Empirical study on factors affecting performance of Singapore's neighbourhood shops.

Abstract

This paper addresses the lack of research on factors that affect the performance of neighbourhood small shop in the Singapore retail context. These factors, marketing activities, feedback, managerial expertise, marketing efforts, service quality and customers’ loyalty, which are within retailers’ control, were hypothesized to affect the store performance. Consistent with the hypothesized model, all of these factors with the exception of service quality, have significant effect on store performance. To better understand customers’ needs, this study also finds out how important store image to consumers is. Managerial expertise was found to be the most fundamental factor which is significantly related to other factors which affects store performance. The strong link between service quality and customer loyalty is also not to be overlooked to ensure good store performance. Characteristics of retailers with poor and good performing stores were summarized to suggest the necessary skills needed for good store performance. Recommendations on how to build up managerial expertise to improve store performance were given. This study also proposed retailers to understand the changing needs of aging population so that retailers can target this market.