Question

In: Operations Management

Business has been dropping. The major complaints of BurgerSupreme’ s customers’ are that they have to...

Business has been dropping. The major complaints of BurgerSupreme’ s customers’ are that they have to wait 20% longer than at most competitor's restaurant; that the hamburgers are cold when served; and, that they are more expensive. Which of the following is most likely the basis of the troubles for BurgerSupreme?

a. Lack of customer satisfaction b. Lack of repeat business c. Lack of customer loyalty d. Lack of retained earnings e. Not providing enough value

Solutions

Expert Solution

Answer: e. not providing enough value

Explanation:

The most likely basis of the troubles for BurgerSupreme is that they are not providing enough value to the customers for the price they charge for the hamburgers. Businesses should focus on providing superior value to customers to improve customer satisfaction and loyalty. When a business charges a high price for a product, it should provide a better product or service to increase the perceived value. If the product does not meet customer expectations in terms of value creation, it leads to customer dissatisfaction and complaints. Here BurgerSupreme’ s customers’ have to wait 20% longer than at most competitor's restaurant, the hamburgers are cold when served, and, they are more expensive compared to competitors which makes customers feel that they are not provided with enough value for the price they pay. Customer satisfaction and loyalty comes after value creation. Retained earnings include profit made by a company and it may not be the underlying issue as the issue is related to service issues and high price. Repeat business also does not lead to customer complaints.


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