Pa ge 1 Pa ge 1 American Journal of Multidisciplinary Research and Innovation (AJMRI) Structural Equation Model on Customer Expectations and Perception of Restaurants’ Service Quality Adapting a Modified DINESERV Approach Enya Marie D. Apostol1*, De Guzman Erodalyn J.1, Mañibo Clark Devon M.1 Volume 2 Issue 5, Year 2023 ISSN: 2158-8155 (Online), 2832-4854 (Print) DOI: https://doi.org/10.54536/ajmri.v2i5.1879 https://journals.e-palli.com/home/index.php/ajmri Article Information ABSTRACT Received: July 05, 2023 Accepted: July 28, 2023 Published: August 22, 2023 The study focused on assessing empirically on the developed version of the Modified DINESERV model. The purpose of the research is to assist restaurant owners and managers in measuring customers’ expectations and perceptions of service quality along the following dimensions: Tangibility, Reliability, Responsiveness, Assurance, and Empathy. The modified DINESERV model composed of 29 attributes was utilized in the formulation of the questionnaires. In the efforts to explore the multivariate relationship among the variables, structural equation modeling (SEM) using JAMOVI version 2.3.21 software was used to analyze the data from one hundred two (102) customers. The findings showed that the overall perceptions score was higher than expected, indicating that customers are satisfied with the service quality of services they received. The study included the results on demographic profile of respondents by which majority were aged 21-25 years (n=38), generally single (n=67) and female (n=62) who were mostly employed (n=49) and most of customers were students (n=30) of nearby Colleges and Universities. The findings of the study unveiled that there is a significant relationship among dimensions; tangibility (β=0.634), reliability (β=0.589), responsiveness (β=0.561), assurance (β=0.641), empathy (β=0.656) have a positive and direct effect on service quality and the value of customers’ expectations (β=0.711), the value of customers perceptions have a significant relationship with service quality (β=0.754). Keywords Customer Expectation, Customer Perception, Service Quality, DINESERV Model, Restaurants INTRODUCTION Determining customer expectations and perception on service quality is one of the significant indicators in Hospitality industry. Customers are known as the backbone of a business without them, businesses cannot continue to exist. Customers enter restaurants with preconceived ideas about the quality of service they want to expect to receive which is the customer expectation. Meanwhile, customers form perceptions when they assess the equality of the services. By some means today’s customers are more demanding, experienced, and more aware of what they want and how best to deliver it, their expectations of service quality are at the highest extent. They either consciously or unconsciously have certain standards and expectations for how a restaurant’s delivery of services fulfills those needs. The way businesses monitor customers’ behavior can give a competitive advantage. It is understood that service quality should be properly described by taking the perspective of the customer into account. Providing high-quality service through exceeding customer perception and expectation builds customer satisfaction. Performing a certain service in a way that satisfies its customers’ needs. It is somehow important to distinguish what’s within the service expectations and the service perception that a customer has. Consumers are becoming more certain of the restaurant service quality (RSQ) of local restaurants (Rhou & Signal, 2020). Understanding how a customer perceived service quality, the customer insights will enable the establishment in achieving several objectives, such as strengthening the quality of their goods and services (Schuckert et al., 2015). As the dining experience has an immediate effect on a customer’s behaviors and intentions to return to a restaurant, these factors are the establishments should be focused on providing quality service. The perception of service quality by customers is important for long- term sustainability, thus a need to continually monitor customer satisfaction with the service. Restaurant owners that can provide their customers with high-quality service will have an advantage over their rivals in campaigns to keep business, grow, and remain sustainable, based on the study of (Ryu & Han 2010, cited in Oswald, 2018). The challenges are how the restaurants will continually provide quality service to meet the customer expectations and perceptions to survive the competition. Within the hospitality industry, the food and service sectors are one of the largest sectors. According to the data gathered by Statista that is published by Lock (2021), the number of food services units worldwide is varied greatly by country, the Mainland China had the most establishments at 9.3 million, comparatively the second highest number of food units in India with 1.4 million establishments, this statistic shows how large a food and beverage industry. This statistic can help the researchers and readers to understand how important the food and services sectors in one country that can produce a lot of job opportunities. According to the National Restaurant Association (2020) the total revenues of the restaurant business have tripled over the past 25 years, but they have decreased by 30% to just under $200 billion, this gathered 1 Mindoro State University, Philippines * Corresponding author’s e-mail: shreekrishna@kusoed.edu.np Pa ge 2 https://journals.e-palli.com/home/index.php/ajmri Am. J. Multidis. Res. Innov. 2(5) 1-12, 2023 statistics show how large a food service sector and how it can generate income that helps the country’s revenue in food service sectors, with this statistics the decreased in revenue can be determined and proposed a solution that can help the growth of the industry. Based on the data gathered by the Travel and Tourism Research Association TTRA (2018) more than 170 million Americans visit restaurants every day. Customer desires to dine according to their interests and it is helpful to the growth of the food and service industry. According to Danny Klein (2022) in checking the customer restaurant state that 64% of customers are looking for a certain type of food; 58% of customers wanted to celebrate a special occasion or simple celebrations; and 43% of the customers said they craved the ambiance of the restaurant. Food and service outlets are part of the daily lives of billions of customers as a place for them to get food or simply spend some quality time with their friends and family. According to the Philippine Statistics Authority (2012) the Survey of Tourism Establishments in the Philippines (STEP) conducted a survey nationwide year 2009, under the collected data 13,120 establishments were operating in the Philippines that provided food and beverage services. The majority, 10,282 or 78.4% of the total were restaurants, cafés, and fast food outlets. This statistic shows how many food service establishments are operating in the Philippines and how important to research the contribution of the largest sectors in every country. As the food and services industry are continuously growing from 2015 until the present, the food and service sectors in the Philippines generated revenues of $8.37 billion. The country’s food service sector is expected to produce $9.36 billion, or 12.0% more, in revenue in 2021 based on the statistics gathered by Statista (2022). This statistic shows how important the food service sectors are in the contribution of the country’s revenue. According to the statistics gathered by Statista (2021), 53% of the customers were likely to dine in restaurants towards the end of 2020. This shows that the food service sector is one of the most important outlets that can contribute to the growth of the economy. Until today numerous researchers attempted to understand how customer expectations and perceptions influence the service quality of restaurants. Thus, customers distinguish the quality of service based on how much service managers put time and effort into their daily operations as well as academic researchers (Markovic et al. 2015). To measure service quality, researchers have created service models in an attempt to quantify customer expectations and perceptions in the hospitality industry. One of those is the SERVQUAL, a predominant instrument refined by Parasuman et al. (1988). However, the model was criticized for being inadequate to measure the entire type of services in the restaurant industry. The DINESERV model was proposed by Stevens et al. (1995) as the combination of the SERVQUAL service quality scale (Parasuraman et al. 1988) and the LODGSERV accommodation quality scale (Knutson et al. 1990) to incorporate the restaurant services. Various studies evaluate how customers view restaurant service quality using the DINESERV model by (Steven et al. 1995). Numerous studies about evaluating service quality had been published. However, there is a lack of current research studies about how customers expected and perceived the service quality that focuses on local restaurants, which serves as deciding factor to conduct the study. This study filled the research gap on limited literature in the local setting using the DINESERV model, since most were using SERVQUAL model on determining the relationship between customer expectation and customer perception on service quality. The study aims to help restaurant owners and managers to measure customers’ expectations and perceptions of service quality based on the following dimensions: Tangibility, Reliability, Responsiveness, Assurance, and Empathy. This will enable local restaurants to get an overview of the service quality according to customers and take the required actions to close any gaps and meet the satisfaction as well as preferences of the customers. This research, which was conducted by hospitality students, is informative, and relevant to delivering high- quality service, and it supports the researchers’ chosen career path. The results of this study will increase and improve the performance of restaurant services and acquire an awareness of consumer expectations and perceptions. Steven, et al. (1995) developed the DINESERV instrument as a tool to evaluate restaurant service quality. DINESERV is suggested as a reliable, relatively simple method for determining how customers think about the service quality of a restaurant. Five categories of service-quality standards are included in the 29- item DINESERV questionnaire: assurance, empathy, reliability, responsiveness, and tangibles. As cited by Abezie (2019), in a recent study of assessing a restaurant service quality the analysis accomplished and proved that the DINESERV model is a reliable tool to gauge how well services are perceived by customers. Theoretically, the DINESERV can be used in different types of restaurants but to an extent, it will be used only in fine dining restaurants to measure the customer expectations and perception of service quality of the local restaurants. DINESERV has been improved so that it can be used to examine how the customer perceived the quality of service to a restaurant. It is developed exclusively for ongoing evaluation of customers’ perceptions of the restaurant’s quality of service. This DINESERV would help the researcher to evaluate whether a change in perceptions was driven by a change in normative expectations or a change in the quality of the services provided. Restaurant owners would also benefit from using DINESERV to study the customers of their competitors because success requires having a competitive edge. This aims to provide restaurant owners and operators with a tool to gauge and get an overview of the service quality of their restaurants as well as to be prepared to take the appropriate actions. Pa ge 3 https://journals.e-palli.com/home/index.php/ajmri Am. J. Multidis. Res. Innov. 2(5) 1-12, 2023 the perceptions of customers, the dimensions of service quality, and their relative importance for customers can increase customer satisfaction which will result in gaining loyalty. Customer perception can influence customer decisions on which type of product or service to purchase. This perception and expectation on the quality of products and services can affect the business in gaining customer loyalty if not met. Customers are more knowledgeable to have a source of information about the upcoming products and services encounter that will lead to their expectations and perception towards the quality services. As stated by (Omanukwue, 2011) that the perception and expectation of service quality are reflected in customer behavior. It can influence product or service purchases. According to (Fornell, et al. 1996) that perceived service quality is the evaluation of the consumption experience of associated service, while xpectations of service quality are the pretrial beliefs. Managing customers’ perception and expectation are important. Other business meets their customers’ perception and expectation by actively managing the customer expectations as presented by Miller (2000). Providing and delivering high-quality services t customers can offer a business an opportunity to be known in the competitive market as discussed (Yavas & Benkenstein, 2007). In the service industry, customer expectations and perceptions of the quality of service are based on what they have experienced. According to Parasuraman et al. (1985), SERVQUAL is the modified model in determining the perception gap between the received service quality and the expected service quality but as stated by (Steven et al. 1995) DINESERV model fits in the restaurant industry in determining how customers view the restaurant service quality as explained by Madison (2022) that expectations and perceptions are closely related to satisfaction. It means that customers who have low expectations of the service quality of the restaurant will be satisfied if they get more than what they expected, while if they expected high quality and it’s not met the result will be dissatisfaction with the service. Customer Satisfaction on Service Quality The firm’s ability to compete in the market depends on high-quality services. Customer Satisfaction is a key component of business methodology that determines the bearing of service performance. By recognizing service issues and developing metrics for service performances, outcomes, and customer satisfaction, high service quality can be attained. Customer satisfaction is a measure of how products and the services provided meet or surpass customer expectations as stated in the study (Kotler & Armstrong, 2018). Customer satisfaction was characterized as the customer`s evaluation of a product or service as far as whether that product or service has addressed the customer’s needs and expectations (Alan, Valarie, Mary Jo, & Dwayne, 2012) as indicated by them, some variables impact customer satisfaction, for Research Model and Hypotheses The study aimed to empirically assessed the service quality of select local restaurants in the province of Oriental Mindoro, Philippines. The level of expectations and perceptions among restaurant services will be evaluated using the Modified DINESERV Model. In this context, the study intended to use Structural Equation Modeling following the research model in Figure 1. Figure 1: Research Model The study proposed seven (7) hypotheses which serve as the study’s research questions. Structural Equation Modeling is used to determine the results of the significant relationship between the expected and perceived service quality, unlike a prior study by Saneva & Chortoseva (2018) that solely used a software package to determine the results of a significant relationship. Structural Equation Modeling of the impact of Service Quality on Customer expectation and Perception. The research hypotheses for the study include: H1. The Tangibility of restaurants have positive and direct effect on service quality. H2. The Reliability of restaurants have positive and direct effect on service quality. H3. The Responsiveness of restaurants have positive and direct effect on service quality. H4. The Assurance of restaurants have positive and direct effect on service quality. H5. The Empathy of restaurants have positive and direct effect on service quality. H6. The service quality of restaurants has significant relationship with customers’ expectations. H7. The service quality of restaurants has significant relationship with customers’ perceptions. LITERATURE REVIEW Customer Expectations vs. Customer Perception Service quality measures how services that have been delivered meet the customers’ expectations and perceptions. According to Mark (2015) expectations are the future beliefs of customers before the consumption of products. Customer expectations are continually on the rise, as stated by Berkman, et al. (2012) it is important to deliver quality service and meet the customers’ expectations and perceptions that can influence the revisit and recommendations. Rahman, et al. (2010) identified Pa ge 4 https://journals.e-palli.com/home/index.php/ajmri Am. J. Multidis. Res. Innov. 2(5) 1-12, 2023 example, product/service quality, perceptions of value or reasonableness, value, individual elements (buyer’s mindset or passionate state), and different purchasers, satisfied customers spread positive informal exchange and it pulls in new customers and makes long-term business benefit. Learning how to measure and improve service quality is a valuable skill, but it requires research and expertise. Abd-El-Salam, et al. (2013) and Chen (2010) suggest that customer satisfaction is the result of a customer’s comparison of perceived quality and actual service performance. Measuring customer satisfaction gives a sign of how an organization is performing or giving products or services; hence, customer satisfaction will be the degree of accomplishment to every one of the organizations including the public sector too according to (Tirimba, Richard, Robert, Thomas & Tom. 2013). Doucet (2004) explained that the quality in these traditional settings depends on the design of the location and the behavior of the service provider. The key to generating customer loyalty is to provide high customer value. (Sugeng, 2016). Customer loyalty will considerably rise when customer satisfaction reaches a particular point as stated in a recent study conducted by (Kagsiri et al. 2017). Satisfied customers tend to stay loyal to products that can satisfy their needs and wants as emphasized by (Moh1d Suki, 2017). According to (Kotler 2006:177, 2019) if the performance is below the expectations of eating dissatisfied customers, if the performance meets expectations, then the customer is satisfied, if the performance exceeds expectations, then the customer is very satisfied or happy. Customers who experience positive feelings and attitudes toward the services during the service consumption process are more likely to perceive favorably the service provider, which subsequently leads to customer loyalty as stated (Ishaq, 2012). This is consistent with past studies which have shown that in the hotel industry, customers who are satisfied with the service quality are more likely to become loyal customers stressed (Cheng & Rashid, 2013; Cheng et al. 2014). In the context of tourism, research by Wu and Li (2015) on a sample of visitors to the Museums of Macau revealed that service quality is critical to customer satisfaction. Since a company’s growth is largely dependent on how well it maintains its customers through service and how well they keep its customers satisfied, service quality and customer satisfaction are important aspects of business explained (Edward and Sahadev, 2011). If a company wants customers to perceive their products or services as valuable, customer satisfaction must be fulfilled according to (Zameer et al. 2015). According to Chang et al. (2017) customer satisfaction is expected to result from good service efficiency, which will improve customer engagement and interrelationships. González et al. (2007) asserted that customer satisfaction is linked to high service quality, which makes businesses more competitive in the marketplace. High service quality can be achieved by identifying problems in service and defining measures for service performance and outcomes as well as the level of customer satisfaction. The more quality of service provided by the company the satisfaction felt by customers will be higher, and vice versa (Marnovita, 2020). Dineserv Model The hospitality industry is critical in terms of service quality on expectations and perceptions. Customers expect to receive the same standard of service quality regardless of the restaurant or service location and regardless of the form of management at any given operation. (Kırcova, Köse & Özer, 2020), stated that service quality is the customers’ assessment of the service offered by the business. The service quality is explained when the customers find a gap between their expectations and perceptions of the quality of services they received. Stevens, Knutson, & Patton (1995) introduced the DINESERV instrument to evaluate customers’ expectations and perception of the service quality at restaurants, divided into five service quality dimensions; tangibles, reliability, responsiveness, assurance, and empathy. DINESERV can compare the overall quality scores of service units which is why it is considered a great use in measuring the performance of restaurants (Adeinat, 2019). The DINESERV model has been supported by scholars in various dining settings. It is valid reliable and costeffective. The goal of DINESERV is to give restaurant operators and owners an efficient way to measure and acquire an overview of the service quality base on their eating establishments. Through that, they can be ready and take the necessary actions, so that the gaps can be solved or adjusted to the customers’ needs and wants (Victor, 2014). Customer perception and expectations are key elements for the success of the food and service industry stated by (Laming & Mason, 2014). According to Nancy & Christian (2011) pointed that in the context of the restaurant business and to monitor the customer perceptions of service quality, the race to provide better service and value has become increasingly important. According to (Alam et al. 2015) the restaurant industry has witnessed diversified changes and fierce competition over time which caused its consumers to become more sophisticated, value and price-conscious, and demanding and thus find an alternative reason to switch to a different area in case of an unsatisfied experience. DINESERV is at bid used for measuring performance due to its capability in distinguishing overall quality scores as a whole with similar service under the performance (Adeinat, 2019). It is a very well-established measurement tool for measuring customers’ satisfaction with restaurants’ services. Hansen (2014) believed that the objective of the DINESERV is to provide concrete knowledge to the restaurant’s operators and its owners about their service quality and its acceptance to customers. Since culture affects societies and dining habits, the DINESERV model has to be scrutinized in different Pa ge 5 https://journals.e-palli.com/home/index.php/ajmri Am. J. Multidis. Res. Innov. 2(5) 1-12, 2023 nations around the globe to measure their perception and expectation of service quality. (Abezie, 2019), stated in her study that a validity test was conducted using factor analysis and the result indicates that DINESERV is a valid instrument of the restaurant (i.e. Pizza Hut) service quality in Sweden. Hence, the customers’ perception of service quality differs across different cultural settings. Guesalaga & Denis (2014) points out that as globalization affects economies and the marketplace, companies need to understand the extent to which people from different countries evaluate service quality and its dimensions differently. Moreover, Soocheong & Jooyeon (2014) indicated in their study that first-time visitors and behavioral loyal customers may perceive the quality of the food, employee service, and, atmosphere at Korean restaurants differently. First-time customers will likely revisit because of the atmospheric-related attributes more highly and behavioral loyal customers will likely revisit the food-related attributes of the restaurant more highly. Culture and service quality differs significantly based on customers chrematistics and restaurants. There is a significant relationship between service quality dimensions and customer satisfaction. Despite different cultures, the DINESERV model worked equally as an instrument to measure service quality. MATERIALS AND METHODS The research study employed a descriptive correlational method to identify the relationship between the independent and dependent variables of the study by determining the customers’ expectations and perceptions in the selected local restaurants and it utilized survey questionnaires to gather data information from the respondents. The researchers used Structural Equation Modeling as a research technique and as stated by Beran & Violato (2010) this is a set of statistical techniques used to measure and analyze the relationships between observed and latent variables. According to DeVault (2018), Structural Equation Modeling (SEM) is a quantitative research technique that is used to show the relationships between variables and it represents the hypotheses of the researchers. The respondents of the study were one hundred two (102) customers from different local restaurants in the province of Oriental Mindoro. The respondents were chosen through a simple random sampling method from pre-surveyed local restaurants. The study employed a standardized questionnaire adapted from the SERVQUAL instrument (Parasuraman, Zeithamel, and Berry, 1985). The DINESERV instrument consists of 29 items of service quality standards and falls into five dimensions: assurance, empathy, reliability, responsiveness, and tangibles that fit in the restaurant industry (Stevens et al. 1995). There are ten (10) items represented tangibles; five (5) items for reliability; three (3) items for responsiveness; six (6) items for assurance; and five (5) items for empathy that determined the customers’ view on service quality of local restaurants in terms of customers’ expectations and customers perceptions. The study used a Seven-point Likert scale where Strongly Disagree (1), Disagree (2), Somewhat Disagree (3), Neither Agree nor Disagree (4), Somewhat Agree (5), Agree (6), Strongly Agree (7). The research instrument were categorized into two (2) main domains as follows: (1) the first part was the demographic profile of the respondents; and (2) the second part (29 items) was on the view of the customer’s expectations and perceptions of restaurant service quality which are grouped into five dimensions. The data were collected among customers of pre- surveyed different local restaurants in the province. The respondents were provided with a printed survey questionnaire and distributed upon they leave the premise. The study used Jamovi version 2.3 a computer software (2022) as a statistical tool that provides a complete suite of analyses for correlation and regression, parametric tests, contingency tables, reliability, and factor analysis. Prior to the conduct of the study, the respondents were informed and the vital concepts of customer expectations and perceptions were explained. The respondents signified their consent and voluntarily participation in the conduct of the study and the data gathered were treated with confidentiality and anonymity. Data privacy is urgent and complex, to guarantee anonymity, secrecy, and the avoidance of potential harm, all information was handled with the utmost confidentiality under RA 10173, known as Data Privacy Act. RESULTS AND DISCUSSION Demographic Profile of Respondents The study revealed as shown in Table 1, that the majority of respondents dined at select local restaurants aged 21- 25 (n=38), which is 37%, and 26-35 (n=21), which is 21%, were from a young adult as categorized on the theory of eight stages of development (Erik Erikson’s, 1950). This is supported by the study of (Okumus et al. 2021) that aged 21-35 often dined out in a restaurant and they are the most powerful cohort in the restaurant industry as indicated in the study of Yoon and Chung (2018). It is also indicated in the study of Nyheim et al. (2015) that a significant percentage of their expenditure was spent on dining out activities. Their dining preferences differ compared to other generations including that they value health and wellness while also being more open to ethnic cuisines, customization, and a variety of flavors. The result of the study showed that 61% of the respondents were female (n=62), while 38% were male (n=39) and one among the respondents disclose their gender as transgender. This is contrasted by data from the article that shows 10% of men eat out every day compared to 2% of women (Fourth, 2020). It also showed that men spend more on dining out than women. The result of the study showed that the respondents’ marital status was single (n=67) with 66%, while (n=31) Pa ge 6 https://journals.e-palli.com/home/index.php/ajmri Am. J. Multidis. Res. Innov. 2(5) 1-12, 2023 were married with 30%. This is supported by the study of Chun & Nyam-Ochir (2020) that the majority of customers who desired to return to the restaurant based on the service quality were single. This demonstrates that single customers have a higher appreciation for the quality of service in a restaurant, and are more likely to become returning customers if their expectations are met. Whereas, the majority of respondents are employed 48% (n=49) than other categories of employment status. The data connotes that the study of (Abanto, et al. 2019) has proven that most of the customers are those who are employed and tend to dine after their work. Further, most of the customers are students 29% (n=30) this proved that students who studied in Colleges and Universities dine in mostly. The result is nearly the same as the study of (Matin, et al. 2021), who discovered that students prefer to eat at local restaurants. This is most likely because it is more convenient to rapidly access nearby restaurants rather than having to prepare or purchase meals elsewhere. In addition, the respondents who visited less in local restaurants are non-employed 11% (n=11) while business owners 10% (n=10). Overall, the findings highlight the tenacity of local restaurateurs and point to a successful future for local restaurants. Table 1: Demographic profile of respondents Age F* Gender F* Marital Status F* Employment Status F* 14 below 1 Male 39 Single 67 Student 30 15 - 20 10 Female 62 Married 31 Business Owner 10 21 - 25 38 Transgender 1 Separated 0 Employed 49 26 - 35 21 Prefer not to say 0 Widow/Widower 4 Non-Employed 11 36 – 40 12 Retired 2 41 above 20 N=102 *F for frequency Average Value of Customers’ Expectations and Perceptions Based on customers’ expectations and perceptions of service quality at select restaurants, an arithmetic average value was determined for each question-related attribute. Gap analysis is used to determine the key attributes and their correlation to customers’ expectations and perceptions on the SERVQUAL method used in the study of Saneva & Chortoseva (2018) turned into DINESERV method, which determines the relationship between the expected and the perceived service quality. The significance of expected and perceived service quality on individual attributes is determined using the standard deviation. The standard deviation measures the degree of variation in expected and perceived service quality for a given set of individual attributes. The Table 2 shows the average value for respondents’ expectations and perceptions of service quality, as well as the gap score for each attribute (DINESERV SCORE) and SD values from 5.5 – 6.31 with a total mean of 6.06 and the average values for the customers’ perceptions, ranges from 5.7 – 6.32 with a total mean of 6.15 on the scale from 1 to 7. The statement staff members are clean, neat and appropriately dressed, has the highest value for customers’ expectation of service quality. Though this contradicts the study of Abezie (2019) which revealed that most concerns of diners on local restaurants are the external attractiveness as they want to expect service quality. Diners have come to expect more than just good service, however; they are also concerned about the external appearance of the restaurant. The statement, has a visually attractive parking area, has the lowest value in terms of customers’ expectations. The results of the study are in contrast with the findings of Abanto et al. (2019) that the statement has a visually attractive parking area has the highest agreement of customers on local restaurants as they expected to have nice and desirable parking are on the service quality. Customer satisfaction is vital to the success of any small business, and it’s extremely crucial for restaurants. The statement, dining areas that are thoroughly clean” has the highest value for customers’ perception of service quality. Conversely, the results oppose the findings of Matin, et al. (2021) that statement, employees help each other during busy time, in terms of their service quality. This staff team spirit and collaboration is crucial for customer service since it helps to ensure that customers receive the highest quality of service even when the workload is heavy. The statement, has visually attractive parking area has the lowest approval rating concerning the perceptions of service quality. The DINESRV score for statement, provides prompt and quick service, shows positive, which means that customers’ perceptions are superior in terms of restaurant service quality. The statements, menu is easily readable and is dependable and consistent has the biggest negative gap, -0.21 and -0.27. This suggests that customers’ perception of restaurant service quality for these two attributes is higher than their expectations. The statement, staff members are clean, neat and appropriately dressed, and has decor in keeping with its image and price range, have zero (0) value of DINESERV score, which is the lowest one-digit whole value number. This indicates that the customers’ perceptions of the service matched their expectations. In accordance with the survey results, customers believed their expectations were satisfied in terms of the service they received, confirming that they received the kind of service they expected. Pa ge 7 https://journals.e-palli.com/home/index.php/ajmri Am. J. Multidis. Res. Innov. 2(5) 1-12, 2023 Table 2: The average value of customers' expectations and perceptions DINESERV Attributes M ea n St an da rd D ev ia tio n In te rp re ta tio n M ea n St an da rd D ev ia tio n In te rp re ta tio n D IN E SE R V Sc or e (TAN 1) Has a visually attractive parking area. 5.5 0.95 agree 5.7 0.96 agree -0.2 (TAN 2) Has a visually attractive dining area. 6.02 0.78 agree 6.13 0.70 agree -0.11 (TAN 3) Staff members are clean, neat, and appropriately dressed. 6.31 0.72 agree 6.31 0.67 agree 0 (TAN 4) Menu is easily readable. 6.01 0.79 agree 6.22 0.77 agree -0.21 (TAN 5) Has a clean restroom. 6.09 0.83 agree 6.14 0.81 agree -0.05 (TAN 6) Dining area is comfortable and easy to move around in. 6.18 0.79 agree 6.17 0.85 agree 0.01 (TAN 7) Has a visually attractive building exterior. 5.96 0.72 agree 6.16 0.78 agree -0.2 (TAN 8) Has a decor in keeping with its image and price range. 5.95 0.75 agree 5.95 0.86 agree 0 (TAN 9) Has a visually attractive menu that reflects the restaurant’s image. 6.18 0.72 agree 6.24 0.73 agree -0.06 (TAN 10) Dining areas that are thoroughly clean. 6.16 0.74 agree 6.32 0.69 agree -0.16 (REL 1) Serves you in the time promised. 5.98 0.81 agree 6.03 0.76 agree -0.05 (REL 2) Quickly corrects anything that is wrong. 5.99 0.75 agree 6.11 0.74 agree -0.12 (REL 3) Is dependable and consistent. 5.8 0.75 agree 6.07 0.76 agree -0.27 (REL 4) Provides an accurate guest check. 6.14 0.72 agree 6.24 0.69 agree -0.1 (REL 5) Serves your food exactly as you ordered. 6.29 0.67 agree 6.31 0.67 agree -0.02 (RES 1) Provides prompt and quick service. 6.21 0.80 agree 6.19 0.75 agree 0.02 (RES 2) Gives extra effort to handle your special request. 5.97 0.80 agree 6.21 0.81 agree -0.24 RES 3) Employees help each other during busy times. 6.16 0.84 agree 6.17 0.86 agree -0.01 (ASSU 1) Makes you feel personally safe. 6.05 0.89 agree 6.25 0.81 agree -0.2 (ASSU 2) Personnel are well-trained, competent, and experienced. 6.16 0.71 agree 6.23 0.74 agree -0.07 ASSU 3) Employees can answer your questions completely. 6.21 0.72 agree 6.18 0.78 agree 0.03 (ASSU 4) Employees are able to give you information about menu items. 6.24 0.71 agree 6.27 0.79 agree -0.03 (ASSU 5) Give employees a support so they can do their job well. 5.96 0.82 agree 6.04 0.83 agree -0.08 (ASSU 6) Makes you feel comfortable and confident while dealing with them. 6.02 0.92 agree 6.18 0.84 agree -0.16 (EMP 1) Makes you feel special. 5.96 0.86 agree 6.05 0.88 agree -0.09 (EMP 2) Have the customers' best interests. 6.1 0.80 agree 6.13 0.80 agree -0.03 (EMP 3) Employees are sympathetic and reassuring if something is wrong. 6.11 0.78 agree 6.16 0.73 agree -0.05 (EMP 4) Employees provide individual attention. 5.98 0.84 agree 6 0.81 agree -0.02 (EMP 5) Employees anticipate your needs and want, rather than relying to policies and procedures. 6.11 0.83 agree 6.22 0.77 agree -0.11 Overall Mean 6.06 0.79 6.15 0.78 -0.09 *a for expectations *b for perceptions Pa ge 8 https://journals.e-palli.com/home/index.php/ajmri Am. J. Multidis. Res. Innov. 2(5) 1-12, 2023 Research Model Fit Indices The fit of indices as shown in Table 3 refers to a variety of techniques for determining how well-observed data fits a specific probability distribution. The values of an index of fit are typically normalized (i.e., units of measurement are removed) and range from 0 to 1. These values provide a numerical indication of how well your data fits a specific distribution and were commonly referred to as “Goodness of Fit” (Hooper et al. 2008). As revealed in the table, the Standardized Root Mean Square Residual (SRMR) which calculates the difference between the residuals of the sample covariance matrix and the covariance model that is hypothesized is a notch higher than zero (SRMR=0.111), thus, the research model used in the study is “good enough” fit for the distribution. This is supported by the interpretation of Diamantopoulos and Siguaw (2000) that an SRMR of zero is a perfect fit. Moreover, as recommended by Browne and Cudeck (1990) that the Root Mean Squared Error of Approximation (RMSEA) that is ≤ 0.05 is a close fit, and as suggested by Hu and Bentler (1999) that the RMSEA ≤ 0.196 indicate a good fit, the computed RMSEA in the study (p=<0.001) implies that the research model is a good fit. This affirms the statement presented in the theoretical support of the study as cited by Abezie (2019) and the basis of the research model, that the DINESERV model is a reliable tool to gauge how well services are perceived and expected by customers. Table 3: Fit indices of the Research Model 95% Confidence Intervals SRMR RMSEA Lower Upper RMSEA p 0.111 0.196 0.178 0.214 < .001 Parameter Estimates of Endogenous and Exogenous Variable As shown in Table 4 the parameters estimate the summarized p-value of the Exogenous and Endogenous variables. A p-value measures the probability of obtaining the observed results, assuming that the null hypotheses are true. The lower pvalue, the greater the statistical significance of the observed difference. A p-value of 0.05 or lower is generally considered statistically significant (Beers, 2022). If the p-value is less than 0.05, it can be concluded that the observed differences are statistically significant and relevant. Table 4: Parameters estimates 95% Confidence Intervals Endogenous Variable Exogenous Variable Estimate SE Lower Upper β z P Service Quality Empathy 0.143 0.0722 0.00107 0.284 0.656 1.97 0.048* Assurance 0.192 0.0585 0.07706 0.307 0.641 3.28 0.001** Responsiveness 0.243 0.0673 0.11141 0.375 0.561 3.62 < .001 Reliability 0.194 0.0695 0.05803 0.331 0.589 2.79 0.005** Tangibility 0.26 0.0625 0.13738 0.382 0.634 4.16 < .001 Cusper Service Quality 0.597 0.1087 0.38387 0.810 0.711 5.49 < .001 Cusex 0.763 0.0967 0.57366 0.953 0.754 7.89 < .001 ** Level of significance at the 0.01 level, * Level of significance at the 0.05 leve H1. The Tangibility of Restaurants Have Positive and Direct Effect on Service Quality Table 4 showed the result that tangibility have a significant relationship with the service quality of restaurants in terms of customers’ expectations and perception (p=<0.001). According to Panda & Das (2014) study, the route path describing service quality and tangibility is relevant in both circumstances. Their research suggested that service quality is based on a combination of both tangible and intangible elements, with tangibility playing an important role in enhancing overall customer satisfaction. H2. The Reliability Of Restaurants Have Positive And Direct Effect On Service Quality Table 4 showed the result that reliability have a significant relationship with the service quality of restaurants in terms of customers’ expectations and perception (p=0.005). According to respondents’ observations of the degree of the relationship between service quality and reliability, respondents consistently rate service attributes as agree. It is clear that respondents consistently place a high value on service attributes like dependability, reliability, and trustworthiness when it comes to the degree of relationship between service quality and reliability as observed by respondents, Baluyot et al. (2021). The findings of this study by Bichler et al. (2020) affirm the direct effects of the service quality dimensions of reliability. Customer satisfaction and loyalty were significantly influenced by reliability, indicating that customers place a high value on dependable service when making purchasing decisions. Pa ge 9 https://journals.e-palli.com/home/index.php/ajmri Am. J. Multidis. Res. Innov. 2(5) 1-12, 2023 H3. The Responsiveness of Restaurants Have Positive and Direct Effect on Service Quality The result of the study showed that responsiveness have a significant relationship with the service quality of restaurants in terms of customers’ expectations and perception (p=<0.001). Murad & Ali (2015) the findings suggest that in the restaurant industry, responsiveness and customer satisfaction have a highly significant relationship with service quality. This means that when restaurants focus on responding to customers quickly and positively, they are likely to receive higher customer satisfaction ratings regarding the quality of their service. H4. The Assurance of restaurants have positive and direct effect on service quality. Table 4 showed the result of the assurance have a significant relationship with the service quality of restaurants in terms of customers’ expectations and perception (p=0.001). In restaurant service quality, assurance is one of the important dimensions which provides trust and certainty and makes the customers feel safe in making financial transactions (Aftab et al. 2016). Customers are more likely to trust restaurants that demonstrate a high level of assurance, and they are more likely to return to those restaurants. H5. The Empathy of Restaurants Have Positive and Direct Effect on Service Quality Table 4 showed the result that empathy have a significant relationship with the service quality of restaurants in terms of customers’ expectations and perception (p=0.048). This is supported by the study of Aftab et al. (2016), that empathy is one of the important dimensions in the service quality of a restaurant which provides individualized attention and caring to the customers, moreover, the employees’ and customers’ interactions are shown. As a result, when customers enter the restaurant, they should be greeted warmly and generously by staff members to establish a sense of welcome. H6. The Service Quality of Restaurants Have Significant Relationship With Customer’s Expectation In the result presented in Table 4, it can be concluded that customer expectations have a significant relationship with the service quality of restaurants in terms of customers’ expectations and perceptions (p=<0.001). This is supported by the study of Parasuraman et al. (1988) that expectations are considered as consumer desires or wants, i.e., what they believe a service provider should offer rather than would offer. If customer expectations are not met, it can have a positive or negative impact on consumer satisfaction. In the event of a negative impact, the customers may be disappointed because their expectations were not reached. H7. The Service Quality of Restaurants Have Significant Relationship with Customers’ Perception In the result presented in Table 4, it can be concluded that customer perception have a significant relationship with service quality in terms of customers’ expectations and perception (p=<0.001). This is supported by the findings in the study of Saneva & Chortoseva (2018) that customers’ perceptions of service quality are an important factor in restaurant sustainability, implying the importance of continuously monitoring their satisfaction with the service. Restaurant owners can thus be aware of what customers expect and are dissatisfied with in terms of service quality, allowing them to take remedial actions to ensure customers’ satisfaction. Measurement Model The measurement model presented in Table 5 signifies the correlation among latent and observed variables based on the literature of Kang & Anh (2021) that the value of the Squared Multiple Correlation (SMC) Beta Coefficient of values at least 0.3 and greater than 0.5 are interpreted as good, while values greater than 0.7 are interpreted as very good. Therefore, as shown in Table 5, all correlations of the observed variables in Customer Expectations are very good, except for Tangibility (β=0.577) which is good. Furthermore, all correlations of the observed variables in Customer Perception are good, except for Reliability (β=0.712) which is very good. This is in support of the findings of Kim et al. (2015) that the validity of the Table 5: Measurement model 95% Confidence Intervals Latent Observed Estimate SE* Lower Upper β z P Customer Perception Empathy 1.000 0.000 1.000 1.000 0.608 Assurance 0.915 0.189 0.544 1.287 0.611 4.83 < .001 Responsiveness 1.036 0.209 0.626 1.446 0.633 4.95 < .001 Reliability 0.902 0.168 0.572 1.233 0.712 5.36 < .001 Tangibility 0.821 0.165 0.497 1.145 0.635 4.97 < .001 Customer Expectation Empathy 1.000 0.000 1.000 1.000 0.784 Assurance 0.901 0.123 0.66 1.142 0.723 7.33 < .001 Responsiveness 1.057 0.136 0.791 1.323 0.763 7.78 < .001 Reliability 0.731 0.102 0.532 0.931 0.711 7.19 < .001 Tangibility 0.667 0.117 0.438 0.896 0.577 5.7 < .001 *Standard Error Pa ge 10 https://journals.e-palli.com/home/index.php/ajmri Am. J. Multidis. Res. Innov. 2(5) 1-12, 2023 measurement model is deemed necessary to logically analyze the relationship among variables. Variance and Covariances The variances and covariances presented in Table 6 signify the correlation of variables. According to Hall (2021), variance is the spread of a data set around its mean value, whereas covariance is the measure of the directional relationship between two random variables. Based on the literature of Kang & Anh (2021) that the value of the Squared of Multiple Correlation (SMC) Beta Coefficient of values at least 0.3 and greater than 0.5 are interpreted as good, while values greater than 0.7 are interpreted as very good. As a result, as indicated in Table 6, all correlations of the service quality five dimensions are good in terms of customer expectations. All correlations of the service quality five dimensions are good in terms of customer perception. Furthermore, the customers’ expectations and perceptions were interpreted as good. Table 6: Variances and Covariances 95% Confidence Intervals Variable Estimate SE Lower Upper β z P EMP 0.2586 0.04159 0.1771 0.3401 0.63 6.218 < .001 ASSU 0.2129 0.03432 0.1456 0.2801 0.626 6.201 < .001 RES 0.244 0.04007 0.1654 0.3225 0.6 6.089 < .001 REL 0.1203 0.02183 0.0775 0.1631 0.493 5.512 < .001 TAN 0.1513 0.0249 0.1025 0.2 0.597 6.075 < .001 CUSPER 0.075 0.02615 0.0237 0.1263 0.494 2.867 0.004 EMP 0.1387 0.02538 0.0889 0.1884 0.386 5.463 < .001 ASSU 0.1638 0.02732 0.1102 0.2173 0.477 5.994 < .001 RES 0.1773 0.03124 0.1161 0.2385 0.418 5.677 < .001 REL 0.1157 0.01905 0.0783 0.153 0.495 6.072 < .001 TAN 0.1969 0.02972 0.1386 0.2551 0.667 6.624 < .001 CUSEX 0.0954 0.02391 0.0486 0.1423 0.432 3.99 < .001 Path Diagram Result Summary The result of the study presented in Figure 2, showed the path diagram result to determine the relationship between customers’ expectations and perception on service quality. The correlation among latent and observed variables based on the literature of Kang & Anh (2021) that the value of the Squared of Multiple Correlation (SMC) Beta Coefficient of values at least 0.3 and greater than 0.5 are interpreted as good, while values greater than 0.7 are interpreted as very good. Figure 2: Path Diagrams As shown in Figure 2, the path diagram revealed that the seven hypotheses have a significant relationship with service quality: H1. The Tangibility of Restaurants Have Positive and Direct Effect on Service Quality PDR1: Tangibility have a significant relationship with service quality as the value of (β=0.634) that were interpreted as good. H2. The Reliability of Restaurants Have Positive and Direct Effect on Service Quality PDR2: Reliability have a significant relationship with service quality as the value of (β=0.589) that were Pa ge 11 https://journals.e-palli.com/home/index.php/ajmri Am. J. Multidis. Res. Innov. 2(5) 1-12, 2023 interpreted as good. H3. The Responsiveness of Restaurants Have Positive and Direct Effect on Service Quality PDR3: Responsiveness have a significant relationship with service quality as the value of (β=0.561) that were interpreted as good. H4. The Assurance of Restaurants Have Positive and Direct Effect on Service Quality. PDR4: Assurance have a significant relationship with service quality as the value of (β=0.641) that were interpreted as good. H5. The Empathy of Restaurants Have Positive and Direct Effect on Service Quality PDR5: Empathy have a significant relationship with service quality as the value of (β=0.656) that were interpreted as good. H6. The Service Quality of Restaurants Have Significant Relationship with Customer’s Expectation PDR6: Customers’ expectations have a significant relationship with service quality as the value of (β=0.711) that were interpreted as very good. H7. The Service Quality of Restaurants Have Significant Relationship with Customers’ Perception PDR7: Customers’ perception have a significant relationship with the service quality as the value of (β=0.754) that were interpreted as very good. CONCLUSION The result of the study revealed that the majority of the respondents dined in select local restaurants ages ranging from 21-25 years old, and half of the respondents are female, most of the were single and employed. In can therefore be concluded that when staff members are clean, neat, and appropriately dressed, gained highest value for customers’ expectation on service quality. In terms of customers’ perception, dining areas that are thoroughly clean, got the highest value on service quality. The research model is a good fit that conforms with Abezie (2019) that the research model as adapted to the DINESERV model is a reliable tool for assessing how well services are perceived and expected by customers. Furthermore, parameter estimates the DINSERV five dimensions have a significant relationship with the service quality of restaurants. In addition, the customers’ expectations and perceptions have a significant relationship to the restaurant service quality as supported by Berkman et al. (2012), it is important to deliver quality service and meet the customers’ expectations and perceptions which can influence the revisit and recommendations. The measurement model, all correlations of the observed variables in customer expectations are very good, except for Tangibility which is good. Furthermore, all correlations of the observed variables in customer perception are good, except for Reliability which is very good. As the result of variance and covariances, all correlations of the service quality five dimensions are good in terms of customer expectations, while all correlations of the service quality five dimensions are good in terms of customer perception. Furthermore, the customers’ expectations and perceptions were interpreted as good. The researchers, therefore recommend that local restaurants must improve the tangibility of the external factors of their establishments in terms of parking areas. Restaurants may easily do this by adding better lighting and more space so that customers feel more comfortable and safer when they visit, this is in consonance with the study of Apostol, et al. (2023) that the priority in the hospitality industry is creating safe customer experiences. To assist in the improvement of the entire customer experience, this approach may be expanded to all other exterior features of the restaurant, such as the cleanliness of the facility and its surrounding neighborhood. The restaurants can expand on this concept by focusing on improving internal elements such as having well-trained employees and ensuring that the food delivered is of excellent quality. As previous scholars have pointed out, the original DINESERV has certain limitations- DINESERV does not cover all elements of restaurant service for varied and diverse types of restaurants. Moreover, the current study only collected data from local restaurants located in Oriental Mindoro the findings of this study might contribute to future researchers to assess more restaurants using the modified DINESERV model. In addition, future researchers can include the restaurant managers and employees to participate to determine their expectations and perceptions on the service quality of the restaurant. Therefore, future studies can be expanded to collect data from a larger and more diverse population to gain a better understanding of the service quality of those local restaurants. 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