They have both owned a few bad businesses in their day: a department store, a windmill manufacturer, a textile factory, and an airline. Why are those businesses bad? Because they are involved in intensely competitive industries that beat each other up over price, which brings their profit margins down, kills their cash flow, and diminishes their chances of long-term survivability. But Charlie and Warren’s education in misery has been our gain. Now we know that the secret is always to go with the better business that has a durable competitive advantage and can raise prices at will. This allows
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