When To Use A Stacked Chart In Business

published on: 04.10.2023 last updated on: 21.11.2023

Grasping the opportunity to make data-driven decisions can add immense value to your company’s operations. In reality, these decisions could be the difference between thriving and failing. One significant method of visualizing data is by utilizing stacked charts. But it’s essential to know when to use a stacked chart. This article delves deeper into this tool and its uses. Keep reading to learn more.

Understanding The Concept Of A Stacked Chart

Understanding the Concept of a Stacked Chart

A stacked chart is a unique data visualization tool where the part-to-whole relationship is prominently exhibited. Understanding how a stacked chart works can enable insightful deductions from the voluminous, seemingly complex data for a data analyst or business owner. Its usefulness spans financial domains, sales territories, inventory counts, and more.

This graph type layers information, emphasizing the cumulative effect and the individual dataset values, which aids in identifying trends over periods. Understanding the hows of diagram interpretation can yield meaningful insights even as it enables simple visual appreciation of large, composite data.

Type Of Stacked Chart Bars

The stacked chart bars have their own benefits, but most importantly, people can take advantage of different types of such charts. This section discusses some of the types of stacked chart bars.

Simple Stacked Bar Charts 

It is a very common stack chart bar. Here, the absolute value of each category is placed on the top of the previous bar. Here, the numeric axis possesses a numeric value scale. 

Horizontal Bar Chart

Horizontal bar charts have their bars positioned horizontally.  You can reap the same benefits with this variation with that of the vertical configuration. 

Percentage Stacked Bar Charts 

You can say it’s a perfect alternative to that of the stalked bar charts. Here, each bar can be scaled to the same height, that is, in such a way that each bar looks alike. It reduces the ability to compare the totals of the major capability levels. 

Value Annotations

The last in our list is the value annotation. It is one solution that is used for comparing the sub-bar sizes from length. This, however, works to add a bit of the additional visual clutter. Therefore, you have to use it with utmost caution. Check that the stacked bar charts sync with your aim or visualization.

Advantages Of Using The Stacked Bar Chart

Here are some of the advantages of using stacked bar charts. Let us try to find it out here for the sake of convenience. 

With this chart, you can quickly determine the historical figures or trends that are historical. For example, if you have been sold some items over the last ten years, then you can, without any difficulty, evaluate which groupings are more in number. 

The stacked bar charts may also save time. It will allow you to comprehend the data quickly. It may display the findings of the poll. 

You can use the particular chart to understand your business’s sales trend for a long time. It is significant to understand and identify your position. Hence, you need to understand the value of time and thereafter make the best use of it to serve your end. A stacked bar chart can help you with the readings you want for strategy building. 

Deciding When To Use A Stacked Chart

Deciding when to use a stacked chart can greatly enhance the effectiveness and clarity of your data visualization.

When Comparing And Tracking Individual Contributions

Stacked charts are useful when you want to compare the parts of a whole and track their individual contributions over time or across categories. This type of chart allows you to display multiple data series in a single graph, where each series is represented as a stack of segments that add up to a total.

When You Need To Showcase The Composition Of A Total Value

One scenario where stacked charts are beneficial is when you need to showcase the composition of a total value. For example, if you want to demonstrate the sales performance of various product categories over a period of time, a stacked chart can easily depict the contribution of each category to the overall sales. This visualization helps your audience understand the total sales and how each category’s performance fluctuates over time. Stacked charts also enable you to highlight the relative proportions of each category within the total, making it easier for viewers to identify trends and patterns.

When Comparing Data Across Different Category

Additionally, stacked charts are effective when comparing data across different categories. Suppose you want to illustrate the revenue generated by different regions for a specific quarter. Using a stacked chart, you can display the total revenue for each region by segmenting it based on different sources, such as product lines or customer segments. This allows for a clear understanding of each source’s contribution to a particular region’s total revenue.

 Limitations Of Stacked Charts

However, it’s important to consider the limitations of stacked charts. They may become visually cluttered and difficult to interpret if there are too many categories or if the data series has significant value variations. In such cases, it might be more appropriate to consider alternative chart types, such as grouped column charts or stacked bar charts. Ultimately, the decision to use a stacked chart should be based on the specific data you want to visualize and the story you want to convey to your audience.

The Power Of The Stacked Chart In Business

The Power of the Stacked Chart in Business

The information age has made businesses understand that every strategic decision, every minute detail, can use data backing. Herein lays the inherent power of a stacked chart. Its ability to dissect intricate relationships and cumulations in data sets it apart.

Stacked charts, as a part of a broader data visualization strategy, can aid in understanding hidden trends, making predictions, and drawing accurate conclusions in business. The massive data generated in any company becomes manageable and valuable using appropriate visualization tools.

In a world where the future of business is closely tied to the skillful handling of data, a stacked chart is an essential tool. It’s more than just a chart; it’s a strategic companion that helps decipher the data and drives the right decision-making process in business.


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Barsha Bhattacharya is a senior content writing executive. As a marketing enthusiast and professional for the past 4 years, writing is new to Barsha. And she is loving every bit of it. Her niches are marketing, lifestyle, wellness, travel and entertainment. Apart from writing, Barsha loves to travel, binge-watch, research conspiracy theories, Instagram and overthink.

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