- How Graphs Can Track Business Performance
How Graphs Can Track Business Performance
By Jonathan Feniak, Esq., MBA
A graph is a visual tool or picture that helps us to better understand numbers. Instead of just showing us a bunch of numbers in a list, which can be confusing, a graph shows those same numbers in a way that's easy to understand. For example, a bar graph might show a business owner how many apples and oranges their store sells each week, while a line graph could tell us how much money their shop brought in from one day to the next. Graphs can be great to use because they also make it easier to see patterns, like whether something is getting more popular or something else is happening less often. The data is displayed with lines, bars, or dots in a way that our brains can quickly make sense of.
Every graph is made up of a few important parts. At the top is the title. Like a book title, a graph's title tells us what the graph is about and what kind of data we will look at. The horizontal axis is a line that goes from left to right, usually at the bottom of the graph. This line is marked with one of the types of information being used. For example, it might be marked with people's ages from 0 to 100 or the days of the week. The vertical axis is a line that goes from bottom to top, usually on the left side of the graph. It's also marked to explain what places along this line represent. Often, there's also a key at the bottom of the graph or off to the side, which explains the colors or symbols used in the graph.
A bar graph uses bars to show numbers horizontally or vertically. Each bar represents a piece of data. The taller or longer the bar, the more of that thing there is. So if a store owner made a bar graph to show whether customers bought more apples or oranges and saw that the bar for apples is longer than the one for oranges, they'd know that they sold more apples than oranges. Then, they might use this information to decide to order more apples and fewer oranges for their store in the future.
To make a bar graph, start by drawing two lines from one spot on your paper, one of them going to the right and one of them going up. Decide what you want to compare, and write those things on the horizontal axis. Then, write the numbers of those things along the vertical axis, counting up from the bottom. Once this is done, you can draw the bars for each thing, making the top of each bar as high as the spot on the vertical axis that matches the value you're showing.
A line graph is another helpful tool for anyone who needs a visual way to look at numbers. It uses dots connected by lines to show numbers going up or numbers going down. It's perfect for showing how things change over time. For example, a line graph could show how much a store earns each day, week, month, or year.
Making a line graph is similar to making a bar graph at the beginning. You'll start by drawing your axes and labeling them. Usually, the bottom of the line graph is labeled to represent time passing. For instance, if you want to make a line graph of the amount of money your store earned in a week, the horizontal axis would be labeled with the days of the week. Then, you would label the vertical axis with amounts of money, increasing from the bottom to the top. Then, you'd add a dot on the graph for each value. If your store earned $100 on Monday, you'd put a dot at the spot that's above "Monday" and across from "$100." Once you put all of the dots on the graph, you connect the dots with lines. Now, you can easily see when the amounts went up or down.
For a business owner, a line graph could show how sales increase or decrease throughout the year. This can help them to better understand the best times to sell certain products. For example, if a line graph shows that more oranges are sold in July than in November, the store owner might decide to stock up on oranges every summer and not order as many in the fall.
For a business owner, a line graph could show how sales increase or decrease throughout the year. This can help them to better understand the best times to sell certain products. For example, if a line graph shows that more oranges are sold in July than in November, the store owner might decide to stock up on oranges every summer and not order as many in the fall.
Graphs are powerful tools, not just for business owners but for everyone, helping us to make sense of information and make better decisions. To learn more, check out these resources: