VIET NAM GENERAL CONFEDERATION OF LABOUR TON DUC THANG UNIVERSITY DEPARTMENT OF BUSINESS ADMINISTRATION FACTORS THAT INFLUENCE ON THE LOGISTICS SERVICE QUALITY OF LOGISTICS COMPANIES IN HO CHI MINH CITY Thesis submitted as a requirement for the degree Bachelor of Business Administration Supervisor: MBA. MAI NGUYEN TRUONG SON Student: HUYNH NGUYEN NGOC ANH DAO Student ID: 082674Q Intake: 12 HO CHI MINH CITY, AUG 2012 ACKNOWLEDGEMENT I would like to express my sincere gratitude to all those who gave me the possibility to complete this thesis. I want to thank to Ton Duc Thang teachers in helping me to broaden my view and knowledge. The special thank goes to my helpful supervisor.
I am deeply indebted to MBA. Mai Nguyen Truong Son whose help, stimulating suggestions and encouragement helped me in all the time of research for and writing of this thesis. My grateful thanks also go to the board of director of LOKI Co.,Ltd, along with emloyees of import and export department, enthusiastically helped me from time to time during my intership program in there and my research. Finally, I thanks my friends who always encourage and help me to finished this thesis.
Once again I would like to thank all. LIST OF ABBREVIATIONS EFA : Exploratory Factor Analysis PAF : Principal Axis Factoring OLS : Ordinary Least Square KMO : Kaiser, Meyer and Olkin VIF : Variance Inflation Factor FIATA : International Federation of Freight Forwarders Association IATA : International Air Transport Association BIMCO : The Baltic and International Maritime Coucil ICIAO : International Civil Aviation Organization Re3 : Ensuring in taking care of goods properly Re4 : Delivering goods to right place Re5 : Delivering goods in right time Re6 : Delivering goods in their right quality Tan1 : Meeting the customers’ demand about storage system Tan2 : The readiness of loading and unloading equipment Tan3 : Equipment for packing, marking and sorting goods Tan4 : The readiness of inland transport Re7 : Meeting the customers’ needs quickly Res5 : The capacity of keeping track of goods Res6 : Implementing customs procedures quickly As10 : Understanding regulations in international forwarding As11 : Having a good relationship with carriers LIST OF FIGURES Figure 2. The Integrated Gaps Model of Service Quality (Parasuraman, Zeithaml, Berry 1985) Figure 2. The 10 determinants of service quality (Parasuraman, Zeithaml, Berry,1985) Figure 2.
The model of research Figure 2. Reliability factor Figure 2. Responsiveness factor Figure 2. Tangible factor Figure 2.
Assurance factor Figure 2. Empathy factor Figure 4.5 Types of businesses Figure 4. The adjusted model (1) Figure 4. The adjusted model (2) Figure 4.
Scatter plot LIST OF TABLES Table 2. Quality Dimensions Table 4. Total Variance Explained of the model (1) Table 4. Pattern Matrix of the model (1) Table 4.
Describing variables in the factors of the model (1) Table 4. The factors and variables in the model (1) Table 4. Variance Explained of the model (2) Table 4. Pattern Matrix in the model (2) Table 4.
The factors and variables of the model (2) Table 4. Model Summary of model (1) Table 4. Model Summary of the model (2) Table 4. Coefficients of the model Table 4.
ANOVA of the model TABLE OF CONTENTS LIST OF ABBREVIATIONS LIST OF TABLES LIST OF FIGURES FOREWORD CHAPTER 1: INTRODUCTION .Background of problem .Rationale of the Subject .Object and Scope of research .Significance of Subject .Composition of thesis. 3 CHAPTER 2: RELATED LITERATURE AND THEORETICAL FOCUS. The theories and literatures relating logistics service quality. Definitions of quality.
Overview about service quality. Some of service quality models:. Some researches relating Logistics service quality .The quantitative research .The qualitative research. Some of assessments about developing of Logistics in Vietnam in global integration progress.
Developing Logistics companies in Vietnam, shortcomings and solutions. The model of research. The model service quality in Logistics. The factors in the model of research.
16 CHAPTER 3: RESEARCH METHODOLOGY. Sampling method and sample size. Published guidlines on the subject “ Samlpe size in factor analysis” 22 3. Format of Survey.
Structured Response Formats:. Unstructured Response Formats. Statistical Analysis Technique. Exploratory Factor Analysis (EFA).
Mutiple Linear Regression Model. 30 CHAPTER 4: RESULTS OF RESEARCH. Removing the answers which are not fit and making the data clear. Removing the answer which was not fit.
Making the data clear. Coding and the data entry. Description of sample. Description of sample by “Gender”.
Description of sample by “Age”. Description of sample by “Education”. Description of sample by “Department”. Description of sample by “Types of businesses”.
Exploratory Factor Analysis (EFA). The model (1) having “Res9 variable” .2 The model (2) without “Res9” variable. Multiple Linear Regression, comparing and choosing the model, and verifying the assumptions of OLS .Multiple Linear Regression .Comparing and choosing between model (1) and model (2). The model equation.
Verifying autocorrelation of residuals (Durbin-Watson). Verifying the assumptions of OLS. Normal distribution of residuals. 47 CHAPTER 5: CONCLUSION AND RECOMMENDATIONS.
The situation of Logistics service companies in Vietnam. Recommendations to the government. Limitations of the study. KMO and Barlett’s Test of independent variables in model (1).
KMO and Barlett’s Test of dependent variable in model (1). Cronbach’s alpha of “Reliability factor”. Cronbach’s alpha of “Infrastructure factor”. Cronbach’s alpha of “Responsiveness factor”.
Cronbach’s alpha of “Assurance factor”. Cronbach’s alpha of dependent variable. KMO and Barlett’s Test of independent variable in the model (2)60 Appendix 2: The questionnaire. 61 FOREWORD After Vietnam had joined WTO, Logistics service market in Vietnam has had the positive changes with the number of enterprises operating in the Logistics sector, which is growing and high growth.
Logistics services are commercial whereby traders organize the performance of one or more work including receiving, transporting, storage, demurrage, customs procedures, consulting customers, packing, marking, delivery and other service relating to goods. The traders sign the contracts with their customers. And they receive remuneration after finishing their duty. Now, the Logistics enterprises in Vietnam are quite professional and efficient.
But in reality, they only meet 25% the market demand and provide simple services or some steps in the important series of Logistics progress. In the fact that enterprises in Vietnam are mainly small and medium. Their size and capacity are limited. Among enterprises, the link is very weak and the competitiveness is low.
Through the survey in 10 provinces and cities in the country in 2011 of Economic Development Research Institute – The National Economic University, there were 69.28% respondents who thought that Logistics enterprises have lacked the link.7% respondents believed that the staff working Logistics have been professtional.26% of workforce in the Logistics business were only trained through job. These are basis reasons to make the competitiveness of Vietnam Logistics enterprises lag behind foreign enterprises. The Vietnam Logistics enterprises are mostly as satellites of foreign Logistics enterprises, just taking one of single services such as customs procedures or rental vehicles or warehouses or the things like. In the context of the import and export activities develop fast and domestic trade expands, the demand for Logistics service increases.
So it is essential to improve and enhance Logistics service quality. We want to find out the factors that influence on Logistics service quality in order to make the plan to invest effectively and efficiently. This is the reason why I choose the topic “Factors that influence on Logistics service quality of Logistics companies in Ho Chi Minh” to do in my thesis. I hope that the result of research will be suggestions for logistics companies enhancing service quality.
Background of problem From 1986 to now, along with the shift of market economy of the country, forwarding industry in Vietnam has innovated and integrated with development of global economy. There were a lot of forwarding associations to be established and types of transportation to be expanded. Especially, forwarding industry has served more import and export activities in recent years. However, forwarding industry is more complex and more competitive amongs fowarding associations including domestic and foreign.
The activities of forwarding industry is messy and they have not been unification yet. Besides, we have not had a synchronous system of legal documents yet and have not managed import and export activities closely, which made forwarding industry become more messy and arise lots of negative problems. In addition, the scale of import and export activities have quickly developed in recent years. Here is the reason making forwarding industry develop strongly in width and depth.
Rationale of the Subject According to document of Vietnam Freight Forwarders Assotiation, there are about 1000 logistics service companies in Vietnam. Logistics service has strongly developed including many types of services. It has played an important role for circulating cargos, developing market and increasing import-export turnover. However,the quality of logistics service in Vietnam has a lot of restrictions.
The main reasons are that enterprises have small scale, weak competitiveness, weak infrastructure and do not associate with other businesses. Besides, logistics service has not had package solutions yet and lacked value-added services for shippers’ supply chains. So finding out specific factors which influence logistics service quality in order to improving them is necessary now. Research Objectives The purpose of the study is to find out factors that influence service quality of Logistics service companies in Ho Chi Minh city.
The study is guided by the following objectives: - To identify the factors that influence Logistics service quality - To build and verify scale of each factor that influcences logistics service quality - To define the strenght of factors that influences logistics service quality. 1 - On basis of research result. Some recommendations will be suggested to improve Logistics service quality in Ho Chi Minh city. Object and Scope of research - Research object is factors that influence Logistics service quality.
Through collecting primary information from people that were questioned by questionaire, it is basis to define each factor that influences logistics service quality such as human resources, infrastructure, management, prestige and relationships. Specific aspects of each factors showed by the indexes (observed variables) are also verified and considered. Finally, throught statistical analysis the factors that influence logistics service quality in general are considered and defined. - Research of scope Research area is limited in Ho Chi Minh city only.
People who have knowledge about logistics service or are customers of logistics service companies or work for or used to work for logistics service companies are questioned. Time of research is about two month (from 2nd of June to 2nd of August in 2012). Research methodology - Thesis is implemented by quantitative analysis to study and define the factors that influence logistics quality. Five-level Likert scale is used to measure the values of variables.
- Here is exploratory research, so sampling method is design of choosing non- probability sample with the form of convenience sample. - Self-answer questionnaire is used as a tool to collect necessary information and data serving quantitative analysis. Questionaire is sent people who are surveyed via emails with the link connecting the questionaire designed in the Web. The questionaire is attached in the Appendix.
- Thesis is used statistical inference to analyse results collected from sample. Exploratary Factor Analysis (EFA) is used to define factors that are hid behind observed variables. Cronbach’s alpha is used to select and reinforce component of scale.Multiple linear regression model is also used to model the linear relationship between a dependent variable and many independent variables. Ordinary Least Square is finally used to specify affective factors as well as their strenght on Logistics Service Quality.
Significance of Subject This subject has some of significanes below: - The result of research gives readers overview about factors that influence logistics service quality in many aspects and customers’ satisfaction for the quality of logistics service in Ho Chi Minh city.