INFLUENCE OF INVENTORY MANAGEMENT ON CUSTOMER

SATISFACTION AMONG RETAIL STORES IN TAGUM CITY

A Thesis Presented to
The Thesis Committee, Department of Accounting Education
UM Tagum College, Tagum City

In Partial fulfilment
Of the Requirements for the Degree
Bachelor of Science in Accounting Technology

ERNESTO B. BULURAN

JOHN REX B. MASILLONES

DANILO R. PELOSTRATOS JR.

March 2019

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 Chapter 1

INTRODUCTION

Rationale

Customer satisfaction entirely depends on the effective supply chain

management which is not an easy task. In past, companies used to hold large

inventories to avoid shortage and to increase the customer satisfaction

however it has been observed that this “satisfaction” is subjective to person to

person, though effective inventory management is the only way to increase

customer satisfaction. This inventory caused manufacturers to stockpile large

amounts of raw materials, work in process, and finished goods. The extra

finished goods would be to protect them from going out of stock.

Large inventories are not the preferred choice to handle the shortage

for big companies. As we know that large inventory incurs three different

types of costs i.e. holding costs, when the inventory comprises of raw

materials; work in process, or finished goods. The inventory cost, is the range

of 20 to 40 percent of annual inventory in rupees. Another variables

associated with the holding cost is the opportunity cost, which comprises of

any increase in rents due to the need for more space for inventory, higher

rates for insuring the inventory, and the cost of goods that are outdated.

Indian retail industry has grown exponentially in the past decade.

Liberalization in the sector has brought in foreign investment in most of the

service sectors. Earlier research on the Indian retail sector suggests that

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economic growth, rising income and consumption levels, and a large middle

class segment have contributed towards the growth of organized retailing.

The emergence of large malls, supermarkets and discount stores in the recent

years is likely to affect the existence of small retailers (Williams and Paul,

2014).

Manufacturers and retailers can incorporate technology to assist in the

managing of this inventory, which is later on used by almost all the

multinational companies. This inventory management system uses strong

applications of good forecasting techniques with effective incoming and outing

inventories. These systems make the inventory management more effective

and efficient. According to retail historian, Robert Spector (2005), a critical

factor for retailers is that they have to have a good inventory system. If the

retailer does not have a good inventory system, they will not be able to

forecast demands with any kind of accuracy. This might result in them running

out of stock every so often (Levinson, 2015).

The importance of the influence of inventory management on customer

satisfaction had been established by various scholars in other countries, but

no existing study had been conducted in the local setting, thus creating

knowledge gap among local researchers. It was in this context that the

researchers are encouraged to conduct the study. Moreover, the researchers

have not come across a study that specifically discusses the influence of

inventory management on customer satisfaction among retail stores in Tagum

City. Since, there are no studies where such relationship has been found the

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researchers have pointed that more research is needed in this area. Thus,

this motivates the researchers to investigate the problem.

Research Objectives

The main purpose of the study is to determine the influence of

inventory management on customer satisfaction among retail stores in Tagum

City. Specifically, the study will be conducted to seek answers to the following

objectives:

1. To identify the level of inventory management among retail stores in

Tagum City in terms of:

1.1 inventory level;

1.2 order lead time, and;

1.3 inventory turnover

2. To know the level of customer satisfaction among retail stores in

Tagum City in terms of:

2.1 repeat purchase;

2.2 customer loyalty;

2.3 on-time delivery;

2.4 flexibility, and;

2.5 quality

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 3. To determine the significant relationship between inventory

management on customer satisfaction among retail stores in Tagum City .

Hypotheses

The following null hypothesis will be tested at 0.05 level of

significance. There is no significant relationship between inventory

management on customer satisfaction among retail stores in Tagum City.

Review of Related Literature

This chapter presents the different literature and studies that are

related and relevant to this research. This chapter also tells us how inventory

management on customer satisfaction among retail stores helps ensure that

organizations hold inventories at the lowest cost possible while at the same

time achieving the objective of ensuring that the company has adequate and

uninterrupted supplies to enhance continuity of operations.

Inventory management

Inventory management is to ensure that organizations hold inventories

at the lowest cost possible while at the same time achieving the objective of

ensuring that the company has adequate and uninterrupted supplies to

enhance continuity of operations. Companies are keen in managing their

inventory so as to reduce costs, improve the quality of service, enhance

product availability and ultimately ensure customer satisfaction. Inventory

management has a huge financial implication on both the customer

satisfaction and financial performance of an enterprise. High levels of

inventory increases the probability that the customers are likely to get what

they want, increases sales and service levels (Cachon & Terwiesch, 2016).

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 High inventory levels however lead to both stock holding costs and in-

store logistics errors. This is because it becomes difficult for the employees to

perform shelving and replenishment which makes goods physically available

in the store but the employees cannot trace those (phantom products).

Maintaining optimum levels of inventory is important in an organization

because excess inventory results in stock holding costs (rental charges,

opportunity costs, obsolescence costs, breakages, pilferage) and inadequate

inventory (stock outs) is also costly as customers may leave to competitors.

For each sale that an organization does loose as a result of stock outs, the

company not only loses profits but also customers who may be dissatisfied

and source for an alternative reliable supplier (Berling, 2012).

When inventory management (maintaining adequate inventory levels)

is carried out efficiently, it ensures that the materials needed in an

organization are available in the right quality, quantity thus avoiding issues of

overstocking and under stocking and ultimately guaranteeing customer

satisfaction and increased profits. Inventory Costs Inventory costs in an

organization comprises of inventory carrying costs (opportunity costs,

insurance, rent), ordering costs (transport charges, insurance on goods in

transit, inspection of goods inwards) as well as the shortage costs (idle

machines, labor, loss of sales) (Ewuolo, et al, 2015).

Members of the supply chain should find an optimum balance between

supply chain inventory costs and customer satisfaction. Health services found

out that inventory is one of the largest assets in the organizations and hence

the need to manage it. Inventory costs can be reduced by implementation of

reordering points as well as appropriate Economic Order Quantities (EOQ).

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Companies increasingly employ strategies such as Vendor Management

Inventory (VMI) in an effort to control inventory carrying costs (Narkoty,2012).

Small organizations cash flows can only be improved through the

reduction of excess inventory and the optimization of inventory levels. Today’s

customer focused business environments are facing the challenge of creating

processes that are responsive to the demands of the customers. These

demands for example include product diversification as well as pricing which

must be considered in order to remain competitive (Patel & Tirtiroglu, 2012).

In addition, among these demands also is the need for shorter lead-

times especially among the customers who want to receive the products as

soon as they order them. Reduction in lead times means that products and

information flow in a seamless manner which allow all the supply chain

members to respond to the customers’ needs quickly while maintaining

inventory to a minimum. The increase in the distance from the suppliers

premises and the complexity in the logistical aspects often results in longer

lead times and higher levels of inventory (Ohno & Mae, 2012).

However, it is often a challenge for companies that strive to achieve

cost reduction through lower lead-times and reduced inventory levels since it

is difficult for logistics to achieve both goals (Rushton et al, 2006). Eckert

(2007) asserts that better management of inventory is directly proportional to

customer satisfaction. Customers are said to be more satisfied if their

suppliers are able to meet and fulfill their orders within the required time. The

desire to satisfy the customers according to makes the supply chain

members to keep buffer (safety) stocks. The suppliers also enter into long-

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term relationships (which require trust and commitment) with their suppliers to

secure sustainability in supplies.

Maintaining high levels of inventory contributed to high carrying costs

brought in another notion that a business has to recognise that if the levels of

inventories held were too low, costs such as lost production time due to

shortage of raw materials and loss of customer goodwill due to being unable

to satisfy their needs would be incurred. The above arguments therefore,

leave an organisation with a task to solve the inventory puzzle. Where at

least, the organization could be able to respond to customer needs while at

the same time eliminating waste in inventory which was directly related to cost

saving (Atril, 2012).

However, supply chains depended on the successful flow of material in

order to function and satisfy customer demand. They added on to say that

when the flow of material is interrupted at a particular facility, alternative

sources can be considered to keep material flowing through the chain. This

statement justified that inventory or material as referred by the above writers

was a key element in supply chain (Gurnani and Mehrotra, 2012).

The main aim of inventory management is to ensure that organizations

hold inventories at the lowest cost possible while at the same time achieving

the objective of ensuring that the company has adequate and uninterrupted

supplies to enhance continuity of operations (Mpwanya, 2005). A study

carried out by Bhausaheb & Routroy, (2010) shows that companies are keen

in managing their inventory so as to reduce costs, improve the quality of

service, enhance product availability and ultimately ensure customer

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satisfaction. Results of a study carried out by Rosenfield & Simchi-levi (2010)

shows that inventory management has a huge financial implication on both

the customer satisfaction and financial performance of an enterprise.

High levels of inventory increases the probability that the customers

are likely to get what they want, increases sales and service levels (Cachon &

Terwiesch, 2006). High inventory levels however lead to both stock holding

costs and in-store logistics errors. This is because it becomes difficult for the

employees to perform shelving and replenishment which makes goods

physically available in the store but the employees cannot trace those

(phantom products) (Ton & Raman, 2005). Maintaining optimum levels of

inventory is important in an organization because excess inventory results in

stock holding costs (rental charges, opportunity costs, obsolescence costs,

breakages, pilferage) and inadequate inventory (stock outs) is also costly as

customers may leave to competitors (Berling, 2011).

For each sale that an organization does loose as a result of stock outs,

the company not only loses profits but also customers who may be

dissatisfied and source for an alternative reliable supplier (Knights, 2008).

When inventory management (maintaining adequate inventory levels) is

carried out efficiently, it ensures that the materials needed in an organization

are available in the right quality, quantity thus avoiding issues of overstocking

and under stocking and ultimately guaranteeing customer satisfaction and

increased profits (Ewuolo, et al, 2005).

Inventory costs in an organization comprises of inventory carrying

costs (opportunity costs, insurance, rent), ordering costs (transport charges,

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insurance on goods in transit, inspection of goods inwards) as well as the

shortage costs (idle machines, labor, loss of sales). Members of the supply

chain should find an optimum balance between supply chain inventory costs

and customer satisfaction (Bertrand, Poutre & Luin, 2016).

According to Small Business resource (2013), organizations cash flows

can only be improved through the reduction of excess inventory and the

optimization of inventory levels. Lead Time Today’s customer focused

business environments are facing the challenge of creating processes that are

responsive to the demands of the customers. These demands for example,

include product diversification as well as pricing which must be considered in

order to remain competitive (Patel & Tirtiroglu, 2013).

In addition, among these demands also is the need for shorter lead-

times especially among the customers who want to receive the products as

soon as they order them. Reduction in lead times means that products and

information flow in a seamless manner which allow all the supply chain

members to respond to the customers’ needs quickly while maintaining

inventory to a minimum (Brewer, 2000). The increase in the distance from the

suppliers premises and the complexity in the logistical aspects often results in

longer lead times and higher levels of inventory (Ohno & Mae, 2012).

However, it is often a challenge for companies that strive to achieve

cost reduction through lower lead-times and reduced inventory levels since it

is difficult for logistics to achieve both goals asserts that better management

of inventory is directly proportional to customer satisfaction. Customers are

said to be more satisfied if their suppliers are able to meet and fulfill their

9
orders within the required time. The desire to satisfy the customers according

to) makes the supply chain members to keep buffer (safety) stocks. The

suppliers also enter into long-term relationships (which require trust and

commitment) with their suppliers to secure sustainability in supplies (Wang,

2017).

Customer Satisfaction

Customer satisfaction depends on the product’s perceived

performance relative to a buyer’s expectations. If the product’s performance

falls short of expectations, the customer is dissatisfied. If performance

matches expectations, the customer is satisfied. If performance exceeds

expectations, the customer is highly satisfied and delighted. Customer

satisfaction occurs when the value and customer service provided through a

retailing experience meet or exceed consumer expectations. If the

expectations of value and customer service are not met, the consumer will be

dissatisfied. Only very satisfied customers are likely to remain loyal in the long

run. (Levy, et.al.,2014)

Customer satisfaction in a retailing should be a long-term aim and

concentrate into an existing customer rather than replace dissatisfied

customers with new ones. It is extremely important to satisfy customers

because a retailer’s sale comes from two groups of customers: new

customers and repeat customers. In retailing, attracting new customers is

likely to cost company five times as much as pleasing an existing customer.

Customer retention is more important than customer attraction, and a key to

customer retention is customer satisfaction (Armstrong and Kotler, 2012).

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 Exceeding the value offered by competitors is the key to marketing

success. Consumers decide upon purchases on the judgements about the

values offered by suppliers. Once the product is bought, customer satisfaction

depends upon its perceived performance compared to the buyer’s

expectations. Customer satisfaction occurs when perceived performance

matches or exceeds expectations. Expectations are formed through post-

buying, experiences, and discussions with other people, and suppliers

marketing activities (Jobber, 2014).

Companies need to avoid the mistake of setting customer expectations

too high through exaggerated promotional claims since this can lead to

dissatisfaction if performance falls short of expectations. As earlier mentioned,

companies are ready to fight hard to retain customers. Competition is

increasing and the cost of attracting new customers is rising. It might cost five

times as much as attract new customers as to keep current customers happy.

The best approach to customer retention is to deliver high customer

satisfaction and value that result in strong customer loyalty and well

developed business relationships (Armstrong and Kotler, 2012).

The liberalization of markets across the globe has led to an increase in

competition especially among the manufactured goods and services. The

competitiveness of companies in the future will largely depend on how they

respond to the needs of the customers at the end of a supply chain better

than their competitors (Hogstron and Grigorjev, 2013).

Pressure is mounting on firms to reduce their time to market, manage

risks in their supply chains, reduce the total supply chain costs and ensure

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provision of quality services to the customers across the globe. By doing so,

firms are likely to be rewarded through an increased market share. A research

carried out in Uganda shows that manufacturing firms such as Bata Shoe

Company, East African Breweries (EABL), British American Tobacco (BAT)

have a problem of inaccurate forecasts mainly because they lack real time

inventory information on customers demand. This has in turn led to late

deliveries, inadequate deliveries and lack of consistency in the delivery of

products and thus leading to lack of customer satisfaction and non-

responsiveness to the market signals (Daugherty and Autry, 2013).

The ultimate aim of inventory is to serve the customer. As explained by

Viale (1991) inventory is a very expensive asset in an organization; however,

this expensive asset can be replaced by inventory information which is less

expensive. Some of the problems facing manufacturing companies today are

the ability to provide quality services to the customers whose root cause lies

in poor inventory management (Manjrekar, Bhonsale & Kamath, 2015).

The main challenge today among firms in Kenya is the need to

enhance efficiency while at the same time achieving effectiveness (customer

satisfaction). However, firms in Kenya have been accused of poor inventory

management techniques and this has greatly affected their ability to satisfy

their customers. The study therefore sought to carry out an investigation on

the role of inventory management on customer satisfaction among the

manufacturing firms in Kenya( Mutua, 2010).

Variables such as customer needs (having the products immediately

and on hand to satisfy the customer’s needs), vendor partnerships (sharing of

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information regarding sales, sales forecasts as well as amount of inventory)

and data integrity (data on SKU and location which assists in overall inventory

management) often define customer satisfaction among the manufacturing

sector. Firms must respond to the changing customers’ needs in the

increasing competitive environment (Zhang, 2015).

Customers’ expectations are largely dependent on the flexibility of the

supply chain partners. Customer loyalty Customer loyalty is the act of

customers buying current brands repeatedly as opposed to choosing those of

competitors. Customer satisfaction leads to customer retention which in turn

generates a loyal customer base in an organization. Customer loyalty requires

that manufacturing companies delivers on their customers’ expectations fully

in a predictable and an on-going relationship. Customers often judge the

quality of the services that they receive using their perceived expectations

which often lead to customer satisfaction and loyalty (Colburn, 2013).

Loyal customers are six times more likely to purchase or to

recommend the purchase of a company’s products and services to someone

else. Various studies have also shown that dissatisfied customers are likely to

tell nine others while satisfied customers are likely to tell five other people

about the good service and treatment that they have received (Cacioappo,

2000).

Manufacturers need to provide customer purchase satisfaction before and

after a purchase since this is likely to lead to customer brand loyalty.

Customer loyalty is often manifested in repeat observes that satisfied

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customers are likely to adapt a behavior of increase in purchase as well as a

continuous purchase from the firm purchases (Allen & Wilburn, 2012)

Provision of customer purchase satisfaction before and after a

purchase results in repeat purchases. Provision of satisfaction before the

actual purchase by the customer would include aspects such as provision of

quality products, fair pricing of products as well as flexibility (Amini et al,

2005). Post purchase customer satisfaction on the other hand would include

activities such as provision of repair services and efficient operations of

reverse logistics (Howgego, 2012).

Customers are more satisfied if the time taken to deliver their products

is less than the time they are willing to wait once they have placed an order.

Flexibility is paramount in meeting the delivery deadlines and therefore

information sharing is required to enable the members of the supply chain to

meet specified delivery dates by the customers. A study carried out by shows

that effective customer delivery influences customer satisfaction and service

quality. Customers are said to be more satisfied if their suppliers are able to

meet and fulfill their orders within the required time (Yin-mei, 2013).

Correlation Between Measures

The study sought to find out the role of inventory management on

customer satisfaction. 73% of the respondents indicated that the company did

not determine the inventory levels to hold. This meant that the company was

not able to determine how much stocks the company had to meet demand

variations. This supports findings by who asserted that it is important for

companies to define both the maximum and the minimum stock levels to

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ensure that inventory levels cover demand variations. Company experienced

shortages in terms of inventory. This confirms a study by that inventory

shortages leads to both profit and customer loss (Copco, 2013).

The study also found out that inventory management was hindered by

long lead times which often lead to inventory delays in the organization.

Delays in ordering had a strong significant negative relationship with customer

satisfaction. This means that an increase in the delay of the goods ordered

resulted to a decrease in customer satisfaction. This shows that companies

can improve and increase customer satisfaction by reducing lead-times of the

higher tier customers who contribute significantly to the company’s profits

(Knight, 2015).

Inventory management plays a vital role in enhancing customer

satisfaction among the manufacturing firms in Kenya. The study sought to

carry out an investigation on the role of inventory management on customer

satisfaction among the manufacturing firms in Kenya. Customer satisfaction is

crucial since manufacturing firms contribute greatly to the economic

development of a country. Since the company has a well laid down supply

chain inventory information sharing system that is linked to the customers in

real time to enhance inventory management.

Members of the supply chain should ensure that proper records on raw

materials, work in progress and finished goods are available in real time and

easily accessible. This will prevent reduction in inventory levels which often

results to stocks and consequently stock out costs such as idle machine and

idle labor. Lack of enough stocks mean that companies are not able to match

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supply and demand and this greatly affects customer satisfaction and the

organizations bottom line. Organizations should also strive to reduce the lead

times between ordering and receipt. This can be enhanced through proper

inventory management information sharing and collaboration with the

suppliers so that goods are in the organization when they are needed to avoid

stock outs as well as stock holding costs (Akiva,2014).

Theoretical Framework of the Study

This study is anchored by the proposition of Eckert (2007) asserts that

better management of inventory is directly proportional to customer

satisfaction. Customers are said to be more satisfied if their suppliers are able

to meet and fulfill their orders within the required time. The desire to satisfy

the customers makes the supply chain members to keep buffer (safety)

stocks. The suppliers also enter into long-term relationships (which require

trust and commitment) with their suppliers to secure sustainability in supplies.

This study is supported by Cachon & Terwiesch (2006) who stated that

inventory management is to ensure that organizations hold inventories at the

lowest cost possible while at the same time achieving the objective of

ensuring that the company has adequate and uninterrupted supplies to

enhance continuity of operations. Companies are keen in managing their

inventory so as to reduce costs, improve the quality of service, enhance

product availability and ultimately ensure customer satisfaction. Inventory

management has a huge financial implication on both the customer

satisfaction and financial performance of an enterprise. High levels of

inventory increases the probability that the customers are likely to get what

they want, increases sales and service levels.

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 Also, Rashid (2015) stated that Inventory management consisted of

inventory levels, order lead time and inventory turnover. Buyers get pleased

while merchandisers are quick to respond as well as they have flexibility in

responses. Customers want to get defect free products.

Eckert (2007) stressed that customer satisfaction measures consisted

of repeat purchases, customer loyalty, on time delivery, flexibility and quality.

Improved customer satisfaction can be achieved by better inventory

management On-time orders fulfilled by suppliers satisfies customers. This

crafts members of the chain to keep safety stocks for execution of or go into

long term relations which need loyalty and trust.

Conceptual Framework of the Study

Figure 1, shows the conceptual framework of the study the

independent variable is inventory management in terms of inventory levels,

order lead time and inventory turnover. In this study, inventory levels refers to

sales rate of a product will be used by a typical inventory manager to

determine the optimal time for either producing more, if they are managing a

manufacturer's warehouse, or to order more if the product is being stored

as stock at a retail store, order lead time and inventory turnover.

The dependent variable of the study, customer satisfaction in terms of

repeat purchases, customer loyalty, on time delivery, flexibility and quality.

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 Independent Variable Dependent Variable

Customer satisfaction
Inventory management

repeat purchases
inventory levels
customer loyalty
order lead time on time delivery

flexibility
inventory turnover
quality

Figure 1. The Conceptual Framework of the Study

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Significance of the study

Purpose of this study is to examine the influence of inventory

management on customer satisfaction among retail stores in Tagum City. The

results of this study will be beneficial to the business firms, particularly in the

retail stores, to satisfy its customers and respond to their needs efficiently.

Also, this would highlight the importance of building a good relation with

customers which could result in performance improvements and better

decision making. The findings of this study will serve as a reference material

and guide for future researchers who want to conduct the same

experimental study related in the influence of inventory management on

customer satisfaction

Definition of Terms

Inventory Management. Defined as a list of things held in stock. According to

Christopher (2011), inventory management is the management of upstream

and downstream relationship with suppliers and customers in order to deliver

superior customer value at less cost to the supply chain as a whole.

Customer Satisfaction. Refers to the quality of the products, services, price

performance ratios as well as when a company meets and exceeds the

requirements of the customer. Manufacturing organizations may identify

customer satisfaction in terms of on-time delivery as well as meeting customer

specification needs (Eckert, 2005).

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 Chapter 2

METHOD

This chapter presents the research methodology used in the study.

These methods include the research design, research subject, research

instrument, research procedure and statistical treatment of data that will be

used in the study.

Research Design

This study will use quantitative non-experimental research design

utilizing descriptive-correlational technique. In descriptive-correlational

research, the researcher measures the two variables of interest with little or

no attempt to control extraneous variables and then assesses the relationship

between them (Rosehan, 2006). Moreover, Devin (2013) stated that

descriptive-correlational research is the label given to a study when a

researcher cannot control, manipulate or alter the predictor variable or

subjects, but instead, relies on interpretation, observation or interactions to

come to a conclusion. It was in this context that the researchers chose to

utilize descriptive-correlational technique for the study entails to determine the

influence of inventory management on customer satisfaction among retail

store in Tagum City, and the relationship of the two variables.

Research Locale

The findings of this study are specific to the context of the retail store in

Tagum City, Davao Del Norte. The possibility for the general applicability of

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findings was limited by the scope and the sample. Tagum City has a various

retail store in Tagum City.

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Figure 2. The Map of Tagum City

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Population and Sample

The respondents of this study will be selected retail stores in Tagum

City. The employees will be purposively selected during the actual survey by

the researchers. Moreover, the researchers will use purposive sampling

method in which only employees of retail store in Tagum City will be the

respondents of the study. Babbie (2013) defined purposive sampling as also

commonly called a judgmental sample, is one that is selected based on the

knowledge of a population and the purpose of the study wherein the subjects

are selected because of some characteristics.

Research Instrument

The researchers will used a survey questionnaire and collect study

related data from the respondents. Research made questionnaire will be

used for the convenience of both researchers and the respondents of the

study. The first set of the questionnaire will be the indicators of the

independent variables of the study the influence of inventory management

on customer satisfaction among retail store in Tagum City.

To determine the inventory management the following parameter

limits to be used are:

Range of Means Descriptive Equivalent Interpretation

4.30 – 5.00 Very High This means that the

inventory management

is very much observed.

3.50 – 4.29 High This means that the

inventory management

is much observed.

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2.70 – 3.49 Moderate This means that the

inventory management

is moderately observed.

1.90 – 2.69 Low This means that the

inventory management

is less observed.

1.00 – 1.89 Very Low This means that the

inventory management

is not observed.

To determine the customer satisfaction the following parameter limits

to be used are:

Range of Means Descriptive Equivalent Interpretation

4.30 – 5.00 Very High This means that the

customer satisfaction

is very much observed.

3.50 – 4.29 High This means that the

customer satisfaction

is much observed.

2.70 – 3.49 Moderate This means that the

customer satisfaction

is moderately observed.

1.90 – 2.69 Low This means that the

customer satisfaction

is less observed.

1.00 – 1.89 Very Low This means that the

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 customer satisfaction

is not observed.

Data Gathering Procedure

The researchers will undergo the following steps: First, is to seek

permission from the UM Tagum Administration to facilitate the research

process. After which, the researchers will secure a letter to conduct study

from the respondents to allow them to carry out research in the area.

Primary data will be used for the study. Structured questionnaires will be

used as a tool of data collection. The questionnaires will be prepared and

distributed to the selected retail stores in Tagum City by the researchers.

Respondents may write their names or not in the questionnaire for the

purpose of confidentiality and were given a week to fill in the questionnaire,

and finally, the data will be analyzed and interpreted based on the research

objectives.

Statistical Treatment of the Data

The following statistical tools will employ in the analysis and

interpretation of the gathered data.

Mean. This is used to measure the level of influence of inventory

management on customer satisfaction among retail stores in Tagum City.

Pearson (r) Correlation. This is used to determine the relationship of

influence of inventory management on customer satisfaction among retail

stores in Tagum City.

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