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CUSTOMER CARE AND SALES VOLUME

CASE STUDY; STEEL AND TUBE INDUSTRIES LTD, KAMPALA

BY

MUSASIZI DAVID04/U/13630/EXT

SUPERVISEDBY

MR.TURYAKIRA NAZARIUS

A RESEARCH REPORT SUBMITTED TO MAKERERE UNIVERSITY IN PARTIAL FULFILLMENT OF THE REQUIREMENTS FOR THE AWARD OF

THE DEGREE OF BACHELOR OF COMMERCE

JULY2011

DECLARATIONI, the undersigned Musasizi David , hereby declare that this Research presentation is as a

result of my own original work and effort and has never been presented or submitted to any

institution for any award. Where the work of others has been consulted due acknowledgement

was made.

Signature ……………………….. Date…………………………….

MUSASIZI DAVID

Student

i

APPROVAL

This Work has been supervised and is now ready to be submitted to Makerere University with

approval of supervisor.

Signature.................................... Date.........................

Mr.Turyakira Nazarius

ii

DEDICATION

This piece of work is dedicated to my beloved family members of the Late Rwabitama Francis

and the family of Dr. Denis for their support and care they have given to me. May the Lord bless

them abundantly.

iii

ACKNOWLEDGEMENT

I will first thank the Almighty God for having enabled me to complete this work and I pray that

he gives me more wisdom and guidance in whatever I do.

Special gratitude also goes to my knowledgeable supervisor Mr. Turyakira Nazarius for his

professional guidance and advice throughout this research. May God reward him abundantly.

I am grateful to the family of Mrs. Kekikatu Evanglista for all the moral and material support. I

couldn’t have had it that way.

My appreciation further goes to my course mates; Lorine, Ben, Capt. Alex and Justus, I will

forever live to remember your efforts and may God reward you abundantly. My friends; Jimmy,

Ruth, Vincent, Ezra, Fredrick, Collins, Emma, Edson, Barigye, Maj. Katuramu, Capt. Caleb, Lt.

Wilson, Lt. Mutamba, Lt.Charles, Stellah and Iga. I greatly appreciate your continuous support

and advice.

My gratitude is also extended to the members of the family of the Late Rwabitama Francis for

the assistance they have given me during my research in all ways, may the lord bless them.

Special thanks go to all staff of Steel and Tube Industries Limited for the contributions they gave

towards my research.

Lastly, special gratitude goes all academic staff and administrators of the Makerere College of

Business and Management Sciences and Makerere University who enabled me to produce this

work.

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TABLE OF CONTENTSDECLARATION..............................................................................................................................iAPPROVAL....................................................................................................................................iiDEDICATION...............................................................................................................................iiiACKNOWLEDGEMENT..............................................................................................................ivTABLE OF CONTENTS................................................................................................................vLIST OF TABLES..........................................................................................................................ixABSTRACT...................................................................................................................................xi

CHAPTER ONE............................................................................................................................11.0. Introduction...............................................................................................................................11.1. Background of the study...........................................................................................................11.3. Objectives of the study.............................................................................................................31.4. Research Questions...................................................................................................................31.5.. Scope of the study...................................................................................................................31.5.1. Content scope 31.5.2. Geographical scope 31.5.3. Time scope 31.6. Significance of the study..........................................................................................................4

CHAPTER TWO...........................................................................................................................5LITERATURE REVIEW................................................................................................................52.0. Introduction...............................................................................................................................52.1. Customer care services.............................................................................................................52.1.1. Basic operating principles for customer care 62.1.2. Customer and service perception 72.1.3. Customer care strategies 82.1.4. Customer care strategies 92.1.5. Customer satisfaction 102.2. Sales Volume..........................................................................................................................112.3. Relationship between customer care and sales volume..........................................................142.5. CONCLUSION.......................................................................................................................16

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CHAPTER THREE.....................................................................................................................17METHODOLOGY........................................................................................................................173.0. Introduction.............................................................................................................................173.1. Study design 173.2. Study area 173.3. Study Population 173.4. Sample size consideration.......................................................................................................183.5. Data collection instruments....................................................................................................183.6. Data management and analysis 193.6.1. Data management 193.6.2 Quality control 193.6.3 Data Analysis 193.6.4 Ethical considerations 20

CHAPTER FOUR.......................................................................................................................21PRESENTATION, ANALYSIS AND DISCUSSION OF FINDINGS........................................214.0. Introduction ………………………………………………………………………………....214.1 Demographic characteristic of respondents.............................................................................214.1.1. Findings on Gender response……………………………………………………………...21 4.1.2 Findings on age of respondents 224.1.3 Findings on marital status 224.1.4. Findings on academic qualification 234.1.5 . Findings on department of work 234.1.6. Findings on time served with Steel and Tube Industries Ltd 244.2. Findings on customer care......................................................................................................244.2.1. Findings on whether demand for customer service has become very important in organizations because it is upon what business success prevails 244.2.2. Findings on whether Steel and Tube Industries provides customer care services 254.2.3 Findings on whether Steel and Tube industries fulfils the Basic operating principles for customer care 264.2.4. Findings on whether customers are happy that business can add financial or social benefits and create structural ties between the company and its customers 264.2.5. Findings on whether Steel and Tube industries fulfil the Basic operating principles for customer care. 274.2.6 Findings on whether when customer care is poor, customers get angry with the services

284.2.7. Findings on whether employees are very crucial components of customer care 29

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4.2.8 Findings on whether customer care system should be designed to provide maximum level of care and convenience to customers 294.3 Findings on sales volume.........................................................................................................304.3.1 Findings on whether sales volume has become important in many ways for most companies

304.3.2 Findings on whether high sales volume is the main reason why companies exist 314.3.3 Findings on whether high sales volume is always register 324.3.4. Findings on whether sales have significantly increased over the past 2 years as a result of improvement in customer care 324.3.5. Findings on whether sales volume fluctuates from time to time 344.3.6. Findings on whether Sales volume is affected by number of factors 344.3.7. Findings on whether Sales volume influences profitability that is when sales volume is high profits are high, when sales volume is low profits are high..................................................354.4. Findings on relationship between customer care and sales volume.......................................364.4.1. Findings on whether customer care is improved it ultimately increases sales volume

364.4.2 Findings on whether customer care increases sales volume.................................................364.4.3. Findings on whether customer care improves organizational performance 374.4.4. Findings on whether poor customer care reduces the number of customers thus reducing sales volume. 384.4.5. Findings on whether unbecoming behavior and attitude of sales staff towards customers may determine how much is sold 384.4.6. Findings on whether customers and increase in sales, a business should focus on the needs of customers and their buying behavior 394.4.7. Findings on the relationship between customer care and sales volume 40

CHAPTER FIVE.........................................................................................................................42SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATIONS..........................425.0. Introduction.............................................................................................................................425.1. Summary of findings..............................................................................................................425.1.1. Findings on customer care services by Steel and Tube Industries Ltd………………...….42 5.1.2. Findings on sales Volume on Steel and Tube Industries ……………………………...….425.1.3. Findings on relationship between customer care and sales volume 425.2. Conclusion …………………………………………………………………………….........435.2.1. Conclusion on Customer Care services provided by Steel and Tube Industries Ltd …….435.2.2. Conclusion on sales volume of Steel and Tube Industries Ltd …………………………..435.2.3. Conclusion on relationship between customer care and sales volume 435.3. Recommendations...................................................................................................................43

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5.3.1. Recommendation on Customer care services provided by Steel and Tube Industries Ltd .43 5.3.2. Recommendations on Sales Volume of Steel and Tube Industries Ltd ………….………435.3.3. Recommendations on relationship between customer care and sales volume445.4 . Areas for further research......................................................................................................44References......................................................................................................................................45APPENDICES...............................................................................................................................48

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LIST OF TABLES

Table 1. Distribution of the sample ............................................................................................... 18 Table 2: Showing gender response ................................................................................................ 21 Table 3: Showing age of respondents ............................................................................................ 22 Table 4: Showing the marital status ............................................................................................... 22 Table 5: Showing the academic qualification ................................................................................ 23 Table 6: Showing where respondents are working from. .............................................................. 23 Table 7: Showing period respondents have served with Steel and Tube Industries Ltd ............... 24 Table 8: Showing whether demand for customer service has become very important in organizations because it is upon what business success prevails. ................................................. 25 Table 9: Showing whether Steel and Tube Industries provides customer care services. .............. 25 Table 10: Showing whether Steel and Tube industries fulfils the Basic operating principles for customer care ................................................................................................................................. 26 Table 11: Showing whether customers are happy that business can add financial or social benefits and create structural ties between the company and its customers .................................. 27 Table 12: Showing whether Steel and Tube industries fulfil the Basic operating principles for customer care. ................................................................................................................................ 28 Table 13: Showing whether when customer care is poor, customers get angry with the services 28 Table 14: Showing whether employees are very crucial components of customer care ............... 29 Table 15: Showing whether customer care system should be designed to provide maximum level of care and convenience to customers. .......................................................................................... 30 Table 16: Showing whether sales volume has become important in many ways for most companies. .................................................................................................................................... 31 Table 17: Showing whether high sales volume is the main reason why companies exist ............. 31 Table 18: Showing whether you always register high sales volume ............................................. 32 Table 19: Showing whether sales have significantly increased over the past 2 years as a result of improvement in customer care ....................................................................................................... 33 Table 20: Showing whether sales volume fluctuates from time to time ........................................ 34 Table 21: Showing whether Sales volume is affected by number of factors ................................. 34 Table 22: Sales volume influences profitability that is when sales volume is high profits are high, when sales volume is low profits are high. ........................................................................... 35 Table 23: Showing whether customer care is improved it ultimately increases sales volume. ..... 36 Table 24: Showing whether customer care increases sales volume .............................................. 37 Table 25: Showing whether customer care improves organizational performance ....................... 37 Table 26: Showing whether poor customer care reduces the number of customers thus reducing sales volume. 38

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Table 27: Showing whether unbecoming behavior and attitude of sales staff towards customers may determine how much is sold .................................................................................................. 39 Table 28: Showing whether customers and increase in sales, a business should focus on the needs of customers and their buying behavior. ........................................................................................ 40 Table 29: Relationship between customer care and sales volume ................................................ 40

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ABSTRACTThe study was about customer care and sales volume taking Steel and Tube industries Ltd

located in Kampala as the case study. The Objectives of the study were; To find out the customer

care services provided by Steel and Tube industries Ltd, to establish the sales volume of Steel

and Tube industries Ltd and to examine the relationship between customer care and sales

volume.

The study considered 35 respondents. Both cross-sectional and descriptive research design were

employed. Purposive sampling and simple random sampling methods were employed. Data was

collected using questionnaires, coded and analyzed using frequency tables.

Findings on customer care were a big percentage of respondents supported that the company

provides customer care services, customer service has become very important in organizations, it

also fulfils the Basic operating principles for customer care, Customers perceive poor quality

service when they are serving poorly, employees are very crucial components of customer care

and customer care system is designed to provide maximum level of care and convenience to

customers. Findings on Sales Volume were high sales usually act as a motivator to employees,

sales volume fluctuates from time to time, it also influences the level of profitability. However,

sales have not significantly increased over the past two years as a result of improvement in

customer care and high sales volume is not the main reason for the existence of companies. Also

sales volume is affected by a number of factors. It was found that there is a moderate positive

relationship of (r=0.039) between customer care and sales volume.

Recommendations on customer care were that Steel and Tube Industries ltd should improve on

customer services. It should also endeavor to fulfill the basic operating principles for customer

care and the company should add financial or social benefits to create structural ties between the

company and its customers. Recommendations on Sales Volume were that Steel and Tube

Industries ltd should improve its customer care which ultimately increases sales volume and it

should work on other factors to avoid sales volume fluctuations from time to time.

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CHAPTER ONE

1.0 Introduction

This chapter focuses on the background to the study, statement of the problem, objectives of the

study, research questions, scope of the study and significance of the study.

1.1 Background of the study

Customer care is an action a company takes to add value to its basic goods and services. It

encompasses everything a company does to satisfy its customers and help them realize the

greatest possible value from the goods and services offered to them (Kaplan, 2008).

Customer service throws a new twist into sales and profit analysis. Customer care has an

important influence on the design and management of a company’s marketing mix (Reily, 1996).

The need to handle customers better has been mostly brought about by the emergence of many

competitors offering similar products. This means that the customer has a lot more to choose

from while the suppliers have to struggle so much to give that service or goods to the customers

so as to retain them.

Sales are the basic aim of business units and high sales usually lead to better employee

remuneration. Therefore high sales act as a motivator. If a business is not selling, its existence is

not justifiable and it should as well close doors.

However the customer service quality assessment survey (2009) noted that the standard of

customer care in Steel and Tube industries ltd, is average when compared to the worldwide

customer care standards. The customers normally make their orders either by phone, email, and

fax or in person after making a direct payment on the account of the company in the bank. After

the confirmation of the payment, the logistics officer together with the sales assistant arrange for

the dispatch of goods. This normally takes an average of 24 hours.

Steel and tube industries Ltd is a company selling a range of hardware products such as tanks,

wire mesh, steel and plastic pipes, bolts and joints, nails, and bars. It has a number of outlets in

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Kampala. Increased sales volume is one of the aims of the company. The standard of customer

care in Steel and Tube industries is average when compared to the worldwide customer care

standards (Synergy 2009).

The sales volume in Steel and Tube industries keeps on changing. The company experiences

both low and high volume sales. The recent study indicated a low sales volume at Steel and Tube

industries Ltd (Synergy 2009).

According to Kotler (2003), sales volume increases with improvement in customer care. If one`s

customer care is good, the sales will increase while when the customer care is poor by all means

the sales volumes will drastically drop, (Kotler, 2003). Increased sales volume always leads to

increased market share much as marketing leads to good customer satisfaction, the aim is to sell.

This study is therefore set to examine the relationship between customer care services provided

at Steel and Tube industries Ltd and the sales volume.

1.2 Statement of the problem

According to Reilly (1996), customer care is a philosophy in which all employees feel and act

accountable for creating satisfied customers. Customer care is used to describe a set of activities

performed by seller and others which accompany the sale of a product and aid in its exchange or

its utilization (Reilly, 1996). Sales volume is the quantity of products and services taken by

willing customers either for cash or credit and this increases with good customer care.

There is a number of customer care services provided in steel and tube industries. These include;

- discounts to distributors, delivery on time of products, handling quality complaints from

customer on time issuance of proper tax invoices on which input VAT is claimed (Financial

report, 2010)

Despite the provision of the above customer care services, there is still low sales volume at Steel

and Tube industries Ltd. The study will therefore examine the relationship between customer

care services provided at Steel and Tube industries Ltd and the sales volume.

2

1.3 Objectives of the study

The study was guided by the following objectives:-

i. To find out the customer care services provided by Steel and Tube industries Ltd.

ii. To establish the sales volume of Steel and Tube industries Ltd.

iii. To examine the relationship between customer care and sales volume.

1.4 Research Questions

The study was guided by the following research questions:-

i. What customer care services are provided by Steel and Tube industries Ltd?

ii. What is the sales volume of Steel and Tube industries Ltd?

iii. What is the relationship between customer care and sales volume?

1.5. Scope of the study

1.5.1 Content scope

The study covered customer care services provided by Steel and Tube industries Ltd,

sales volume of Steel and Tube industries Ltd and the relationship between customer care

and sales volume.

1.5.2. Geographical scope

The study was carried out from Steel and Tube industries Ltd. Steel and Tube industries

Ltd has a number of sales centers distributed in Kampala city. The study involved 5 sales

outlets with one selected from each of the 5 divisions that make Kampala city. In these

outlets the study concentrated on customer service departments.

1.5.3. Time scope

The study covered five months. The first one month was for proposal writing and

planning the study. The subsequent two months were used for data collection while the

last one month was used for reporting.

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1.6. Significance of the study

The findings of the study will be relied upon by the industrial, commercial sector, to

strengthen their current effort in improving sales.

The findings will provide up-to-date literature for academicians, that can further research

and academic referencing in the fields of customer care, managing sales volume and

expanding clientele.

Specifically, the findings will be relied upon by Steel and Tube industries Ltd to improve

customer care and lay other strategies for increasing sales volume.

4

CHAPTER TWO

LITERATURE REVIEW

2.0 Introduction This chapter reviews the literature related to customer care and sales volume. The literature has

been reviewed according to the sub themes. This includes: Customer care services, sales volume

and the relationship between customer care and sales volume.

2.1 Customer care services

According to Ngalu (1999), the only reason for business to exist is to serve a customer. Ngalu

also noted that a customer is the most important person ever on the premises of the organization,

either in person or mail. A customer is the purpose for the existence of an organization and the

business depends on him to succeed. Balunywa (1992) had earlier noted that the most vital

aspect of any business is its success. For a business to achieve success it must create customers

and offer good customer care. Customers are regarded as the higher stake holders in the business.

According to Reilly (1996), customer care is a philosophy in which all employees feel and act

accountable for creating satisfied customers. Donnelly (1995) however urges that customer

service, as a term, is used to describe activities performed by sellers. It also includes other

services which aid in the sale of a product its exchange or its utilization. Such services are either

pre-sale and post sale and supplement the product but do not compromise it. If performed during

sales, they are considered to be tangible part of the product.

Kotler (2000) says customer care is another element of product strategy thus the company’s

products can be goods or service and additional services might be included. This focuses on

customer services accompanying the main offer. The marketer hence faces three decisions with

respect to customer services and these include determining what customer service should be

included in the customer service mix, what forms should the customer care be provided as well

as what level of customer care should be offered.

Omagor (1992) observed that customer care entails performing many things that customers

consider important in the physical distribution function. Between 1960 and today organizations

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have changed from traditional selling of products to augmenting the product with the service

hence the new phase “customer”

According to Balunywa (1994), the concept of customer services is still new and most managers

are yet to embrace it. There is need to make customers satisfied since they help us to earn a

living and business survival. Balunywa further noted that customer satisfaction depends on the

extent to which a customer’s expectations about the product/services are fulfilled and these

expectations are not static, but keep on changing.

Bara (2001) also described customer service as activities or satisfaction which are offered to sale

or are provided for in connection with the sale. Good customer service among other things

entails keeping the promises made to them and not guarantying things cannot be possible given

the nature of the operating environment.

Customers always expect a standard service, which is appropriate to their needs though their

expectations are not constant. The raising customer’s expectations reflect an economic and social

phenomenon where customers are more demanding because they are constantly being educated

to become knowledgeable and hence needs better judgment.

Mulindwa (1999) mentioned six ways of evaluating customer service by customers. These

include: - Responsibility of employees to react quickly and creativity to customers requests and

problems, convenience and accessibility of the service in terms of location and the ease with

which the customers will access the goods and services, security which is the extent to which the

service is free from danger, credibility which is the honesty of employees and management, as

well as competency in skill of providing the required service. He noted that courteous employees

are friendly polite and respectful customers.

2.1.1 Basic operating principles for customer care

According to Balunywa (1992) the purpose of business is to create a customer. He notes that no

business can survive without a customer. So organization should make sure they design their

business according to the needs of the customer because customer care is very important

determinant of sales volume.

6

Tom and et al (1991), interviewed forty three high performing companies to find out what made

them succeed. He found out that these companies shared a set of basic operating principles such

as;- a deep respect for customers and treating a customer the same way you would like to be

treated yourself.

Kotler (1991), also noted that one of the basic principle for customer care is a keen sense of

appropriate market. He noted that it is important for companies to have an admirable capacity to

motivate their employees to produce high quality products and value for money to their

customers. He also noted that customer’s interaction should not be thought of as a confrontation

(Kottler 2003).

2.1.2 Customer and service perception

According to Brochure & Poster (1987) a customer is the most important person ever on the

premises of the organization, either in person or mail. A customer is the purpose for the existence

of an organization and the business depends on him to succeed.

Drukler (1992) considers a customer to mean a person that buys a product from the marketing

organization. Bara therefore noted that, to provide an excellent service to one’s customers, the

organization should deliver beyond the customer’s expectation. To be a winner in today’s

business, one has to delight and astound the customers.

According to Ngalu (1999), the only reason for business to exist is to serve a customer.

Therefore, there is need to have quality customer care. Quality customer care is associated with

an attitude away of thinking and philosophy of doing business that emphasizes a strong

commitment and sincere dedication to satisfying customers. It advocates for making customers

satisfaction a priority of the company. It calls for the adoption of customer’s orientation.

Wasswa Balunywa (1995) noted that a customer is a person who enables people to earn a living

and also enable people to earn a living and also enable government to exist and function.

Companies have developed customer care programs with the aim of satisfying and delighting

their customers expecting them to be loyal to the company.

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Bara (2001) and Ngalu (1999), advocates for shaping the perceptions of customers towards the

company products. They described perceptions as how we make sense out of what we experience

shaping high quality services image in the customer’s eyes involves developing a customer

profile by getting a clear picture of kind of customers you want to win and keep looking at the

business in terms of customer views and carrying out personal evaluation of ones self. These will

help to shape the customer perception and thus and thus win them.

Kotler (2000) says that, even if customers are just looking around, they feel like their presence is

known and appreciated. Kotler further emphasizes that treat a customer as if he was a guest in

your home greet him or her by name if you can, service approach is to use polite question

indicating your willingness to be of service.

There is challenge to produce delighted and legal customers. Companies seeking to expand their

profits and sales have to spend considerable time and resources searching for new customers, the

companies must keep them and increase their business. Customers are much more informed,

emancipated and are exposed to a very wide choice of goods and services. It is the market to go

after the customer and not vice versa (Kathleen, 2000).

2.1.3 Customer care strategies

The demand for customer service has become very important in organizations because it is upon

them that success for the business prevails. According to Balunywa (1995), there are two types

of customers who enjoy the organization’s services i.e. the external people who buy from the

business and those internal to the organization who are the employees, those that make things

happen in the organization and deal with the external ones.

Balunywa called the first types “kings” and the second type, “royalty”. He observed that, the

winning organizations are characterized by a committed customer base, healthy profits and

happy people. Balunywa (1995) noted that however, companies often fail to recognize the

importance of staff care. Balunywa therefore recognized that customers are likely to receive

good service if the staff delivering them is happy in their work. Employers who treat their staff

like kings are more likely to have a motivated and committed workforce who is interested and

willing to deliver quality service.

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Balunywa (1995) concluded that, management should not expect to have customer satisfaction of

its own internal customers and the employees. They are the key to success during what Jan

Carlson calls the “moment of truth”

2.1.4 Customer care strategies

Customer care is the identification and management of moments of truth (Cotwell 1984). There

are 3 components of customer care:-

The service strategy

To foster a customer care orientation, a service strategy should be customer oriented enabling the

business meet the needs, expectations and motivation.

The system;

A customer care system should be designed to provide maximum level of care and convenience

to customers. This could be achieved by conducting a task analysis which identifies the stage

involved in delivering the service ad enables to staff to rely the performance required to satisfy

the customer.

People strategy (Employees)

Employees are very crucial components of customer care. Customers often than not use the

employees they come into contact with as the company. Cotwell (1984) stated that the major way

that a worker can achieve outstanding customer care is to give the customer what they need just

in time. This implies prompt delivery or quick service by customer. Customers believe n fact

delivery of service.

Cotwell et al, (1984) further explained strategies of keep customer happy, markets can add

financial or social benefits or create structural ties between the company and its customers.

Refund

This means that incase the customer is right about his complaint, you should explain the claim or

refund his money in case of overbilling.

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Staff discipline

Take staff disciplinary action. If you have identified that your staff are poor in delivering service,

it is necessary to discipline them by transfers or any other action that will make them improve on

performance.

Handle customer complaints

As people interested in proving sound customer care, it is important to handle customers with

care and solve all their problems.

Look smart and different

The organization should as try as much as possible to have all employees appear smart and

presentable. Emphasis should be put on the sales representatives. Top quality representatives

should be attracted and encouraged to perform effectively. Managing the sales force can be done

by: - Recruiting and selecting sales representatives, training them, supervising them, motivating

them, and evaluating them.

Apologize

In case you find it is the corporation’s mistake, it will be necessary to apologize and make

amendments where possible.

2.1.5 Customer satisfaction

According to Kotler (2003), customer satisfaction is a level of persons feeling resulting from

comparing a product perceived performance (outcome) in relation to the person’s expectation.

Thus the satisfaction level is function of the difference between perceived performance and

expectation if performance falls short of expectation. The customer is dissatisfied whereas if

performance matches the expectation, then the customer is highly satisfied, pleased or delighted.

Kotler further said that a buyer bus the firm that he/she perceives to offer the highest customer

delivery value and customer value is a bundle of benefit a customer expect from given product or

service.

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2.2 Sales Volume

Kotler (2003) asked why sales increase with improvement in customer care. If ones service is

good, the sales will increase while when the service is poor by all means the sale volume will

drastically drop.

Bovet (1989), the amount of sales usually depends on how a company handles prospective

customers. Sales volume usually is one of the measures of an original performance. Increased

sales volume always leads to increased market share much as marketing leads to good customer

satisfaction, the aim is to sell. Sales are the basic aim of any organization.

Other aims may be secondary high sales usually lead to increase pay to employees. Therefore

high sales act as motivator. If any business is not selling, its existence is not justifiable and it

should as well close doors forever. Sales are one of the issues why organizations exist; it’s from

sales that other factors of production are paid.

The empirical data on customer satisfaction and business performances stem from 1998 and

1999. Based on the empirical data it can be concluded that it is possible to find evidence for the

hypothesis that there is a positive relationship between customer satisfaction and organizational

performance indicators, although the relationship is not very strong (Capodagli and Jackson,

1998)

Various factors might influence the time lag between a change in customer satisfaction and an

expected effect in sales, margin, or other output indicators. However, the analyses do give

answers to questions related to the quality dimensions as underlying factors behind the items in

the customer satisfaction and some indications for the changing behavior of the customer in

relation to his perception.

Sales volume has become important in many ways for most business organizations. Although

sales volume is partially influenced by customer care, still the general view is that

organizations/companies don't take it too seriously. According to Zemke (1990): “Nothing is as

common today as the organization committed more to lip service than customer service; more

interested in advertising than action”.

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Capodagli and Jackson (1998) point in the same direction: “All too many companies seem to

consider customers as nothing more than a necessary nuisance. Oh, they may say otherwise, but

they don’t deliver. If the road to hell is paved with good intentions, then the road to business

failure is littered with placards proclaiming ‘the customer is always right’”.

One of the reasons is that the relationship between customer satisfaction (as a result of service

quality) and business performance is not always very clear. The link between customer

satisfaction and sales volume is neither straightforward nor simple (Zeithaml, 2000).

Zeithaml (2000) also notes that there are three major problems in measuring the relationship are;

- the time lag between measuring customer satisfaction and measuring sales volume and profit

improvements, the number of other variables influencing sales volume like price, distribution,

competition etc and the fact that other variables (e.g. behavioral issues) should be included in the

relationship because they explain the causality between satisfaction and results.

Zeithaml (2000) gives an excellent overview of findings of research on aspects of the

relationship between customer satisfaction, sales volume and organizational performance. He

notes that there is positive evidence on the direct relationship between customer satisfaction and

organizational performance is found.

Koska (1990) and Nelson et al (1992) in hospital settings with higher profitability; Aaker and

Jacobson (1994) found better stock return linked to improved quality perceptions; Anderson et al

(1994) found a significant association between customer satisfaction and accounting return on

assets; Ittner and Larckner (1996) found that shareholder value is highly elastic with respect to

customer satisfaction.

Other research by Buzzell and Gale (1987); Jacobson and Aaker (1987); Gale (1992); Hallowell

(1996); Fornell (1992) shows that higher customer satisfaction translates into higher than normal

market share growth, the ability to charge a higher price, improved customer loyalty with a

strong link to improved profitability, and lower transaction costs and increased volume of sales.

12

Customer satisfaction is also found to be strongly correlated with repurchase intentions, the

willingness to recommend the company, and to improved cross-buying (Reichheld (1996b);

Cronin and Taylor (1992); Parasuraman, et al (1988); Anderson and Sullivan (1993); Verhoef, et

al; (1999)).

One reason that companies don't take customer satisfaction very seriously might be the difficulty

in measuring the relationship between customer satisfaction and sales volume. However, another

reason is the difficulty in translating the customer satisfaction data into action within the

company. Most customer satisfaction measurements are based on short lists of items which have

been defined inside-out. Those measurements don't improve the knowledge about what

customers really find important and how customers build their perception.

In service environments customer satisfaction will be built on a combination of technical quality

aspects and functional quality aspects (Gronroos, 1984). Technical quality or the quality of the

output corresponds to traditional quality control in manufacturing, it is a matter of properly

producing the core benefit of the service. Functional quality or process quality is the way the

service is delivered, it is the process in which the customer is a participant and co-producer and

in which the relationship between service provider and customer plays an important role.

Technical quality is related to what the customer gets (transaction satisfaction), functional

quality is related to how the customer gets the result of the interaction (relationship satisfaction).

Another approach is to identify more clearly what quality dimensions play a role in the

development of customer's perception. Parasuraman et al (1988) developed the general

perspective for service organizations, building on empirical research in various service sectors.

It can be argued that quality perception has an effect in the next period in terms of sales volume,

margin, and placements and hours sold. However, there are also reasons to believe that the

measurement of quality perceptions are very much based on the most recent experiences and are

already forgotten next year. Other reasons are that quality perceptions are built not only on the

service (service quality and matching quality) you deliver to the customer, but are also built on

many other factors, e.g. market circumstances, competition, economic situation and changes

etceteras.

13

Buzzell and Gale (1987) note that here is a big relationship between customer care and sales

volume. They give a comparative example of two sales agents and their performance. For

example a sales agent with the highest sales volume has a tendency to be placed on a pedestal

and the one with the most units sold about halfway up. In some cases sales volume can reflect

the value of the market, not the value of the agent. For example, one agent's average price range

is $100,000, so his average commission check is $3,000.

That agent closes 65 deals a year and earns a gross commission of $195,000. Across town there

is another agent whose average price is $300,000, so the average commission check is $9,000.

This agent closes 25 transactions a year and also earns a gross commission of $225,000. Who has

more options in his business and may be a better salesperson? I think there are strengths to both.

Agent A who does 65 deals only needs to raise his sales price because he already knows how to

achieve 65 closed sales per year. He has the skills to close 65 transactions.

He understands the process and if he has set up his business properly, he only needs to apply his

philosophy and business in a higher sales price range to earn more income. He also did almost

three times as many transactions. Usually Agent B with the higher commission earned receives

all the rewards from peers, brokers, owners, and the company. Agent B is held in high esteem

and reverence because he was the high producer in the office. Agent B has a good business but

only sold two homes per month. (By most sales standards not an earth-shattering mark.) Agent B

will also need to learn to do more transactions to increase his business, a far harder proposition.

Which one really has a business that is posed to go to the next level?

2.3 Relationship between customer care and sales volume

Kotler (2003) noted that sales increase with improvement in customer care. According to him, if

customer service is good, the sales will increase while when the service is poor by all means the

sale volume will drastically drop. The amount of sales usually depends on how a company

handles prospective customers. Sales volume usually is one of the measures of an original

performance. Increased sales volume always leads to increased market share much as marketing

leads to good customer satisfaction, the aim is to sell.

Sales are the basic aim of any organization. Other aims may be secondary high sales usually lead

to increase pay to employees. Therefore high sales act as motivator. If any business is not

14

selling, its existence is not justifiable and it should as well close doors forever. Sales are one of

the issues why organizations exist; it’s from sales that other factors of production are paid.

Bara (2001) observed that good customer care increases sales volume. He noted that the last

person to buy from you is the most likely to buy again and soon. This therefore leads to repeat

sales from existing customers. A repeat customer does not happen by accident because a repeat

customer is the result of a relationship you have built up through excellent customer service. He

summarized the relation ship between customer care and sales volume as "Care for your

customer and they will return...care for your merchandise and they won't."

Drukler (1992) also noted that customer care influences sales volume. In his survey, he noted

that poor customer care reduces the number of customers thus reducing sales volume. She

noted that the average person who has a bad-service experience tells at least nine others about it

and 13% of complaints relate their experience to more than 20 other people. In comparison,

people who receive silent service only tell three or four others about it". When more people

learn about good customer care services, the customers periodically increase thus increasing the

number of commodities sold.

Bovet (1989) noted that managers may not realize this but a lot of selling points across the

country have lost customers worth million of shilling every year after because of unbecoming

behavior and attitude of their sales staff. Customers respond first to the reception, then to the

product on sale. In other words the salesman’s personality is the bridge between the customer

and the product (Kotler 2000) is of the view that it is cheaper to keep customers than finding new

ones. The longer the customer stays with the company the more the customer is worthy. Long

time customers buy more and take less of the company’s time and the less sensitive to price

changes than new customers.

Drukler (1992) suggested that to attract customers away from other sellers, firms should try to

improve the quality of their products, develop new products, operate efficiently and try to offer

quality service. According to Ngalu (1999), the main reason customers choose one product over

15

another is because it better meets their needs in some way, such as ease of use, services or ability

to do what it promises to do. Ngalu observed that, to become customer driven is to build market

share through increased sales. Research shows that you can not maintain market share with

unique features alone, as your competitors will imitate you. Sustainable market share growth is

achieved through loyal customers and excellent service.

Balunywa (1995), business is about winning, is about making tones of money, creating

customers that will buy again and again and this ca easily be got through good customer service.

He therefore observed that, to win customer and increase sales, a business should focus on the

needs of customers and their buying behavior.

2.5 CONCLUSION

Although the available data and literature shows a relationship between customer care and sales

volume, the literature does not go further to explain this relationship given the presence of vary

many other influencing factors. Various factors might influence the time lag between a change in

customer satisfaction and an expected effect in sales, margin, or other output indicators. The

analyses do not give answers to questions related to the quality dimensions as underlying factors

behind the items in the customer satisfaction and some indications for the changing behavior of

the customer in relation to his perception.

16

CHAPTER THREE

METHODOLOGY3.0 Introduction

This chapter presents the procedures that were followed in conducting the study. It gives details

regarding the study population, sample and sampling techniques, research design, a description

of data collection instruments used, as well as the techniques that will be used to analyze data.

3.1 Study designThe study used descriptive and which included both quantitative and qualitative methods of data

collection. The descriptive approach was used because it allows simultaneous description of

attitudes, views, perceptions, and opinions.

3.2 Study areaThe study was conducted in Kampala City where steel and Tube industries Ltd, has a number of

sales centers. The study covered 5 Divisions that make up Kampala City. These include: -

Kawempe, Nakawa, Kampala Central, Makindye and Lubaga Division. The study involved 5

sales outlets with one selected from each of the 5 divisions that make Kampala city. In these

outlets the study concentrated on customer service departments.

3.3 Study Population

The primary population selected for the study was sales representatives/managers, recruited from

sampled sales centres of Steel and Tube Industries. A total of 35 people were involved in the

study. These have been directly involved in selling products and are in direct contact with

customers. The secondary population included branch managers of the selected sales centres.

These are responsible for supervision of sales and relations between customers and sales

representatives. The study also involved Key informants. These include:- officers selected from

the top management of steel and Tube industries, such as the General Manager, Manager in

charge of marketing, public relations manager etc. These included in the study because of their

role in designing customer care polices and because of their vast experience in managing sales.

17

3.4 Sample size consideration

The study used purposive sampling in determining the sample size. The researcher also used

purposive sampling because he wanted respondents who are equipped with knowledge of the

subject matter.

The sample for the Study was estimated using the following formula:

n=

Where p=0.3; q= (1-p) =0.6; d=+/-5% and z=1.96. This sample is intended to estimate the

proportion of study population (p) to which a 5% margin of error (d) with 95% confidence limits

(z). A design effect of 1.5 will be taken into consideration

A sample size of 35 respondents was considered sufficient to achieve the purpose of the

study

Table 1. Distribution of the sample

Category Number and distribution Total

Sales representatives 5 x 5 Sales Centres 25

Sales Managers 5 5

Key Informants 5 5

Total 35

In all 35, respondents were selected. 6 sales representatives/agents were purposively selected

from each of the 5 sales centres with one selected from each Division of Kampala city. A total

of 5 managers was selected with one selected from each of the 5 sales centres. 5 key informants

included and these constituted the top management of steel and tube industries. They included:

General Manager, Public relations officer, marketing manager, Finance Manager, as well as

human resource manager.

18

3.5 Data collection instruments

The tools that were used to collect data include:-

(a) Semi structured questionnaire

This was used to obtain information from sales representatives and sales centre managers in

order to determine the customer care services provided by Steel and Tube industries and to

establish the sales volume of Steel and Tube industries Ltd.

(b) Key informant interviews

The key informant interviews were conducted among key informants who mainly constitute the

top management of steel and tube industries in order to examine the relationship between

customer care and sales volume.

(c) Observational checklist

The observational checklist was used to observe the behavior of sales representatives and sales

centre managers during transactions. The researcher also made it possible to observe the relations

between the sales agents and customers during transactions.

3.6. Data management and analysis

3.6.1 Data management Preliminary editing of quantitative data was done on all questionnaires on daily basis. The

researcher checked for missing data and correct errors. The data was cleaned, and coded for easy

entry. The data was grouped according to the main categories and sub themes of the study.

3.6.2 Quality control Good quality of data was ensured by pre-testing the data collection instruments to ascertain their

accuracy. Ink pens and paper were used to record, notes taken during key informant interviews,

while other instruments such as a camera will be used to record pictorial information.

3.6.3 Data Analysis

19

Questionnaires were sorted, numbered and data entered accordingly. Data will be checked by the

researcher for completeness and internal consistency. Data collected was cleaned, edited,

categorized, coded and summarized. The researcher analyzes quantitative data using SSPS

computer package, and then generated, frequencies and tables. Qualitative data was coded

divided into various themes and sub-themes. It was then presented in narratives.

3.6.4 Ethical considerations Permission to do the study was sought from the respective managers of steel and tube Industries

Company. The researcher obtained an introductory letter from Makerere University, institute of

adult and continuing education which were presented to the management of Tube and steel

industries. He was than introduced to respondents and first seek the consent from these

respondents in order to involve them. Strict confidentiality was observed and names of study

participants were recorded on questionnaires and interview guides.

20

CHAPTER FOUR

PRESENTATION, ANALYSIS AND DISCUSSION OF FINDINGS

4.0 Introduction

This chapter presents findings, discussion and interpretations of data collected to; to find out the

customer care services provided by Steel and Tube industries Ltd to establish the sales volume of

Steel and Tube industries Ltd and to examine the relationship between customer care and sales

volume.

4.1 Demographic characteristic of respondentsFindings on the demographic characteristics of respondents were considered and can be evidenced below

4.1.1. Findings on gender responseFindings on the gender of the respondents were considered and can be evidenced in the table below.

Table 2: Showing gender responseCategories Frequency Valid Percent (%) Cumulative percent (%)

Male 22 63 63

Female 13 37 100

Total 35 100

Source; primary data.

From table 2 above; Females were 37% while Male respondents were 63%.This implies that

male were more involved in productive and viable ventures.

21

4.1.2 Findings on age of respondents

The study covered different age brackets of respondents in order to establish the most prevalent

group. The respondents were asked to tick the age group the distribution was in the table below;

Table 3: Showing age of respondents

Categories Frequency Valid Percent (%) Cumulative Percent (%)

18—25 11 31 31

26—32 13 37 68

34---41 6 17 85

42+ 5 15 100

Total 35 100


From table 3 above; 31% of respondents were in 18-25 age bracket, 37% were in26-32,17%

were in 34-41 and 15% were 42 and above. This shows that the company employees relatively

mid aged employees.

4.1.3 Findings on marital status

Findings on marital status of the respondents were also considered and con be evidenced in the

table below;

Table 4: Showing the marital status

Categories Frequency Valid Percent (%) Cumulative percent (%)

Married 20 57 57

Single 11 31 88

Widowed 4 12 100

Total 35 100


22

From table 4 above; 57% of respondents were married,31% of respondents were single, 12%

were widowed. This implies that the company has more married people more responsibilities and

stable at work place.

4.1.4 Findings on Academic Qualification

Findings on academic qualification were also considered and can be evidenced in table below;

Table 5: Showing the academic qualificationCategories Frequency Valid Percent (%) Cumulative Percent (%)

Graduates 17 17 17

Diploma 13 13 30

Secondary 5 5 35

Primary 0 0 35

Never went to school 0 0 35

Total 35 35


From table 5 above; 17% of respondents were graduates, 13% were diploma holders,5% had

Secondary certificates. 0% of the respondents were primary and none went to school. This

indicates that most of the respondents were well educated and informed therefore; research

findings can be relied on.

4.1.5. Findings on department of work

Findings on the Department of work were also considered and can be evidenced in the table

below.

Table 6: Showing where respondents are working from

Categories Frequency Valid Percent (%) Cumulative (%)

Finance 6 17 17

Marketing 19 54 71

Sales 8 23 94

Public Relations 2 6 100

Total 35 100


23

As indicated above; 17% of respondents were from Finance, 54% were from marketing, 23%

were from sales and 6% were from public relations. This means that all functions were equally

represented.

4.1.6 Findings on time served with Steel and Tube Industries limited

Findings on the time of serve of respondents were also considered and can be evidenced in the

table below.

Table 7: Showing period respondents have served with Steel and Tube Industries ltd


Less than a year 9 26 26

1-3 years 12 34 60

4-6 years 10 29 89

Over 7 years 4 11 100

Total 35 100

Source; primary Data

As shown in the above table, it is indicated that 34% of respondents have served for 1-3years,

followed by 29% who have served for 4-6 years, 26% for less than a year and 11% for over 7

years. This indicates that most respondents had experience.

4.2. Findings on customer care.

Findings on the customer care were also considered and can be evidenced in the tables below;

4.2.1. Findings on whether demand for customer service has become very important in

organizations because it is upon what business success prevails

Findings on whether demand for customer service has become very important in organizations

because it is upon what business success prevails were also considered and can be evidenced in

the table below;

24

Table 8: Showing whether demand for customer service has become very important in organizations because it is upon what business success prevails.


Strongly agree 15 43 43

Agree 10 28 71

Not sure 5 14 85

Disagree 2 6 91

Strongly disagree

3 9 100

Total 35 100

Source; primary data. From table 8 above; 43% strongly agreed that demand for customer service has become very

important in organizations because it is upon what business success prevails, 28% agreed, 14%

were uncertain, 6% disagreed, and 9% strongly disagreed. This indicates that demand for

customer service has become very important in organizations because it is upon what business

success prevails.

4.2.2 Findings on whether Steel and Tube Industries provides customer care services.

Findings on whether Steel and Tube Industries provides customer care services were considered

and can be evidenced in the table below;

Table 9: Showing whether Steel and Tube Industries provides customer care services.



Agree 4 1177

Not sure 1 3 80

Disagree 5 1494

Strongly disagree 2 6100

Total 35 100


25

From table 9 above; 66% strongly agreed that Steel and Tube Industries provides customer care

services, 11% agreed, 3% were uncertain, 14% disagreed, and 6% strongly disagreed. This

means that Steel and Tube Industries provides customer care services.

4.2.3 Findings on whether Steel and Tube industries fulfils the Basic operating principles

for customer care

Findings on whether Steel and Tube industries fulfil the Basic operating principles for customer

care were considered and can be evidenced below;

Table 10: Showing whether Steel and Tube industries fulfils the Basic operating principles for

customer care


Strongly agree 13 3838

Agree 4 1149

Not sure 7 20 69

Disagree 6 17 86

Strongly disagree 5 14 100

Total 35 100


From table 10 above; 38% strongly agreed that Steel and Tube industries fulfils the Basic

operating principles for customer care,11% agreed, 20% were uncertain, 17% disagreed, and

14% strongly disagreed. This shows that Steel and Tube industries fulfil the Basic operating

principles for customer care.

4.2.4 Findings on whether customers are happy that business can add financial or social

benefits and create structural ties between the company and its customers

Findings on whether customers are happy that business can add financial or social benefits and

create structural ties between the company and its customers were considered and can be

evidenced in the table below;

26

Table 11: Showing whether customers are happy that business can add financial or social

benefits and create structural ties between the company and its customers



Agree 6 17 51

Not sure 9 26 77

Disagree 3 986


Total 35 100


From table 11 above; 34% strongly agreed that if customers are happy the business can add

financial or social benefits and create structural ties between the company and its customers,

17% agreed, 26% were uncertain, 9% disagreed and 14% strongly disagreed. This implies that

customers are happy that business can add financial or social benefits and create structural ties

between the company and its customers.

4.2.5 Findings on whether Steel and Tube industries fulfill the Basic operating principles

for customer care.

Findings on whether Steel and Tube industries fulfill the Basic operating principles for customer

care were considered and can be evidenced in the table below;

27

Table 12: Showing whether Steel and Tube industries ltd fulfill the Basic operating principles for customer care.



Agree 4 1148

Not sure 7 20 68

Disagree 6 1785


Total 35 100


From table 12 above; 37% strongly agreed that steel and Tube industries fulfils the Basic

operating principles for customer care,11% agreed, 20% were uncertain, 17% disagreed and 15%

strongly disagreed. This indicates that Steel and Tube industries fulfil the Basic operating

principles for customer care.

4.2.6. Findings whether when customer care is poor, customers get angry with the services

Findings whether when customer care is poor, customers get angry with the services

Table 13: Showing whether when customer care is poor, customers get angry with the services



Agree 8 2368

Not sure 3 9 77

Disagree 2 683


Total 35 100


28

From table 13 above; 45% strongly agreed that customer care is poor, customers get angry with

the services, 23% agreed, 9% were uncertain, 6% disagreed, and 17% strongly disagreed. This

implies that when customer care is poor, customers get angry with the services

4.2.7. Findings whether employees are very crucial components of customer care

Findings whether employees are very crucial components of customer care were considered and

can be evidenced in the table below;

Table 14: Showing whether employees are very crucial components of customer care



Agree 8 2357

Not sure 6 17 74

Disagree 1 3 77


Total 35 100


From table 14 above; 34% strongly agreed that employees are very crucial components of

customer care, 23% agreed, 17% were uncertain, 3% disagreed, and 23% strongly disagreed.

This implies that employees are very crucial components of customer care.

4.2.8. Findings on whether Steel customer care system should be designed to provide

maximum level of care and convenience to customers

Findings on whether Steel customer care system should be designed to provide maximum level

of care and convenience to customers were also considered and can be evidenced in the table

below;

29

Table 15: Showing whether customer care system should be designed to provide maximum level

of care and convenience to customers.



Agree 9 27 63

Not sure 5 14 77

Disagree 7 2097


Total 35 100


From table 15 above; 37% strongly agreed that customer care system should be designed to

provide maximum level of care and convenience to customers, 26% agreed, 14% were uncertain,

20% disagreed, and 3% strongly disagreed. This shows that customer care system should be

designed to provide maximum level of care and convenience to customers.

4.3 Findings on sales volume

Findings on the sales volume of Steel and tube Industries Ltd were considered and can be

evidenced in the tables below

4.3.1 Findings on whether sales volume has become important in many ways for most

companies

Findings whether sales volume has become important in many ways for most companies were

considered and can be evidenced in the tables below

30

Table 16: Showing whether sales volume has become important in many ways for most companies. High sales usually act as motivator and usually lead to increase in pay of employees.Categories Frequency Valid Percent (%) Cumulative Percent (%)


Agree 9 2663

Not sure 5 14 77

Disagree 7 20 97


Total 35 100


From table 16 above; 37% strongly agreed that sales volume has become important in many

ways for most companies. High sales usually act as motivator and usually lead to increase in pay

of employees, 26% agreed, 14% were uncertain, 20% disagreed, and 3% strongly disagreed. This

implies that sales volume has become important in many ways for most companies. High sales

usually act as motivator and usually lead to increase in pay of employees.

4.3.2 Findings whether high sales volume is the main reason why companies exist

Findings whether high sales volume is the main reason why companies exist were considered and can be evidenced in the table below. Table 17: Showing whether high sales volume is the main reason why companies exist



Agree 9 1732

Not sure 4

1143

Disagree 6 2669


Total 35 100

Source; Primary Data

31

From table 17 above; 15% strongly agreed that high sales volume is the main reason why

companies exist, 17% agreed, 11% were uncertain, 26% disagreed, and 31% strongly disagreed.

This indicates that high sales volume is not the main reason why companies exist

4.3.3 Findings on whether high sales volume is always register

Findings on whether high sales volume is always register were considered and can be evidenced

in the table below.

Table 18: Showing whether you always register high sales volume



Agree 6 1746

Not sure 3 9 55

Disagree 9 2580


Total 35 100


From table 18 above; 29% strongly agreed that they always register high sales volume, 20%

agreed, 9% were uncertain, 25% disagreed, and 17% strongly disagreed. This implies that you

always register high sales volume.

4.3.4 Findings on whether sales have significantly increased over the past 2 years as a result

of improvement in customer care

Findings whether sales have significantly increased over the past 2 years as a result of

improvement in customer care were considered and can be evidenced.

32

Table 19:Showing whether sales have significantly increased over the past 2 years as a

result of improvement in customer care



Agree 5 1732

Not sure 4 11 43

Disagree 12 2366


Total 35 100


From table 19 above; 34% strongly disagreed that sales have significantly increased over the past

2 years as a result of improvement in customer care, 23% disagreed, 11% were uncertain, 17%

agreed and 15% strongly agreed. This implies that sales have not significantly increased over the

past 2 years as a result of improvement in customer care.

33

4.3.5 Findings on whether sales volume fluctuates from time to time

Findings on whether sales volume fluctuates from time to time were considered and can be

evidenced in the table below.

Table 20: Showing whether sales volume fluctuates from time to time



Agree 9 25 68

Not sure 6 17 85

Disagree 3 994


Total 35 100

source; primary Data

From table 20 above; 43% strongly agreed that sales volume fluctuates from time to time, 25%

agreed, 17% were uncertain, 9% disagreed and 6% strongly disagreed. This indicates that sales

volume fluctuates from time to time

4.3.6. Findings on whether Sales volume is affected by number of factors

Findings on whether Sales volume is affected by number of factors were considered and can be

evidenced in the table below.

Table 21: Showing whether Sales volume is affected by number of factors



Agree 11 3174

Not sure 0

074

Disagree 5 1589


Total 35 100


34

From table 21 above; 43% strongly agreed that sales volume is affected by number of factors,

31% agreed, 15% disagreed and 11% strongly disagreed. This implies that Sales volume is

affected by number of factors

4.3.7 Findings on whether Sales volume influences profitability that is when sales volume is

high profits are high, when sales volume is low profits are high.

Findings on whether Sales volume influences profitability that is when sales volume is high

profits are high, when sales volume is low profits are high were considered and can be evidenced

in the table below.

Table 22: Sales volume influences profitability that is when sales volume is high profits are

high, when sales volume is low profits are high.



Agree 7 2074

Not sure 2 6 80

Disagree 1 3 83


Total 35 100


From table 22 above; 54% strongly agreed that Sales volume influences profitability. When sales

volume is high profits are high, when sales volume is low profits are high, 20% agreed, 6% were

uncertain, 3% disagreed and 17% strongly disagreed. This indicates that Sales volume influences

profitability that is when sales volume is high profits are high, when sales volume is low profits

are high.

35

4.4 Findings on relationship between customer care and sales volume

Findings on relationship between customer care and sales volume were considered and can be

evidenced in the tables below.

4.4.1 Findings on whether customer care is improved it ultimately increases sales volume

Findings on whether customer care is improved it ultimately increases sales volume were

considered and can be evidenced in the table below.

Table 23: Showing whether customer care is improved it ultimately increases sales volume.



Agree 10 29 72

Not sure 4 11 83

Disagree 1 386


Total 35 100


From table 23 above; 43% strongly agreed that customer care is improved it ultimately increases

sales volume, 29% agreed, 11% were uncertain, 3% disagreed and 14% strongly disagreed. This

implies that customer care is improved it ultimately increases sales volume.

4.4.2 Findings on whether customer care increases sales volume

Findings on whether customer care increases sales volume were considered and can be

evidenced in the tables below.

36

Table 24: Showing whether customer care increases sales volume



Agree 11 3168

Not sure 6 17 85

Disagree 2 691


Total 35 100


From table 24 above; 37% strongly agreed that customer care is improved it ultimately increases

sales volume, 31% agreed, 17% were uncertain, 6% disagreed and 9% strongly disagreed. This

shows that customer care increases sales volume.

4.4.3 Findings on whether customer care improves organizational performance

Findings on whether customer care improves organizational performance were considered and

can be evidenced in the tables below.

Table 25: Showing whether customer care improves organizational performance



Agree 13 3766

Not sure 2 6 72

Disagree 6 17 89


Total 35 100


37

From table 25 above; 29% strongly agreed that customer care improves organizational

performance, 37% agreed, 6% were uncertain, 17% disagreed and 11% strongly disagreed. This

implies that customer care improves organizational performance

4.4.4 Findings on whether poor customer care reduces the number of customers thus

reducing sales volume.

Findings on whether poor customer care reduces the number of customers thus reducing sales

volume were considered and can be evidenced in the tables below.

Table 26: Showing whether poor customer care reduces the number of customers thus reducing

sales volume.



Agree 13 3794

Not sure 0 94

Disagree 2 6100

Strongly disagree 0100

Total 35 100


From table 26 above; 57% strongly agreed that customer care reduces the number of customers

thus reducing sales volume, 37% agreed, 6% disagreed. This indicates that poor customer care

reduces the number of customers thus reducing sales volume.

4.4.5 Findings on whether unbecoming behavior and attitude of sales staff towards customers

may determine how much is sold

Findings on whether unbecoming behavior and attitude of sales staff towards customers may

determine how much is sold were considered and can be evidenced in the tables below

38

Table 27: Showing whether unbecoming behavior and attitude of sales staff towards

customers may determine how much is sold



Agree 8 2377

Not sure 4

380

Disagree 3 9 89


Total 35 100


From table 27 above; 54% strongly agreed that unbecoming behavior and attitude of sales

Staff towards customers may determine how much is sold, 23% agreed, 3% not sure,9% disagreed

and 11% strongly disagreed. This implies that unbecoming behavior and attitude of sales staff

towards customers may determine how much is sold.

4.4.6. Findings whether customers and increase in sales, a business should focus on the needs

of customers and their buying behavior

Findings on whether customers and increase in sales, a business should focus on the needs of

customers and their buying behavior were considered and can be evidenced in the tables below

39

Table 28: Showing whether customers and increase in sales, a business should focus on the

needs of customers and their buying behavior.



Agree 7 20 54

Not sure 3 9 63

Disagree 8 23 86


Total 35 100


From table 28 above; 34% strongly agreed that customers and increase in sales, a business should

focus on the needs of customers and their buying behavior, 20% agreed, 14% disagreed. This shows

that customers and increase in sales, a business should focus on the needs of customers and their

buying behavior

4.4.7 Findings on the relationship between customer care and sales volume

Findings on the relationship between customer care and sales volume were considered can be evidenced in the table below. Table 29: Relationship between customer care and sales volume

customer care sales volume

customer care

Pearson Correlation 1.000 0.039(**)

Sig. (2-tailed) . 0.000

N 35 35

sales volume

Pearson Correlation 0.039(**) 1.000

Sig. (2-tailed) . 0.000.

N 35 35

** Correlation is significant at the 0.05 level (2-tailed).

40

From the table 29 above, there is a weak positive relationship between customer care and sales

volume at Steel and Tube Industries Ltd at Pearson Correlation Coefficient of (r=0.039). Since

r< 0.500, it means that the relationship is weak. This implies that sales volume are not greatly

affected by customer care and this calls for the management of Steel and Tube Industries Ltd to

focus on other factors other than customer care to determine the sales volume of the company.

41

CHAPTER FIVE

SUMMARY OF FINDINGS, CONCLUSION AND RECOMMENDATIONS

5.0 IntroductionThis chapter presents the summary of the study findings and the conclusion. It presents the

recommendations arising from the study and issues that required further investigation.

5.1 Summary of findings

5.1.1 Findings on customer care services provided by Steel and Tube industries ltdFindings on customer care services provided by Steel and Tube industries ltd revealed that

Demand for customer service has become very important in organizations, Steel and Tube

Industries provides customer care services, Steel and Tube industries fulfils the Basic operating

principles for customer care, Customers are happy that business can add financial or social

benefits and create structural ties between the company and its customers, Steel and Tube

industries fulfils the Basic operating principles for customer care, When customer care is poor,

customers get angry with the services, employees are very crucial components of customer care

and customer care system is designed to provide maximum level of care and convenience to

customers.

5.1.2 Findings on sales volume of Steel and Tube industries ltdFindings on sales volume of Steel and Tube industries ltd show that Sales volume has become

important in many ways for most companies. High sales usually act as motivator and usually

lead to increase in pay of employees, high sales volume is the main reason why companies exist,

Sales have not significantly increased over the past 2 years as a result of improvement in

customer care ,Sales volume fluctuates from time to time, Sales volume is affected by number of

factors and Sales volume influences profitability that is when sales volume is high profits are

high, when sales volume is low profits are high.

5.1.3 Findings on relationship between customer care and sales volume

Findings on relationship between customer care and sales volume showed that there is a weak

positive relationship between customer care and sales volume in Steel and Tube Industries ltd at

42

Pearson Correlation coefficient of 0.039. This implies that sales volume is not greatly affected by

customer care. Therefore sales volume of 3.9% is affected by customer care and 96.1% is

affected by other factors.

5.2 Conclusion

5.2.1 Conclusion on customer care services provided by Steel and Tube industries LtdConclusion on customer care services provided by Steel and Tube industries ltd was a customer

care system should be designed to provide maximum level of care and convenience to customers.

This could be achieved by conducting a task analysis which identifies the stage involved in

delivering the service ad enables to staff to rely the performance required to satisfy the customer.

5.2.2 Conclusion on sales volume of Steel and Tube industries Ltd

Conclusion on sales volume of Steel and Tube industries Ltd was there should be higher customer satisfaction translates into higher than normal market share growth, the ability to charge a higher price, improved customer loyalty with a strong link to improved profitability, and lower transaction costs and increased volume of sales.

5.2.3 Conclusion on relationship between customer care and sales volume

Conclusion on relationship between customer care and sales volume was there is a weak

positive relationship of (r=0.039) between customer care and sales volume. This implies that the

better customer care the high sales volume

5.3 Recommendations

5.3.1 Recommendations on customer care services provided by Steel and Tube industries LtdThe company should improve on customer service, Steel and Tube Industries should add on

more customer care services, Steel and Tube industries should endeavor to fulfill the basic

operating principles for customer care and the company should add financial or social benefits to

create structural ties between the company and its customers.

5.3.2 Recommendations on sales volume of Steel and Tube industries LtdSteel and Tube Industries Ltd should improve its customer care which ultimately increases sales

volume and Company should work on other factors s to avoid sales volume fluctuations from

time to time

43

5.3.3 Recommendations on relationship between customer care and sales volume There should be higher customer satisfaction translates into higher than normal market share growth.

5.4 Areas for further research Further research is needed to be done in the following areas

Sales Volume and organizational performance

Other factors that affect sales Volume of an organization other than customer care.

44

References

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Gutek B.A., Cherry B., Bhappu A.D., Schneider S., and Woolf L., (2000), Features of service relationships and encounters, Work and Occupations, 27(3), 319-52.Hallowell R., (1996), The relationship of customer satisfaction, customer loyalty and profitability: An empirical study, International Journal of Service Industry Management, 7(4), 27-42.

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47

APPENDICES

APPENDIX 1

QUESTIONNAIRE FOR SALES REPRESENTATIVES AND SALES CENTRE

MANAGERS

Dear respondent,

I am a student of Makerere University Kampala carrying out a study titled Customer Care and Sales Volume, in Steel and Tube Industries Ltd, Kampala. You have been chosen to participate in this study. Please help me answer the questions as honestly as possible. The information you give will be treated confidentially and used solely for the purpose of the study. Answer all appropriate questions and do not disclose your name.

Instructions:

Please tick or fill in the blank space with what is most appropriate to you.

SECTION A: BIO DATA

1. Sex of respondent

(a) Male

(b) Female

2. Age of respondent

18-25

26-32

34-41

42+

3. How long have you served with Steel and Tube Industries Uganda limited?

Less than a year

1-3 years

4-6 years

Over 7 years

48

4. Department where you are working

Finance

Marketing

Sales

Public Relations

SECTION B: CUSTOMER CARE SERVICES

5. The demand for customer service has become very important in organizations because it is

upon what business success prevails.

Strongly agree Agree Not sure Disagree Strongly disagree.

6. Steel and Tube Industries provides customer care services.


7. Steel and Tube industries fulfils the Basic operating principles for customer care


8. If customers are happy the business can add financial or social benefits and create structural

ties between the company and its customers


49

9. If customer care is poor, customers get angry with the services


10. Employees are very crucial components of customer care


11. A customer care system should be designed to provide maximum level of care and

convenience to customers.


SECTION C: SALES VOLUME

12. Sales volume has become important in many ways for most companies. High sales usually act

as motivator and usually lead to increase in pay of employees.


13. High sales volume is the main reason why companies exist


14. Sales volume increases with better customer care services


50

15. The amount of sales in your company usually depends on how you handle prospective

customers


16. Sales volume fluctuates from time to time


17. Sales volume is affected by a number of factors


18. Sales volume influences profitability. When sales volume is high profits are high, when sales

volume is low profits are high.


SECTION D: RELATIONSHIP BETWEEN CUSTOMER CARE AND SALES VOLUME

19. There is a strong relationship between customer care and sales volume.


20. Customer care increases sales volume and sales volume increases with level of customer care

services


51

16. Customer care increases organizational performance


17. Poor customer care reduces the number of customers thus reducing sales volume.


18. The unbecoming behavior and attitude of sales staff towards customers may determine how

much is sold


19. To win customers and increase sales, a business should focus on the needs of customers and

their buying behavior.


52

APPENDIX 11

INTERVIEW GUIDE FOR KEY IMFORMANTS

I am a student at Makerere University Kampala carrying out a study titled Customer care and sales volume, in Steel and Tube industries ltd, Kampala.

You have been chosen to participate in this study. Please help us answer the questions as honestly as possible. The information you give will be treated confidentially and used solely for the purpose of the study. Answer all appropriate questions and do not disclose your name.

1. What is your age?

2. How long have you served with Steel and Tube Industries Uganda limited?

3. Which department are you working in and what is your position?

4. What do you understand by the term customer care?

5. Do you provide customer care services in Steel and Tube Industries LTD?

6. Does Steel and Tube industries fulfils the Basic operating principles for customer care

7. What customer care services are provided by Steel and Tube Industries LTD?

8. What do you understand by Sales volume?

9. What is the weekly target for sales volume in Steel and Tube Industries?

10. What Factors influence your sales volume?

11. Is there a strong relationship between customer care and sales volume?

12. What is the relationship between customer care and sales volume?

END THANK YOU

53

APPENDIX III

BUDGET FOR THE RESEARCH.

The research was funded by myself. The expenses incurred were as in the budget

below.

BUDGET FOR THE RESEARCH

EXPENCES AMOUNT

TYPING 80,000/=

PRINTING 100,000/=

TRANSPORT 300,000/=

DATA COLLETION AND ANALYSIS 100,000/=

MISCELLANEUOS 100,000=

TOTAL 680,000/=

54

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