
6. CONCLUSIONS AND RECOMMENDATIONS
The structural model testing for six hypotheses are all accepted. Based on formulation of
problem, the conclusions are described below.
1. Service quality has no effect on customer satisfaction. Higher service quality will
decrease the level of customer satisfaction.
2. Service quality affects on customer value. Better service quality perceived by
consumers through availability of goods, prices, services and convenience to shop,
will increase the consumers satisfaction and will shop again at all branches of One
Mart mini market.
3. Customer value affect on customer satisfaction. Better customer value, such as the
atmosphere when shopping, benefits felt when shopping, and convenience when
shopping, will increase customers satisfaction and will repurchase at One Mart
mini market.
4. Customer satisfaction has no effect on repurchase intention. Higher level of
customer satisfaction will decrease the repurchase intention.
5. Customer satisfaction affects on brand choice. The higher level of consumers
satisfaction for the facilities and atmosphere when shopping will increase branch
choice in minds of consumers.
6. Brand choice affect on repurchase intention. Easiness for consumers to find daily
needs, ease of shopping and a good reputation will increase the repurchase
intention.

This research has several weaknesses that need to be improved in future research. First,
self-filling questionnaires by respondents has potential of common bias response. Future
researchers can improve it by using a better method, as 360 respondent. Second, this
research was examined only from consumer side. This limits information from one party
only. The other party also needs to be investigated, as from employee side.
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