Complete/Correct Question:
Todd Harris and Associates, a New York sales promotion agency, discovered from analysis of its files that one-fifth of its clients accounted for more than three-quarters of its fees and commissions. This is an example of what classic concept?
A. the majority fallacy
B. the law of inverse proportions
C. Murphy's Law
D. service quality
E. the 80/20 rule
Answer:
E. the 80/20 rule
Explanation:
The 80/20 rule states that '80% of sales come from 20% of sales rep'. The 80/20 rule is also known as the Pareto principle was discovered by Italian ecoonomist Vilfredo Pareto. It can also be called the law of inequality,
The rule aims to help one understand how to manage sales activities as the rule also states that 80% of one's sales will come from 20% of one's customers. this understanding helps to break the rule.
Also for small businesses, The 80/20 rule is a challenge as there isn't as much customers yet and this means that every member of the sales force is needed to generate as much income as possible.
I hope this helps.
