Relationships between service quality and customer satisfaction in rail freight transportation: A structural equation modeling approach

Promoting the use of rail for freight transportation can improve logistics performance and contribute to sustainable development. To increase the share of rail freight, it is crucial to understand its service quality factors as well as their relationships with customer satisfaction, which have not been studied yet. Therefore, the objective of this study was twofold: first, to construct a reliable service quality measurement instrument for understanding the service quality factors and their associated indicators; and second, to examine the direct and indirect relationships between these service quality factors and customer satisfaction. A questionnaire survey was conducted among shippers, freight forwarders, and clearance and forwarding agents (C&F) in Bangladesh, resulting in the collection of 209 samples. Analyzing the data through exploratory factor analysis (EFA) and confirmatory factor analysis (CFA), we developed a six-dimensional instrument for service quality measurement, which includes tangibility, cost of transportation, transit time, reliability, safety and security, and responsiveness. The empirical results obtained through structural equation modeling (SEM) indicated that tangibility has the highest impact on customer satisfaction, followed by cost of transportation. Additionally, transit time, reliability, and responsiveness also play significant roles in influencing customer satisfaction. The findings of the research would help the rail authorities improve the service quality of rail freight transportation and, consequently, enhance customer satisfaction levels.