Warren Buffett：Berkshire 1995 Letter, Excerpt 4

Concluding this little dissertation on acquisitions, I can't resist repeating a tale told me last year by a corporate executive. The business he grew up in was a fine one, with a long-time record of leadership in its industry. Its main product, however, was distressingly glamorless. So several decades ago, the company hired a management consultant who - naturally - advised diversification, the then-current fad. ("Focus" was not yet in style.) Before long, the company acquired a number of businesses, each after the consulting firm had gone through a long - and expensive - acquisition study. And the outcome? Said the executive sadly, "When we started, we were getting 100% of our earnings from the original business. After ten years, we were getting 150%."

Source： https://www.berkshirehathaway.com/letters/1995.html
Locator：1995 Chairman's Letter, excerpt 4 · Verified：2026-10-19 · Verification：Short excerpt

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