An intelligent sales forecasting system through integration of artificial neural networks and fuzzy neural networks with fuzzy weight elimination

Abstract

Sales forecasting plays a very prominent role in business strategy. Numerous investigations addressing this problem have generally employed statistical methods, such as regression or autoregressive and moving average (ARMA). However, sales forecasting is very complicated owing to influence by internal and external environments. Recently, artificial neural networks (ANNs) have also been applied in sales forecasting since their promising performances in the areas of control and pattern recognition. However, further improvement is still necessary since unique circumstances, e.g. promotion, cause a sudden change in the sales pattern. Thus, this study utilizes a proposed fuzzy neural network (FNN), which is able to eliminate the unimportant weights, for the sake of learning fuzzy IF–THEN rules obtained from the marketing experts with respect to promotion. The result from FNN is further integrated with the time series data through an ANN. Both the simulated and real-world problem results show that FNN with weight elimination can have lower training error compared with the regular FNN. Besides, real-world problem results also indicate that the proposed estimation system outperforms the conventional statistical method and single ANN in accuracy.