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Strategies & Market Trends : Value Investing

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To: J Mako who wrote (44799)10/5/2011 12:13:48 AM
From: Paul Senior  Read Replies (2) of 78720
 
ADVC. Could work out very well. I'll pass on it though.

I agree with Jurgis Bekepuris's conclusions. If a person were to do the research and get comfortable enough with this thinly-traded .ob stock, to become confident and comfortable enough to hold on if the stock got slammed, it might be a buy now. I would not be such a person. For me, in this market, I want the big low-hanging fruit. There are so many, many of them. I don't want the risk of being in another roach motel. I'm in several already.

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"A supplier typically pays a couple of hundred dollars per monthly. There is no incentive for them to switch EDI vendor. (It's a bit like once you use an accountant, you are reluctant to switch.) It increased price in 2010. That shows the pricing power."

I don't understand this. A small grocery supplier? You mean a small grocer that sells to folks? Or is it a small wholesale supplier who sells to grocery stores? The margins in the grocery business are so small. And the big guys seem to be beating up the little guys worse and worse. I have to assume that small companies -- small grocers -- have to fight for each penny of profit. If I were one of them I certainly would look at the benefits of switching my EDI to a cheaper firm or doing business differently if I could, than just without question routinely paying a couple hundred dollars a month to ADVC for its services.
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