The Influence of Product Quality and Price Through Service Quality on Customer Satisfaction at UD Dewi Sri Ciracas Distributor

Abstract

This study examines the influence of product quality and price on customer satisfaction, mediated by service quality, at UD Dewi Sri Ciracas rice distributor in Jakarta, Indonesia. Despite the strategic importance of rice as a staple food and the competitive nature of the distribution sector, limited empirical evidence exists regarding the factors driving customer satisfaction in small-scale rice distributors. Using a quantitative approach with purposive sampling, data were collected from 100 customers through structured questionnaires and analyzed using Partial Least Squares Structural Equation Modeling (PLS-SEM) with SmartPLS 4.0. The findings reveal that product quality has a significant positive effect on customer satisfaction (t-statistic = 4.932, p < 0.05), while price (t-statistic = 1.511, p > 0.05) and service quality (t-statistic = 0.600, p > 0.05) do not significantly influence customer satisfaction directly. Furthermore, service quality fails to mediate the relationship between product quality and customer satisfaction (t-statistic = 0.606, p > 0.05) or between price and customer satisfaction (t-statistic = 0.533, p > 0.05). The model explains 91.2% of the variance in customer satisfaction (R² = 0.912). These results suggest that in the rice distribution context, product quality remains the primary driver of customer satisfaction, while price competitiveness and service improvements require strategic reconsideration. Managerial implications include maintaining product quality standards, implementing more competitive pricing strategies, and enhancing information transparency regarding product availability.