Service Quality and Customer Retention in Uganda: A case of Century Bottling Company Limited

Abstract

The purpose of this research study was to establish the effect of service quality on customer retention in Uganda with a case of Century bottling company limited. The study objectives included; to establish the effect of tangibility, reliability and assurance on customer retention. A case study research design was used and a response rate of 85% out of the 95 accessible population was achieved. A population Census, purposive and Simple random sampling techniques were used to select participants from the population of study and the SPSS (statistical package for social sciences) was applied in analysing quantitative data while content analysis was used for analysing qualitative data. For purposes of simplicity, means, standard deviations, frequency tables and bar charts were used to present the findings. The study established a strong positive association between service reliability and customer retention as determined by person correlation coefficient of r=0.910**, a moderate but significant relationship of service tangibility on customer retention indicated by Pearson correlation coefficient of r=0.569** and weak but statistically significant relationship between service assurance and customer retention revealed by Pearson correlation coefficient of r=0.370**. In Conclusion, the service quality dimensions of tangibility, assurance and reliability greatly affect customer retention. This implies that customer retention can be achieved through ensuring clean and well packaged products, using up-to-date communication materials, having responsible Company employees who act professionally and are accessible, good packaging of the products, good work Environment, availability of assorted product mix, right order fulfilment, accuracy and safety of customer transaction records, better problem and complaints handling, offering good business building advice, high level of integrity, professionalism and willingness of staff to listen and help customers besides improving on customer discount margins and ensuring continuous investment in product-service components of the company offerings.