You may have seen on the news that Woolworths, the owners of Masters, is now closing down the Hardware chain since it’s lost over $700m (yes SEVEN HUNDRED MILLION) since starting it’s takeover of the world (!) 2011.
I don’t know about you, but that’s a super fast fall from grace, with 63 Stores that’s like a Titanic hitting the iceberg for sure!!!
Some links to satisfy yourself: click here to read
And another interesting article: click here
So what can you & I learn from this massive loss?
Here are some take-aways:
1. Having Money Doesn’t Win The Game (it also doesn’t Give You Brains)
Woolworths have alot of money, and with their cashflow from the supermarket chain I’m sure they could ride it out for a few more years.
But unfortunately having money doesn’t mean you win in every game.
Some doctors/dentists (pick a high earning white collar profession) for example, making $500,000 p.a. think they can be Super Successful Property Developers because they afford more they most mums and dads, and buy some more expensive sites.
In a boom market they are geniuses (ha), but when the market corrects they are great interest payers to make banks rich.
In any game you need experience, education, knowledge and know how.
It’s like you and me starting to operate on a sick person with no training…good luck!
2. Don’t Feel The Need To Keep Up With The Big Boys.
When everyone is “high” on the hype that is out there, we sometimes look around and want to “crack it big” like the likes of Mirvac , Stockland and Australand just to name a few.
You need to remember these guys didn’t start BIG.
They started as modest developers and grew organically over DECADES.
You should have seen their faces after the GFC.
With the size of their land holdings & valuation drops of 10% – 15% plus, man they were bleeding like anything — nothing was selling and interest still needed to be paid.
YES they may be making a Motza in the current market but it hasn’t (and won’t ) always be that way.
They are in the game for the long haul and so should you.
I have often been encouraged to get good at my game and let other people get good at their game.
It’s like any sport, everyone has their different levels and competing/comparing too much can sometimes be detrimental to you winning!!!
Thanks for listening :O)
Til next time,
Nhan
