Re: Sustainable competition LO1682

Doug Blair (dblair@ix.netcom.com)
Sat, 17 Jun 1995 21:04:10 -0700

In LO1672, Jack says,-
>In all this talk about competitive advantage, I'm surprised that nobody
>has mentioned the grow or die imperative that is built into the capitalist
>system.

Why is this an imperative? The need to improve and compete, yes. But to
grow? I don't particularly see it.

It's just that the large sexier ones plan to grow, so they fund themselves
to grow, hence have to grow to provide returns - sort of a self-imposed
self-fulfilling requirement. Likewise, these companies grab the headlines
because they are capturing market share, or providing returns in the stock
market.

I suspect we just don't hear about successful stable privately held ones,
and assume they don't exist. Since they are interested in income rather
than growth (often read as capital appreciation), they tend to be quiet
regional or local partnerships and family owned operations.

Somehow I don't think that a business rag publishing an annual "Stable
500" would attract a large readership. We don't read about cash cow
funeral homes, but we do read about SCI buying all they can get there
hands on. We don't read about similar software companies, but we do read
about Computer Associates buying out the owners.

Now this is just speculation on my part - based on small businesses that
I've played with, career hungry corporate types that I've worked with, and
what I look for in investments.

--
Doug Blair, dblair@ix.netcom.com