代做ST2187 Business analytics, applied modelling and prediction

日期：2025-02-07 05:39

BUSINESS ANALYSIS REPORT

Key Insights and Recommendations

BSc Data Science and Business Analytics

(Standard Entry)

Business analytics, applied modelling and prediction

(ST2187)

1. Executive Summary

The business report outlines the insights from the visualizations created using Tableau and provides recommendations and strategies to acton those findings. There are primarily 7 insights:

i.       Tables are the least profitable product among all other products sold.

ii.       Tables are significantly more profitable in some countries compared to others.

iii.       Majority of customers who  purchased Tables are associated with  low volume of sales and high losses.

iv.       Tables have a substantially greater percentage of discount compared to other products.

v.       Significantly   greater   percentage  of  discount  on  Tables  in  unprofitable  countries  over profitable countries.

vi.       Forecast of sales and profits of Tables indicate that Tables remain unprofitable in the future. vii.       Tables experience volatile seasonality effects in its sales.

The findings outlined above help set the direction of the report. The report focuses on Tables as it is the only unprofitable product among all other products sold by the firm. The difference in profitability of Tables in different countries raises the question on what makes Tables profitable in some countries and unprofitable in others.

An analysis on the average discount on all products sold by the firm reveals that Tables have a significantly greater percentage of discount compared to the discount on other products. This finding exposes the underlying reason for the unprofitability of Tables which is due to excessive discounts that are reducing profits margins.

The firm could address the excessive discount on Tables by balancing the discount in profitable and  unprofitable  countries.  It  could  raise  discounts  in  profitable  countries  to   increase  profits generated and reduce discounts in unprofitable countries to decrease losses generated which would improve the overall profitability of Tables.

The company could take advantage of seasonality in sales of Tables by designing Tables to be locally responsive to different cultures in different timings. New marketing strategies and promotions could be tested during off-peak seasons for Tables and implemented in peak seasons to boost sales and profitability of Tables. Additional strategies such as personalized discounts for customers and loyalty programs could be implemented to attract and retain customers.

Implementation of above-mentioned strategies would improve the profitability of Tables and help the firm gain a competitive edge over its competitors in the long run.

2. Introduction

The business report is conducted based on data collected by the company from December 2016 to December 2020. The data includes information on the sales and profits of multiple products sold  by  the  company  along  with  geographical  information  such  as  country  and  region,  shipping information such as shipping date and shipping cost, customer information such as customer names and customer segmentation, the category and sub-category of products, the discount on products sold, and etc.

The  aim  of this  report  is  to  identify  unprofitable  products  sold  by  the  company  and  the underlying causes for the unprofitability of the products, so as to formulate strategies and provide recommendations to minimize losses and maximize profits generated by the company.

3. Insights from Story

3.1 Overview of Profits and Sales by Product

 

Figure 1: Ranking of Products by Overall Profitability

Tables are ranked 17th  in overall profits amongst 16 other products sold. They are the least profitable product among all products sold from 2017 to 2020, resulting in a loss of $64,000.

 

Figure 2: Ranking of Products by Overall Sales

Tables  are   ranked  8th     in  overall  sales  amongst   16  other   products  sold.  They   have comparable sales with respect to sales volume of other products sold from 2017 to 2020, resulting in sales of $757,000. Thus, the losses experienced from the sale of Tables is not associated with the lack of sales, but rather with other underlying issues which will be exposed in this report.

3.2 Geographical Overview of Profitability of Tables

 

Figure 3: Top 10 Most and Least Profitable Countries for Tables

From figure 1, we have identified Tables to be the least profitable product. Figure 3 exposes that Tables are not unprofitable throughout all the countries. In some countries like India and United Kingdom, the sale of Tables is much more profitable compared to its sale in countries like United States and Indonesia.

Given the discoveries made, it is crucial to understand why the sale of Tables is profitable in some countries while unprofitable in others. The next few sections will shed more light on the overall unprofitability of Tables and itsunprofitability in certain countries.

3.3 Overview of Overall Distribution of Customers

 

Figure 4: Distribution of Customers by Profits and Sales of Tables

Figure 4 displays the distribution of customers by the total sales of Tables made to each individual customer from 2017 to 2020, and the corresponding profits generated from those sale of Tables. Observe that there is a greater proportion of unprofitable customers over profitable customers in the sale of Tables which aligns with the overall unprofitability of Tables.

Furthermore, observe that significant proportion of customers associated with low sales generate higher losses compared to customers associated with high sales. This indicates that the sale of Tables is extremely unprofitable under certain conditions as the company experiences large losses from individual customers despite having low sales. Thus, it is imperative that the company discovers the conditions it should avoid to ensure that Tables become profitable.

 

Figure 5: Distribution of Customers in Top 10 Most and Least Profitable Countries for Tables

From  figure  5,  it  is  notable  that  significant  proportion  of  individual  customers  who purchase Tables tend to  be  associated  with  low  profits  in  profitable  countries  and  low  losses  in unprofitable countries. This reinforces the reason for Tables to be unprofitable in some countries while being profitable in others which is attributed to its distribution of customers in profits and sales. Given the discoveries made earlier, the next section will expose the underlying reason for Tables to be the only unprofitable product, and the reason for some countries to be profitable in the sale of Tables while others remain unprofitable.

3.4 Overview of Discount on Products

 

Figure 6: Average Discount of Products

Figure 6 shows that the average discount on Tables from 2017 to 2020 is 29% which is significantly  greater  than  the   15%   average  discount  on  all  products.  The   significantly  greater percentage of discount provided on Tables greatly reduces the profits generated from the sale of Tables. This explains why Tables are the only unprofitable product in figure 1 despite its comparable sales with respect to other products with similar sales volume such as Machines and Accessories.

 

Figure 7: Average Discount in Top 10 Most and Least Profitable Countries for Tables

Furthermore, the average discount on Tables differs significantly from the top 10 most and least profitable countries for Tables. Figure 7 shows that the average discount on Tables is 52% in the top 10 least profitable countries for Tables while the average discount on Tables is only 7% in the top 10 most profitable countries for Tables. This explains why tables are profitable in some countries while unprofitable in others in figure 3, which is attributed to the difference in average discount on Tables from 2017 to 2020.

3.5 Overview of Seasonality and Forecast of Tables

 

Figure 8: Forecast of Profits and Sales for Tables

Based on the four years of data from 2017 to 2020, the forecast of the following two years in figure 8 indicate similar sales volume for the sale of Tables in 2021 and 2022. Furthermore, the forecast of profits in 2021 and 2022 remains to be negative as it predominantly was from 2017 to 2020.

 

Figure 9: Seasonality of Profits and Sales for Tables

Observe that there is a seasonal effect on the sale of Tables during the months of June, November, and December which experience a significantly greater volume of sales compared to the other months. Furthermore, July in particular tends to experience significantly lower volume of sales compared to the other months.

It is notable that on months that experience significantly greater sales of Tables such as June, November,and December, the company generates significantly greater losses compared to the other months. Observe that the greater the volume of sales of Tables, the greater the losses suffered by  the  company.  As  previously  discovered,  this  is  directly  attributed  to  the  significantly  greater discount on Tables which reduces profits greatly as the volume of sales increases.

4. Conclusion

The report has exposed Tables to be the least profitable product among all other products sold despite having comparable sales. Furthermore, Tables are unprofitable in some countries while profitable in others. The distribution of customers who purchased Tables by sales and profits indicates significant proportion of individual customers associated with low volume of sales but high  losses which supports the overall unprofitability of Tables.

The unprofitability of Tables is mainly due to the significantly greater percentage of discount on Tables compared to the discount on other products. This finding is supported by the significantly greater  percentage of discount on Tables  in  unprofitable countries compared to the discount on Tables in profitable countries.

Given the insights derived, strategies and recommendations have been provided in the next section to minimize the losses generated from Tables and transform. Tables into a profitable product.

5. Recommendations

5.1 Reducing Average Discount for Tables

 

Figures 6 and 7 for reference

Given  that  the  average  discount  on  Tables  is  significantly  greater  than  the  average discount on other  products  as shown  in figure 6, the  intuitive approach would  be to  reduce the discount on Tables. However, such an approach might reduce the revenue generated due to a fall in sale of Tables. Thus, given that the average discount for Tables in the top 10 most profitable countries are significantly lower than the average discount in the top 10 least profitable countries as shown in figure 7, the company could balance the discount on Tables in different countries.

Discounts  on  Tables  could  be  adjusted  to  be  greater  in  profitable  countries  and  be reduced in unprofitable countries. This would reduce the losses generated due to reduced discount in unprofitable countries while increasing revenue generated from the increase in sales due to greater discount on Tables in profitable countries. Overall, this would increase the profitability of Tables.

5.2 Taking Advantage of Seasonality for Tables

The company can take advantage of seasonality by designing Tables to suit the needs of customers during the various seasons. For example, a proportion of Tables manufactured could be designed to be horror themed during the autumn season when Halloween is celebrated. Thus, the Tables manufactured would be locally responsive to the different cultures in countries.

 

Portion of Figure 9 for reference

During  periods  of  low  sales  of  Tables such  as  in July,  the company  can test out the effectiveness of various promotions through A/B testing. It involves offering the promotion to half the customers over multiple time periods and weighing the differences in profits generated between the two groups.  If a type of promotion proves to  be profitable, it could be implemented during peak seasons to further boost the sales of Tables.

Discounts could be  increased to enhance sales further during  peak season such as in November and December, and reduced during off-peak season such as in July to balance and optimize overall discount on Tables throughout the year.

The company could take advantage of seasonality of other products by bundling products together to be sold with Tables. For example, if Chairs experience a period of high sales, customers could be incentivized to buy a Table along with Chairs by offering discounts when both products are purchased together. Such an approach preserves the sales volume of chairs while increasing the sale of Tables as well.

5.3 Additional Strategies

Discounts could be personalized to customer purchasing patterns. Some customers may require a 10% discount incentive to purchase products while others may require a greater amount of discount. Furthermore, the firm could take note of repeat customers and offer them a loyalty program that provides them with special discounts that other customers would not have access to. This creates loyal customers for the firm who would make repeated purchases and increase sales for the firm over time.

It is crucial for the firm to develop additional strategies on top of the recommendations provided above to develop a competitive advantage over its competitors.