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When to Use a Bar Mekko Chart. When to Use a Bar Mekko Chart. Use a Bar Mekko chart when you want to display profit or contribution margin by industry. The wider the bar, the bigger the industry and the taller the bar the greater the margin. - PowerPoint PPT Presentation
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When to Use a Bar Mekko Chart
Copyright 2012 © Knowledge Management Associates, LLC. All rights reserved .
When to Use a Bar Mekko Chart
Use a Bar Mekko chart when you want to display profit or contribution margin by industry. The wider the bar, the bigger the industry and the taller the bar the greater the margin.
Some examples of when you would use a Marimekko Chart are: • Profit by Business Unit• Supply Chain Profitability• Industry Profit Pool• Channel Profitability• Plant Cost Review• Future Growth By Region
Copyright 2012 © Knowledge Management Associates, LLC. All rights reserved .
Profit by Business Unit
Use a Bar Mekko chart to analyze profitability for different business units. The height of the bar represents profit margin and the width business unit revenue. You might want to focus on growing the medical unit and not automotive.
40
50
60
70
80%
Total CompanyProfitability: 65%
Transp
ortati
on
Medica
l
Rubbe
r, Pap
er &
Misc Pl
astic
Prod
ucts
Appli
ances
and Hou
seware
s
Automoti
ve
Sport
ing Goo
ds, To
ys
& Recrea
tiona
l Equ
ipmen
t
Cont
ribut
ion
Mar
gin
(%)
Copyright 2012 © Knowledge Management Associates, LLC. All rights reserved .
Supply Chain Profitability
You can also illustrate the contribution and revenue from different segments of the supply chain. Distributors and Tier 3/4/5 suppliers have the highest contribution, while manufacturers have the highest revenue. Add a data row to highlight revenue.
0
3
5
8
10
13%
Contribution Margin (% )
Raw MaterialManufacturer
4%
Tier 3/4/5Supplier
12%
Tier 1 Supplier
8%
Manufacturer
6%
12%
Dealer
2%
National Distributor
$3B $2B $5B $10B $2B $2BTotalRevenue
Copyright 2012 © Knowledge Management Associates, LLC. All rights reserved .
Industry Profit Pool
Industry profit pools help you identify the most profitable industry segments, which are often not the largest segments. In this example, software and services are the segments with the highest profit margins.
0
10
20
30%
Profit Margin
Microprocessors
12%
Servers
6%
Storage
9%
Peripherals
4%
20%
25%
Software Services
Copyright 2012 © Knowledge Management Associates, LLC. All rights reserved .
Channel Profitability
If you sell through several channels, you can use a Bar Mekko to look at the profit made through each channel compared to the amount of sales through the channel.
0
5
10
15
20%
Direct
20%
Value-addedResellers
10%
Global SystemsIntegrators
16%
Regional SystemsIntegrators
14%
$450M $1,050M $900M $600MRevenue
Copyright 2012 © Knowledge Management Associates, LLC. All rights reserved .
Plant Cost Review
Use a Bar Mekko to present cost and production for your plants. The Y axis represents cost per unit for each plant and the X axis represents number of units produced by the plant. You can identify your low cost plants.
0.00
1.00
2.00
$3.00
Cost per Unit
Average $1.41
Atlant
a
$2.40
Orland
o
$2.10
Pomon
a
$1.90
Germany
$1.60
Hungar
y
$1.30
Romani
a
$0.90
Malaysi
a
$0.70
Shan
ghai
$0.40
Copyright 2012 © Knowledge Management Associates, LLC. All rights reserved .
Future Growth by Region
You can also use a Bar Mekko to compare growth in a key variable, in this case defense spending, to the current spending level. You can see that the growth in defense spending will come from the Asia-Pacific region over the next 10 years. Source: THE GREAT EIGHT Trillion-Dollar Growth Trends to 2020
0
50
100
150
175%
Asia-P
acific
165%
Middle Eas
t and Afric
a
94%
LatinAm
erica
49%
North Ameri
ca
30%
Europ
e
28%
Estimated I ncrease in DefenseSpending by Region 2010-2020
Copyright 2012 © Knowledge Management Associates, LLC. All rights reserved .
A successful business chart should help you as well as your audience make sense of what would otherwise be complex numbers and ideas. When designed poorly, charts just confuse. But choosing the right chart and utilizing good chart design will convey your message clearly and effectively.
For more information on other charts available in Mekko Graphics and the right way to use them please explore the following resources:
Mekko Graphics charts not available in PowerPoint:Marimekko ChartCascade (Waterfall) Chart
Our Chart Finder and Sample Presentations can help you learn about other charts enhanced by Mekko Graphics
Choosing the Right Chart for the Job
