Let’s take our own advice and cut straight to the chase: WHY is it the best annual meeting we’ve ever been to? Three big reasons; it’s a huge moneymaker for Berkshire Hathaway shareholders…it treats shareholders with the total respect they deserve…and…it’s a ton of fun. And please note, dear readers, that aside from being fun to go to, and to write about – and to read about too, we hope there ARE some very important lessons that Warren Buffett can teach us about Annual Meetings, and about the way we should be treating shareowners.
Most annual meetings tend to be big time-and-moneywasters, for companies and attendees alike…But B-H meeting attendees made a modest first-score the moment they checked into their hotel rooms – to find a welcoming note, a tee-shirt, tied in a ribbon – and a prospectus, of course, from the giver, the Gabelli Asset Fund – prominently laid-out on the pillow. What an “instant message” it was as to how much spendable and investible money was floating around the normally quiet city of Omaha that week.
Every hotel room was booked up and every rental car was rented. Every restaurant was fully booked too…although, not to worry, we had already reserved our table at Gorat’s, Warren Buffett’s favorite eatery, many weeks in advance, as the ‘preliminary proxy materials’ had advised us to do. And what a great meal…and a great value it turned out to be. And what a surprise too, to find that nearly half the diners were from places like China, Germany, India, Japan, South Africa…all of them chomping on Gorat’s awesome steaks and swilling down expensive wines at a furious pace – thanks in part to the incredibly good year B-H holders enjoyed, and also to the incredibly low markups on the wines. “Woodstock for capitalists” indeed.
We could have, and maybe should have saved our money, a la Buffett. Once we arrived at the cocktail reception – at Borsheims enormous jewelry store, which B-H owns, of course - and which is in a Warren Buffett-owned mall, we’re sure – a HUGE “Buffet” was in full swing: Waiters were furiously carving prime beef, shareholders were balancing plates and glasses, and extra plates plied high with shrimp…while jockeying for a spot near the huge bar, which was “top shelf” all the way, thank you.
Having eaten already, your editor, and his sidekick and fellow meeting-goer, Ray Riley, made a beeline straight from the bar - to the already jam-packed Borsheims sales floors, where anyone with a B-H Meeting “credential” around their neck was entitled to a 25% discount. (The first thing to catch our eye…a 96-carat, graduated diamond necklace – with a center stone almost as big around as a nickel, and a price-tag of $2.9 million. “We can certainly do better than a 25% discount on this, if you’re interested, the sales clerk told Ray…who DID buy something, though not this item, this time. And we sure shilled up a huge crowd of lookers, including someone who DID seem ready to buy it). With our shopping done and the bar still open ‘til 10:00 or so, we parked by the enormous watch counter – where the cheapest time-piece started around $1200 and went straight to the moon from there. They were selling a watch every 45 seconds, we calculated – heavy on the platinum, gold and diamond- encrusted models, we noted. And, no surprise - as a fellow kibitzer, a reporter from Time magazine told us - 35% of Borsheims’ annual profits are derived from this event.
Next morning we got up with the chickens, thinking to snag seats in one of the sections reserved for ‘people with a question’. No such luck: By 7:00 a.m., when the doors opened, we were over a half mile away from the door we chose…and six or eight other lines were equally long. The total audience – a record-breaker for B-H, we were told – was over 32,000 people.
With an hour and a half for shopping before the meeting kick-off time, we began to make the rounds of the 34 B-H businesses that had set up shop in the huge exhibit hall, where a veritable buying-frenzy was in progress. Shareholders were grabbing armfuls of Fruit of the Loom socks, shorts and briefs…filling big bags with ginzu-knives, and other high-end cutlery from Douglas Qiukut, and from The Pampered Chef…browsing boats, bricks (!) RVs and modular houses for their second, third and fourth properties… ordering encyclopedias and Buffett-books, getting quotes from GEICO…standing in line for tins of See’s peanut brittle – a complete sellout, and a big contributor to the $100,000 worth of candy that See’s expected to sell that day - and trying on expensive Justin cowboy boots around a big pen, featuring long-horned cattle and a bevy of attractive young cowgirls to help you try them boots on. Shoppers grabbing up the little blue Buffett-bears were surprised - then not so surprised - to discover they were not freebies: “Warren does not believe in freebies” shareholders were told with a wink and a smile, as the bears flew out of the boxesand into the big shopping bags one could also buy.
The Meeting itself, truth to tell, was something of an anti-climax. The 1 hour film, written by Buffett and his sidekick Charlie Munger, and produced and filmed by Buffett relatives it seemed, featured corn-ball jokes that were not all that new…or all that funny. But Warren and Charlie made an amazingly good comedy team once they went “live”…with a steady stream of funny and mighty pithy ad-lib remarks…as both of them sipped Cokes and munched steadily on See’s peanut brittle the entire time. (About the only excitement was when a tornado-warning horn sounded from afar…and we thought “What if the roof blows off the dome…and sucks 32,000 shareholders out the top, right where we are sitting, darn it…and where, for sure, B-H is the insurance carrier?”). Sad to say, we couldn’t stay for lunch…or for the second part of the six-hour question period, much less for the “official part” of the meeting itself, which began at 3:15…or for the “Baja Beach Bash” that night at B-H’s Nebraska Furniture Mart…or the Borsheims Sunday brunch and Shopping Day…ot the Gorat’s “Shareholder Evening”…but we WILL be back next year.
Share
Share the Optimizer with your colleagues!