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If you would like to write for this, or any other Emerald publication, then please use our Emerald for Authors service information about how to choose which publication to write for and submission guidelines are available for all. Please visit www.emeraldinsight.com/authors for more information. About Emerald www.emeraldinsight.comEmerald is a global publisher linking research and practice to the benefit of society. The company manages a portfolio of more than 290 journals and over 2,350 books and book series volumes, as well as providing an extensive range of online products and additional customer resources and services.Emerald is both COUNTER 4 and TRANSFER compliant. The organization is a partner of the Committee on Publication Ethics (COPE) and also works with Portico and the LOCKSS initiative for digital archive preservation. AbstractPurpose -The purpose of this paper is to improve understanding of the relationships between the service environment, service provider mood, and provider-customer interaction. Specifically, mood is evaluated as a potential moderator of the relationship between the service environment and provider-customer interaction. Design/methodology/approach -A multi-method data collection approach was utilized, including observation and provider and customer surveys. Hypotheses are tested using regression, ANOVA, and MANOVA. Findings -Findings indicate that service provider evaluations of the physical environment improve in the presence of an appropriate ambient scent. Behavioral responses are also enhanced: providers are viewed as more courteous and customers more friendly. Perhaps the most interesting observation is that provider mood moderates the relationship between the service environment and customer perceptions of service provider behavior.Research limitations/implications -The only environmental characteristic that was manipulated was scent, and access was granted to only one store over the course of three consecutive Saturdays. Consequently, validity is threatened by the potential for impact of factors other than the manipulated characteristic. Practical implications -Implications for managers include careful consideration of potential changes to the ambient environment; if introduction of an appropriate scent can be undesirable, other changes may also lead to unexpected results. Changes under consideration should be tested before implementation. Originality/value -This research extends service theory by examining the relationship between providers and customers in an actual retail setting. Important theoretical contributions include: demonstrating that service provider mood moderates the relationship between service environmental characteristics and customer perceptions of provider behavior; and finding that positive changes to the environment can amplify negative outcomes.