Business Decision Analysis for Sales Data | Desklib

This document presents an analysis of sales data for a retail organization dealing in office supplies, furniture, and technology products. The analysis includes the relation between sales and profit, financial ratios, and the effect of discounts on profit-ratio for different product categories. The document also discusses the advantages of using Tableau for data analysis. The subject of the document is Business Decision Analysis and the course code and college/university are not mentioned.

Running Head : DATA ANALYSIS, PROBLEM SOLVING, AND DIGITAL OPERATIONS
Business Decision Analysis
Name of the student
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1DATA ANALYSIS, PROBLEM SOLVING, AND DIGITAL OPERATIONS
Table of Contents
Introduction......................................................................................................................................2
Analysis of Sales Data.....................................................................................................................2
Conclusion.......................................................................................................................................9

2DATA ANALYSIS, PROBLEM SOLVING, AND DIGITAL OPERATIONS
Introduction
Herein we present an analysis of sales of the retail organization. The organization deals in
office supplies, furniture and technology products. The key information that have been used for
the analysis pertain to the organization are the order date, shipping mode, order priority, sales
price, discount and profit on the products. Information regarding the activities of the organization
in different regions of Australia are also presented. The variables order priority, shipping mode,
product category and sub-category and customer segment are presented as categorical variables.
In order analyse the sales figures of the retail organization the numerical variables chosen are
order date, sales, profit and discount. Moreover, new variables are also created to help in the
analysis. Total discount is calculated as the product of sales and discount.
Total discount=sales∗discount
To gain insights into the functioning of the retail organization “Tableau” is used.
“Tableau” offers advantages over other BI tools such as we can clean and arrange the data. In
addition, new variables cam be created in Tableau. In the present analysis we have created Total
discount to analyse how it would affect the sales of the products.

3DATA ANALYSIS, PROBLEM SOLVING, AND DIGITAL OPERATIONS
Analysis of Sales Data
Relation of Sales and Profit
The above figure presents the relation between avg sales and profits of the products. The
image on the top presents the relation of sales and profits across product sub-categories. The
above graph effectively shows the average sales and profits on the basis of product category. In
addition to this, the graph also shows segregation on the basis of quarter. The image on the down
presents the relation of sales and profits across quarters for which trend lines are also shown.
From the above figure it can be inferred that for the entire period between 2013-16 “technology
products” had a higher average sale as well profits. Moreover, it is found that Tables and
bookcases, furniture products of the retail organization made losses. “Office Supplies” products
of the organization had the least average sales as well as average profits (Anderson et al. 2017).
The average profits is shown to be maximum for technological products such as copiers and fax,
office machines and telephones. The average profits and average sales on the basis of

4DATA ANALYSIS, PROBLEM SOLVING, AND DIGITAL OPERATIONS
technological category is shown to be higher than office supplies and furniture. The office
supplies shows that the average profits which is generated for certain items such as papers, pens,
rubber bands are close to zero mark.
From the relation of sales and profits by quarter it can be concluded that Q4 of 2013 and
2015 posted substantial higher profits as compared to other quarters between 2013-16 for the
entire range of products of the organization. The highest average sales for the organization was
in Q1 of 2013. In addition to this the graphs which is presented above shows that the average
sales which is generated in the first quarter for each of the year is higher (O'brien 2015). The
results which are shown for 2015 shows a significant rise in the average profits of the business
and the same is more than any other year as per the chart which is represented above. In 2016, it
can be clearly noted that the average profits generated has fallen even though the average sales
has increased. More information of sales and profits can be visualised by segregating the
information across time and product sub-categories.

5DATA ANALYSIS, PROBLEM SOLVING, AND DIGITAL OPERATIONS
Financial Ratios according to Product Sub-category
In the above figure we analyse the financial ratios of the products of the organization. He
financial ratios can be used effectively for any analysis which is conducted for the organization
and it can measure the average profits and sales which is generated by different items. From the
figure it can be inferred that copiers and faxes had the highest average sales and profit for the
organization. This is despite the fact that the average and total discount on the product (copiers
and faxes) was the highest. All four products in Technology category are profitable goods for the
organization. Moreover, it is found that tables and Bookcases in Furniture category are loss
making products for the retail organization. The red bar which are represented in the chart above
near the furniture category represents the losses which the organization makes. In office supplies
category, scissors, rulers and trimmers are a loss-making product for the organization. The office
supplies items such as scissors, rulers and trimmers, rubber bands also show that the average
sales which can be generated is significantly low. The average discount across products varied

6DATA ANALYSIS, PROBLEM SOLVING, AND DIGITAL OPERATIONS
between 0.045 and 0.050 percent. The average discount figure shows that more or less discounts
are offers for all categories of products which is offered by the business. To create the above
visualization a variable “Total discount” had to be created.
Total discount=Sales∗Discount
It can be inferred from an analysis of the above figure that the average total discount for
office supplies products is the least. This is mainly due to the fact that such office supplies have a
lower average sales and so low discounts are offered on such category of items. Changing in the
time period and regions in which the organization sale their products would provide more
information on the financial ratios.
Does discount provide more profit?
Average sales and profit of products categories for discounted and non-discounted range
are presented in the above figure. In order segregate the products across discounted and not-

7DATA ANALYSIS, PROBLEM SOLVING, AND DIGITAL OPERATIONS
discounted categories a dimension “whether discounted” was created. A new parameter was
created from the measure “discount” using the formula
if [Total Discount]>0 THEN Discounted ELSE Not −Discounted END
The variable “whether discounted” had two factors – “Discounted” and “Not-
Discounted.”
Analysis of the above figure proves that the average sales for Furniture and Office
Supplies categories are approximately similar. Moreover, it is visualized that the average profit
from a much larger higher quantity of discounted furniture products is similar to a much smaller
number of non-discounted products (Choi, Medlin and Hunsinger 2017). Further, it is found that
the average profit from a much smaller number of non-discounted office-supplies is higher than a
much larger number of discounted products. This shows that the same is more profitable even
though no discounts are offered by the business (Mathuva 2015). For technology products also, it
is found that much smaller number of non-discounted products have a higher profit than
discounted products. The average profits which is generated for non-discounted technological
products is much more than the averages sales which is generated by the business. Moreover, the
average sales from non-discounted product is higher than discounted product (Lee and Law
2018). Segregating the above information across time, product sub-category and region would
provide more insight into the relation between sales and profits for discounted and not-
discounted products. This would be an effective method for taking major decisions regarding
which products the business wants to offer.
It can be inferred from the above visual that the average profit from lesser quantity of
not-discounted products is higher than higher quantity of discounted products.

8DATA ANALYSIS, PROBLEM SOLVING, AND DIGITAL OPERATIONS
This obviously leads to the question – does discount have any effect on profit-ratio for
different product categories?
Profit-ratio vs discount
The above chart represents the relationship between profit ratios and discounts for the
three categories of products which is offered by the organization. The above graph shows that the
profit ratios for office supplies and technologies intersect at different points depending on the
discounts which is offered by the organization (Scott 2017). After 6% discount level, the red line
which represents the technological products have higher profit ratios in comparison to office
supplies. However, in an overall estimate it can be said that the results which are depicted for
office supplies and technological products are quite similar in nature (Shahriar, Schwarz and
Newman 2016). On the other hand, the blue line represents the furniture category and the same is
shown to be declining with increase in discounts by the business. At 11% discount, the profit
ratios for the category of the product is shown to be on the decline which suggest that the with

9DATA ANALYSIS, PROBLEM SOLVING, AND DIGITAL OPERATIONS
more discount the profit ratio would further fall. The furniture category shows constant fall in the
profit ratio of the organization.
Conclusion
The above analysis effective shows the relationship between average profits and average
sales which is generated from the three category profits which is offered by the business. The
relationship between averages and average profits is shown on the basis on product wise as well
as quarter wise. The average sales and average profits which is generated from technology
products are shown to be better than furniture and office supplies category. In addition to this,
comparison is also made on the basis of average discounts and average total discounts which is
offered on the three categories of products. The graphical presentation shows that fax and copiers
which forms a part of technology goods have highest sales and profitability even though the
average discounts on the same is also highest. The above discussion also shows relation between
the profit ratios and discounts which is offered by the organization. Therefore, it can be said that
the technology category of goods is most profitable for the business followed by office supplies
category even though some sub products are loss making. The category of furniture is loss
making in nature.

10DATA ANALYSIS, PROBLEM SOLVING, AND DIGITAL OPERATIONS
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