Sales: 80% of your sales come from 5% of your customers; 15% of your sales come from 15% of your customers; 5% of your sales come from 80% of your customers.
Purchasing: 80% of your purchases come from 5% of your vendors; 15% of your purchases come from 15% of your vendors; 5% of your purchases come from 80% of your vendors.
In either case, we are talking dollar volume, not number of incidents. We are also talking at a manufacturing/marco level; not an individual retail/micro level.
That’s really cool, thanks for the post. I was familiar with gaussian distributions (from physics - lasers have gaussian distributions for example) but not Pareto distributions.