Warren Buffett Clayton Homes deal was an example of how Warren Buffett does his business dealings and finding the new investment to purchase. The way he studies different potential business ventures has proven to be very effective for him and his business dealings for his past and future investments.
Warren Buffett was looking for a new investment like he always does every day so he goes over financials of many of his potential business partners or ownerships into stocks. Warren Buffett grew interested in Clayton Homes, a manufacturing home building company that build mobile manufactured homes. He saw that the company had great earning potential with its past finances and accounting practices. He evaluated all of their business transactions and how they ran their business for towards its customers.
Seeing how their past financial earnings were he could make a sound decision without even meeting his potential new partners and wrote out a check of 1.7 billion dollars to buy the company. This modular home manufacturer was bought by one of the biggest investors of our time without even stepping foot in the Clayton Homes headquarters office to make a huge business transaction. Warren credits the way he does business by actually studying each business and making decisions off of their financial statements that are released to the public. He has a keen eye for every single detail as a number cruncher where he can understand if it’s a Sound investment or not.
The way Warren Buffett does his business dealings differs from many in the industry. With his daily readings of five to six hours, Warren Buffett religiously studies the financial earnings of various companies to see if it’s a good idea to invest in a new organization or not.