Last I checked, Berkshire’s position in Tesco was almost equivalent (on a dollar basis) to its
Walmart position – and is currently larger than the BYD stake.
Walmart – as Berkshire’s largest customer and the beneficiary of generous amounts of ‘free float’ from us – seems to get all the attention. GB’s Tesco is the world’s ‘number four’ mass merchant in sales – behind also France’s Carrefour and Germany’s Metro –but is ‘number two’ in earnings. Tesco's earnings are about double the combined earnings of somewhat larger (sales) Carrefour and Metro. Even at #2 though, it still trails Walmart’s earnings substantially, with $3.5B to Walmart’s $16.3B.
With these four, the US, GB, France and Germany each has its big gun. Looking at global retailing, these are the ‘masters of the retail universe’ and retailing's future will be a battle among these guys. No one else has the proven international experience or reach. Each has huge home-country market share to the point of saturation (during one stretch of the recession, Carrefour gained market share in France even while its total domestic sales declined slightly).
We see so much hand-wringing in this country over trends in Walmart’s customer base. But all the discussion is US-centric. Walmart’s huge growth and growth potential has been – and will be – international. It - and Tesco - are almost unstoppable (except apparently in countries where being on a first-name basis with someone like Putin trumps market influences – Walmart and Tesco both got unceremoniously bounced from Russia last year).
In Brazil, newcomer Walmart easily trounced what was formerly an entrenched (by two decades) Carrefour, just walking away with Carrefour’s long-established market share. Carrefour has also suffered from unusually poor financial controls for a company its size. The financially weaker and less efficient duo from the continent so far look like they may be outmatched by Walmart and Tesco in this global showdown – at least that’s the way it appears coming out of this recession.
Over the next decade or two, I’d look for both Walmart and Tesco to continue to spread their efficiencies across the globe. The way I see it, pretty much all significant 'retail' discussion will revolve around this global battle. Barring full-fledged domestic disasters, almost everything else is almost trivial for these guys, relative to their long-term prospects.
Walmart position – and is currently larger than the BYD stake.
Walmart – as Berkshire’s largest customer and the beneficiary of generous amounts of ‘free float’ from us – seems to get all the attention. GB’s Tesco is the world’s ‘number four’ mass merchant in sales – behind also France’s Carrefour and Germany’s Metro –but is ‘number two’ in earnings. Tesco's earnings are about double the combined earnings of somewhat larger (sales) Carrefour and Metro. Even at #2 though, it still trails Walmart’s earnings substantially, with $3.5B to Walmart’s $16.3B.
With these four, the US, GB, France and Germany each has its big gun. Looking at global retailing, these are the ‘masters of the retail universe’ and retailing's future will be a battle among these guys. No one else has the proven international experience or reach. Each has huge home-country market share to the point of saturation (during one stretch of the recession, Carrefour gained market share in France even while its total domestic sales declined slightly).
We see so much hand-wringing in this country over trends in Walmart’s customer base. But all the discussion is US-centric. Walmart’s huge growth and growth potential has been – and will be – international. It - and Tesco - are almost unstoppable (except apparently in countries where being on a first-name basis with someone like Putin trumps market influences – Walmart and Tesco both got unceremoniously bounced from Russia last year).
In Brazil, newcomer Walmart easily trounced what was formerly an entrenched (by two decades) Carrefour, just walking away with Carrefour’s long-established market share. Carrefour has also suffered from unusually poor financial controls for a company its size. The financially weaker and less efficient duo from the continent so far look like they may be outmatched by Walmart and Tesco in this global showdown – at least that’s the way it appears coming out of this recession.
Over the next decade or two, I’d look for both Walmart and Tesco to continue to spread their efficiencies across the globe. The way I see it, pretty much all significant 'retail' discussion will revolve around this global battle. Barring full-fledged domestic disasters, almost everything else is almost trivial for these guys, relative to their long-term prospects.
