Using new Huff model for predicting potential retail market in South Korea

This study sets out to reinvestigate the existing theoretical models (that is, the Huff Model, the new probability model, and the gravity model) for the following two critical reasons: (1) it is because the precedent models have seldom predicted an estimation of sales potentials at the opening of stores particularly at local markets in Korea and (2) it is also because the existing models did not offer specific factors affecting success in estimating a sales volume at the point of opening in local markets. The current study, thus, proposes a new formulation (model) which can precisely predict a sales potential volume at the opening of stores at a particular large local market located in Daejeon, Korea. From the newly-established formulation (model), some locally-specified factors affecting success in estimating a sales volume at the point of opening are incubated. And it is suggested that advertising expense, sales promotion expense, and top-of-mind store brand recognition of/on each store have been found to impact profoundly on increasing a sales volume at the inceptive business stage. The study, however, has found a limitation that the number of samples of this study is only four major department stores. Future research needs to include some more samples expanded with other cities and Eastern Asia countries.