Have you ever heard of Pareto principle or 80/20 rule? It's the idea that 80% of results come from just 20% of your effort. In other words, a small percentage of what you do has the biggest impact — whether it's acquiring clients, growing revenue, or expanding your network of contacts.

As a coworking entrepreneur, you juggle countless tasks — meeting with potential clients, perfecting your presentation, marketing your business, and running operations. But not all efforts yield equal results. Maybe 20% of your networking leads to 80% of business opportunities. Or a small portion of your marketing efforts generates the most engagement.

The key is that you identify what really drives things and focus your energy there. Prioritize the relationships, strategies, and tasks that yield the highest returns. By applying the 80/20 rule, you can work smarter, not harder — making the most of your time, resources, and coworking space.

What exactly is the 80/20 rule?

At its core, the 80/20 rule is a time management strategy. Also known as the "law of the vital few", it was developed by the Italian economist Vilfredo Pareto in 1906. In one of his books, Political economy courses, stated that 80% of land in Italy was owned by only 20% of inhabitants.

A few years later, engineer Joseph M. Juran applied this principle to quality control. According to his findings, 80% quality problems were caused by only 20% causes. Today, the Pareto Principle is widely used in marketing, management, economics, and in areas such as fitness and personal finance.

For example, you may notice that 80% of your sales come from 20% of your customers. Or that 20% of what you do in the gym brings 80% of your progress.

How to apply the 80/20 rule in business

Business owners can use this principle to prioritize those activities (20%) that deliver the most meaningful results. Depending on the context, you should focus on:

• 20% marketing processes which bring 80% potential clients (leads) or conversions.
• 20% products which generate 80% of sales revenue.
• 20% page on the website which attract 80% traffic.
• 20% business processes which cause 80% inefficiencies.
• 20% supplier which provide 80% of the materials you use.
• 20% customers which bring 80% of total profits.

Once you identify these key 20%s, you can focus resources where they are needed most. This approach can increase your productivity, reduce costs, and increase profits.

Here's how to specifically use the 80/20 rule to improve your business:

Focus on high value customers

For many companies, 80% of profit comes from 20% of customers. Some customers buy all the time or make large orders, while others are occasional customers with small requirements. You should prioritize those customers who bring the most value. Reward them with gifts, special discounts or exclusive access to events.

Say “goodbye” to problem customers

Get rid of those 20% customers who waste your time or complain about everything. These are the customers who ask a million questions but never buy anything, or the ones who keep returning items for no apparent reason. Be polite and professional, but let them know that your service may not be the best choice for them.

Identify the most profitable products or services

If 20% of your products account for the majority of your sales, dedicate more time to them, and gradually phase out the ones that are doing poorly. Analyze the data, improve their features, and promote them to a wider audience through social media, newsletters, or PPC campaigns.

Retain the best employees

Identify the 20% of your most successful employees and provide them with the environment they want. Invest in their education and reward their efforts. Research shows that the best employees want the opportunity to develop their skills and receive constructive feedback. Of course, don't ignore the others, but provide them with mentoring programs so that they can progress as well.

Analyze and improve business processes

Review your core processes and invest resources in those 20% that drive results. For example, in SEO optimization, you may realize that you are wasting too much time on keywords that no one is searching for. Document what is working and focus on what is driving real conversions and return on investment (ROI).

Final thought: Faster and better with 80/20

The 80/20 rule is applicable to almost every sphere of business. It is not a one-time task, but a long-term commitment to continuous improvement. Start with one or two processes, measure the results, then expand as you better understand your customers and performance.