applied

sciences
Article
A Multi-Criteria Decision-Making Approach for Ideal Business
Location Identification
Salman Ahmed Shaikh 1, * , Mohsin Memon 2 and Kyoung-Sook Kim 1

1 Artificial Intelligence Research Center (AIRC), National Institute of Advanced Industrial Science and
Technology (AIST), Tokyo Waterfront, Tokyo 135-0064, Japan; [email protected]
2 Department of Software Engineering, Mehran University of Engineering and Technology,
Jamshoro 76020, Pakistan; [email protected]
* Correspondence: [email protected]; Tel.: +81-80-3557-4442

Abstract: Location has always been a primary concern for business startups to be successful. There-
fore, much research has focused on the problem of identification of an ideal business site for a
new business. The process of ideal business site selection is complex and depends on a number of
criteria or factors. Since the ultimate goal of all businesses is to increase customer footprints and to
thus increase sales, criteria including traffic accessibility, visibility, ease of access, vehicle parking,
customers availability, etc. play important roles. In other words, we can say that optimal business site
selection is a multi-criteria decision-making (MCDM) problem. MCDM is used to identify an optimal
solution or decision out of many alternatives by utilizing a number of criteria. In mathematics, there
exist a number of structured techniques for organizing and analyzing complex decisions, for instance,
AHP, ANP, TOPSIS, etc. In this work, we present a hybrid of two such techniques to solve the
MCDM problem for an optimal business site selection given a set of candidate sites. The proposed





 approach is based on the AHP (Analytic Hierarchy Process) and TOPSIS (The Technique for Order of
Preference by Similarity to Ideal Solution) approaches. The reason for using the proposed hybrid
Citation: Shaikh, S.A.; Memon, M.;
Kim, K.-S. A Multi-Criteria Decision-
approach is multi-fold. The hybrid approach reduces the computational complexity and require
Making Approach for Ideal Business less manual effort, thus improving the efficiency and accuracy of the proposed approach. Given a
Location Identification. Appl. Sci. set of candidate locations for a new business, the proposed approach ranks the candidates. Thus,
2021, 11, 4983. https://doi.org/ the candidate locations with higher ranks are identified as suitable or ideal. The approach comes
10.3390/app11114983 up with the ranking of all of the candidate locations, thus giving business managers room to make
calculated decisions. To show the effectiveness of the proposed approach, a detailed step-by-step
Academic Editors: Leon Rothkrantz, case study is given to identify an ideal location in New York City for a new gas station. Furthermore,
Miroslav Svitek and Ondrej Pribyl an experimental evaluation is also presented using a number of real New York City datasets.

Received: 8 April 2021

Keywords: multi-criteria decision-making; AHP/TOPSIS hybrid approach; optimal site selection;
Accepted: 20 May 2021
GeoSpatial data; smart cities
Published: 28 May 2021

Publisher’s Note: MDPI stays neutral

with regard to jurisdictional claims in
1. Introduction
published maps and institutional affil-
iations. The location of a brick and mortar business plays a vital role in its success or failure.
In order to keep investors happy and to avoid any financial losses, it is necessary to select
an optimal site for a new business. The term “optimal” refers to a location that may
be suitable for a new business and that yields paybacks. However, the identification of
Copyright: © 2021 by the authors.
optimal sites does not depend on any one factor. There are several aspects that require
Licensee MDPI, Basel, Switzerland.
consideration, such as competition in the area, the target customers’ convenience in terms of
This article is an open access article
accessibility, the convenience of suppliers, traffic congestion in the area, etc. The selection
distributed under the terms and of an optimal business site is a multi-criteria decision-making (MCDM) [1,2] problem.
conditions of the Creative Commons MCDM involves dealing with decisions where the choice of an alternative site is provided
Attribution (CC BY) license (https:// by several potential candidates while considering several criteria [3–5].
creativecommons.org/licenses/by/ Since this problem poses great challenges, there are several related research papers
4.0/). that suggest different algorithms for the identification of an ideal location to open new

Appl. Sci. 2021, 11, 4983. https://doi.org/10.3390/app11114983 https://www.mdpi.com/journal/applsci

Appl. Sci. 2021, 11, 4983 2 of 23

business. Most of these approaches are either data based [6] or survey based [7,8]. Data-
based approaches take into consideration only a single criteria in their evaluation, which
results in biased decisions, whereas survey-based approaches lack the use of real data
and are based on the opinion of a small group of people. Our argument is that, in big
cities, for the selection of an optimal business site such as gas stations, convenience stores,
restaurants, etc., a multi-criteria-based approach must be employed, and it should be
applied on some real data for evaluation.
There is disagreement upon the decision of a suitable site for a new commercial
opening as there are several criteria to be considered and some of them are more impor-
tant/significant than others. For instance, for a gasoline station, ease of access for vehicles
is an extremely important criteria, whereas for a convenience store, it is not so important.
Based on the significance, different weights need to be assigned to different criteria. Hence,
in this work, we present an AHP (Analytic Hierarchy Process) /TOPSIS (The Technique for
Order of Preference by Similarity to Ideal Solution)-based approach [9,10], which choses an
optimal site for a commercial opening when given a set of candidate sites. The techniques
of AHP and TOPSIS are termed multi-criteria decision-making (MCDM) [1,2]. They are em-
ployed to derive criteria/factors’ weight and to provide the ranking of alternatives/options.
Although both approaches can be used to solve the MCMD problem separately, individu-
ally, each approach has some limitations. For instance, AHP alone is a very flexible and
powerful MCDM tool and the computations made by AHP are always guided by the
decision maker’s experience. However, if the decision maker’s understanding about the
alternatives is not good enough, it can lead to inaccurate results. On the other hand, AHP
alone requires a large number of evaluations by the user, especially for problems with
many criteria and alternatives [11]. In fact, the number of pairwise comparisons grows
quadratically with the number of criteria and options. This is discussed with an example
in Section 4. To tackle this issue, Sangiorgio et al. proposed an optimized-AHP (O-AHP)
method for the generation of a judgment matrix by using a mathematical programming
formulation. According to the authors, O-AHP exhibits the same effectiveness as the
standard AHP and can be easily applied to a large number of alternatives [12]. In [13], the
authors use augmented reality-based decision-making (AR-DM) for the multicriteria analy-
sis approach. The approach starts with problem structuring using a flowchart similar to
that of the AHP and proceeds with new phases inspired from the SRF method. On the other
hand, TOPSIS does not support criteria weight computation and must be combined with
some technique to compute the weights. Usually AHP or entropy weights are used with
TOPSIS [14]. Thus, in this work, we propose the use of an AHP/TOPSIS hybrid approach.
The hybrid approach results in (1) lowering of the computational complexity and (2)
easing the manual effort needed for the construction of AHP pairwise comparison matrices.
Here, all of the candidate sites are ranked based on their performance scores and the
optimal site is identified as the candidate with the highest score. The decision makers are
given flexibility to chose the optimal site in the form of top ranked alternatives based on
the performance scores of all of the candidates/alternatives.
Since the AHP/TOPSIS approach consists of a number of steps, a detailed step-by-step
case study is presented to identify an optimal location for a new gas station in New York
City by employing four criteria. To assess the effectiveness of the proposed approach,
an experimental evaluation is performed to select an optimal location of a convenience
store making use of five criteria. The proposed approach presented here is flexible and can
effectively incorporate any number of criteria to rank the candidates. This is an extended
version of our work published in [15]. The main contributions of the extended work can be
summarized as follows:
• A comprehensive flowchart showing the flow of important steps in the proposed
AHP/TOPSIS approach (Section 5);
• An experimental evaluation utilizing real datasets to select an optimal location of a
convenience store using the proposed AHP/TOPSIS approach (Section 6); and
Appl. Sci. 2021, 11, 4983 3 of 23

• A detailed discussion on the evaluation results and the strength and weaknesses of
the proposed AHP/TOPSIS approach (Section 7).
The rest of the paper is organized as follows: Section 2 discusses the related work.
In Section 3, the problem formulation is presented. Section 4 elaborates two multi-criteria
decision-making approaches. In Section 5, a case study is shown for the selection of an
optimal location for a gas station. Section 6 presents experimental details for the evaluation
of the proposed AHP/TOPSIS approach, while Section 7 discusses the evaluation results
and the strength and weaknesses of the AHP/TOPSIS approach. Section 8 concludes the
manuscript with the possible future directions.

2. Related Work
In this section, we present a few works related to optimal site selection of a commercial
opening and the multi-criteria decision-making including AHP and TOPSIS approaches.

2.1. Computing the Best Alternative for a Commercial Opening

The research by J.Bean [16] provides an analysis of the prediction of a location for a new
store by Starbucks. Various types of statistical analysis were applied for the identification
of a suitable location to open a new Starbucks store. The results helped narrowed down the
search for a location in the United States to find the best suitable location of a new Starbucks
store. The authors were able to determine the success and popularity of existing businesses,
difficulty accessing the store location, and peak rush hours. They also assisted in the
development of a system to identify desirable locations for new businesses in that locality.
In [3], the authors presented a hierarchy of factors for selecting the best gas station site.
In the study, the Analytic Hierarchy Process (AHP) methodology was used to calculate
the relative importance of criteria and the sub-criteria in accordance with the aggregate
opinions of experts. However, to compute the criteria in this work, the authors made use
of a survey rather than real data as in our case.
The authors in [6] utilized machine learning features on the popularity of retail stores
in the city through the use of a dataset collected from FourSquare. Their analysis is
mainly focused on three different commercial chains, i.e., Starbucks, Dunkin Donuts, and
McDonalds. The features that they mine are based on two general signals: geographic,
where features are formulated according to the types and density of nearby places, and user
mobility, which includes transitions between venues or the incoming flow of mobile users
from distant areas. Their evaluation suggests that the success of a business may depend
on multiple factors/criteria, which supports our study of a multi-criteria decision-making
approach for an ideal business site selection.
The authors of [17] discussed a wide range of factors that are useful for decision-
making such as whether it would be beneficial to open a commercial store in a certain
locality. They identified the factors as being competition, vehicle ownership, and traffic
rush in a locality, which may assist in making a decision about a new commercial store to
ensure its success.

2.2. Multi-Criteria Decision-Making

In [18], the authors employed Fuzzy AHP for the selection of a new site for a hospital
using the factors travel time and population density surrounding the new site of a hospital.
The authors of [19] used AHP and spactial data in an attempt to determine candidate
landfill sites. As a result, they were able to find the best, good, and unsuitable landfill
areas. Awasthi et al. in [20] presented a TOPSIS-based approach for location planning
under uncertainty. The uncertainty in their work was used to handle the lack of real data
in location planning. In contrast, this work makes extensive use of real spatial data to
compute alternative locations’ factors/criteria computation. We believe that the use of real
data can give us more accurate results. Furthermore, we made use of real spatial data to
evaluate our approach.
Appl. Sci. 2021, 11, 4983 4 of 23

Besides their individual use, the AHP/TOPSIS approach is frequently used together
for different multi-criteria decision-making problems. For instance, the authors in [21] made
use of the AHP/TOPSIS hybrid approach to identify and rank the solutions of RL (reverse
logistics) adoption to overcome its barriers. Fuzzy AHP is applied to obtain the weights of
the barriers as criteria by pairwise comparison, and the final ranking of the solutions of RL
adoption is obtained using fuzzy TOPSIS. The authors in [22] utilized the AHP/TOPSIS
approach to select the best alternative, with an aim to improve the electronic supply chain
management (e-SCM) performance of an Indian automobile industry. Supraja et al. [23]
utilized AHP/TOPSIS to solve the problem of selection of a branch of students for the “All
Round Excellence Award” from an engineering college.
A CSPCM/TOPSIS approach for the quantification of accessibility to market facilities
in rural areas was studied by Niaz et al. [24]. The authors made use of the Constant-
Sum Paired-Comparison Method (CSPCM) to weight the factors and TOPSIS to rank the
accessibility to market facilities. The study evaluated the accessibility of different urban
and rural markets by using four factors, i.e., distance, time, cost, and road condition. Their
study was mainly based on survey, i.e., a total of 335 questionnaire surveys were conducted
from the whole study area (ten sub-districts) or, on average, 33.5 surveys per district, which
is quite a small number for a district and is highly prone to bias. In contrast, we propose a
real spatial data-based approach in this work, i.e., several million real dataset records and
a spatial distance function are used to compute the criteria/factors weight. Furthermore,
the accuracy of the obtained results are evaluated against real customer footprints.
Emrah et al. [25] proposed a supplier selection analysis model considering both the
AHP and TOPSIS method. Subjective and objective opinions of purchase managers/experts
are quantified using AHP. The TOPSIS technique is used for calculating the supplier’s
ratings. The aim of their research is to determine the appropriate supplier providing the
most customer satisfaction for the criteria identified in the supply chain.
The proposed work presented in this paper provides a hybrid AHP/TOPSIS approach
for pointing out an optimal site to open a commercial store. The reasons for selecting
the AHP and TOPSIS methods are multi-fold. First and foremost is that the AHP and
TOPSIS are among the most widely adopted MCDM techniques due to their simplicity
and accuracy [26]. Secondly, when combined, they can reduce the computational efforts
required to rank the alternatives. Other MCDM methods such as ANP, BWM, ELECTRE,
or PROMETHEE would have been considered if one of our goals was not lowering the
computational complexity and time required to find the ranking. Furthermore, TOPSIS
works well with AHP quite nicely; that is, AHP is good for computing the criteria weights,
while TOPSIS is good for ranking based on given weights. With other MCDM methods,
such a hybrid approach is either not possible or not effective while non-hybrid approaches
are computationally not feasible.

3. Problem Formulation
The proposed approach aims to identify the best location for a new commercial
opening given a candidate set of locations. In accordance with this aim, the problem can be
defined as follows:
Let us suppose that an enterprise wants to open a new business and is provided with
a set of candidate locations L to chose from. The optimal location l ∈ L such that the
newly opened business at l attracts the largest number of customers is always preferred.
Besides the identification of an optimal site, it is significant to rank each candidate site in L
based on its performance score obtained using the AHP/TOPSIS hybrid method. The can-
didate locations ranking is generated by assigning top ranks to those locations that have
higher scores. The location with the top rank is identified as the best site. Each candidate
site in L is given in terms of the geographical coordinate system, i.e., in terms of longitude
and latitude. Since AHP and TOPSIS are multi-criteria decision-making approaches and
require multiple factors to compute the performance score of each candidate location,
multiple spatiotemporal datasets are utilized to compute these factors.
Appl. Sci. 2021, 11, 4983 5 of 23

4. AHP/TOPSIS-Based Multi-Criteria Decision-Making

The AHP (Analytic Hierarchy Process)/TOPSIS (Technique for Order of Preference
by Similarity to Ideal Solution)-based hybrid approach is proposed in this research to
compare a number of factors/criteria (in the following, criteria and factors are used in-
terchangeably) and provides the rank based on those factors for each candidate. Many
researchers have used either AHP or TOPSIS to find the best alternative from several poten-
tial candidates [3–5], since they are two different multi-criteria decision-making (MCDM)
methods [1,2]. With the assistance of the approaches mentioned above, a set of criteria
can be evaluated to rank the alternatives. The purpose of using AHP is to determine the
criteria weights, and TOPSIS employs the weights obtained from AHP in order to rank
the alternatives; however, on many occasions, the two approaches are combined to obtain
optimal results [27]. AHP/TOPSIS refers to the mechanism where TOPSIS uses AHP
weights. The reasons behind the use of this hybrid approach in this article, are as follows:
• It helps lower the computational complexity.
• It eases the manual effort needed for the construction of the AHP pairwise compari-
son matrices.
Although AHP alone is a very flexible and powerful MCDM tool, the computations
made by AHP are always guided by the decision maker’s experience, and AHP can thus
be considered a tool that is able to translate the evaluations made by the decision maker
into a multi-criteria ranking. However, if the decision maker’s understanding about the
alternatives is not good enough, it can lead to inaccurate results. On the other hand, AHP
alone requires a large number of evaluations by the user, especially for problems with
many criteria and alternatives [11]. In fact, the number of pairwise comparisons grows
quadratically with the number of criteria and options. Let us discuss the following example
to understand the proposed approach.

Example 1. In this example, the best alternative is computed from a set of 10 alternatives using five
criteria. Only two alternatives are taken at a time by AHP and a comparison matrix is constructed
by comparing their criteria one by one. As a result, the best one is found among the 10 alternatives
via AHP. A total of (10
2 ) = 55 combinations are generated, i.e., a total of 55 comparison matrices need
to be constructed. Each criteria is given some weight based on its importance. Hence, a comparison
matrix of the criteria is necessary to obtain criteria weights. In total, 56 comparison matrices are
required and each matrix has to be made with careful selection of the degree of importance for each
matrix cell [11]. This process takes a lot of time, and the problem intensifies when the number of
alternatives are increased. Once TOPSIS is applied after given the criteria weights, a single decision
matrix is generated with the assistance of all of the alternatives simultaneously. The best alternative
or ranking of the alternatives is generated with the help of this decision matrix.

The TOPSIS approach drastically reduces the computational complexity and the
manual effort required in the AHP approach, but it does not assist in the formulation of a
mechanism to compute the criteria weights.
Several researchers have adopted hybrid MCDM approaches to increase the overall
efficiency. In [28], the authors suggested that the hybrid between AHP and Complex Pro-
portional Assessment (COPRAS) to rank seven sustainable hydrogen production options
helped reduce uncertainties in all phases of the task. In another research [13], AHP and
SRF were combined to determine precast concrete panels for building retrofitting. They
defined six criteria and evaluated seven visual rankings within 15 min, making it easier
even for non-expert users to carry out the procedures. Sedghiyan et al. in [29] ranked
seven alternatives of renewable energy sources with AHP, TOPSIS, and Simple Additive
Weighting (SAW). The best renewable energy source in varied climate zones was identified
if it was ranked best by any two methods. In [30], ten high-risk activities in the mining
sector were identified in order to access them in a work environment. The risks were
associated with multiple activities to generate a house of safety with the assistance of
AHP and fuzzy inference. Keskin et al. in [31] proposed a hybrid AHP and Data Envel-
Appl. Sci. 2021, 11, 4983 6 of 23

opment Analysis-Assurance Region (DEA-AR) model to measure the efficiency of public

and private airports in Turkey. A total of five criteria were chosen, and 48 airports were
ranked based on these criteria. In another research [32], nine risk criteria were chosen
and five risk response alternatives were ranked in construction projects. They employed
the Analytical Network Process (ANP) and Multi-Attributive Border Approximation Area
Comparison (MABAC) techniques to reduce imprecision and fuzziness in the decision
process. The work of [33] used a hybrid of AHP and Genetic Algorithms (GAs) to access
ground water vulnerability in China. They optimized the land ratings from 1 to 10, where
10 indicates the highest potential to pollution, based on eight factors. In [34], Fuzzy AHP
and Particle Swarm Optimization (PSO) techniques were used to solve the optimization
model as a nonlinear system of equations. Their proposed method was scalable and was
applied on various cases studies for prioritization even with an incomplete set of judgments.
Table 1 compares the various hybrid MCDM approaches along with their applications,
strengths, and weaknesses.

Table 1. Hybrid MCDM approaches and their applications, strengths, and weaknesses.

Ref. Hybrid MCDM Approach Application(s) Strength(s) Weakness(es)

AHP and Complex (1) Controls uncertainties Relied on data given
Sustainable hydrogen
[28] Proportional Assessment in all phases. (2) Improves by only four experts
production options
(COPRAS) group decision-making. of the domain.
(1) Visual information
The technique cannot be
Augmented Reality (AR) during the decision phase.
applied to non-graphical
[13] and the Simos-Roy- Building retrofitting (2) On average, takes
problems where 3D models
Figueira (SRF) 15 min to evaluate
are not required.
seven rankings.
(1) The best alternative is
the one that is selected best
AHP, TOPSIS, and Simple Renewable energy by at least two methods.
[29]
Additive Weighting (SAW) resources prioritization (2) Consumes a lot of time
since ranking is generated
using three methods.
(1) Dependency of multiple
Results highly reliant on
AHP, House of Safety, Risk Assessment in events is considered.
[30] the input of occupational
and Fuzzy logic Mining Sector (2) Imprecise and vague
safety specialists.
structures are managed.
AHP and Data
Efficiency scores of The model can be
Envelopment Prevents extreme
[31] publicly or privately discriminatory in
Analysis-Assurance weight distribution.
operated airports some situations.
Region (DEA-AR)
Analytical Network Addresses uncertain
Process (ANP) and information weighting
Uncertain risk strategies in Computational time
[32] Multi-Attributive Border risk criteria such as
construction projects is high.
Approximation Area incompleteness and
Comparison (MABAC) imprecision.
Other contaminants
AHP and Genetic Groundwater vulnerability Better results compared to
[33] except nitrate are not
Algorithms (GAs) assessment DRASTIC [35] model.
considered in this study.
(1) Applied to group
Professor decision-making. PSO has a tendency to
Fuzzy AHP and Particle
[34] selection/Investment (2) Solves the optimization converge prematurely on
Swarm Optimization (PSO)
prioritization model as a nonlinear early best solutions.
system of equations.

This work proposes the use of an AHP/TOPSIS hybrid approach. The AHP/TOPSIS
hybrid approach efficiently caters to weight computation and the problem of AHP having
Appl. Sci. 2021, 11, 4983 7 of 23

a large number of matrices to compute, i.e., using the hybrid approach, the criteria weights
are determined by AHP while the alternatives are evaluated using TOPSIS. In evaluating
the alternatives, the TOPSIS approach makes use of the weights computed via the AHP
approach. Thus, for instance, if there are 10 alternatives, then the AHP approach alone
requires 56 comparison matrices. Using the AHP/TOPSIS approach, this is reduced to
two matrices, i.e., one matrix for criteria weight computation using AHP and the other
matrix for alternative/candidate evaluation using TOPSIS. A short description of the two
approaches is given in the following subsections, while the detailed step-by-step procedure
of the proposed hybrid approach for the selection of an optimal site for a new business is
presented with the help of a case study in Section 5.

4.1. Analytic Hierarchy Process (AHP)

The organization and analysis of complex decisions of mathematics and psychology
is best achieved via the analytic hierarchy process (AHP). It was developed by Thomas L.
Saaty [9,11] in 1970s and has been extensively studied and refined since then.
A set of evaluation criteria and alternative options are considered by the AHP,
among which the best has to be selected. A weight for each evaluation criterion is gener-
ated by the AHP according to the decision maker’s pairwise comparisons of the criteria.
The higher the weight, the more important the corresponding criterion is. In the next
step, for a fixed criterion, AHP assigns a score to each option according to the decision
maker’s pairwise comparisons of the options based on that criterion. The performance
of the option is directly proportional to the score with respect to the considered criterion.
Finally, the criteria weights and the options scores are combined by the AHP, which helps
in assigning a global score to each option and eventually a consequent rannking. The
global score for a given option is a weighted sum of the scores obtained with respect to all
of the criteria [11]. The following are the steps taken during the AHP process.
1. The problem is defined, the different criteria that are essential to decision-making are
selected, and a hierarchical model is developed.
2. A set of pairwise comparison matrix is constituted with the assistance of the criteria,
and priorities (weights) are derived.
3. The consistency of the comparison matrix is checked.
4. Final decision is made based on the derived priorities.

4.2. The Technique for Order of Preference by Similarity to Ideal Solution (TOPSIS)
One of the multi-criteria decision-making (MCDM) methods is the Technique for
Order of Preference by Similarity to Ideal Solution (TOPSIS), which was created in 1981
by Ching-Lai Hwang et al. [10]. It is a compensatory aggregation method based on the
idea that the ideal candidate or alternative must have the smallest geometric distance to
a PIS (positive ideal solution) and the geometric farthest distance from an NIS (negative
ideal solution) [36]. In other words, the benefit is maximized and cost is minimized by
PIS; on the other hand, the benefit is minimized and cost is maximized by NIS. It is
assumed that, for each criteria, maximization or minization is applied. TOPSIS requires
normalization as the parameters or criteria are often of incongruous dimensions in multi-
criteria problems [10,37]. Ranking a number of feasible alternatives based on the closeness
to the ideal solution is best achieved via the TOPSIS approach. TOPSIS also avoids pair-
wise comparisons, thus allowing it to be computed in a simple and efficient manner [25].
The TOPSIS method implementation can be summarized with the following steps [38]:
1. Establish a decision matrix;
2. Calculate a normalized decision matrix;
3. Determine the weighted decision matrix;
4. Identify the positive and negative ideal solutions;
5. Calculate the separation distance of each competitive alternative from the ideal and
non-ideal solutions;
6. Measure the relative closeness of each location to the ideal solution; and
Appl. Sci. 2021, 11, 4983 8 of 23

7. Rank the preference order.

5. Case Study: An AHP/TOPSIS-Based Optimal Gas Station Site Selection

This section presents a case study to identify an optimal site for a new gas station.
The case study makes use of the AHP/TOPSIS hybrid approach to compute the criteria
weights and to choose the best option from among a finite set of decision alternatives.
The four criterion values are computed using four real geospatial datasets. Although there
could be several criteria affecting the new business site selection for an optimal gas sta-
tion site, we followed the results of [7]. The authors presented a multi-criteria factor
evaluation model for a gas station site selection. Their study was mainly based on a
questionnaire/survey and they identified several important and crucial factors for site se-
lection. Figure 1 presents a flowchart depicting the flow of important steps in the proposed
AHP/TOPSIS approach. Among the factors they identified, we adopted the following four
important factors in this study, listed with respect to their significance from top to down:
• Competitors in the area (competition);
• Traffic near the location (traffic);
• Popularity of the close-by businesses (area-popularity); and
• Approximate number of vehicles nearby residents own (vehicle-owners).

AHP

Criteria weights
AHP hierarchical model Pairwise comparison
Selection of alternative determination using
construction and criteria matrix construction using
sites and evaluation criteria normalized pairwise
computation selected criteria
comparison matrix

TOPSIS

Closeness computation Ranking of candidate

Decision & normalized Weighted decision matrix Identification of negative
between candidate and locations to identify the
decision matrix generation derivation and positive ideal solutions
ideal locations ideal location

Figure 1. Flow of the important steps in the AHP/TOPSIS approach.

The appraoch in this study is empirical in contrast to the appraoch by [7] for the
identification of a feasible location for a new gas station. In the Section 5.1, all of the
datasets used in the study along with the prediction criteria are listed.

5.1. Dataset Analysis and Prediction Criteria

Four different geographical datasets used in this work are presented here for the
computation of four different criteria.

5.1.1. Gas stations Dataset and the Competition Criterion

The NYC Open Data [39] provides the New York City gas stations data. Detailed
addresses of the 416 gas stations present in New York City are provided in this dataset
and shown in Figure 2. In this study, the competitors that are near the candidate gas
stations are computed with the help of the reference dataset. According to [7], one of the
most significant factors in identifying the ideal location for opening a gas station is the
competitors in that area. The best location for a new gas station is the location with the
least number of competitors.
Appl. Sci. 2021, 11, 4983 9 of 23

Figure 2. NYC gas stations.

Let us suppose that G represents the set of all gas stations in New York City, while
g refers to the geographical location of a gas station. The competition criterion can be
computed with the help of the number of gas stations within radius r g of each candidate
location l ∈ L. Equation (1) explains the abovementioned appraoch.

|{ g ∈ G : dist( g, l ) < r g }| (1)

where the Euclidean distance between locations a and b is represented by dist( a, b).

5.1.2. Traffic Estimates Dataset and the Traffic Criterion

With the assistance of the traffic estimate dataset, hourly average traffic information
of all of the major and minor road segments of New York City is determined. This dataset
includes the traffic estimates from 2010 to 2013, of the city based on the estimation of
approximately 700 million taxi trips [40,41]. For the computation of traffic criteria, this
dataset is exploited.
While observing all of the criteria, traffic is the second most important criterion that
affects the gas station sales. In Figure 3, the locations are highlighted, where per hour
traffic estimates are performed in New York City. The estimated traffic within radius rt
of each l ∈ L is computed to determine the traffic near the candidate locations. Here,
the assumption is that T represents the set of points where traffic estimation for NYC is
available and t represents the point at which the traffic is estimated. The traffic estimation
within radius rt of each l ∈ L is performed using Equation (2).

|{t ∈ T : dist(t, l ) < rt }| (2)

Appl. Sci. 2021, 11, 4983 10 of 23

Figure 3. NYC traffic estimate.

5.1.3. FourSquare Check-Ins Dataset and the Area-Popularity Criterion

The area-popularity criterion can be easily found with a location-aware social network-
ing application. Here, FourSquare is exploited to gather user check-in details at various
business attractions to find out their popularity. The FourSquare dataset for this research
work consists of check-in information within New York City from 12 April 2012 to 16 Febru-
ary 2013 (approx. 10 months). A total of 227,428 check-ins in New York City are contained
in this data set and are shown in Figure 4. There is a time stamp, GPS coordinates, and some
semantic meaning (expressed with the fine-grained venue-categories) connected to every
check-in [42]. The area popularity factor is computed with the help of this check-in dataset.
Another significant factor for picking out a suitable location to open a new gas station
is area popularity. The potential number of customers can be estimated with this criteria.
A distance function, similar to that given in Equation (1), is used for finding the area
popularity. Here, C represents the set of all check-ins in the dataset and c ∈ C denotes
an individual check-in instance at some geographical location. Hence, with the help of
Equation (3), the total number of check-ins of each candidate location l ∈ L within the
radius rc are estimated.
|{c ∈ C : dist(c, l ) < rc }| (3)

5.1.4. Parking Lot Datasets and the Vehicle-Owner Criterion

The NYC Open Data [39] also provides New York City parking lot data. A total
of 20,715 parking lots in New York City are contained in this dataset along with their
geographical location and the size (in terms of area). In Figure 5, polygons are used to
show the location and the area of the parking lots. The criterion vehicle owners, i.e., the
number of people who own a vehicle in the surroundings of the candidate gas stations are
estimated by employing this dataset.
Appl. Sci. 2021, 11, 4983 11 of 23

Figure 4. NYC FourSquare check-ins.

Figure 5. NYC parking lots.

It is obvious that a gas station is accessed by vehicle owners only. Therefore, this
criterion plays a significant role in this research. Although it is challenging to determine the
actual number of people who own vehicles in New York City, the NYC Open Data provides
parking lots details that can be processed for estimating this factor. An estimated number
of parking slots per area can be obtained by dividing the area according to the parking
standards [43,44]. Suppose that V represents the set of all parking lots; then, the function
Appl. Sci. 2021, 11, 4983 12 of 23

given in Equation (4) is employed to determine the approximate number of owned vehicles
that are in close proximity to a candidate location l ∈ L with the help of the approximate
number of parking slots that are located within distance rv of l.

|{v ∈ V : dist(v, l ) < rv }| (4)

5.2. Criteria Computation

In this step, the competitors, traffic, popularity, and vehicle owner criteria are con-
sidered to select an optimal gas station site. Once the set of candidate gas station sites
is provided, the very first step is to compute the criteria. Second, the candidate sites are
evaluated with the AHP/TOPSIS technique to identify the ideal site for a new gas station.
In Figure 6, red stars represent the candidate gas station sites (provided by user) and green
circles explicitly provide the location of existing gas station sites in New York City.
For the calculation of criteria traffic, popularity, vehicle owners, and competitors,
the distance functions given in Section 5.1 and the radius values rt : 1000, rc : 1000, rv : 5000,
and r g : 3000 m are used, respectively. Table 2 shows the candidate sites’ computed criteria.

Figure 6. NYC gas stations and candidate locations.

Appl. Sci. 2021, 11, 4983 13 of 23

Table 2. Candidate sites factor computation.

Factors
CID Alternatives Traffic Popularity Vehicle Owners Competitors
1000 m 1000 m 5000 m 3000 m
1 40.8839, −73.8561 2.91667 178 28,029 23
2 40.8095, −73.8807 3.89881 79 56,643 7
3 40.8347, −73.9177 228.345 631 42,954 32
4 40.7931, −73.9675 16,170.9 1171 19,815 7
5 40.7586, −73.9731 73,897.9 15,316 25,402 7
6 40.7699, −73.9271 2624.86 1276 47,071 13
7 40.7496, −73.8692 416.202 200 51,613 16
8 40.7231, −73.914 507.357 33 44,028 10
9 40.6686, −73.9321 110.815 340 30,995 38
10 40.6599, −73.8701 2.57738 122 33,898 20

5.3. Criteria Weight Computation via AHP

In computing the factors’ weights, the very first step is the hierarchical model con-
struction. The AHP hierarchical model consists of the goal at the top or at the root level.
The criteria are placed at the intermediate level, whereas the candidates or alternatives are
placed at the bottom. The AHP hierarchical model for our optimal site selection problem is
shown in Figure 7.

Goal Ideal Site

Criteria/
Competitors Traffic Popularity Vehicle Owners
Factors

Alternatives Location 1 Location 2 … Location n

Figure 7. AHP hierarchical model.

The next step in the AHP is the construction of a pairwise comparison matrix A to
compute the criteria priorities/weights. The matrix A is a m × m real matrix, where m
is the number of evaluation criteria/factors considered. Each entry a jk of the matrix A
represents the importance of the jth criterion relative to the kth criterion. If a jk > 1, then the
jth criterion is more important than the kth criterion, while if a jk < 1, then the jth criterion
is less important than the kth criterion. If two criteria have the same importance, then the
entry a jk is 1. The entries a jk and akj satisfy the following constraint [11]:

a jk .akj = 1

The following assumptions for the four factors are derived based on the pairwise
comparison matrix. Table 3 shows the pairwise comparison matrix.
• The most significant factor is the number of competitors nearby.
Appl. Sci. 2021, 11, 4983 14 of 23

• The second most significant factor is nearby traffic, followed by popularity of the area.
• The least important factor found in this study is vehicle ownership in the vicinity.

Table 3. Pairwise comparison matrix.

Factors Competitors Traffic Popularity VOwners

Competitors 1 5 6 8
Traffic 0.2 1 5 7
Popularity 0.1667 0.2 1 3
Vehicle Owners 0.125 0.1429 0.3333 1

The factors’ weight is computed after normalization of the pairwise comparison matrix.
The normalized pairwise comparison matrix Anorm is derived by making the sum of the
entries in each column equal to 1, i.e., each entry a jk of the matrix Anorm is computed as

a jk
a jk = m
∑l =1 alk

Ultimately, the criteria/factors weight vector w is obtained by averaging the entries

on each row of the matrix Anorm and can be computed as follows:

∑m
l =1 a jl
wj =
m
Table 4 shows the normalized pairwise comparison matrix with the weights of the
criteria. It is necessary to calculate the consistency of the pairwise comparison matrix;
therefore, it is performed after criteria weight computation. The acceptance of the criteria
weight w depends upon the consistency ratio, which must be less than 0.1; otherwise, it is
assumed that the selection of comparison matrix values are not consistent. In this situtaion,
the values of the pairwise comparison matrix need to be reallocated. In order for the matrix
to be consistent, please refer to [9,25].

Table 4. Normalized pairwise comparison matrix with factors weights.

Factors Competitors Traffic Popularity V Owners Factors Weight

Competitors 0.676691 0.779221 0.529411 0.473684 0.614752121
Traffic 0.135338 0.155844 0.352941 0.315789 0.239978288
Popularity 0.112781 0.038961 0.088235 0.157895 0.099468256
V Owners * 0.07518 0.025974 0.029411 0.052631 0.045801335
* V Owners: Vehicle owners.

5.4. Ranking the Alternatives Using TOPSIS

Once the criteria weights are determined with the help of AHP [11], TOPSIS is uti-
lized to assign ranks to each alternative (gas station candidate sites). According to the
researchers in [10], TOPSIS is a multi-criteria decision analysis method (MCDM), which
assists in selecting the best option among a finite set of decision alternatives. A step-by-step
procedure is shown below for computing the ranking of the alternatives.
Step 1: This step makes use of TOPSIS to make an n × m evaluation matrix E consisting
of n alternatives and m criteria. Without losing generality, 10 alternatives (gas station
candidate sites as shown in Figure 6) and 4 criteria are chosen. Table 5 presents a TOPSIS
evaluation matrix of the 10 candidate sites and 4 factors.
Appl. Sci. 2021, 11, 4983 15 of 23

Step 2: In this step, the matrix E is normalized to form the matrix Enorm , where each
entry eij of Enorm is computed as

eij
eij = q
∑nk=1 e2kj

where i = 1, 2, ..., n and j = 1, 2, ..., m.

Step 3: In this step, the weighted normalized decision matrix Eweighted is obtained by
multiplying the criteria weights w j (computed in Section 5.3) to the corresponding criteria
values. Hence, each entry eijw of Eweighted is computed as eij .w j . The weighted normalized
decision matrix is represented by the grey columns in Table 5.

Table 5. Weighted normalized decision matrix.

ID Candidates Traffic Popularity Vehicle Owners Competitors

1 40.8839, −73.8561 9.24677 × 10−6 1.14721 × 10−3 1.02115 × 10−2 2.21658 × 10−1
2 40.8095, −73.8807 1.23605 × 10−5 5.09158 × 10−4 2.06362 × 10−2 6.74612 × 10−2
3 40.8347, −73.9177 7.23926 × 10−4 4.06682 × 10−3 1.56490 × 10−2 3.08394 × 10−1
4 40.7931, −73.9675 5.12669 × 10−2 7.54714 × 10−3 7.21901 × 10−3 6.74612 × 10−2
5 40.7586, −73.9731 2.34279 × 10−1 9.87122 × 10−2 9.25446 × 10−3 6.74612 × 10−2
6 40.7699, −73.9271 8.32164 × 10−3 8.22387 × 10−3 1.71489 × 10−2 1.25285 × 10−1
7 40.7496, −73.8692 1.31949 × 10−3 1.28901 × 10−3 1.88036 × 10−2 1.54197 × 10−1
8 40.7231, −73.914 1.60848 × 10−3 2.12686 × 10−4 1.60403 × 10−2 9.63731 × 10−2
9 40.6686, −73.9321 3.51319 × 10−4 2.19131 × 10−3 1.12921 × 10−2 3.66218 × 10−1
10 40.6599, −73.8701 8.17112 × 10−6 7.86295 × 10−4 1.23497 × 10−2 1.92746 × 10−1
Vj+ 2.34279 × 10−1 9.87122 × 10−2 2.06362 × 10−2 6.74612 × 10−2
Vj− 8.17112 × 10−6 2.12686 × 10−4 7.21901 × 10−3 3.66218 × 10−1

Step 4: Next, we determine the worst alternative (Vj− ) and the best alternative (Vj+ )
for each column in Eweighted as follows:

Vj− = {(maxi eijw | j ∈ J− ), (mini eijw | j ∈ J+ )}

Vj+ = {(mini eijw | j ∈ J− ), (maxi eijw | j ∈ J+ )}

where i = 1, 2, ..., n, J+ = { j = 1, 2, ..., m} is associated with the criteria having a positive

impact and J− = { j = 1, 2, ..., m} is associated with the criteria having a negative impact.
Step 5: Next, we need to compute the Euclidean distance (L2 − distance) between the
target alternative i and the best alternative Vj+ and between the target alternative i and the
worst alternative Vj− , denoted by Si+ and Si− , respectively, and given as follows:
v
um
Si = t ∑ (eijw − Vj+ )2 , i = 1, 2, ..., n
+ u
j =1
v
um
Si− = t ∑ (eijw − Vj− )2 , i = 1, 2, ..., n
u
j =1

Step 6: Finally, the performance score (Pi ) of each ith alternative is computed using
the following equation.

Si−
Pi =
Si− + Si+
Appl. Sci. 2021, 11, 4983 16 of 23

By comparing the Pi values, the ranking of alternatives is determined: the higher

the value, the better the rank. Table 6 shows the Si− , Si+ , and Pi values along with the
candidates/alternatives ranking.
From the Table 6, it is deduced that candidate having ID 5 is ranked first; therefore,
a new gas station can be opened at this optimal site, followed by candidate IDs (CID) 4
and 2. The performance scores suggest that CID 9 must be avoided because it ranks worst
among all of the candidate sites.

Table 6. Candidate Si− , Si+ , and Pi values and their ranking.

ID Candidates Si+ Si− Pi Rank

1 40.8839, −73.8561 0.297131401 0.144593761 0.327338747 8
2 40.8095, −73.8807 0.254017926 0.299058138 0.540717918 3
3 40.8347, −73.9177 0.348682791 0.05856651 0.143809971 9
4 40.7931, −73.9675 0.204902022 0.303211003 0.596739284 2
5 40.7586, −73.9731 0.011381735 0.392231042 0.97180036 1
6 40.7699, −73.9271 0.250201973 0.241413717 0.491061864 5
7 40.7496, −73.8692 0.266998664 0.212344026 0.442990016 6
8 40.7231, −73.914 0.254352423 0.269993794 0.514915118 4
9 40.6686, −73.9321 0.391639917 0.004541242 0.011462539 10
10 40.6599, −73.8701 0.283262679 0.173548531 0.37991303 7

6. Experiments
In this section, we evaluate the effectiveness of the proposed AHP/TOPSIS approach
to identify an ideal business location. As mentioned earlier, ideal business location in
this work means the location that can attract the maximum number of customers. For the
evaluation in this section, sensitivity measurement is used, which can be defined as the
proportion of positives (correct results) that are correctly identified, also known as True
Positive Rate (TPR). Let the TP and FN denote the number of true positives and false
negatives, respectively; then, the TPR is given by the following:

TP
TPR = (5)
TP + FN
To evaluate the proposed method effectiveness, an NYC convenience store dataset is
used to identify the popularity and/or success of a convenience store, and its visitor count
is used.

6.1. Datasets and Experimental Setup

For the evaluation, we made use of NYC conveninece store checkin data available
from FourSquare [45]. To obtain convenience stores’ location data and their visitor counts
from FourSquare, the developers’ places API was used. API calls to APIs can be broken
down into two categories: regular and premium. Regular API calls only return basic
information including the venue location, category, and a venue ID. Premium API calls
return rich content including the number of visitors. In order to obtain convenience store
data, premium API calls were used as we were interested in convenience store’s visitor
count in addition to its location information.
For the sake of evaluation, we ranked the NYC convenience stores in descending
order with respect to their visitor count and used it as ground truth. Although the visitor
count is reliable, the duration of the visitor count is not known. We then used our proposed
AHP/TOPSIS approach to rank the NYC convenience stores. The obtained ranking is
compared against the ground truth, and the TPR is computed.
For the convenience stores’ ideal location, we identified the following five criteria based
on the intuition that most of the convenience stores’ customers come from these locations:
1. TStations: Transportation stations (train, metro, bus, stations, etc.);
Appl. Sci. 2021, 11, 4983 17 of 23

2. Buildings: Buildings including residential, commercial, etc.;

3. EVenues: Entertainment venues (museums, movie theaters, stadiums, etc.);
4. Shops: Other shops in the vicinity; and
5. PPlaces: Professional places (convention centers, medical centers, factories, etc.)
The data (venue information) related to the criteria TStations, EVenues, Shops, and
PPlaces were obtained from the FourSquare developers’ places API [46]. Using the API,
up to date check-in information was obtained for over 62 million global venues (As of
31 August 2020). The data related to criteria Buildings was obtained from the NYC buildings
footprint data [47]. Building footprints represent the full perimeter outline of each building
as viewed from directly above. Besides the perimeter, other useful attributes of this
dataset included ground elevation at building base, roof height above ground elevation,
construction year, and feature type. The Buildings dataset consists of more than 1 million
NYC building information including residential, commercial, and government buildings.

6.2. Evaluation
As discussed in Section 5.2, we computed the criteria values for the five criteria
mentioned in Section 6.1. The radius values 1000, 300, 1000, 1000, and 1000 m were used for
the criteria TStations, Buildings, EVenues, Shops, and PPlaces, respectively. The reason for
using a smaller radius for the criterion Buildings compared to the other criteria is that the
Buildings dataset is quite large and we obtain a uniform and a large number of buildings
for each candidate for radius 1000 m. Thus, limiting the radius to a smaller value, in this
case to 300 m, help us identify the nearby population of a convenience store. The same is
not true for the other criteria, i.e., TStations, EVenues, Shops, and PPlaces. Thus radius
values of 1000 m are used for them.
Table 7 shows the pairwise comparison matrix for the five criteria. In the criteria
computation, we assume that the criterion TStations, i.e., transportation stations, is the
most important criteria as a large number of people visit convenience stores during their
commute or travel. The second most important criterion that we identified is buildings.
A large number of buildings around a convenience store means a large number of people
either living or working there. Criteria TStations and Buildings are followed by criteria
EVenues, Shops, and PPlaces, which are comparatively less significant compared to the first
two criteria. In addition to the pairwise comparison matrix, Table 7 shows the computed
criteria weights. The details of its computation are discussed in Section 5.2.

Table 7. Pairwise comparison matrix and computed criteria weights.

Criteria TStations Buildings EVenues Shops PPlaces Weight

TStations 1 3 7 9 7 0.495486996
Buildings 0.3333 1 7 9 7 0.327448046
EVenues 0.1428 0.1428 1 3 1 0.071501752
Shops 0.1111 0.1111 0.3333 1 0.3333 0.034061454
PPlaces 0.1428 0.1428 1 3 1 0.071501752

Tables 8 and 9 show the top 20 stores ranked based on FourSquare visitor count
(ground truth) and the top 20 stores ranked by our AHP/TOPSIS approach, respectively.
Figure 8 shows the NYC map containing the convenience stores in Tables 8 and 9. Bold
tuples in Table 9 are the ones ranked by the ground truth in Table 8 as well. Based on
Tables 8 and 9, we computed the True Positive Rate (TPR). We counted the records predicted
by AHP/TOPSIS, i.e., the record that is present in Table 9 is a True Positive (TP) if it also
appears in the ground truth table i.e., Table 8, irrespective of its rank. On the other hand,
a record is counted as a False Negative (FN) if it is predicted by AHP/TOPSIS but it does
not appear in Table 8. Hence, the TPR for the criteria weights computed in Table 7 is given
as follows:
Appl. Sci. 2021, 11, 4983 18 of 23

TP 11
TPR = = = 0.55
TP + FN 20
The TPR is heavily dependent on the criteria weights, and the derivation of the right
criteria weights is important to obtain an optimal or desired prediction. To prove this,
we performed experiments with a number of manual weight assignments to the criteria
vector [TStations, Buildings, EVenues, Shops, PPlaces] as follows:
• uniform = [0.2, 0.2, 0.2, 0.2, 0.2]
• increasing = [0.05, 0.1, 0.2, 0.3, 0.35]
• decreasing = [0.35, 0.3, 0.2, 0.1, 0.05]
• oneCriteriaZero = [0.4, 0.3, 0.2, 0.1, 0]
For the random weight vectors uniform, increasing, decreasing, and oneCriteriaZero
above, we obtained the TPRs 0.25, 0.25, 0.4, and 0.35, respectively. The TPRs are far
lower than the one obtained using carefully derived weights, i.e., 0.55. Figure 9 shows
the placement of ground truth convenience stores (green triangles) and the AHP/TOPSIS-
predicted convenience stores using the manual weights (red circles). As can be observed
from the obtained TPR values of the different weight vectors, the AHP/TOPSIS approach
is heavily dependent on the criteria weight computation.

Table 8. Ground truth—stores ranked based on FourSquare visitor count.

Rank Store ID Store Name

1 5cd15dc59d7468003903fe8a Amazon Go
2 5266a90711d23056d7c6dc67 Bread & Butter
3 4e034363b61ce80e5d67d09f Duane Reade
4 59ceacc02955135d6151aef3 CVS pharmacy
5 4b0b3438f964a520982e23e3 Walgreens
6 4cdc1f63df986ea8550fce16 CVS pharmacy
7 4ca4e5b214c33704a852b13b Duane Reade
8 5678271c498ed123ac7fc1e0 CVS Pharmacy
9 4c545b1b479fc9280e360293 Duane Reade
10 58768de8f2299508aa731849 CVS pharmacy
11 4b61db21f964a52060272ae3 Duane Reade
12 4b130a80f964a520239323e3 Duane Reade
13 4b95bf56f964a520cdb134e3 Duane Reade
14 5b92aaf3033693002c2af840 Open Market
15 4b574341f964a5200e2e28e3 Duane Reade
16 4aca8742f964a52041c220e3 Duane Reade
17 4ae1ed7cf964a520d58821e3 Duane Reade
18 4fe4f632a17c9aa22d55209f Duane Reade
19 4a7f68e6f964a520eff31fe3 Duane Reade
20 4a9e7fadf964a520503a20e3 Duane Reade
Appl. Sci. 2021, 11, 4983 19 of 23

Table 9. AHP/TOPSIS—stores ranked obtained using the AHP/TOPSIS approach.

Rank Store ID Store Name Ground Truth Ranking *

1 4b0b3438f964a520982e23e3 Walgreens 5
2 59ceacc02955135d6151aef3 CVS pharmacy 4
3 4b61db21f964a52060272ae3 Duane Reade 11
4 4ad3f4e5f964a52011e720e3 Duane Reade NR
5 4e034363b61ce80e5d67d09f Duane Reade 3
6 4a9c8a06f964a520813720e3 Duane Reade NR
7 5b92aaf3033693002c2af840 Open Market 14
8 4fe4f632a17c9aa22d55209f Duane Reade 18
9 59a7303f8d0a5343731f326c 7 Eleven NR
10 4aca8742f964a52041c220e3 Duane Reade 16
11 4d6b8ebe56cc6a3175a95eac 7-Eleven NR
12 4adb7ccdf964a520152821e3 Duane Reade NR
13 5d4117543c3cf7000794b01b CVS Pharmacy NR
14 4e7a39122271920e476b47e3 7-Eleven NR
15 5266a90711d23056d7c6dc67 Bread & Butter 2
16 4adf4335f964a520df7821e3 Duane Reade NR
17 5cd15dc59d7468003903fe8a Amazon Go 1
18 4ae1ed7cf964a520d58821e3 Duane Reade 17
19 4a7f68e6f964a520eff31fe3 Duane Reade 19
20 4ba57508f964a520160939e3 Duane Reade NR
* NR: Not Ranked.

Figure 8. Convenience store placement: ground truth vs. AHP/TOPSIS.

Appl. Sci. 2021, 11, 4983 20 of 23

(a) Uniform (b) Increasing

(c) Decreasing (d) One Criteria Zero

Figure 9. Manual weight assignments (ground truth convenience stores (green triangles) and AHP/TOPSIS convenience
stores (red circles)).

7. Discussion
By looking at the result, it seems that the AHP/TOPSIS method is not as effective as
we could obtain only 55% correct results (TP) compared to the ground truth. However, we
would like to argue that ground truth raking is based on the number of visitors, which can
be biased. For instance, the number of visitors depends on several factors besides the five
criteria, i.e., TStations, Buildings, EVenues, Shops, and PPlaces, which we considered in
our AHP/TOPSIS approach. Thus, in order to improve the accuracy of the AHP/TOPSIS
model, more data sets are needed. For instance, stores’ daily sales, pricing policy, product
line, timed sales, special sales, etc. are very important criteria that play important roles in
attracting visitors and in improving daily sales. In fact, daily sales is a better criteria to
rank stores than the number of visitors used in this study. However, the data related to
such criteria is very difficult to obtain if not impossible because of stores’ privacy policies.
We strongly believe that the accuracy of the results can be significantly improved with the
combination of the right criteria and respective datasets.
By analyzing the top 20 stores in Figure 8, one can observe that the proposed AHP/TOPSIS
approach identified convenience stores mainly at the center of the NYC Manhattan area,
which makes sense as it is the most crowded area with a lot of residential and commercial
buildings, transportation stations, shops/markets, and entertainment venues. Since in the
experiments, the highest weights were allocated to the TStations and Buildings criteria,
AHP/TOPSIS identified business locations at a crowded part of NYC. The most important
step in the AHP/TOPSIS approach is the identification of the set of important criteria and
the derivation of their weights with the help of a pairwise comparison matrix. The accuracy
of the the AHP/TOPSIS approach is heavily dependent on the criteria weight computation.
Appl. Sci. 2021, 11, 4983 21 of 23

Section 6.2 shows that, for the random weights assignment, i.e., the weight vectors uniform,
increasing, decreasing, and oneCriteriaZero, we obtained the TPRs 0.25, 0.25, 0.4, and
0.35, respectively, which are far lower than the one obtained using the careful derivation
of criteria weights. This proves that the AHP/TOPSIS approach is sensitive to criteria
weight assignments.

8. Conclusions and Future Work

In this paper, the challenge of selecting an optimal site to open a commercial place is
addressed. It is evident with the support of related research that an ideal site selection to
open a new business requires thorough study of various factors and criteria. This study puts
forward an AHP/TOPSIS-based hybrid solution for this problem, where AHP and TOPSIS
are two state-of-the-art multi-criteria decision-making approaches. The proposed approach
helps to identify the best alternative among the given candidates for a commercial opening
while minimizing the computational complexity and reducing the manual effort required.
The classic MCDM approach AHP becomes computationally expensive, i.e., requires a
large number of comparison matrices to be constructed in the presence of a large number of
alternatives/candidates. Thus, the proposed AHP/TOPSIS approach is particularly useful
to solve this issue and can come up with the best alternative using only two matrices: one
for riteria weight computation and the other for alternatives ranking. The applicability of
the proposed approach is demonstrated with the help of a detailed step-by-step case study
and to evaluate the effectiveness of the proposed approach, and an experimental evaluation
to identify an optimal location for a convenience store is presented. In the presented case
study, a nexus of four criteria was considered, including competitors, traffic, popularity,
and vehicle owners, where the criteria values were computed with the assistance of real
GeoSpatial data. In contrast, for the evaluation, we made use of five criteria, namely,
TStations, Buildings, EVenues, Shops, and PPlaces, which were based on real data. This
study claims that the proposed mechanism is flexible in a sense that any number of criteria
can be exploited for ranking the candidate sites. The results of the evaluation suggests that
the proposed approach is highly dependent on the criteria weights and that the derivation
of the right weight matrix is important to obtain a correct prediction. Since the derivation
of criteria weight is a heuristic approach, it is both flexible and error-prone, flexible in the
sense that it enables users to give preference to one of more criteria of their choice and
error-prone because of manual computation of a weight matrix. In the future, this work
will be extended to identify an optimal route for mobile businesses.

Author Contributions: Conceptualization, S.A.S., M.M. and K.-S.K.; methodology, S.A.S. and M.M.;
software, S.A.S.; validation, S.A.S.; formal analysis, S.A.S.; investigation, S.A.S. and M.M.; resources,
S.A.S.; data curation, S.A.S.; writing—original draft preparation, S.A.S. and M.M.; writing—review
and editing, S.A.S. and M.M.; visualization, S.A.S.; supervision, S.A.S.; project administration, S.A.S.;
funding acquisition, K.-S.K. All authors have read and agreed to the published version of the
manuscript.
Funding: This research was funded by New Energy and Industrial Technology Development Organi-
zation (NEDO) grant number JPNP18010.
Institutional Review Board Statement: Not applicable.
Informed Consent Statement: Not applicable.
Acknowledgments: This article is based on results obtained from a project, JPNP18010, commis-
sioned by the New Energy and Industrial Technology Development Organization (NEDO).
Conflicts of Interest: The authors declare no conflict of interest.

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