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It.According to TCVN 5814-1994, based on ISO-9001/2015 standard, the definition is given: "Quality is a set of characteristics of an entity object that gives that entity the ability to s
1.1 Theoretical basis of service quality 1.1.1 The concept of service, service quality 1.1.1.1 Service In today's world, the economy is not simply made up of specific physical products, but also includes service products Services are considered a smokeless industry In developed countries, the proportion of services in gross national product is often very high - Marx said: "Services are the offspring of the commodity production economy When the commodity economy develops strongly, it requires a smooth, fluid, and continuous circulation to satisfy needs As people's values grow higher and higher, services develop more and more." Thus, by approaching from an economic perspective, Marx pointed out the origin and development motivation of services As the economy develops, the role of services becomes increasingly important and services have become the subject of research in many different disciplines: From economics to cultural studies, law, from administrative studies to science study management Therefore, there are many concepts of service in different broad and narrow senses - In a broad sense: services are considered a third economic sector With this understanding, all economic activities outside the two sectors of agriculture and industry are considered to belong to the service sector - In a narrow sense: service is understood as product software, supporting customers before, during and after consuming the product Thus, it can be defined in the most general way: Services are social activities, creating goods that not exist in a specific physical form, not lead to the transfer of ownership to satisfy customers Timely satisfaction of production and daily life needs of people The broad and narrow conception of services depends on the one hand on the level of economic development of each country in a specific historical period, and on the other hand it also depends on the economic methodology of each country nation Within the scope of this topic, services are considered a field of activity of the national economy that includes all activities serving production and population life In this sense, service activities include commercial activities Because of its particularly important position and unique characteristics, commercial activities are often separated from the service category and considered equal to service activities But in this topic, trade - services are considered as an economic sector that carries out the process of circulating and exchanging goods and performing work to serve the consumption of production and population in the market 1.1.1.2 Service Quality Service quality is viewed as the gap between customers' expectations and their perceptions after using the service Service quality is the ability of a service including overall durability, reliability, accuracy, ease of operation, ease of repair and other valuable attributes to perform its functions It According to TCVN 5814-1994, based on ISO-9001/2015 standard, the definition is given: "Quality is a set of characteristics of an entity (object) that gives that entity the ability to satisfy requirements." stated or implied demand” In summary: Service quality is the level of customer satisfaction in the process of perceiving service consumption, bringing a chain of benefits and fully satisfying the customer's expected value in production and supply activities response and in service delivery at the output Because service quality is related to customers' expectations as well as their perceptions of the service, service quality is difficult to evaluate Usually there are three basic levels of assessment of service quality: - Service quality is good when customers perceive the service to exceed their expectations their - Service quality is satisfactory when customers perceive it to be consistent with their expectations - Poor service quality is when customers perceive their expectations for the service to be below their level Therefore, to retain customers, businesses must ensure that their services are always evaluated from satisfactory to good Only then can businesses survive and develop sustainably 1.1.2 Dimensions of Service Quality Tangibles According to Khan & Fasih (2014, after, Blery, Batistatos, Papastratou, Perifanos, Remoundaki & Retsina, 2009), tangibles are seen to be perceptible by touch or a visible existence Information and Communication Technology (ICT), tools, sites, company’s employees and any visible facilities form the tangible dimension of service quality However, these tangibles are applied in various ways by the service providers and are perceived and experienced on different levels by the end users Tangibles are especially important to service delivery firm's as they are crucial variables to developing strong, positive and inspiring customer association and experience, through its proprietary assets (Naidoo, 2014) Reliability The process in which service provider remains faithful in rendering services to its customers can be considered as the reliability dimension of service quality (Khan & Fasih, 2014, after, Blery, et al., 2009) Reliability assures the customer of a service provider’s ability to consistently provide a perceived quality of service Reliability has an impact on trust and the overall impression left in the mind of a customer after service consumption (Abd-El-Salam, et al., 2013) The reliability dimension of service quality is vital and perceived through the people aspect of service quality (Kaura, et al., 2012) Assurance Khan & Fasih (2014, after, Blery, et al., 2009), states that the process of acquired knowledge being showcased by staffs in executing their term of preferences during service delivery can be highly assuring to customers This gives customers the confidence that the service delivery representative will perform his/her duty professionally and ethically Naidoo (2014) argues that not all customers have the expertise to understand the quality of service and values they received, and as such may require effective communication or personal explanations to understand the value they receive This service quality dimension is performed through the people aspect of service quality (Kaura, et al., 2012) Empathy Khan & Fasih (2014, after, Blery, et al., 2009) state that empathy is the ability for service delivery firms to pay attention to individual customer problems and demands, then address these issues effectively Khan & Fasih (2014, after, Blery, et al., 2009) also argues that the way the company takes responsibility to address problems faced by their customers on an individual or group level is classified as empathy This service quality dimension is perceived through the people aspect of service quality (Kaura, et al., 2012) Responsiveness The process in which service providers react quickly to resolve customer problem positively within a given time is called responsiveness (Blery, et al., 2009) This dimension of service quality is perceived through the people aspect of service quality However, information technology advancement like emails, webpage and customer service interface improves the responsiveness of service delivery firm (Kaura, et al., 2012) 1.2 Theoretical basis of the delivery of Fast-Moving Consumer Goods 1.2.1 Concept and classification of fast-moving consumer goods 1.2.1.1 Concept FMCG is the fast-moving consumer goods industry, a sector defined by products that sell quickly at relatively low costs This means that fast-moving consumer goods companies rely heavily on profits based on the volume of goods sold The more products sold and the faster they are sold, the greater the profit For large manufacturers, hundreds or even thousands of products can roll off the production line in a minute The fast-moving consumer goods industry is often classified into four sectors as follows: Household appliances, personal consumption items, food and beverage, and basic healthcare items From the consumer's perspective, fast-moving consumer goods products are relatively cheap and essential for daily consumption, such as food, beverages and other household necessities This means that fast-moving consumer products must always be available in stores and markets near residential areas Usually large fastmoving consumer goods companies not sell directly to users but use a network of retailers to provide products to customers Thus, there will be many supply services to transport goods from manufacturers to distributors, from distributors to retailers to customers Because the sales volume of this industry is high with a large network of retailers, distribution is a very important and valuable operational step Supply management is always under heavy pressure to minimize costs in this stage 1.2.1.2 Classification We can see that fast-moving consumer goods are a group of goods that cannot be repaired when damaged or have a short lifespan and are consumed at a rapid pace Fast-moving consumer goods currently include the following groups: + Processed food group: includes products such as cheese, cereals, canned noodles, + Prepared meals: are meals that have been prepared + Beverages: Including bottled water, bottled purified water, soft drinks, fruit juice, + Fast food: Biscuits, toast, etc + Frozen foods, fresh foods and dry goods: Including green vegetables, fruits, beans, frozen carrots, nuts and dried grapes, etc + Medicines: Including pain relievers or other medicines that can be purchased without a prescription + Cleaning products and chemicals: Such as floor cleaner, baking soda, glass cleaner, + Cosmetics and personal items: Lipstick, powder, skin and hair care products, toothpaste, toothbrush, soap, + Stationery: Ruler, pencil, eraser, crayons, chalk, board, 1.2.2 Factors affecting the fast-moving consumer goods industry For the FMCG industry, the sales speed of products in this industry will be affected by many different factors We can mention some factors affecting the FMCG industry as follows: Packaging and wrapping This is one of the important factors affecting FMCG In order to attract the attention of consumers and sell to the market in large quantities, FMCG product packaging needs to be designed in the most creative and impressive way while ensuring hygiene born In addition, a quality packaging also contributes to protecting the product, prolonging the product's shelf life and providing product-related information to consumers Profit and price of the product On each product of the FMCG industry there will be a small profit However, if a large quantity is sold, the profit will be very high Nowadays, people working in the fast-moving consumer goods industry are often under increased pressure to bring products to market quickly From there, it shows that the product is being greatly affected when the deadline is pushed forward faster Development of the Internet Nowadays, internet information technology is increasingly developing and it affects the rise of the brand community phenomenon and boosts FMCG demand Consumers are also using the internet to shop online in large and increasing numbers However, most FMCG products cannot be ordered online Because most customers seek the convenience of stores that provide FMCG products closest to them 1.2.3 Fast-moving consumer goods industry trends 1.2.3.1 Consumption trends in the FMCG industry - Consumers are more strict in choosing products With the increasing quality of life, consumers gradually tend to pay more attention to each product in terms of quality, food hygiene and safety, In the FMCG industry market, consumers have more and more choices, demand is also increasing and leading to higher competition Therefore, manufacturers as well as FMCG store owners need to have specific directions and come up with the most suitable business strategies - Purchasing power is increasing due to the epidemic situation According to statistics, in two big cities Hanoi and City In Ho Chi Minh City, online shopping users increased due to the complicated epidemic situation and demand Among them is the middle class with relatively high consumption and paying ability Along with that is a clear rapid increase in both rural areas as well as other cities Besides, with the current epidemic situation, the demand for essential goods is also increasing Due to the implementation of the solution, people's need to hoard goods is increasing The supply of goods also faces many difficulties for FMCG businesses today Therefore, this is an opportunity to present business in this market, to rebalance the supply and demand of goods for consumers With the current situation, it is certain that the online consumption trend will gradually become a major trend in Vietnam thanks to its convenience and perfect response to the consumption needs of Vietnamese people - Gradually switch to safe consumption at home Due to the current Covid epidemic situation, takeout is gradually being replaced by cooking at home And of course food safety and hygiene are always top priority Packaged products or clean foods, dairy products, and essential appliances quickly dominate the FMCG market To match shopping trends as well as consumer needs, enhancing and adding products with high consumption capacity is an extremely important factor for FMCG business owners - Health products are increasing rapidly The Covid pandemic has greatly impacted consumer trends and the ability to consume many products today In the FMCG industry, health products are consumed faster such as masks, hand sanitizer, In addition, the need to use products with vitamins or drugs to increase resistance is also of greater concern 1.2.3.2 Trends driving the FMCG market - Distribution channel strategy must also segment customers (customers have a preference for buying at traditional channels, modern channels or E-commerce channels, then explain modern as supermarkets, convenience stores, vending machines automatic, traditional channels have markets E-Commerce is an online channel (explosive trend due to shopping behavior and preference for online purchasing) - Focus on customer experience - At the distribution point, display style, service attitude, customer's feeling when shopping at the distribution point - Choose suitable and capable distribution intermediaries so as not to affect the brand - Sales trends in the fast-moving consumer goods industry and mobile models Society is in a position to move quickly, promptly, and minimize time Therefore, when the mobile sales business model appeared, it could handle almost all the difficulties 1.2.4 The relationship between the FMCG industry and third-party logistics With the rapid development of Logistics, there are many forms of Logistics such as One-Party Logistics - 1PL (self-sufficient logistics service), Two-Party Logistics - 2PL (Logistics service provider responsible for one step in the chain), Third Party Logistics - 3PL (supplier manages and performs Logistics services on behalf of shippers), 4th Party Logistics - 4PL (manages the entire Logistics process), 5th Party Logistics - 5PL (usually in the field e-commerce sector) However, at present, the relationship between 3PL and FMCG is a very important link in the economy because it promotes the efficiency and advantages of third-party Logistics services, especially in the consumer goods industry Use quickly However, with competition among third-party logistics service providers and growing awareness and increasing customer demand, the supply chain in the fast-moving consumer goods industry is facing challenges big challenge FMCG companies are closely aligned in their views on the role of 3PLs in helping them improve freight density/load utilization, reduce logistics costs, and execute supply chain strategies disruption strategy / supply chain strategy to reduce risk (mitigation strategy), as well as in perfect order processing and sustainable development projects “Sustainability is very important to our company,” says Frits Voortman, supply chain manager at FrieslandCampina We come out with new, improved post-merger sustainability programs, and we'll look to the 3PLs for help.” 1.3 Overview of the delivery of FMCG 1.3.1 Means of transport For FMCG products, the main mode of transportation is still by road Road transport is a method of transporting goods by land vehicles such as cars, passenger cars, trucks, tank trucks, container trucks, trailers, semi-trailers pulling cars… Road transport is the most popular form of transport among all types of transport This type of transport has outstanding advantages such as convenience, mobility and high adaptability to terrain conditions, and is highly economical over short and medium distances Freight transport by road is always proactive in terms of time and diversity in transporting all types of goods However, this form of transport is limited by the volume and size of goods, cannot carry large volumes of goods like water transport, but is quite flexible with goods with small transport volumes too big and small Although it has the highest cost, road transport is considered a flexible form of transport because it can be transferred directly from warehouse to warehouse, from production to consumption, and can operate in all conditions different weather conditions, can meet market commodity requirements… Freight transport plays an important role in goods circulation activities contributing to social development and is the top choice for many shippers who want to move goods within the city and inter-province Road freight transport plays an important role in the growth of the country's economy It also contributes greatly to the budget through many taxes and through the development of accompanying services, creating millions of additional jobs for workers Some road transport services are as follows: - Transporting construction materials: Cement, water pipes, bricks, sand, stone, iron and steel, plaster, furniture, - Transportation of agricultural products: Rice, corn, flour, fresh fruits and vegetables - Transporting industrial goods: textiles, packaging, animal feed, machinery and equipment, - Transporting import and export goods - Transport all types of goods from ports to any location - Long-distance transport, transport of goods in transit - Transporting oversized and overloaded goods - Retail pickup and delivery to all locations 1.3.2 Factors affecting the delivery of FMCG Objective factors Goods delivery activities for FMCG products, like any other form of service business, are affected by many factors, especially objective factors such as the legal environment and the environment politics, weather, characteristics of goods (1) Legal environment: Any change in one of the above-mentioned legal environments such as the promulgation or approval of a circular or decree by the Government in one of the above-mentioned countries; or the ratification or adoption of an international Convention will also have the effect of restricting or promoting freight forwarding activities (2) Political and social environment The political and social stability of each country not only creates favorable conditions for that country to develop but is also one of the factors for other countries and foreign traders to trade and cooperate with each other that country Changes in the political and social environment in the countries involved in forwarding activities will greatly affect the goods delivery process (3) Technology environment Along with the historic progress of the world freight forwarding industry, Vietnamese aviation is also gradually innovating to improve itself, contributing to promoting the development of the young air freight forwarding field (4) Weather Weather greatly affects delivery, receipt and transportation of goods This will affect the speed of processing and delivery time of goods In addition, the air transport process is also affected by weather factors that can cause complete damage or delay delivery, giving rise to economic consequences for the parties involved Due to the above impacts, weather will affect the quality of goods, and is one of the causes of disputes It is also the basis for building a force majeure case and the ability to exempt the forwarder from liability (5) Characteristics of the goods Each type of commodity has its own characteristics For example, agricultural products are perishable and easily change in quality, while machinery and equipment are often bulky, large in volume and size These specific characteristics of the goods will determine how to package, load, unload and tie goods according to proper specifications and suitable for each type of goods to ensure the quality of goods during the delivery and transportation process Besides, each different type of goods with unique characteristics will require different types of documents to certify their qualities and qualities Subjective Factors The delivery of FMCG goods is also influenced by various subjective factors, including infrastructure, equipment, machinery; investment capital; the expertise of organizational management and participation in the process (1) Infrastructure, Equipment, Machinery: The infrastructure and machinery of freight carriers include offices, warehouses, loading and unloading vehicles, transportation, and storage facilities To participate in freight transportation activities, especially in containerized conditions as today, freight carriers need modern infrastructure with advanced equipment and machinery to facilitate cargo consolidation, preparation, and inspection With the rapid development of information technology, freight carriers can manage all their activities and customer information through computer systems and use electronic data interchange (EDI) systems With modern infrastructure and equipment, freight carriers will be increasingly closer to meeting customer needs and maintaining long-term relationships (2) Investment Capital: If the infrastructure and equipment/machinery are incomplete and inadequate, it will pose difficulties and obstacles to the freight receiving process However, to build infrastructure and own modern equipment, freight carriers need a significant amount of investment capital However, freight carriers may not always have abundant financial resources Therefore, with limited financial resources, freight carriers must carefully consider building technical infrastructure efficiently, alongside renting or jointly owning specialized machinery and equipment with other businesses (3) Expertise of Organizational Management and Staff: One factor that significantly influences the import-export air freight process is the expertise of organizational management and personnel directly involved in the process The efficiency of the import-export freight process, which occurs within the shortest possible time to deliver goods to customer-requested locations, depends heavily on the expertise of those directly or indirectly involved in the process If participants have understanding and experience in this field, they can process information quickly Additionally, the quality of goods is ensured due to experience in handling various types of goods Therefore, the expertise of employees is always a primary consideration, as it is a decisive factor in the quality of the freight process and contributes to the credibility and trust of customers 1.4 Theoretical basis for applying the SERVQUAL model to evaluate service quality in FMCG delivery 1.4.1 The overview of SERVQUAL model SERVQUAL scale (Parasuraman et al., 1985:2005) The SERVQUAL model was first published in 1985 by A Parasuraman, Valarie A Zeithaml and Leonard L Berry for measuring and managing service quality on a large scale Wide range of services The authors of this model defined service quality as "the difference between expected quality and perceived quality" Taking the theoretical idea from Gronroos' model (1984), Parasuraman et al (1985) built a mixed measurement tool, called SERVQUAL, to measure perceived service quality The SERVQUAL scale contains 22 pairs of items measured on a Likert scale to separately measure customers' expectations and actual perceptions of service quality In which, the first part: determining customer "expectations" for services in general; The second part: determine the customer's "feeling" about the service performance The research results aim to identify gaps between customer perceptions of the quality of service received and customer expectations for that service quality As follows: (1) Reliability When company xyz promises to something by a certain time, they will it When you encounter an obstacle, company xyz demonstrates a genuine interest in solving that obstacle Company xyz performs the service correctly the first time Company xyz provided the service on time as promised Company xyz takes note to avoid any errors (2) Responsiveness Employees of xyz company let you know when the service will be performed Employees of xyz company quickly perform the service for you Employees of xyz company are always ready to help you Employees of xyz company are never too busy to respond to your requests (3) Assurance The behavior of xyz employees inspires your trust You feel safe while dealing with xyz company Employees of xyz company are always welcoming to you Employees of xyz company have enough knowledge to answer your questions (4) Empathy Company xyz always pays special attention to you Company xyz has employees who care about you Company xyz takes your interests as their top priority Employees of xyz company clearly understand your needs Company xyz works at convenient hours (5) Tangibles Company xyz has very modern equipment The facilities of xyz company look very attractive Employees of xyz company dress very neatly The brochures of xyz company related to the service look very nice From there, the service quality model is built based on analysis of service quality gaps Figure 1.1: SERVQUAL model proposed for research Source: Parasuraman et al (1985) The central focus of this model is the gap or difference (GAP) between customer expectations and their perception of the service, known as satisfaction Satisfaction = Perception – Expectation Based on this difference, customers will feel either satisfied or dissatisfied with the perceived service According to the SERVQUAL service quality model, service quality depends on the gap between customer expectations of the service and the actual perceptions customers have after consuming the product In the SERVQUAL service quality model, there are gaps These gaps represent the difference between customer expectations and perceptions of service quality, where the service in question is transportation The specific details of these gaps are as follows: + Gap (G1): The gap between the business's perception of customer expectations and the customer's actual expectations + Gap (G2): The gap between the business's perception of customer expectations and the quality standards of the service + Gap (G3): The gap between service standards and the actual service that the business provides to customers + Gap (G4): The gap between the actual service quality provided by the business and the service quality communicated to customers + Gap (G5): The gap between the service customers receive and their expectations of the service The goal of service businesses in general, and transportation services in particular, is to eliminate or at least minimize these gaps, especially Gap Additionally, customer expectations of service quality are influenced by external factors such as accessing information from various sources, the individual needs of each customer, or simply the customer's past experiences with services 1.4.2 Survey sample Currently, according to many researchers, the issue of sample size—how much is sufficient—is still not clearly defined Moreover, this sample size also depends on the estimation methods used in the specific study According to some studies, the representativeness of the selected sample size for investigation will be most appropriate if the sample size is at least times the total number of observed variables Thus, n=5*m, where m represents the number of questions in the survey Applying this to the questionnaire design table for the survey, the valid sample size for analysis is: 5*13=65 samples Therefore, within the scope of this research topic, the minimum number of surveys is 65 In this study, a sample size of 140 surveys has been chosen This sample size is entirely reasonable for application and conducting the survey 1.4.3 Research Method To achieve the research objectives and analyze the research model, I have combined both qualitative and quantitative research methods for the study Specifically: Qualitative Research Method + Preliminary research is conducted through qualitative methods involving analysis, evaluation, synthesis of collected materials, and discussions to establish a service quality measurement scale for the delivery of FMCG at Viet Logistics Solutions Co., LTD + Collection and systematization of relevant materials: Gathering and organizing reports, theses, textbooks, reference books to serve as a foundation for constructing the research model on the delivery service quality of FMCG + Analysis and synthesis method: From the collected materials, I synthesized research theories related to the topic, analyzed data from business performance results to establish a basis for analyzing the current state of FMCG delivery at Viet Logistics Solutions Co., LTD + Comparison method: Referencing and comparing research models on service quality to select the model most suitable for the research topic Quantitative Research Method: I employed a survey investigation method using a questionnaire with a target group comprising customers currently using the services of Viet Logistics Solutions Co., LTD 1.4.4 Scale building For the freight transportation service, through interviews and surveys, I adjusted the measurement scale and studied a model with dimensions, including reliability, responsiveness, service capacity, flexibility, and tangibles Additionally, I utilized an identification scale and a ranking scale to screen interview subjects and gather personal information such as customer names, company names, the type of service they are using, and the duration of service usage Table 1.1: Scale to measure customer expectations No Dimension Observed Variable Symbol Reliability Delivery on the agreed lead time in the contract R1 Delivery to the specified location R2 Quick and accurate document processing R3 Delivery of the correct weight and quantity of goods R4 Consistently delivering the right goods R5 No loss or damage to goods R6 Responsiveness Monitoring, updating, and informing customers of cargo status as soon as information is available RP1 Quick response time to customer feedback RP2 Service Capacity Employees' attitude is always friendly, attentive, and quickly receive information from customers SC 10 Flexibility Flexible response to customer needs FL1 Efficient handling and resolution of issues arising during transportation FL2 Modern vehicle equipment, application of advanced technology T1 Company website is easily accessible, providing sufficient information for customers T2 11 12 Tangibles 13 Table 1.2 Scale to measure customer satisfaction No Dimension Observed Variable Symbol Reliability Delivery on the agreed lead time in the contract R1 Delivery to the specified location R2 Quick and accurate document processing R3 Delivery of the correct weight and quantity of goods R4 Consistently delivering the right goods R5 No loss or damage to goods R6 Responsiveness Monitoring, updating, and informing customers of cargo status as soon as information is available RP1 Quick response time to customer feedback RP2 Service Capacity Employees' attitude is always friendly, attentive, and quickly receive information from customers SC 10 Flexibility Flexible response to customer needs FL1 Efficient handling and resolution of issues arising during transportation FL2 Modern vehicle equipment, application of advanced technology T1 Company website is easily accessible, providing sufficient information for customers T2 11 12 Tangibles 13 1.4.5 Data processing method - For secondary data: I conducted analysis, synthesis, comparison, and drew evaluations from the aggregated data on the company's website, business performance results, and cargo output (from the business activity reports of the Vietnam Logistics Solutions Corporation over the last years) - For primary data: Information from the survey forms was encoded, cleaned, and processed using Excel Subsequently, I assessed the quality of the delivery service for FMCG products of the Vietnam Logistics Solutions Corporation as follows: + Used the Average function to calculate the average values of the surveyed variables + Calculated the difference values for each variable using the formula GAP = Perception – Expectation + Calculated the average difference value and compared it with the GAP1 to GAP13 ranges (according to the 13 surveyed variables) Variables with difference values higher than the average indicate areas that need improvement 1.4.6 Model measurement To measure the model, I used a 5-point Likert scale for both the expectation and perception surveys of customers The level of agreement or satisfaction of customers will increase gradually from to Specifically: Evaluation of customer expectations - Strongly disagree - Disagree - Neutral - Agree - Strongly agree Evaluation of customer satisfaction - Very dissatisfied - Dissatisfied - Neutral - Satisfied - Very satisfied 1.5 Conclusion for Chapter In Chapter I, the author provided an overview of the general theoretical foundation regarding the concept, classification, characteristics, and the role of service quality for businesses The chapter outlined the criteria for evaluating the effectiveness of the FMCG delivery method within the enterprise Additionally, it presented an overview of issues related to FMCG and distribution activities This serves as a basis for evaluating the effectiveness of delivery service indicators for Viet Logistics Solutions CO., LTD