Monthly Sales Analysis of JSW Steel Coated Products Ltd.
Pavani Koduri
January 3, 2018
1. Introduction :
Steel is a versatile product. It has a wide range of applications from the manufacture of a small pin to automobiles, railway system, aircrafts, defence materials, big engineering projects, roads, bridges, housing, nuclear projects, power projects, port construction, building of irrigation projects and in many other areas associated with economic and industrial development of a country. However, the only demerit of steel it its tendency to corrode. Corrosion eats away steel, causing a significant loss to economy of a country and sometimes leads accidents. It has been estimated by experts that corrosion of steel costs up to 4% of the GDP of on industrialized country.
Coil Coating: Coil coatings provide corrosion resistance, colour and surface structure of steel coils. Continuous coating of steel coils is a step in the manufacture of industrial products for use in building facades, white goods and many other applications. Once the metal strip has been coated, the panels are cut, shaped and fitted as per requirement. This often involves high complex processing stages such as deep drawing and roll forming. The coated surface should be able to withstand mechanical damage, heat, chemicals and moisture etc. Besides the above, there is a multiplicity of applications for coilcoated materials. For each material used and each step in various production stages, there is an acknowledged state-of-the-art application which requires current knowledge about the materials and processing.
In this paper, the sales register data of JSW Steel Coated Products Ltd., for the month of November, 2017 has been put to use for analysis. Below, further information is furnished regarding the conglomerate.
About the company : JSW Group is a major player in steel industry with a formidable presence in Steel, Energy, Cement and Ports. JSW Steel Ltd has become a single largest steel plant in India through speed and innovation in short span of time. JSW Steel Coated Products Limited (JSWSCPL) is a 100 % subsidiary of JSW Steel Ltd., having state of the art manufacturing facilities at Vasind, Tarapur & Kalmeshwar in Maharashtra. JSWSCPL is India’s largest manufacturer and exporter of Coated Steel with a total capacity of 1.8 MTPA with the capability to produce 0.69 MTPA of Colour Coated Steel. The manufacturing facilities at Vasind & Tarapur plants are located near major ports & Kalmeshwar plant is centrally located near Nagpur to serve customers across the nation.
JSW STEEL COATED PRODUCTS LTD., has three manufacturing facilities in the State of Maharashtra at Vasind, Tarapur and Kalmeshwar. It is engaged in the manufacture of value added flat steel products comprising of Galvanized and Galvalume Coils/Sheets and Colour Coated Coils/ Sheets.
This company caters to both domestic and international markets. JSW Steel Coated reported a production (Galvanising / Galvalume products) growth of 16% YoY at 1.72 Million tonnes. The sales volume grew by 12% YoY to 1.71 Million tonnes during FY 2016- 17. Exports sales increased by 0.13 Million tonnes over the previous year, witnessing a 22% growth. The revenue from operations for the year under review was 9,753 crores. The operating EBITDA during FY 2016-17 was 630 crores as compared to the EBITDA of 348 crores in FY 2015-16. The operating EBIDTA margin improved to 7% from 5% in FY 2015-16. The net profit after tax stood at 277crores, compared to net profit after tax of 75 crores in FY 2015-16. KEY NEW PROJECTS:
Tin Plate Mill: JSW Steel Coated Products Limited is setting up a Tin Plate Mill and related facilities at its Tarapur work to cater to the increasing demand for the tin plate. The estimated project cost is 650 crores and is expected to be commissioned in FY 2018-19. Modernisation and capacity enhancement of manufacturing facilities: Additions / modifications will be carried out at Vasind and Tarapur for net capacity enhancement of Cold Rolling 0.96 mtpa, GI/GL: 0.63 mtpa & Colour Coated 0.08 mtpa. The project mainly includes two units of 5 Stand Batch Tandem Cold Rolling Mill (BCTM) one each at Vasind and Tarapur by replacing existing 6 cold rolling mills, two new pickling lines one each at Vasind and Tarapur and one new GI/GL line at Vasind. The project cost is estimated at 1,200 crs and expected to be commissioned by April 2019.
Galvanised Galvanised coils and sheets are manufactured in Vasind, Tarapur and Kalmeshwar Works. Galvanised products comprised 11% of product portfolio in FY2016-17. Key Sector Galvanised products in India are significantly consumed by the construction and infrastructure and consumer durables sectors. Solar Industry holds a lot of promise with the Government of India targeting 100 GW of capacity by 2022. Keeping in mind the tough operating environment of solar structures, the Company has introduced a special grade coated product- JSW GALVOS, to increase the life of the structures. Galvalume in the thickness range of 1.5 mm has been specifically developed for solar applications. Our efforts have ensured that every second solar structure is made with JSW Coated Steel. We are collaborating with few solar developers of international repute to offer customised solutions for their global projects.
Colour Coated coils, sheets and profiles are manufactured in Vasind, Tarapur and Kalmeshwar Works. Colour Coated products comprised 3% of product portfolio in FY 2016-17. During the year, the total sales volume of colour coated products increased by 15% y-o-y. Key Sectors Major consumers of Colour Coated products in India are Construction & Infra and Consumer Durables sector. Appliance industry Continued to grow at more than 11%, despite effects of demonetisation faced during the third quarter of the financial year. The Company has made substantial developments in the appliance sector utilizing its state-of-the-art appliance grade coating line at Vasind. Colour coated sheets from the Company are approved by all large appliance players. As a part of the Government’s Make in India drive, focused efforts are being made to develop VCM door panels for refrigerators and washing machines. Through joint product development initiatives with few appliance players, we have introduced zinc aluminium coated products as an alternative to regular galvanised product, thereby offering longer product life cycle to its customers. Special IF grade steel was developed and commercialised to cater to the increasing demand for dish antennas.
3. Analysis Description :
Overview of Study :
The analysis is aimed at understanding relationships between different data fields provided in the monthly sales register of JSW Steel Coated Products Ltd., which includes sale regions, product types, base prices, GST rates, net weights end-products, total sales values etc. to improve profits and overcome setbacks.
We also try to investigate dependency of total sales value on parameters like basic unit price, GST rate, product type and net weight of material to achieve future sales targets.
# Reading Data into R.
setwd("~/R")
sales.df <- read.csv(paste("company_sales_nov.csv",sep=""))
attach(sales.df)Model :
Consider this model for two of the product types:
- Sheets:
sheet.df <- sales.df[(Producttyp=='Sheet'),]
fit1<-lm(sheet.df$Total.Value~sheet.df$Basic.Price+sheet.df$Integratd.GST..+sheet.df$Net.Wt)
summary(fit1)##
## Call:
## lm(formula = sheet.df$Total.Value ~ sheet.df$Basic.Price + sheet.df$Integratd.GST.. +
## sheet.df$Net.Wt)
##
## Residuals:
## Min 1Q Median 3Q Max
## -2231295 -19168 706 37374 4217342
##
## Coefficients:
## Estimate Std. Error t value Pr(>|t|)
## (Intercept) -3.730e+05 8.659e+03 -43.073 <2e-16 ***
## sheet.df$Basic.Price 7.322e+00 1.468e-01 49.895 <2e-16 ***
## sheet.df$Integratd.GST.. -4.386e+02 1.905e+02 -2.302 0.0214 *
## sheet.df$Net.Wt 5.105e+04 2.631e+02 194.042 <2e-16 ***
## ---
## Signif. codes: 0 '***' 0.001 '**' 0.01 '*' 0.05 '.' 0.1 ' ' 1
##
## Residual standard error: 111800 on 5212 degrees of freedom
## Multiple R-squared: 0.8847, Adjusted R-squared: 0.8846
## F-statistic: 1.333e+04 on 3 and 5212 DF, p-value: < 2.2e-16- Corrugated Sheets:
corrsheet.df <- sales.df[(Producttyp=='Corrugated Sheet'),]
fit2<-lm(corrsheet.df$Total.Value~corrsheet.df$Basic.Price+corrsheet.df$Integratd.GST..+corrsheet.df$Net.Wt)
summary(fit2)##
## Call:
## lm(formula = corrsheet.df$Total.Value ~ corrsheet.df$Basic.Price +
## corrsheet.df$Integratd.GST.. + corrsheet.df$Net.Wt)
##
## Residuals:
## Min 1Q Median 3Q Max
## -5410654 -57190 11276 93804 3139865
##
## Coefficients:
## Estimate Std. Error t value Pr(>|t|)
## (Intercept) -7.226e+05 1.779e+04 -40.621 < 2e-16 ***
## corrsheet.df$Basic.Price 1.440e+01 2.939e-01 48.999 < 2e-16 ***
## corrsheet.df$Integratd.GST.. -3.438e+03 4.426e+02 -7.766 9.96e-15 ***
## corrsheet.df$Net.Wt 4.748e+04 4.953e+02 95.872 < 2e-16 ***
## ---
## Signif. codes: 0 '***' 0.001 '**' 0.01 '*' 0.05 '.' 0.1 ' ' 1
##
## Residual standard error: 238000 on 4497 degrees of freedom
## Multiple R-squared: 0.6883, Adjusted R-squared: 0.6881
## F-statistic: 3310 on 3 and 4497 DF, p-value: < 2.2e-16We can see the effects of net weight and base price on the total value of sale, which is useful in achieving sales targets.
Results :
The p-values are less than 0.05, the R-squared values account for 88.47% and 68.83% of the variation in response data. Also, all the parameters are significant.
From above, we can see the highest increase in Total.Value(278.4 and 256.6 respectively) per unit positive change in Net.Wt, in comaparison to other paramters. Also, there is an increase in Total.Value(7.3 and 1.44 respectively) per unit positive change in Basic.Price.
Conclusion :
So, we can increase Total Value by: a) increasing production to increase net weight. b) increasing basic price. Obviously, a presence of strong demand for the company’s products is a necessity, for the results to show their effects.
We can hence, achieve a sales target by determining the produce and price to be set using the model for that product type.
References :
– Company Website : www.jsw.in
–Annual Sales Register of JSW Steel Coated Products Ltd.: http://www.jsw.in/sites/default/files/assets/industry/steel/IR/Financial%20Performance/Annual %20Reports%20_%20STEEL/JSW%20Steel%20Annual%20Report%202016-17.pdf
–Sales register for the month of Nov 2017: Personal data.
Appendix 1
Visualizing length and breadth of dataset.
dim(sales.df)## [1] 48121 20colnames(sales.df)## [1] "Sold.to.Party.No" "Sold.to.Party.Name" "Sold.to.Party.City"
## [4] "Sold.to.Party.State" "Dc.description" "Source.Plant"
## [7] "Sales.District" "Shipment.Date" "G.L.Description"
## [10] "ODN.No" "Net.Wt" "Basic.Price"
## [13] "Basic.value" "EW1.Freight" "Total.value"
## [16] "Integratd.GST.." "Integratd.GST" "Total.Value"
## [19] "Producttyp" "So.Description"str(sales.df)## 'data.frame': 48121 obs. of 20 variables:
## $ Sold.to.Party.No : int 40024488 40007108 40007108 40007108 40007108 40007108 40007108 40007108 40035511 40035411 ...
## $ Sold.to.Party.Name : Factor w/ 905 levels "?SteelGate GmbH",..: 863 437 437 437 437 437 437 437 356 763 ...
## $ Sold.to.Party.City : Factor w/ 442 levels "","4705-564 Braga",..: 383 319 319 319 319 319 319 319 431 124 ...
## $ Sold.to.Party.State: Factor w/ 31 levels "Andaman und Nico.In.",..: 10 19 19 19 19 19 19 19 11 12 ...
## $ Dc.description : Factor w/ 7 levels "Auction","Job Work",..: 3 5 5 5 5 5 5 5 1 5 ...
## $ Source.Plant : int 1013 1013 1013 1013 1013 1013 1013 1013 1013 1013 ...
## $ Sales.District : Factor w/ 5 levels "CENTRE","EAST",..: 5 5 5 5 5 5 5 5 5 3 ...
## $ Shipment.Date : Factor w/ 47 levels "","10/1/2017",..: 26 26 26 26 26 26 26 26 27 27 ...
## $ G.L.Description : Factor w/ 5 levels "","DOMESTIC SALES",..: 2 2 2 2 2 2 2 2 2 5 ...
## $ ODN.No : Factor w/ 13961 levels "KL2700015898",..: 10785 10786 10786 10786 10786 10786 10786 10787 10788 10789 ...
## $ Net.Wt : num 4.46 3.39 4.25 3.94 3.93 ...
## $ Basic.Price : num 65443 56325 55625 55625 55625 ...
## $ Basic.value : num 292203 190942 236684 219163 218606 ...
## $ EW1.Freight : num 9408 2119 2659 2463 2456 ...
## $ Total.value : num 301611 193061 239343 221626 221062 ...
## $ Integratd.GST.. : int 18 0 0 0 0 0 0 0 18 18 ...
## $ Integratd.GST : int 54290 0 0 0 0 0 0 0 110102 53204 ...
## $ Total.Value : num 355901 227811 282425 261518 260854 ...
## $ Producttyp : Factor w/ 7 levels "Coil","Corrugated Sheet",..: 7 7 7 7 7 7 7 7 7 7 ...
## $ So.Description : Factor w/ 2 levels "JSW Coated Dom Sales",..: 1 1 1 1 1 1 1 1 1 1 ...Creating descriptive statistics of each variable.
library(psych)
describe(sales.df)## vars n mean sd median
## Sold.to.Party.No 1 48121 38681805.49 7196640.68 40022812.00
## Sold.to.Party.Name* 2 48121 474.73 264.00 460.00
## Sold.to.Party.City* 3 48121 215.18 125.10 206.00
## Sold.to.Party.State* 4 48121 16.19 7.30 17.00
## Dc.description* 5 48121 4.56 1.88 5.00
## Source.Plant 6 48121 1014.55 2.11 1013.00
## Sales.District* 7 48121 4.37 0.95 5.00
## Shipment.Date* 8 48121 29.76 10.40 31.00
## G.L.Description* 9 48121 2.59 1.53 2.00
## ODN.No* 10 48121 7063.90 3974.53 6885.00
## Net.Wt 11 48121 5.23 40.99 3.59
## Basic.Price 12 48121 56008.80 12325.29 55555.20
## Basic.value 13 48121 241089.79 247974.52 208936.42
## EW1.Freight 14 48121 3439.18 6036.95 0.00
## Total.value 15 48121 177530.98 258134.87 146254.00
## Integratd.GST.. 16 48121 8.75 9.00 0.00
## Integratd.GST 17 48121 18770.19 27566.57 0.00
## Total.Value 18 48121 276742.91 289073.58 231208.00
## Producttyp* 19 48121 2.06 1.92 1.00
## So.Description* 20 48121 1.24 0.43 1.00
## trimmed mad min max range
## Sold.to.Party.No 40020465.44 18553.26 1013.00 40036770 40035757.00
## Sold.to.Party.Name* 477.99 343.96 1.00 905 904.00
## Sold.to.Party.City* 215.41 148.26 1.00 442 441.00
## Sold.to.Party.State* 15.89 8.90 1.00 31 30.00
## Dc.description* 4.66 2.97 1.00 7 6.00
## Source.Plant 1014.31 0.00 1013.00 1018 5.00
## Sales.District* 4.56 0.00 1.00 5 4.00
## Shipment.Date* 30.34 10.38 1.00 47 46.00
## G.L.Description* 2.49 1.48 1.00 5 4.00
## ODN.No* 7084.04 5042.32 1.00 13961 13960.00
## Net.Wt 3.61 1.64 0.02 5000 4999.98
## Basic.Price 55976.68 9524.62 2.37 231700 231697.63
## Basic.value 204817.99 95926.33 7.00 5901399 5901392.00
## EW1.Freight 2163.41 0.00 0.00 89429 89429.00
## Total.value 137184.90 159201.59 0.00 5901399 5901399.00
## Integratd.GST.. 8.69 0.00 0.00 18 18.00
## Integratd.GST 14858.96 0.00 0.00 744770 744770.00
## Total.Value 234543.24 115708.03 8.00 6963651 6963643.00
## Producttyp* 1.58 0.00 1.00 7 6.00
## So.Description* 1.18 0.00 1.00 2 1.00
## skew kurtosis se
## Sold.to.Party.No -5.19 24.92 32806.70
## Sold.to.Party.Name* -0.02 -1.23 1.20
## Sold.to.Party.City* 0.00 -1.13 0.57
## Sold.to.Party.State* 0.24 -0.85 0.03
## Dc.description* -0.14 -1.01 0.01
## Source.Plant 0.96 -0.94 0.01
## Sales.District* -1.52 1.62 0.00
## Shipment.Date* -0.62 0.33 0.05
## G.L.Description* 0.75 -1.05 0.01
## ODN.No* 0.00 -1.13 18.12
## Net.Wt 94.18 9634.80 0.19
## Basic.Price 2.06 35.38 56.19
## Basic.value 10.26 198.13 1130.42
## EW1.Freight 3.10 21.33 27.52
## Total.value 9.50 177.36 1176.74
## Integratd.GST.. 0.06 -2.00 0.04
## Integratd.GST 7.13 158.77 125.67
## Total.Value 10.65 209.46 1317.77
## Producttyp* 1.84 2.00 0.01
## So.Description* 1.21 -0.54 0.001-way Contingency tables.
#Based on Domestic and International Sales.
xtabs(~So.Description)## So.Description
## JSW Coated Dom Sales JSW Coated Exp Sales
## 36506 11615Domestic sales are more than three times that of Exports for the company.
#Based on Product type.
xtabs(~Producttyp)## Producttyp
## Coil Corrugated Sheet Others Producttyp
## 31707 4501 5857 1
## Profile Sheet Rectangular Sheet
## 664 175 5216The company predominantly produces coils compared to other products.
#Based on end-use.
xtabs(~Dc.description)## Dc.description
## Auction Job Work OEM Others
## 3893 94 15656 292
## Retail SEZ/Deemed Export Stock Transfer
## 14932 29 13225The company acts as an OEM producing finished equipment, majorly.
#Based on region.
xtabs(~Sales.District)## Sales.District
## CENTRE EAST NORTH SOUTH WEST
## 641 2380 5135 10108 29857Most sales occur towards the western regions in the country, much greater than the sum of all other regions.
#Based on Source plant.
xtabs(~Source.Plant)## Source.Plant
## 1013 1014 1018
## 24450 10967 12704The source plant, 1013, in Vasind produces more steel equipment than the other two plants put together.
Aggregating total sales,in terms of value (in crores):
aggregate(Total.Value/10000000,by=list(Dc.description),sum)## Group.1 x
## 1 Auction 87.4387746
## 2 Job Work 0.6697823
## 3 OEM 314.1363746
## 4 Others 35.6956470
## 5 Retail 519.0652377
## 6 SEZ/Deemed Export 0.3287486
## 7 Stock Transfer 374.3799894aggregate(Total.value/10000000,by=list(Producttyp),sum)## Group.1 x
## 1 Coil 548.970450
## 2 Corrugated Sheet 102.936574
## 3 Others 85.793591
## 4 Producttyp 0.000000
## 5 Profile Sheet 7.055564
## 6 Rectangular 2.577263
## 7 Sheet 106.963381aggregate(Total.value/10000000,by=list(Sales.District),sum)## Group.1 x
## 1 CENTRE 10.6484
## 2 EAST 47.7538
## 3 NORTH 101.6898
## 4 SOUTH 230.1184
## 5 WEST 464.0864aggregate(Total.value/10000000,by=list(Source.Plant),sum)## Group.1 x
## 1 1013 448.7490
## 2 1014 129.6502
## 3 1018 275.8976We can infer that each of these: WEST sales region, Retail products, Vasind plant and Coils contribute majorly towards Total Sales Value.
2-way Contingency tables.
#Based on region and end-use.
xtabs(~Sales.District+Dc.description)## Dc.description
## Sales.District Auction Job Work OEM Others Retail SEZ/Deemed Export
## CENTRE 362 0 152 9 118 0
## EAST 19 0 396 0 1965 0
## NORTH 1019 0 1614 3 1889 0
## SOUTH 250 0 4261 0 4582 29
## WEST 2243 94 9233 280 6378 0
## Dc.description
## Sales.District Stock Transfer
## CENTRE 0
## EAST 0
## NORTH 610
## SOUTH 986
## WEST 11629#Based on region and Product Type.
xtabs(~Sales.District+Producttyp)## Producttyp
## Sales.District Coil Corrugated Sheet Others Producttyp Profile Sheet
## CENTRE 489 60 44 0 12
## EAST 2270 9 92 0 0
## NORTH 4014 192 401 0 45
## SOUTH 8293 338 843 0 160
## WEST 16641 3902 4477 1 447
## Producttyp
## Sales.District Rectangular Sheet
## CENTRE 0 36
## EAST 0 9
## NORTH 19 464
## SOUTH 40 434
## WEST 116 4273#Based on plant and end-use.
xtabs(~Source.Plant+Dc.description)## Dc.description
## Source.Plant Auction Job Work OEM Others Retail SEZ/Deemed Export
## 1013 1345 0 10158 109 6643 29
## 1014 1684 0 1310 63 2939 0
## 1018 864 94 4188 120 5350 0
## Dc.description
## Source.Plant Stock Transfer
## 1013 6166
## 1014 4971
## 1018 2088#Based on plant and Product Type.
xtabs(~Source.Plant+Producttyp)## Producttyp
## Source.Plant Coil Corrugated Sheet Others Producttyp Profile Sheet
## 1013 8036 4501 5857 1 664
## 1014 10967 0 0 0 0
## 1018 12704 0 0 0 0
## Producttyp
## Source.Plant Rectangular Sheet
## 1013 175 5216
## 1014 0 0
## 1018 0 0As we can see from the contingency tables, some source plants have null productions for certain equipments. Also, some sales regions have zero sales taking place for certain product types. These areas can have scope for improvement.
Boxplots for variables: Total.Value, Net.Wt, Basic..
boxplot(Total.Value,main="Boxplot for Total Sales Value",horizontal = TRUE)
boxplot(Net.Wt,main="Net weight of sold product",horizontal = TRUE)
boxplot(Basic.Price,main="Basic price of sold product",horizontal = TRUE)
Histograms for net weight of product and total sales value.
hist(Net.Wt,breaks = 10)
hist(Total.Value,breaks = 30)
hist(Basic.Price,breaks = 10)
Plots.
plot(Total.Value~Source.Plant)
We see that the plant at Vasind(1013), produces highly valued end products.
plot(Total.Value~Sales.District)
As we can see, the WEST region contributes to a good no. of outliers for the total sales value.
plot(Total.Value~Producttyp)
plot(Total.Value~Dc.description)
Correlation matrix for Monthly Sales.
col = c("Total.Value","Net.Wt","Basic.value","EW1.Freight","Integratd.GST")
tc <- cor(sales.df[,col])
round(tc,2)## Total.Value Net.Wt Basic.value EW1.Freight Integratd.GST
## Total.Value 1.00 0.08 1.00 0.09 0.26
## Net.Wt 0.08 1.00 0.08 0.00 0.00
## Basic.value 1.00 0.08 1.00 0.04 0.22
## EW1.Freight 0.09 0.00 0.04 1.00 0.57
## Integratd.GST 0.26 0.00 0.22 0.57 1.00Visualizing correlations using corrgram.
library(corrplot)## Warning: package 'corrplot' was built under R version 3.4.3## corrplot 0.84 loadedcorrplot(tc,method = "circle")
We can see that the Total.Value is positively correlated to the Net.Wt, Basic.value, Freight, GST, which is a logical consequence.
Testing impact of Sales Region on number of Domestic/ International Sales.
Running chi-square test,
p1 <- xtabs(~So.Description+Sales.District)
addmargins(p1)## Sales.District
## So.Description CENTRE EAST NORTH SOUTH WEST Sum
## JSW Coated Dom Sales 478 1920 4187 8440 21481 36506
## JSW Coated Exp Sales 163 460 948 1668 8376 11615
## Sum 641 2380 5135 10108 29857 48121chisq.test(p1)##
## Pearson's Chi-squared test
##
## data: p1
## X-squared = 692.92, df = 4, p-value < 2.2e-16Since, p-value<0.01, a dependency is indicated between above variables.
Testing impact of Source Plant on type of Product produce based on End-Use.
Running chi-square test,
p1 <- xtabs(~Source.Plant+Dc.description)
addmargins(p1)## Dc.description
## Source.Plant Auction Job Work OEM Others Retail SEZ/Deemed Export
## 1013 1345 0 10158 109 6643 29
## 1014 1684 0 1310 63 2939 0
## 1018 864 94 4188 120 5350 0
## Sum 3893 94 15656 292 14932 29
## Dc.description
## Source.Plant Stock Transfer Sum
## 1013 6166 24450
## 1014 4971 10967
## 1018 2088 12704
## Sum 13225 48121chisq.test(p1)##
## Pearson's Chi-squared test
##
## data: p1
## X-squared = 5872.8, df = 12, p-value < 2.2e-16Since, p-value<0.01, a dependency is indicated between above variables.
Testing impact of Source Plant on Sale Region.
Running chi-square test,
p1 <- xtabs(~Source.Plant+Sales.District)
addmargins(p1)## Sales.District
## Source.Plant CENTRE EAST NORTH SOUTH WEST Sum
## 1013 237 238 1626 2860 19489 24450
## 1014 302 778 1079 1442 7366 10967
## 1018 102 1364 2430 5806 3002 12704
## Sum 641 2380 5135 10108 29857 48121chisq.test(p1)##
## Pearson's Chi-squared test
##
## data: p1
## X-squared = 12507, df = 8, p-value < 2.2e-16Since, p-value<0.01, a dependency is indicated between above variables.