A comparative study of various statistical and machine learning models for predicting restaurant demand in Bangladesh

Precise demand forecasting has become crucial for merchants due to the growing complexity of client behavior and market dynamics. This allows them to enhance inventory management, minimize instances of stock outs, and enhance overall operational efficiency. In Bangladesh, there is a significant lack of emphasis on demand forecasting to enhance corporate performance. In recognition of these difficulties, the study seeks to produce predictions by employing two statistical models and three machine learning models. The historical sales data was obtained from a restaurant in Bangladesh, and five specific products were chosen for the purpose of predicting sales. The models have been rated according to their average score of deviation from the optimal root mean squared error. The Multilayer Perceptron and Random Forest algorithms have attained the top two positions. Statistical models such as simple exponential smoothing and Croston's method have exhibited superior performance compared to XGBOOST model. This study advances demand forecasting techniques in Bangladesh's restaurant industry by providing valuable insights, comparing different approaches, and suggesting ways to improve forecast accuracy and operational efficiency, thereby demonstrating the practical relevance and applicability of the research to the reader.