20% of Your Businesses Are Probably Responsible for 80% of Your Turnover …. and Fractals Dictate There Are Huge Profit Opportunities With The 20%
Definition of a Fractal: a graphical curve or geometric figure, each part of which has the same statistical character as the whole.
Businesses and people are predictable, far more predictable than many people think. Economist Vilfredo Pareto was aware of this and described the Pareto Principal with regards income distribution.
But it applies to other situations as well. The Pareto Principle is actually a fractal in that the same relationship exists as you drill down through your business. 20% of your customers will either buy 80% of your goods or contribute 80% of your profits. And if that 20% you’ll find that 20% of them are super customers and contribute 80% of the 80% ….. well you get the idea.
It takes some doing getting your head around this but it is important that you do because when it comes to profit not all customers are equal.
In business fractals are all around you. Take football, a huge number of people watch the game in the pub. It cost s them a glass of beer. Of these people 20% can be persuaded to buy a ticket to go to a game. 20% of them will buy a season ticket. 20% of them will take a box. And a few of them will buy a club!
Of course 20% doesn’t hold true in every single case but you get the idea I’m sure. There is a,ways a percentage that can be unsold to the next level.
So what are up you doing to tap into these sales?