The Pareto Principle, also known as the 80/20 Rule, suggests that roughly 80% of results come from 20% of efforts. In business, this often means:
- 80% of sales come from 20% of customers
- 80% of complaints come from 20% of products
- 80% of revenue comes from 20% of inventory
Note: The exact ratio doesn’t matter—the insight is that not all inputs are equal. Identifying and focusing on the most impactful 20% can lead to better results with less effort.
This principle is especially helpful in retail: highlight bestsellers, nurture loyal customers, and streamline operations by concentrating on what matters most.