Quality businesses possess certain attributes that make them long-term winners: enduring competitive advantages (such as the franchise value of brands or a store footprint that is hard to replicate), robust and adaptable business models, good cash flows and excellent returns. These characteristics often result in such businesses compounding revenue and earnings at a higher rate than expected and the market rewarding this superior growth with a premium rating when compared with the average company. However, one attribute that is often overlooked when assessing a business’s track record is the role played by management. While most companies are heavily subject to the macroeconomic conditions of the day, good managers make things happen and get on with the job of driving shareholder value. We are fortunate to have many examples of truly exceptional businesspeople in SA, who have created enormous value for shareholders over time. What is it that makes the managers in question so special...
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