Moats : The Competitive Advantages of Buffett and Munger Businesses by Bud Labitan

Author:Bud Labitan [Labitan, Bud]
Language: eng
Format: epub
Tags: Business, Economics, Finance, Investments, Non-Fiction
ISBN: 9781105422867
Google: iTiMAwAAQBAJ
Publisher: Lulu.com
Published: 2012-06-14T23:00:00+00:00

Larson-Juhl Competitive Advantages

Bud Labitan and Tim Bishop

Larson-Juhl is the nation's leading provider of custom picture frames. In 2001, Craig Ponzio, the owner of Larson-Juhl’s parent company, Albeca, called Warren Buffett. Ponzio told him about his business’ sustainable competitive advantages and its financial characteristics. Berkshire Hathaway then acquired this small business. Albecca sells custom picture frames under the brand name of Larson-Juhl, and it is the nation's leading provider.

Larson-Juhl has a large economic moat because it has built up a respected brand built on high quality products and service, with less reliance on price. Also, it has a great distribution system. In servicing their customer base, Larson-Juhl calls on its 18,000 customers about five times a year.

Buffett always asks himself how much it would cost to compete effectively with a business. Charlie Munger said this about investing: “The number one idea, is to view a stock as an ownership of the business, and, to judge the staying quality of the business in terms of its competitive advantage.” With businesses like Larson-Juhl, they feel that there is a higher probability that things will work out well.

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