I was once asked what fast food restaurant I would like to own. My immediate response was “In and Out Burger.” Of course it is privately owned so I will never have one, but I have long admired the genius of their business model. One only need to drive over at midnight and see the line of 20 cars in the drivethrough to know they must be doing something right. And what is this brilliant company doing that fills their dining room almost every minute they are open? Is it their wide selection of healthy menu choices? Are they keenly in tune with the changing culinary tastes of their customers? Are they tracking and imitating the competition?
A gentleman recently commented about a poster I have with a picture of a plane and the caption, “Fly the Plane.” He asked what that phrase had to do with investing. I told him it is a pilot expression that reminds us to always remain focused on what is most important. Many planes have been lost when a pilot became obsessed with solving some minor issue while forgetting to continue flying the plane. Many investing fortunes have also been lost when investors got distracted by some event and forgot to continue doing that which mattered most. Corporate America often has the same struggles staying focused in a fast paced world, essentially responding to the noise of the world while forgetting to fly the plane.
“In and Out” is an iconic corporate example of “Fly the Plane.” In 1948 the Snyder family wanted to do just one thing. They wanted to make a great burger with fries and a shake. Now 70 years later, they still sell the same three things, and nothing else. It is all they do, but they do it very well. I am certain many have suggested to the Snyders over the years that they should expand their menu to keep up with the competition, but they stayed focused and recognized that their greatest success would come from continuing to do what they did best.
“Flying the Plane,” is the one of the greatest challenges for investors. Every day they are pelted with news ranging from economic opportunities in distant lands to a neighbor who has been doing really well with a particular stock. The temptation to be distracted is great, and the desire to venture off into unknown areas, even worthy ones, can cause an investor to lose sight of what really matters most to them.
Success in investing does not come from having everything on your menu. It does not come from imitating your neighbor. Stay true to what you do, and be good at it. If you somehow think you will be less successful if you don’t have all your neighbor has in their portfolio, take a drive over to “In and Out” and see how long the line is for the three menu items that they have been selling for nearly 70 years.
Hi, I'm Dan. I'm a CFP® Professional.
Securities and advisory services offered through Commonwealth Financial Network®.
Member www.finra.org / www.sipc.org , a Registered Investment Advisor. Wyson Financial, 375 E Riverside Dr, St. George, UT 84790
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