An Investigation of Customer Satisfaction and Its Impact on Business Profitability: A Study of Hotels in Kwara State
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Background of the Study
Customer satisfaction is a critical determinant of business success in the hospitality industry, where service quality directly influences profitability (Kotler et al., 2024). Satisfied customers are more likely to return, recommend services to others, and contribute to positive brand reputation. In Kwara State, the hotel industry has witnessed significant growth due to increasing tourism and business activities, yet challenges related to service delivery persist.
Studies suggest that many hotels struggle to meet customer expectations due to issues such as inadequate facilities, untrained staff, and inconsistent service quality (Adewale et al., 2023). This study investigates the relationship between customer satisfaction and business profitability in Kwara State, focusing on how improved satisfaction levels can enhance revenue and competitiveness.
Statement of the Problem
Despite the growth of the hotel industry in Kwara State, many businesses face declining profitability attributed to poor customer satisfaction. Factors such as delayed services, unclean facilities, and lack of personalized experiences have contributed to customer dissatisfaction (Omole & Ibrahim, 2024).
Existing research has primarily focused on service quality without adequately linking it to profitability metrics. This gap underscores the need for a comprehensive analysis of how customer satisfaction impacts business profitability in Kwara State’s hotel industry.
Objectives of the Study
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To assess the level of customer satisfaction in hotels in Kwara State.
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To analyze the relationship between customer satisfaction and business profitability in the hotel industry.
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To identify strategies for improving customer satisfaction to enhance profitability.
Research Questions
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What is the current level of customer satisfaction in hotels in Kwara State?
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How does customer satisfaction influence business profitability in the hotel industry?
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What strategies can hotels adopt to improve customer satisfaction and profitability?
Research Hypotheses
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Customer satisfaction levels in hotels in Kwara State are not significantly high.
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Customer satisfaction does not significantly influence business profitability in the hotel industry.
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Strategies for improving customer satisfaction do not significantly enhance profitability.
Scope and Limitations of the Study
The study focuses on hotels in Kwara State, analyzing customer satisfaction levels and their impact on profitability. Limitations include data reliability, potential biases in customer responses, and varying economic factors influencing profitability.
Definitions of Terms
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Customer Satisfaction: The degree to which customers feel their expectations are met by a product or service.
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Business Profitability: The financial gain achieved after all expenses have been deducted from revenue.
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Hotel Industry: A sector that provides lodging, food, and other hospitality services to customers.
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