This study extends previous research on perceived value by including the ro
le of perceived risk within a model of the antecedents and consequences of
perceived value. The model was tested in a retail setting using a sample of
consumers actively looking for an electrical appliance. The mediating impa
ct of perceived risk on the quality-value relationship ms specifically exam
ined. Empirical results confirmed that not only do perceived product and se
rvice quality lead to perceived value for money in a service encounter but
that these quality components reduce perceived risk. Perceived risk was fou
nd to play an important role in the perceived product and service quality-v
alue for money relationship and was found to be a significant mediator of t
his relationship. Perceived value for money was also found to be a signific
ant mediator of perceived quality, price and risk and willingness-to-buy. T
he results obtained have major implications for retailers as well as for fu
ture research in this strategically important area of consumer research.