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See's Candies is Warren Buffett’s ‘dream’ investment

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Re: See's Candies is Warren Buffett’s ‘dream’ investment

#141

Post by bombcar »

reaperducer wrote: post #120
bombcar wrote: post #103

Earlier quoted context omitted.

Before the fast food brands revitalized Burger King (and somewhat Carl’s Jr.) were famously a bit of a cut above in quality (and price) but now everyone works on an on-demand model and the difference is harder to notice.

Before the fast food brands revitalized Burger King (and somewhat Carl’s Jr.) were famously a bit of a cut above in quality Yep. And it put one of my relatives on the unemployment line. He was responsible for importing cheap meat from Australia and New Zealand for Burger King and a bunch of prisons. In the early 90's there was a brief wave of "made in USA" pride that swept America, and Burger King changed suppliers a…

I remember the kangaroo meat scandal from that time, forget who it was, maybe Jack in the Box?

Re: See's Candies is Warren Buffett’s ‘dream’ investment

#142

Post by daniel-cussen »

marvin wrote: post #135
nightski wrote: post #83

Earlier quoted context omitted.

They are quite smug and judgmental in their annual meetings towards anything they don’t understand.

That's good; means the good things they don't understand will be priced lower for those who do.

In the long run, like way after they're dead. I don't know.

I'm in business for the dividends and raising tax funds for the State. You do both together generally, and because every businessman wants to do the total opposite, he hates paying dividends, hates giving the money he earned to investors, always saying reinvest. Or buybacks, which are strictly dividends. Buybacks are dividends. They just say they're different because they want to dodge taxes.

Like there's this whole song and dance they teach in speculation schools, as if you could learn this in schools ("all those Harvard MBA's didn't add up to dogshit" -- Michael Douglas, Wall Street) well those guys, they're like no dividends no. Because then your stock goes down by the amount you paid. Like really? But who cares, if an investor reinvests the dividend his share is the same, call it by another name. Come on. Nomenclature thing. But without dividends, there's no point in investing.

I talk about it and pg too, that's the end game, there is no other end game really. https://news.ycombinator.com/item?id=306464

Re: See's Candies is Warren Buffett’s ‘dream’ investment

#143

Post by refurb »

Animats wrote: post #33
Barrin92 wrote: post #24

Earlier quoted context omitted.

That's not last century thinking. You can't create any monopoly for generic drugs, by definition. You're not even forced to buy an an expensive Apple or Google phone. You can buy a 200-300 dollar phone with more than decent specs. They reason why people are running around with 1k phones is because it's a status symbol. It's exactly this century where you can buy anything at manufacturing cost from India or China if y…

You can't create any monopoly for generic drugs, by definition. Sure you can. If you're the dominant player, you can pay or buy out new entrants. Happens all the time in generic drugs.[1] [1] https://www.nytimes.com/2015/09/21/business/a-huge-overnight...

By “all the time” you mean “so rarely it makes the NYTimes”?

I work in the industry. It doesn’t happen all the time.

Re: See's Candies is Warren Buffett’s ‘dream’ investment

#144

Post by mbesto »

shrubble wrote: post #127
mbesto wrote: post #122

Earlier quoted context omitted.

> I value the guy who runs the sriracha sauce company higher than Buffett: Value him in what sense? The sriracha guy made a terrible commercial mistake. The capitalist in me doesn't value a person who does that and I would hesitate investing in a venture he did over, say, Warren Buffet (hypothetically speaking of course). People "like" Warren Buffett because he's the ultimate capitalist. Also... If you value the srir…

What was the 'terrible commercial mistake' that the sriracha guy made? If the sriracha guy is letting people keep their own money, that is decidedly utilitarian also...

> What was the 'terrible commercial mistake' that the sriracha guy made?

"He does not bother going after restaurants and other businesses that use his sauce in their dishes and products, even though he could make millions from them in licensing fees. His company's advertising budget is nothing. He hasn't even bothered to trademark the name "sriracha."

Re: See's Candies is Warren Buffett’s ‘dream’ investment

#145

Post by shrubble »

mbesto wrote: post #144
shrubble wrote: post #127

Earlier quoted context omitted.

What was the 'terrible commercial mistake' that the sriracha guy made? If the sriracha guy is letting people keep their own money, that is decidedly utilitarian also...

> What was the 'terrible commercial mistake' that the sriracha guy made? "He does not bother going after restaurants and other businesses that use his sauce in their dishes and products, even though he could make millions from them in licensing fees. His company's advertising budget is nothing. He hasn't even bothered to trademark the name "sriracha."

Now apply it to businesses that have an open-source model...

Re: See's Candies is Warren Buffett’s ‘dream’ investment

#146

Post by daniel-cussen »

fny wrote: post #111
daniel-cussen wrote: post #53

Earlier quoted context omitted.

The strong brand, yeah. That's what Warren Buffet looks for most. Really means you're getting a good deal, so he looks for things people psychologically have ingrained are good deals, and then makes them higher-priced deals. Maybe still good deals but I don't know. Because a win-win deal can be made into a win-lose deal simply by negotiating.

This is actually something you'll notice in grocery stores now. The higher price has moved far higher (2x) while the discount price has moved 20%. They're prepping everyone for higher prices if needed.

Yeah and the discount brand uses worse eg pig parts chicken things et cetera.

Re: See's Candies is Warren Buffett’s ‘dream’ investment

#147

Post by nradov »

lotsofpulp wrote: post #34
Animats wrote: post #12

It's the slow and steady increase in prices that made it so profitable. About 5x over inflation during Buffett ownership. This has happened to far too many items over the last few decades. Most of the things drugstores sell are cheap to make, but have steadily increased in price in the US over the last few decades. Vitamins used to be priced according to manufacturing cost. Slowly, the low-cost vitamins have been up-…

>Vitamins used to be priced according to manufacturing cost. Slowly, the low-cost vitamins have been up-priced to match the expensive ones. Vitamin C is about $10/Kg in bulk, but about $100/Kg at a US drugstore. How does one even know if the Vitamin C is Vitamin C? There is no government agency that confirms supplements and vitamins are what they say they are, nor are there penalties. The only thing I have heard of i…

The NSF Certified for Sport program is a good place to start.

https://www.nsfsport.com/

Re: See's Candies is Warren Buffett’s ‘dream’ investment

#148

Post by DantesKite »

01100011 wrote: post #23

I'm pretty sure the peanut brittle has crack cocaine in it. Avoid at all costs unless you want to spiral into a never ending addiction. Sees is able to transform cheap ingredients into a premium product. It has a strong brand and pricing power. These are good things to have in a company. Still though, it's a luxury good and not something I'd want to own as we head into a recession. Own things people need, not things…

The article points out their business survived the Great Depression and while I don't think you're entirely wrong, I do think they'll survive a few downturns if they keep to their values.

Re: See's Candies is Warren Buffett’s ‘dream’ investment

#149

Post by adgjlsfhk1 »

taffer wrote: post #116
ldoughty wrote: post #64

Earlier quoted context omitted.

Then the competition moves money from profit markets to undercut you... making it impossible to compete... your competition subsedize the costs and effectively sell for 20% below cost until you agree to sell or close shop

How can they sell vitamin c at 10x the bulk price and at the same time undercut you?

small businesses generally can't launch everywhere. a big drug manufacturer can switch to selling at cost in a region for a few months to kill the profit opportunity of a young competitor. also, once they've done that a few times, it prevents others from trying

Re: See's Candies is Warren Buffett’s ‘dream’ investment

#150

Post by qgin »

lotsofpulp wrote: post #34
Animats wrote: post #12

It's the slow and steady increase in prices that made it so profitable. About 5x over inflation during Buffett ownership. This has happened to far too many items over the last few decades. Most of the things drugstores sell are cheap to make, but have steadily increased in price in the US over the last few decades. Vitamins used to be priced according to manufacturing cost. Slowly, the low-cost vitamins have been up-…

>Vitamins used to be priced according to manufacturing cost. Slowly, the low-cost vitamins have been up-priced to match the expensive ones. Vitamin C is about $10/Kg in bulk, but about $100/Kg at a US drugstore. How does one even know if the Vitamin C is Vitamin C? There is no government agency that confirms supplements and vitamins are what they say they are, nor are there penalties. The only thing I have heard of i…

Stick to brands that have a reputation for quality worth defending.

It's no guarantee, but you want a brand that perhaps charges a bit more because of their long track record of quality. The longer and more solid their track record of quality, the more motivation they will have to make sure that reputation stays intact.

That's about the best you can do.

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