Service Quality and Employee Welfare Effects on Customer Satisfaction: Evidence from Indonesian Coffee Chain

Abstract

The intensifying competition in the specialty coffee industry demands comprehensive understanding of customer satisfaction determinants beyond product quality alone. Despite theoretical expectations that both service quality and employee welfare positively influence customer satisfaction, prior empirical findings remain inconsistent regarding their relative contributions and pathways. This study examines the direct and simultaneous effects of service quality and employee welfare on customer satisfaction in coffee shop settings. Employing a quantitative cross-sectional design, primary data were collected through structured questionnaires administered to baristas at Dua Coffee establishments across five branch locations in Greater Jakarta, Indonesia. The findings reveal asymmetric effects: service quality demonstrates a significant positive influence on customer satisfaction, whereas employee welfare exhibits a positive but insignificant direct effect. However, both variables jointly explain meaningful variation in customer satisfaction when examined simultaneously. These results advance service management theory by clarifying that service quality operates as a proximate satisfaction determinant while employee welfare exhibits a positive but statistically insignificant direct effect, suggesting potential indirect mechanisms warranting future mediation analysis. These results offer practitioners preliminary evidence that service quality improvements may yield more immediate satisfaction gains, though balanced attention to both factors remains advisable.