I’ve toured a number of locations for prospective investments over the years and I’m not so much concerned with how many forklifts the company has or their capacity to turn out so many widgets per hour.

Frequently you’ll find me talking to the workers on the floor of the production plant or near the loading docks in order to assess what’s happening at the bottom level of the company to see if it matches the same enthusiasm as that from the top.

From a productivity viewpoint that’s very important. If management is involving all employees into the operations of the company they have a vested interest and enthusiasm to continue working efficiently. I think most investors would be surprised what I’ve learnt from such conversations in passing.

I happen to work in a manufacturing plant and I’m not sure what anyone is supposed to get out of touring the facility. As an investor, I’d probably be looking around going, well that was fascinating but what is it that you wanted me to see? I see machines making things and forklift ferrying material around, though I kind of figure that’s what the capital on the balance sheet of a manufacturing firm was. I see there’s actually people employed so you can justify your expenses, which I already kind of figured since stuff is leaving the plant and getting sold. It feels like saying, “I’m not a mechanic, but show me the guts of your used car anyway so that I can be completely mystified as to whether or not its a good car.”

Thanks to CC and Brad for this opportunity to understand more about PF.

L505 – I think a number of investors look back now on their investment decisions with a much better view of what their risk tolerance should have been. The troubling fact is that when the markets recover, start making new highs and the fever once again takes hold only a few will actually remember that there’s still risk out there despite the attractive returns.