Pareto analysis is a statistical technique in decision-making used to select a limited number of tasks that produce significant overall effects. Pareto analysis is supported by the Pareto principle, which states that, for many events, approximately 80% of the effects come from 20% of the causes.
We can apply this rule to almost anything in economics, computing, sports, in engineering, etc.
But how does it affect our jewelry?
- 20% of the jewelry in your store is responsible for 80% of the sales.
- 20% of your customers make 80% of your purchases
- 20% of your salespeople make 80% of your sales.
We must keep in mind that we can improve the profitability of our jewelry if we discover that 20% where we are achieving 80% of the results.
You should review your jewelry store’s annual turnover information and identify that 20% that gives you 80% of your revenue. And that is what you should highlight and work on.
Can’t find your 20%? We live in times of global change, and maybe that 20% to invest is not a jewel but a service. Here are some points raised by well-known people in the jewelry or sales industry that might help you.