A deep learning model for predicting the number of stores and average sales in commercial district

Abstract

This paper presents a plan for preparing for changes in the business environment by analyzing and predicting business district data in Seoul. The COVID-19 pandemic and economic crisis caused by inflation have led to an increase in store closures and a decrease in sales, which has had a significant impact on commercial districts. The number of stores and sales are critical factors that directly affect the business environment and can help prepare for changes. This study conducted correlation analysis to extract factors related to the commercial district’s environment in Seoul and estimated the number of stores and sales based on these factors. Using the Kendaltau correlation coefficient, the study found that existing population and working population were the most influential factors. Linear regression, tensor decomposition, Factorization Machine, and deep neural network models were used to estimate the number of stores and sales, with the deep neural network model showing the best performance in RMSE and evaluation indicators. This study also predicted the number of stores and sales of the service industry in a specific area using the population prediction results of the neural prophet model. The study’s findings can help identify commercial district information and predict the number of stores and sales based on location, industry, and influencing factors, contributing to the revitalization of commercial districts.