I've been reading (as I'm sure you all have)about the tremendous rise in food costs globally.Not only dairy but across the board in most foodstuffs.How does this effect the food suppliers like Willi foods?I would imagine that on staples that have a shelf life of a year or more they would do well if they have a large inventory as food prices rise.Would be interested to know what their inventories are like.Wff -Chris Chu- maybe you could enlighten us on this .
When I was in Israel(5 weeks ago)I had a tour of the new facility in Yavne.It is a state of the art facility with lots of room for growth.If I remember correctly we were told that many staple items have a 2-3 year shelf life.Also that on many items in stock they have up to a year and half supply. I MHO Zvi and company are savvy and astute and its only a matter of time (which has been longer than alot of us thought)until they make it big time.
Good post -good questions z48.I guess until some of these are answered there's not going to be much action in this stock.1st qtr results in terms of the actual profit margins and the eps should give us some direction-but that's not for a month.Until then I don't expect much.
In this type of inflationary period, increased food prices actually hurt consumers and vendors alike.
Vendors normally pass on increased food productions costs but in the past year a perfect storm has enveloped: biofuels, acts of god (drought/bad weather), low supply and increasing demand in BRIC countries has put the balance of supply and demand out of phase.
These increased prices will not subside. -Period. They will hopefully stabilize throughout this year. Willi Food and the industry will slowly wean consumers onto a new pricing platform. Some corporations choose to do it wholesale in one shot, Willi Food is trying its best to do it slowly so as to not lose customers. Margins will get crunched but profitability will get back on track ultimately once consumers are forced to absorb the price increases.