Pareto principle (80/20 rule): Definition, Formula & Why It Matters

Also called: 80/20 rule

The Pareto principle, or 80/20 rule, observes that roughly 80% of results come from 20% of causes. In a shop, about 80% of revenue typically comes from about 20% of listings. It is the idea behind ABC analysis.

Example

If 20% of your listings produce 80% of revenue, those are the items to protect and promote.

Why it matters for Reverb sellers

Knowing which small set of products drives most of your sales lets you focus buying, pricing, and promotion where they move the needle, instead of spreading effort evenly across the catalog.

How Verbstack helps

Verbstack surfaces the listings driving most of your revenue so you can act on the vital few.

Track this on every order, automatically.

✓ Real fees, margins, and profit on every Reverb sale
✓ COGS and inventory tracked for you, no spreadsheet
✓ Full history and a live monthly P&L

Get started free

Free forever to get started. No credit card required.

← Back to the glossary

See this number on every order.

Connect your Reverb shop and Verbstack tracks your fees, margins, and profit automatically.