Importance of Statistics in Business World

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Throughout the business world, statistics have allowed numerous sources for entrepreneurs to stay informed and fabricate vast decisions, provide prominent leadership. When one is in management, statistics can be helpful whether they’re innovating products, trying to think of a way to speed-up the production process, or even analyze the demands of repeat consumers/ soon-to-be consumers. One can simply ineffectively run these stages with the intuitive way of thinking, but it would not be as effective, this is why we use statistics based on trial and error. With the use of statistics, one can significantly increase the magnitude of production, which regulates the waste of resources.

The extent of statistics in research and development is quite prominent for one starting a business. First of all, one must understand the demand for the product they are trying to sell. It would be a smart idea to look into the companies that have tried selling the same or a different product and look at what went downhill, leading them to the decline stage. Then, one must realize the level of income in the area one is selling the product by analyzing statistics on unemployment levels, looking at what type of businesses are surrounding the area, and so on.

Most importantly, one may use trends of other similar businesses in the area and use this to make predictions for future sales. For example, if one is trying to plan on opening a pizza restaurant or an ice cream parlor in Connecticut, statistics will show the pizza being more successful due to weather conditions throughout the year. From this, the person will be able to make a literate decision on which is more beneficial to himself.

The use of statistics can also be prominent in the performance in the business world. For example, one can gather the output of each worker, to analyze if the worker is meeting the production standards of the company. If this becomes an issue, the owner may decide to invest in equipment to make the product efficiently itself, which may produce more output. Also if one is running a business for toys: statistics must be run to test that the object runs efficiently and test to see if all others follow the same pattern.

It’s very beneficial for a business to view customer data to improve operations in a business. One can understand the likes, dislikes, and so on of their target group. For example, Netflix analyzes what people most often watch, and they are able to see what movies to add. This is a huge priority for them because they have a large portion of the market share with online streaming services, and want to keep it that way. Companies that analyze these statistics of their consumers are able to satisfy more people and eventually more sales, as people talk!

In the business world, one must realize the value of measuring numbers to increase sales, productivity, and supply. One must understand the basics of statistics: there must be an underlying knowledge to understand what one is looking for. Also, some tools of statistics don’t allow for all of what one needs in order to understand their consumers.

For example, if you want a 5-star rating on your hotel, you must make sure you analyze the statistics of 2-star hotels and 5-star hotels to reach your goal! Without statistics, we would essentially not grow as an economy and what a business owner can really only benefit from with the result being maximum profitability for their enterprise.


Cite this paper

Importance of Statistics in Business World. (2021, May 15). Retrieved from https://samploon.com/importance-of-statistics-in-business-world/

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