How to Make a Pareto Chart

A Pareto chart is one of the most powerful and straightforward tools for finding where to focus your effort. It operates on the Pareto Principle, or the 80/20 rule, which suggests that roughly 80% of outcomes come from 20% of causes. This guide will walk you through what a Pareto chart is, why it's so useful for any business, and how to create one step-by-step in both Excel and Google Sheets.

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What is a Pareto Chart, and Why Should You Use One?

At its core, a Pareto chart is a combination of a bar chart and a line graph. The bars represent individual causes or categories, arranged in descending order of importance (from tallest to shortest). The line graph represents the cumulative percentage total of those causes.

The entire point of a Pareto chart is to visually separate the "vital few" from the "trivial many." It helps you instantly see which problems or contributors are having the biggest impact so you can channel your limited resources - time, money, and energy - into fixing the things that truly matter.

You can use Pareto analysis for almost anything, such as:

• Identifying the most common customer complaints.
• Finding which blog posts drive the most website traffic.
• Pinpointing the bugs causing the most crashes in your software.
• Understanding which products generate the most revenue.

Instead of trying to solve dozens of small issues at once, a Pareto chart guides you to the handful of big ones that, once solved, will make about 80% of the problem go away.

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Step 1: Get Your Data Ready

Before you can build the chart, you need to organize your data correctly. A well-structured table is the foundation for an accurate chart. You'll need at least two columns:

• Cause / Category: The specific reason or item you are measuring (e.g., "Late Delivery," "Wrong Item Shipped," "Damaged Product").
• Frequency / Cost: The number of times each cause occurred, or its associated cost or value (e.g., number of complaints, support tickets, or revenue per product).

Let's use an example of customer service complaints. Imagine you've collected data for a month and compiled it into a simple table:

Cause of Complaint | Number of Issues Wrong Item Shipped | 65 Late Delivery | 112 Damaged Product | 45 Poor Packaging | 31 Website Glitch | 8 Customer Service Delay | 12 No Order Confirmation | 4

The most important step is to sort the data in descending order based on the frequency column. Your sorted table should look like this:

Cause of Complaint | Number of Issues Late Delivery | 112 Wrong Item Shipped | 65 Damaged Product | 45 Poor Packaging | 31 Customer Service Delay | 12 Website Glitch | 8 No Order Confirmation | 4

Now that your data is sorted, you're ready to build the chart.

How to Make a Pareto Chart in Excel

Creating a Pareto chart in Excel requires a few manual steps, but it’s straightforward once you know the process. First, you'll need to add a "Cumulative Count" and a "Cumulative Percentage" column to your table.

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1. Add Cumulative Count & Cumulative Percentage Columns

Total up all your issues first. In our example, the total is 112 + 65 + 45 + 31 + 12 + 8 + 4 = 277.

Your table will now have four columns. Let's assume your data is in columns A and B, starting from row 2.

• Column C (Cumulative Count): For the first item, the cumulative count is just its own count. So, in cell C2, enter =B2. For the second item, add its count to the cumulative count of the one above it. In cell C3, enter =C2+B3. Click the small square in the bottom-right corner of cell C3 and drag it down to apply this formula to the rest of the column.
• Column D (Cumulative Percentage): This column calculates the running percentage of the total. In cell D2, enter the formula =C2/277 (replace 277 with your total). Then, drag this formula down the column. To format these values as percentages, select column D, right-click, choose "Format Cells," and select "Percentage."

Your completed table should now look like this:

2. Create a Combo Chart

Now it's time to build the visual.

1. Highlight the columns for the Cause, Number of Issues, and Cumulative %. In our example, select columns A, B, and D. You can do this by holding the Ctrl key (or Cmd on Mac) while clicking the column headers.
2. Navigate to the Insert tab on the Ribbon.
3. In the Charts section, click Recommended Charts, then select the All Charts tab.
4. Choose the Combo chart type at the bottom of the list.
5. Excel will set up a clustered column chart by default. You need to adjust the settings:
6. Click OK.

3. Format and Refine Your Chart

You have a basic Pareto chart, but it needs a few tweaks:

• Adjust the Secondary Axis: Right-click the numbers on the secondary axis, choose Format Axis, and change the Maximum Bound to 1.0 (which represents 100%).
• Remove the Gap Between Bars: Right-click on any of the blue bars, choose Format Data Series, and set the Gap Width to 0%.
• Add Titles: Add your chart a descriptive title, e.g., "Analysis of Customer Complaints," and axis titles to label what the bars and lines represent.

After these tweaks, you will have a clean, insightful Pareto chart ready to share.

How to Make a Pareto Chart in Google Sheets

Google Sheets makes building a Pareto chart even easier because it offers a dedicated Pareto chart type. You don't need to manually create the cumulative percentage column.

1. Prepare Your Sorted Data

Start with the same first two columns as the Excel guide: your cause or category and its corresponding frequency. Be sure to sort the frequency column data in descending order. That's all the prep you need.

2. Insert the Pareto Chart

1. Highlight your two columns of data (the causes and their frequencies).
2. Go to the nav bar and click Insert > Chart.
3. Google Sheets will probably suggest a chart type, but it might not be a Pareto. In the Chart editor on the right, under the Setup tab, click the chart type dropdown.
4. Scroll down to the "Other" section and select Pareto chart.

That's it! Google Sheets automatically sorts the data, calculates the cumulative percentage, adds the line, creates the secondary axis, and formats the chart for you. You can then use the Customize tab in the Chart editor to change titles, colors, and fonts.

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How to Read and Use Your Pareto Chart

A beautiful chart is pointless if you can't get insights from it. Reading a Pareto chart is simple once you know what to look for.

• The "Vital Few" are on the left: The tallest bars are your biggest problems. In our example, "Late Delivery," "Wrong Item Shipped," and "Damaged Product" are the three root causes driving the majority of complaints.
• Follow the 80% line: Look at the cumulative percentage line. Find where it crosses the 80% mark on the right-side axis. The bars to the left of that intersection point are your "vital few." All your energy should go into solving these first.
• Ignore the "Trivial Many" (for now): The flat tail of the line graph on the right represents the smaller issues. While things like "No Order Confirmation" aren't ideal, they make up a tiny fraction of your overall problem. You can safely deprioritize them while you focus on the big wins.

In this scenario, your actionables are clear: an immediate review of shipping logistics and order fulfillment procedures is needed to address delivery times and accuracy. After that, look into packaging suppliers and protocols to reduce product damage. Solving these three issues will eliminate 80% of your customer complaints.

Final Thoughts

The Pareto chart is an essential tool for turning a long list of problems into a short, focused action plan. By identifying the critical inputs that are having the most impact on outcomes, it allows every team to stop wasting time on minor issues and start putting their resources where they'll make a real difference.

While spreadsheets are excellent for analyzing known issues you've already compiled, finding those insights across all your different marketing and sales platforms can be a manual, time-consuming process. We designed Graphed to solve that problem. Instead of exporting CSVs from a dozen tools, we allow you to connect your data sources and simply ask questions in plain English - like "what are my top 5 underperforming Facebook Ad campaigns by ROI?" - to get these kinds of priority insights in seconds.