A relative frequency pareto chart consists of two graphs – a bar graph showing frequencies and a line graph showing cumulative frequencies (in percentages) over it.

We now explain how to construct a relative frequency pareto chart by means of an example.

**Steps to construct a Pareto chart:**

- Given the frequency table, calculate the cumulative frequencies by adding the current and previous frequencies.
- Convert the cumulative frequencies to percentage, by first dividing with the total frequency and then multiplying by 100.
- Plot the frequencies using a bar graph.
- Plot the cumulative percentages and join them by straight lines.

**Example**:

Suppose we are given the following data on factors influencing purchase decisions vs the number of customers.

Factors Influencing Purchase Decisions | Number of Customers |

Quality | 1501 |

Price | 1216 |

Brand | 1040 |

Service | 810 |

New Products | 539 |

Reviews | 316 |

Easy Returns | 76 |

* Step 1*: We first find the cumulative frequencies by adding up the current and previous frequencies.

Factors | Frequency | Cumulative Frequency |

Quality | 1501 | 1501 |

Price | 1216 | 1501+1216 = 2717 |

Brand | 1040 | 1501+1216 + 1040 = 3757 |

Service | 810 | 4567 |

New Products | 539 | 5106 |

Reviews | 316 | 5422 |

Easy Returns | 76 | 5498 |

TOTAL = 5498 |

** Step 2**: We convert the cumulative percentage by dividing cumulative frequency by total frequency and multiplying by 100.

Factors | Frequency | Cumulative Percentages |

Quality | 1501 | (1501/5498)*100 = 27.30% |

Price | 1216 | (2717/5498)*100 = 49.42% |

Brand | 1040 | (3757/5498)*100 = 68.33% |

Service | 810 | (4567/5498)*100 = 83.07% |

New Products | 539 | (5106/5498)*100 = 92.87% |

Reviews | 316 | (5422/5498)*100 = 98.62% |

Easy Returns | 76 | (5498/5498)*100 = 100% |

TOTAL = 5498 |

** Step 3**: We plot the frequencies using a bar graph and plot the cumulative percentages using a line graph. We obtain the relative frequency pareto chart as shown below.