The TQM Journal

How “quality” determines customer satisfaction: Evidence from the mystery

shoppers’ evaluation
Chih-Hsing Liu Sheng-Fang Chou Bernard Gan Jin-Hua Tu
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To cite this document:
Chih-Hsing Liu Sheng-Fang Chou Bernard Gan Jin-Hua Tu , (2015),"How “quality” determines
customer satisfaction", The TQM Journal, Vol. 27 Iss 5 pp. 576 - 590
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TQM
27,5
576
Received 17 January 2013
Revised 7 September 2013
10 January 2014
Accepted 17 March 2014
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How “quality” determines
customer satisfaction
Evidence from the mystery shoppers’ evaluation
Chih-Hsing Liu
Department of Leisure & Recreation Administration,
Research Centre of Tourism School, Ming Chuan University, Taoyuan, Taiwan
Sheng-Fang Chou
Department of Hospitality Management, Research Center of Tourism School,
Ming Chuan University, Taoyuan, Taiwan

Bernard Gan
School of Organization and Management,
University of New South Wales, Sydney, Australia, and
Jin-Hua Tu
Graduate Institute of Recreation, Tourism and Hospitality Management,
National Chiayi University, Chiayi, Taiwan

Abstract
Purpose – The purpose of this paper is to develop a research framework to explain the relationship
between overall restaurant quality and customer satisfaction.
Design/methodology/approach – To test this model, the authors deploy 48 mystery shoppers to
evaluate 496 Taiwanese restaurants. Further, the authors performed two different regression models
and performing the Baron and Kenny (1986) procedure to test the hypotheses.
Findings – This study investigates whether restaurants are susceptible to the quality and level
of restaurant service, and the restaurant’s physical atmosphere. Further, this study investigates
whether these two constructs are likely to improve customers’ perception of restaurant quality,
and whether such a strategy may also lead to customers’ satisfaction and facilities word-of-mouth
recommendations.
Practical implications – The evidence suggests that the construct of “restaurant service” and
“physical atmosphere” are strong determinant of improving customers’ perception of overall quality of
restaurant. That is, there is a tendency to innovate when restaurant managers prioritize customers’
satisfaction. Further, managers who believe that service and physical atmosphere issues are top
priorities will also improve the overall quality in their restaurants.
Originality/value – Measuring the relationships between Michelin star evaluation criteria via a large
observation sample is rare in the present literature. As far as the authors know, this is the first paper
to exam the relationships between Michelin star evaluation criteria.
Keywords Environmental management, Customer satisfaction, Customer services quality,
Customer service
Paper type Research paper

Introduction
Global competition in the restaurant industry has intensified, and its context is rapidly
The TQM Journal changing. Two general observations can be made. First, high-service-quality restaurants
Vol. 27 No. 5, 2015
pp. 576-590
are sprouting in the Asian region due to the increasing affluence of Asian consumers.
© Emerald Group Publishing Limited
1754-2731
Second, restaurant managers have recently paid increasing attention to acquiring
DOI 10.1108/TQM-01-2013-0004 good market reputations and international recommendations by benchmarking against
 the best restaurants (Cotter and Snyder, 1998; Johnson et al., 2005). One of the earliest Quality
restaurant rating systems was the universally recognized Michelin star system, determines
which was developed by the French company Michelin and has been maintained for
more than a century. The Michelin star system encompasses a comprehensive list of
customer
evaluation criteria that range from consistency in food quality to restaurant ambience. satisfaction
Michelin employs its own professional inspectors who evaluate restaurants
anonymously and then shortlist, collate, and compile top-quality restaurants into an 577
annual guide in various countries, primarily western ones.
The growing affluence of consumers and the sophistication of their dining
preferences together with the increasing popularity of cooking reality shows and
celebrity cooks and the proliferation of consumer recommendations for good
restaurants via social media have further advanced the global influence and prestige of
the Michelin restaurant rating system. A Michelin-starred restaurant achieves fame
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and the highest respect of its peers and customers alike. A restaurant achieving
Michelin-star status is like a mountaineer conquering Mount Everest. However,
the parallel stops there. Unlike the mountaineer, who only needs to conquer the highest
peak in the world once, a Michelin-starred restaurant needs to maintain its high
standards to retain its Michelin-star status. A salient feature of the Michelin evaluation
method is that restaurants do not know when the Michelin inspectors will visit
anonymously. Following this well-proven model, we adopted the mystery shopper
approach in this study.
Although the Michelin Guide has been slow to extend its reach in Asia (it is available
only in Hong Kong, Macau, and Japan), celebrity chefs from Michelin-starred
restaurants from other parts of the world are often invited to showcase their culinary
skills and share their restaurant management know-how with Asian restaurants
aspiring to take their businesses to new levels. Despite the growing importance of the
Michelin star standard as the benchmark for the restaurant evaluation process, there is
limited empirical research on the effects of the Michelin star system on restaurant
performance and consumer satisfaction in the hospitality industry, particularly in
high-service-quality restaurants in Asia.
To fill this gap in the existing restaurant evaluation literature, we deployed
mystery shoppers to evaluate Taiwanese restaurants using the Michelin star system
and various statistical methods. Because logic suggests that satisfied customers
will recommend good restaurants to their friends, we measured two main indicators
of customer satisfaction: satisfaction and recommendation. Although comprehensive
performance measures of customer satisfaction have been widely used in various
industries (Boxall and Macky, 2007; Evans and Davis, 2005; Purcell and
Hutchinson, 2007), measurement of the relationships between evaluation criteria
using large sets of observations is rare in the literature. Figure 1 depicts the
framework and hypotheses of this research.

Restaurant
H1 H4 Customer
Service
Overall H3 Satisfaction
Quality Customer Figure 1.
Physical Recommendation Research framework
H2 and the hypotheses
Atmosphere
 TQM Literature review and hypotheses
27,5 The mystery shopper approach
The mystery shopper approach involves deploying anonymous observers to evaluate the
process of service delivery, often in frontline operations (Wilson, 1998). The selection and
training of mystery shoppers (occasionally referred to as anonymous, secret, or phantom
shoppers) can be conducted in-house or outsourced to a professional organization
578 that provides mystery shopper services. Once deployed, the mystery shoppers pose as
customers to gather information (Cobb, 1995; Dwek, 1996; Wiele et al., 2005).
The information gathered is then collated into a report on the results of an evaluation of
service delivery procedures, the performance of frontline staff, the quality of products,
and potential problems and shortfalls in service quality (Finn and Kayande, 1999;
Finn, 2001). The mystery shopper approach is widely used in various contexts to
measure service quality and performance (Beck and Miao, 2003; Wilson, 1998, 2001).
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This approach can even help to improve service quality and performance (Wilson, 1998).
As mentioned above, Michelin employs its own in-house trained anonymous
inspectors as mystery shoppers. The key advantage of the mystery shopper approach
is that it allows the anonymous inspector to collect a huge amount of information while
avoiding the inconsistencies and discrepancies that result from ad hoc customer
surveys. Conversely, the main concerns with this approach are with the qualifications
and training of mystery shoppers. Do they know what they are evaluating? Mystery
shoppers do not all share similar backgrounds, and their preferences are subjective.
Finn and Kayande (1999) and Beck et al. (2004) suggest that it is possible to fine-tune
the implementation process. Although the mystery shopper approach has been widely
discussed in trade magazines and other non-academic publications, there has been little
academic research on this topic (Wilson, 1998). Wilson (2001) suggests that the mystery
shopper approach deserves wider attention and application in the future.

Effects of quality on restaurant service

Restaurant service is an important consideration that influences restaurant customers’
dining experiences. Restaurant service not only makes critical first impressions on
customers but also influences customers’ perceptions of the quality of a restaurant.
Some scholars advocate that the measurement of restaurant service should encompass
such aspects as friendliness, price, speed of service, care, cleanliness, food consistency
with the menu, and diversity (Knutson, 2000; Johns and Pine, 2002; Nield et al., 2000).
Communication between restaurant employees and customers has been shown to be an
important factor in customers’ satisfaction with restaurant service, with an influence
equal to the influence of environmental indicators (Wall and Berry, 2007). In general,
services that influence customers’ assessments of restaurant service quality include
taking dining reservations via phone or web site, welcoming customers on arrival,
guiding customers to seating, introducing customers to the menu, providing assistance in
ordering, serving food promptly, serving correctly, and billing accurately. Customer’s
assessments of restaurant service quality are also influenced by the levels of care and
friendliness with which these services are provided.
From the perspective of consumers, the quality of a restaurant depends on the service
(speed, friendliness, and care), atmosphere (restaurant layout, furnishings, hygiene,
and level of comfort), and food (hygienic, balanced, and healthy) (Johns and Pine, 2002).
Sulek and Hensley (2004) suggest that an assessment of the quality of a restaurant
encompasses safety, appeal, and dietary acceptability. Namkung and Jang (2007) list
menu variety, meal presentation, healthy, taste, freshness, and temperature as factors
 used to assess the quality of food at restaurants. They also stress the importance of Quality
appropriate food serving temperatures, attractive food plating, preparation methods, determines
appropriate food portions, taste, appearance, aroma, healthfulness, and the cleanliness of
dining ware and food. We propose the following hypothesis:
customer
satisfaction
H1. There is a positive relationship between restaurant service and (customers’
perceptions of) the quality of a restaurant.
579
Effects of quality on atmosphere
The physical atmosphere is a direct factor affecting customer perceived service quality
(Jain et al., 2013). Restaurant atmosphere is an important factor in the evaluation of
high-service-quality service restaurants. Namkung and Jang (2007), Wall and Berry (2007),
Ryu and Jang (2008a, b), and Ryu and Han (2011) argue that the quality of the restaurant
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atmosphere has a significant effect on customers’ satisfaction. For example, seating

capacity, decoration, and background music are key indicators of customers’ satisfaction
with a restaurant’s atmosphere. These studies have shown that layout, furniture, lighting,
temperature, and appliances can affect the atmosphere of a restaurant and the mood and
behavior of the customers. In addition, restaurant atmosphere factors such as visuals,
sound, lighting, scent, and furniture facilities are considered important elements that
influence spending in restaurants (Robson, 1999). Inconsistencies with customers’ previous
experiences in a restaurant, such as discrepancies in service or atmosphere, also affect
customers’ satisfaction and repeat patronage (Ryu and Han, 2011). The salient elements of
restaurant atmosphere are the layout, lighting, decorations, furniture, sounds, smells,
temperature, brand name and logo design, menu design, and advertisement design.
The main purpose of a restaurant is to provide a relaxing environment for
customers to enjoy dining. Therefore, the restaurant environment and architectural
design need to create a unique sense of beauty and attractiveness to attract consumers’
attention (Wakefield and Blodgett, 1994, 1996; Newton, 2002; Fischer, 2006; Peyton, 2006).
With respect to culinary skills, research has shown that the ability of chefs to
integrate their cuisine perfectly with the restaurant’s atmosphere is a critical aspect
of customers’ perceptions of chefs’ innovativeness and creativity. This is because
customers’ perceptions of the quality of a restaurant are closely linked to their
perceptions of the quality of the dining environment (Horng and Lee, 2006; Horng and
Hu, 2008). Thus, we propose the following hypothesis:
H2. There is a positive relationship between a restaurant’s physical atmosphere and
(customers’ perception of) the quality of a restaurant.

Effects of (customers’ perception of) the overall quality of a restaurant on customer

satisfaction/recommendation
Customer satisfaction usually comes from the overall evaluation of service quality
(Kong, and Muthusamy, 2011; Pantouvakis and Bouranta, 2013; Santouridis and
Trivellas, 2010). Beside service quality not only influence customer satisfaction
and also impact on customer behavioral outcome (Narteh, 2013). Restaurant quality
is often the key factor in customers’ decisions to choose and recommend restaurants
(Clark and Wood, 1999). A number of studies support the view that the quality of a
restaurant is a key factor in customer satisfaction (Susskind and Chan, 2000; Mattila
and Wirtz, 2001). Mattila and Wirtz (2001) show that this is true for casual-dining
restaurants. In another study of customers’ satisfaction with service in Korean
restaurants, high-quality service was found to have a positive influence on customer
 TQM satisfaction (Ha and Jang, 2010). Studies by Baker and Crompton (2000) and Namkung
27,5 and Jang (2007) provide further evidence of the positive relationship between restaurant
quality and customer satisfaction. This study extends these previous studies by testing
whether a customer who is happy with the overall quality of a restaurant will recommend
the restaurant to his or her friends. Thus, we propose the following hypothesis:
H3. There is a positive relationship between the quality of a restaurant and
580 customer satisfaction/recommendation.

Effects of restaurant service quality, atmosphere, and customer satisfaction on the

likelihood of restaurant recommendations by customers
Studies on consumers’ purchase decisions indicate that customer satisfaction is often
attributable to their perceptions of restaurants as providing high-quality service
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(Caruana et al., 2000; Cronin et al., 2000; Namkung and Jang, 2007). For example, Sulek
and Hensley (2004) found that atmosphere, service, and restaurant quality are the most
important factors influencing customer satisfaction. The quality of a restaurant can be
affected by the quality of service (Knutson, 2000; Johns and Pine, 2002; Nield et al., 2010)
and the restaurant’s atmosphere, including the seating arrangements, interior design,
background music, and other sensory factors (Ryu and Han, 2011). Ha and Jang (2010)
have argued that the quality of service and the quality of food have different effects
on customer satisfaction with restaurant atmosphere.
More importantly, although managers may choose to leverage restaurant service
and atmosphere with a simple repertoire of actions and features that may increase
customer satisfaction (Kim et al., 2006), they may also fail to pay attention to other
factors that have been shown to influence customers’ willingness to recommend
the restaurant. That is, customer satisfaction is desirable, but it is not sufficient to
guarantee success. It is not enough for a restaurant to ensure customer satisfaction;
the satisfaction must result in the customer recommending the restaurant to others
in his or her social network. The overall quality of a restaurant is considered a fundamental
element in customer satisfaction and the likelihood of a customer recommending the
restaurant to others (Namkung and Jang, 2007; Sulek and Hensley, 2004). When the overall
quality of a restaurant decreases, these unconsidered critical factors will undermine the
restaurant’s customer satisfaction and loyalty and will rapidly result in negative
word-of-mouth advertisement via social media. Thus, the quality of a restaurant is
expected to enhance customer satisfaction and the likelihood that the customer will
recommend the restaurant. We propose the following hypothesis:
H4. The overall quality of a restaurant mediates the relationships among restaurant
service, physical atmosphere, customer satisfaction, and the customer’s
willingness to recommend the restaurant.
Unlike the usual random customer satisfaction surveys, we adopted a painstaking process
of selecting qualified mystery shoppers who were industry experts in assessing the design
of restaurants and their services and who were also experts in restaurant operations and
evaluations. These mystery shoppers had the necessary training and expertise to provide
better explanations and interpretations of quantitative and qualitative measurements than
regular restaurant customers (Wilson, 1998). Data compiled by 48 mystery shoppers
deployed randomly to 496 restaurants were used in this study. Given the proven track
record of the Michelin star evaluation system and its recent increasing prominence,
particularly for well-established restaurants that have retained their star ratings for more
 than ten years, we used evaluation items based on the Michelin star evaluation system Quality
(Johnson et al., 2005). Most of the independent and dependent variables considered require determines
five-point Likert-style responses ranging from “strongly disagree” to “strongly agree.”
customer
Methods satisfaction
Because of the variable characteristics for measuring the efficiency of the dependent
variable, various statistical methods were used to test the models. We used the STATA 581
program to perform multiple ordinary least squares (OLS) regressions of the customer
satisfaction and overall quality variables. Logistic regression analysis was used to
analyze customers’ recommendations. We added the key variables to the equations
one at a time to ensure that each improved the overall model fit. We then tested the
significance of the indirect effects of overall quality on customer satisfaction and
recommendations using the Sobel test. This test is consistent with Baron and Kenny’s
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procedure, which was judged to be appropriate for use in testing the mediation
hypotheses of this study (Liu and Lin, 2011; Sobel, 1982).

Variables
The research model used in this study consisted of two major components: Michelin
star evaluation criteria and customer satisfaction. The Michelin star evaluation
criteria represent a multi-dimensional construct that measures restaurants with respect
to second-order latent variables in the following three dimensions: restaurant service,
physical atmosphere, and overall quality. Customer satisfaction is a multi-dimensional
construct in two dimensions: satisfaction and recommendation (Michelin Travel
& Lifestyle, 2007). We included a dummy variable for customer recommendation,
with a restaurant worth recommending coded as 1 and one not worth recommending
coded as 0. Restaurant size was measured by the number of employees. We included
the following controlled measurement items: expenditure for average consumption,
whether there were credit card facilities on site (restaurants accepting credit cards were
coded as 1; cash-only restaurants were coded as 0), and on-site parking availability
(restaurants with parking lots were coded as 1; restaurants without parking lots
were coded as 0).

Results
We took several steps to ensure data validity and reliability for the measurement items.
We pre-tested the survey questions with six experts to eliminate ambiguous questions
and revised a number of questions based on the experts’ opinions of their
appropriateness, opinions, and experiences. After each questionnaire was completed,
we used previously validated measurement items whenever possible to help ensure the
validity of the measurement items. We assessed the reliability of the multi-item
constructs using Cronbach’s α, as suggested by previous studies (Cortina, 1993).
As a result of these efforts, all of our measurement scales achieved reliabilities greater
than the recommended 0.70 (see Table I). Considering the apparent validity of the
factors and the strong factor loadings for the measurement items, we believe that it
was reasonable and acceptable to use this factor as a control in subsequent analyzes
(Li and Atuahene-Gima, 2002).
We conducted a confirmatory factor analysis to assess the convergent and discriminant
validity of the Michelin star evaluation criteria. The results of the confirmatory factor
analysis, shown in Table I, indicate that the measurement model fits the data well
(χ2 ¼ 512.46, χ2/df ¼ 164, p ¼ 0.000, RMSEA ¼ 0.65, NFI ¼ 0.899, RFI ¼ 0.871, IFI ¼ 0.929,
 TQM Item description summary Standardized loading Cronbach’s α
27,5
Physical atmosphere
1. The creation of a superior theme or ambience using table decoration,
restaurant decor, appearance, and signage 0.87 0.854
2. The design of the menu is congruent with the restaurant features and
ambience 0.80
582 3. An excellent and appropriately themed web site and
publicity materials 0.80
4. Presence of pleasant ambient stimuli such as lighting, music,
and scent 0.82

Restaurant service
1. Efficient and effective booking service 0.68 0.878
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2. Efficient and effective process in the welcoming and ushering of

the customers 0.83
3. Efficient and effective explanation of the menu 0.79
4. Efficient and effective process in delivery of food 0.80
5. Efficient and effective billing process 0.78
6. Excellent interaction with the customers in the entire process 0.85

Overall quality
1. Food is served at the right temperature 0.66 0.841
2. Excellent presentation of the restaurant decoration 0.69
3. The overall environment is good and the food taste delicious 0.83
4. The excellent of memories leaves long lasting impression 0.79
5. The food look and smell delicious 0.82
Table I. 6. Preparation of food meets health trends 0.65
Construct 7. The place and utensils are clean and hygienic 0.54
measurement and
confirmatory factor Model fit index
analysis results χ2 ¼ 512.46, χ2/df ¼ 164, p ¼ 0.000, RMSEA ¼ 0.065, NFI ¼ 0.899, RFI ¼ 0.871, IFI ¼ 0.929, CFI ¼ 0.929

CFI ¼ 0.929). The global fit indices of the measurement model indicate that the measurement
item fits the data well. We also conducted a convergent validity test. The t-valueW2.0
results suggest that the path coefficients from the latent constructs to the corresponding
manifest indicators are statistically significant. This finding provides strong evidence of
convergent validity (Anderson and Gerbing, 1988).
Table II provides descriptive statistics and correlations for all variables. Tables I
and II show the results of the OLS and logistic regression analyzes of the Michelin star
evaluation criteria and customer satisfaction. We ran similar tests for both dependent
variables (customer satisfaction and recommendation). The results of OLS regression
analysis in Table III show the relationship between restaurant service, physical
atmosphere, overall quality and customer satisfaction. H1 and H2 propose positive
relationships among restaurant service, the physical atmosphere, and overall quality.
As shown for Model 1, restaurant service and the physical atmosphere were
significantly correlated to overall quality (p o 0.001) and explained 51.7 percent of the
variation. Thus, H1 and H2 are supported. Model 2 shows that restaurant service and
the physical atmosphere were significantly correlated to customer satisfaction
(p o 0.001) and explained 24.8 percent of the variation. H3 proposes positive
relationships between overall quality and our two dependent variables (customer
satisfaction and recommendation). Model 3 shows that overall quality was significantly
 Downloaded by Universiti Putra Malaysia At 19:33 02 November 2016 (PT)

Variable Mean SD 1 2 3 4 5 6 7 8 9

1. Satisfaction 3.317 0.812 –

2. Recommendation 0.757 0.482 0.412*** –
3. Overall quality 3.557 0.577 0.528*** 0.510*** –
4. Atmosphere 3.487 0.725 0.331*** 0.321*** 0.530*** –
5. Service 3.379 0.694 0.423*** 0.398*** 0.658*** 0.486*** –
6. Size 103.538 97.112 −0.013 0.058 0.002 0.125** 0.037 –
7. Expenditure 563.401 417.783 −0.091* 0.139** 0.301*** 0.192*** 0.224*** 0.045 –
8. Credit card 0.723 0.447 −0.012 0.177*** 0.168*** 0.333*** 0.197*** 0.207*** 0.335*** –
9. Parking space 0.460 0.498 0.003 0.039 0.085 0.165*** −0.001 0.191*** 0.199*** 0.253*** –
Notes: *p o0.05; **p o0.01; ***p o0.001

Descriptive
statistics and
correlation matrix
Table II.
satisfaction
determines
customer
Quality

583
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27,5

584
TQM

customer
Table III.

satisfaction
of quality and
Results of OLS
regression analysis
Overall quality Customer satisfaction
Model 1 Model 2 Model 3 Model 4
Dependent variables β t β t β t β t Sobel test

Control variables
Restaurant size −0.000 −1.53 −0.000 −0.78 0.000 0.05 −0.000 −0.19
Expenditure 0.000 4.52*** −0.000 −4.50*** −0.000 −6.67*** −0.000 −6.67***
Credit card −0.096 −2.09* −0.172 0.080* −0.049 −0.68 −0.105 −1.42
Parking lot 0.042 1.09 0.055 0.067 0.014 0.23 0.026 0.062
Independent variable
Restaurant service 0.222 0.030*** 0.443 8.32*** 0.156 2.70** 6.713***
Physical atmosphere 0.419 0.030*** 0.235 4.48*** 0.082 1.62 10.418***
Mediating variable
Overall quality 0.857 15.94*** 0.684 9.40***
Model statistics
R2 0.517 0.248 0.347 0.363
R2adj 0.511 0.239 0.341 0.354
F 87.24*** 26.92*** 52.25*** 39.83***
n 496 496 496 496
Notes: *p o0.05; **p o0.01; ***p o 0.001
 correlated to customer satisfaction (po0.001) and explained 34.7 percent of the variation. Quality
Overall quality was also significantly correlated to customer recommendation (po0.001) determines
in Model 6. Thus, H3 is strongly supported.
Lastly, H4 proposes that overall quality mediates the relationship between restaurant
customer
service, the physical atmosphere, and customer satisfaction/recommendation. To test H4, satisfaction
we performed the Sobel test, which is a direct test of the indirect effect of an independent
variable on the dependent variable through the mediator (Preacher and Hayes, 2004; Sobel, 585
1982; Yang et al., 2010). The results of logistic regression analysis in Table IV show the
detail of mediation test. In step 1, the restaurant service and physical atmosphere variables
were found to be significant predictors of customer satisfaction and customer
recommendation in Models 2 and 5 (po0.001). In step 2, overall quality was found to
be significantly correlated to customer satisfaction and customer recommendations in
Models 3 and 6 (po0.001). When we added restaurant service and the physical
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atmosphere to the equation in step 3, the effect of restaurant service decreased significantly,
and physical atmosphere was no longer significant at the conventional level. However,
overall quality remained significant in Models 4 and 7. The combined results of steps 1-3
support H4. Therefore, the results provide strong support for arguments that restaurants’
ratings facilitate customers’ satisfaction and recommendation likelihood.

Discussion
A happy and satisfied customer is likely to repeat patronage and is likely to
recommend the restaurant to his or her friends, family, and acquaintances. Conversely,
an unhappy customer is likely to share information about a bad dining experience
online. In today’s era of Facebook and Twitter, this action has serious and important
implications: bad word-of-mouth publicity can do considerable damage to a restaurant.
This reality raises an important question: what makes a customer happy and satisfied?
This study was conducted to investigate whether the overall quality of a restaurant

Customer recommendation
Model 5 Model 6 Model 7
Dependent variables β t β t β t Sobel test

Control variables
Restaurant size 0.000 0.63 0.001 1.23 0.001 1.16
Expenditure 0.000 0.93 −0.000 −0.56 −0.000 −0.62
Credit card 0.198 0.70 0.600 1.95 0.507 1.60
Parking lot −0.133 −0.54 −0.301 −1.11 −0.241 −0.87
Independent variable
Restaurant service 1.433 6.43*** 0.621 2.41* 5.366***
Physical atmosphere 0.616 3.24*** 0.108 0.49 3.070**
Mediating variable
Overall quality 3.210 9.74*** 2.777 7.55***
Model statistics
Pseudo R2 0.206 0.324 0.336 Table IV.
χ2 116.59*** 183.15*** 190.07*** Results of logistic
Log likelihood −223.87 −190.59 −187.13 regression analysis
n 496 496 496 of customer
Notes: *p o 0.05; **p o0.01; ***p o0.001 satisfaction
 TQM makes a customer happy and satisfied and to investigate whether the level of restaurant
27,5 service and the physical atmosphere of a restaurant are likely to improve customers’
perceptions of restaurant quality and whether these constructs may result in customers’
satisfaction and word-of-mouth recommendations. Our evidence suggests that the
constructs of “restaurant service” and “physical atmosphere” are strong determinants of
customers’ perceptions of the overall quality of a restaurant. Thus, restaurant managers
586 who prioritize customers’ satisfaction should pay attention to these two constructs.
Furthermore, restaurant managers who treat service and physical atmosphere as top
priorities will improve the overall quality of their restaurants. This finding is important;
Snyder and Cotter (1998) argue that high-quality amenities and high-quality service are
pre-conditions for a high-quality restaurant. More attractive establishments are more
likely to receive favorable recommendations from Michelin.
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Conclusions
Prior research has shown that a positive relationship exists between the quality of a
restaurant and customer behavior (Johns and Pine, 2002). We investigated this
relationship using the mystery shopper approach. This is a well-proven approach used
by the Michelin star system to evaluate the best restaurants in the world. To ensure
rigor in the collection of data, we put extensive effort into the selection and training of
our mystery shoppers.
In this study, we went beyond the customer-based research of Johns and Pine (2002)
in three ways. First, we empirically tested the hypothesis of a relationship between
overall quality and customer satisfaction. Second, we considered a different objective
measure of customer satisfaction and used different statistical tests. Lastly, our study
extended previous research findings and added value to cultural sampling by evaluating
Taiwanese restaurants using mystery shoppers. This aspect of our research extended the
work of Namkung and Jang (2007) by examining the perceptions of quality of a
restaurant in relation to customer satisfaction and behavioral intentions. Namkung and
Jang (2007) did not provide such a mediated examination. In particular, by pioneering a
study that examines the mediating role of overall quality, we are able to shed light on the
mechanism by which restaurant service and the physical atmosphere impact customer
satisfaction through customers’ perceptions of the quality of a restaurant.
Our findings highlight the critical roles of various aspects of restaurant evaluation
criteria in restaurant operations and suggest that restaurants need to proactively manage
restaurants’ service and the physical atmosphere to enhance customers’ perceptions of
overall quality, which, in turn, enhances customer satisfaction and recommendations.
Of course, the approach taken in this study has some limitations. First, the restaurant
evaluations were based on mystery shoppers’ perspectives (such as their satisfaction and
overall quality evaluation). The opinions of managers and customers were not explored
in this research. These opinions merit further attention, especially in the restaurant
industry. Second, other restaurant performance variables, such as benefit seeking and
efficiency, which have been usefully employed by other researchers (Kumar et al., 2011),
could be incorporated into future studies. Third, the research setting was confined to the
restaurant industry in a specific geographical setting of Taiwan, calling into question
the appropriateness of generalizing the results to other regions and industries. Thus, in
any future study, similar evaluation criteria should be examined for other regions and
industries to obtain more useful information. In conclusion, the empirical findings of this
study provide important theoretical insights and practical implications for restaurant
evaluations and operations.
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About the authors

Chih-Hsing Liu is an Assistant Professor of Ming Chuan University, and received the PhD Degree
in Strategy Management from the National Taiwan University. His current research interests
focus on understanding the effects of the social context on creativity and examining the impact of
knowledge creation at the firm level and individual level. He has published papers in several
international journals in this field.
 TQM Sheng-Fang Chou is an Assistant Professor of Ming Chuan University, and received the PhD
Degree in Department of Human Development and Family from the National Taiwan Normal
27,5 University. His research interests include hospitality education, food and beverage management,
restaurant franchise management, food culture and gourmet tourism. Assistant Professor Sheng-
Fang Chou is the corresponding author and can be contacted at: dodo.chou@gmail.com
Bernard Gan has recently joined the Department of International Studies and Asian Studies at
the Griffith Business School, Griffith University, Queensland, Australia in July 2015 as a Senior
590 Lecturer.
Jin-Hua Tu is a PhD Student in Graduate Institute of Recreation, Tourism and Hospitality
Management, National Chiayi University, Taiwan. Her main research interests include marketing
management in tourism and hospitality, and leisure behavior.
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