by Paul Moroz, Mawer Investment Management
There are two types of airplane trips to Asia. One is played out in deteriorating discomfort. The other played out in a slightly lower state of deteriorating discomfort (I fly coach). Each state of potential reality is separated only by one central strategic factor: the arm rest.
During my last journey, a less than ideal situation developed – the man beside me managed to secure the coveted arm rest position. How did this happen? Just a brief distraction by a piece of investment research and the land grab was lost. This was not good since my key reading material was an 876 page hardcover copy of Deng Xiaoping’s biography. I could already feel the tennis elbow building in my left arm.
An hour into the flight, and no change in position. The competitive advantage had become entrenched. I began to think about companies that had this metaphorical arm rest advantage. Perhaps Unilever’s distribution network in Indonesia. Imagine a well-developed logistics network across islands… game over. Or TD Bank’s relationships with its retail customers. I can’t imagine the hassle of switching my bank account, credit card, mortgage, etc. when it is all in one place.
So while I still had nine more uncomfortable hours to go before arriving in Tokyo, I was comforted by the fact that our investment portfolios are in great shape.
Paul Moroz
Copyright © Mawer Investment Management
