{"id":567,"date":"2021-05-16T23:56:00","date_gmt":"2021-05-16T15:56:00","guid":{"rendered":"https:\/\/www.granitefirm.com\/blog\/us\/?p=567"},"modified":"2024-09-21T13:53:24","modified_gmt":"2024-09-21T05:53:24","slug":"civilian-production","status":"publish","type":"post","link":"https:\/\/www.granitefirm.com\/blog\/us\/2021\/05\/16\/civilian-production\/","title":{"rendered":"The possibility of civilian production industry to be super growth stocks"},"content":{"rendered":"\n<p>Note: The civilian production industry we discussed in this article are:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Consumer Staple  (or Consumer Discretionary) industry<\/li>\n\n\n\n<li>Consumer Cyclical industry<\/li>\n<\/ul>\n\n\n\n<div id=\"ez-toc-container\" class=\"ez-toc-v2_0_83 counter-hierarchy ez-toc-counter ez-toc-custom ez-toc-container-direction\">\n<div class=\"ez-toc-title-container\">\n<p class=\"ez-toc-title\" style=\"cursor:inherit\">Table of Contents<\/p>\n<span class=\"ez-toc-title-toggle\"><a href=\"#\" class=\"ez-toc-pull-right ez-toc-btn ez-toc-btn-xs ez-toc-btn-default ez-toc-toggle\" aria-label=\"Toggle Table of Content\"><span class=\"ez-toc-js-icon-con\"><span class=\"\"><span class=\"eztoc-hide\" style=\"display:none;\">Toggle<\/span><span class=\"ez-toc-icon-toggle-span\"><svg style=\"fill: #ffffff;color:#ffffff\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" class=\"list-377408\" width=\"20px\" height=\"20px\" viewBox=\"0 0 24 24\" fill=\"none\"><path d=\"M6 6H4v2h2V6zm14 0H8v2h12V6zM4 11h2v2H4v-2zm16 0H8v2h12v-2zM4 16h2v2H4v-2zm16 0H8v2h12v-2z\" fill=\"currentColor\"><\/path><\/svg><svg style=\"fill: #ffffff;color:#ffffff\" class=\"arrow-unsorted-368013\" xmlns=\"http:\/\/www.w3.org\/2000\/svg\" width=\"10px\" height=\"10px\" viewBox=\"0 0 24 24\" version=\"1.2\" baseProfile=\"tiny\"><path d=\"M18.2 9.3l-6.2-6.3-6.2 6.3c-.2.2-.3.4-.3.7s.1.5.3.7c.2.2.4.3.7.3h11c.3 0 .5-.1.7-.3.2-.2.3-.5.3-.7s-.1-.5-.3-.7zM5.8 14.7l6.2 6.3 6.2-6.3c.2-.2.3-.5.3-.7s-.1-.5-.3-.7c-.2-.2-.4-.3-.7-.3h-11c-.3 0-.5.1-.7.3-.2.2-.3.5-.3.7s.1.5.3.7z\"\/><\/svg><\/span><\/span><\/span><\/a><\/span><\/div>\n<nav><ul class='ez-toc-list ez-toc-list-level-1 ' ><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-1\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/05\/16\/civilian-production\/#Most_peoples_circle_of_competence_is_not_in_technology\" >Most people&#8217;s circle of competence is not in technology<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-2\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/05\/16\/civilian-production\/#Everyone_understands_the_civilian_production_industry\" >Everyone understands the civilian production industry<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-3\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/05\/16\/civilian-production\/#The_characteristics_of_civilian_production_industry\" >The characteristics of civilian production industry<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-4\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/05\/16\/civilian-production\/#Food_and_apparel_are_better\" >Food and apparel are better<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-5\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/05\/16\/civilian-production\/#Under_Armour_and_Lululemon\" >Under Armour and Lululemon<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-6\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/05\/16\/civilian-production\/#Contents_of_my_book_about_civilian_production_industry\" >Contents of my book about civilian production industry<\/a><\/li><li class='ez-toc-page-1 ez-toc-heading-level-2'><a class=\"ez-toc-link ez-toc-heading-7\" href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/05\/16\/civilian-production\/#Related_articles\" >Related articles<\/a><\/li><\/ul><\/nav><\/div>\n<h2 class=\"has-medium-font-size wp-block-heading\"><span class=\"ez-toc-section\" id=\"Most_peoples_circle_of_competence_is_not_in_technology\"><\/span><strong>Most people&#8217;s circle of competence is not in technology<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>Most people don&#8217;t believe civilian production industry could be super growth stocks.  However, since the chapter 3 of my book &#8220;The Rules of Super Growth Stocks Investing&#8221; discussed in detail how I discover super growth stocks in the technology industry, I also advocate that investors should guard their own ability to select stocks. But here comes the problem. Most investors do not have a background in technology industry, and it will be difficult to make in-depth investment judgments on listed companies in technology industry. <\/p>\n\n\n\n<p>Even if everyone knows that the chance of finding growth stocks in the technology industry is the greatest, but due to the ability circle, it can only be negative. After all, most people have common sense in the consumer industries such as food, clothing, household and transportation. The question is, is it possible for most people to find super-growth stocks in civilian production industry?<\/p>\n\n\n\n<p>Regarding the circle of investment competence, you can refer to the description of my other blog post, &#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/08\/31\/circle-of-competence\/\">The importance of circle of competence<\/a>&#8220;.<\/p>\n\n\n\n<h2 class=\"has-medium-font-size wp-block-heading\"><span class=\"ez-toc-section\" id=\"Everyone_understands_the_civilian_production_industry\"><\/span><strong>Everyone understands the civilian production industry<\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The probability of non-tech industries becoming super-growth stocks is indeed relatively low. The reason is that I expressed my opinion in Chapter 3; but it is not without opportunities. Some people reported this dilemma to me, but the people\u2019s livelihood industry is a circle of competence that everyone has. This type of stock is also possible, such as Nike (ticker: NKE) and Starbucks (ticker: SBUX), which I ever held. These two are typical representative of super growth stocks in the non-tech industry, and it also meets the three fast filtering criteria I used to find super growth stocks in Chapter 3 of my book\uff1a<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Industry or company market must be large enough, and needed by &#8220;everyone.&#8221; <\/li>\n\n\n\n<li>Have disruptive solutions that can solve existing problems\u3002<\/li>\n\n\n\n<li>The industry or company is futuristic, and the market is not yet saturated.<\/li>\n<\/ul>\n\n\n\n<h2 class=\"has-medium-font-size wp-block-heading\"><span class=\"ez-toc-section\" id=\"The_characteristics_of_civilian_production_industry\"><\/span><strong>The characteristics of civilian production industry <\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>The civilian production industry has a characteristic, it&#8217;s needed by &#8220;everyone&#8221;. As long as it stands out, its sustainable profitability and potential market are much larger than the technology industry. There are many examples that can continue to grow into more than a century. <a href=\"https:\/\/www.forbes.com\/sites\/investopedia\/2013\/10\/31\/analyzing-blue-chip-stocks\/?sh=1795ed821ef5\" target=\"_blank\" rel=\"noreferrer noopener\">Blue chips such as Coca-Cola (ticker: KO), Colgate-Palmolive (ticker: CL) and Procter &amp; Gamble (ticker: PG). <\/a>Nike and Starbucks, if compared with Coca-Cola, Colgate and  Procter &amp; Gamble , are still very young; this is far superior to the technology industry. <\/p>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"has-medium-font-size wp-block-heading\"><span class=\"ez-toc-section\" id=\"Food_and_apparel_are_better\"><\/span><strong>Food and apparel are better<\/strong> <span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>I think that in the two major areas of food and apparel, it is easier to find growth stocks in the civilian production industry than in other civilian production industries. The reason is that these two are basic human needs and have a huge consumer market. But these two major industries also have a trouble: they must be able to survive the rapid changes in consumer trends and tastes, can last for many years, and the probability of becoming a super-growth stock will increase year by year.<\/p>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"176\" height=\"117\" src=\"https:\/\/www.granitefirm.com\/blog\/us\/wp-content\/uploads\/sites\/2\/2022\/09\/Pixabay-1600x1200-7.jpg\" alt=\"civilian production\" class=\"wp-image-14232\"\/><figcaption class=\"wp-element-caption\">credit: Pixabay<\/figcaption><\/figure>\n\n\n\n<h2 class=\"has-medium-font-size wp-block-heading\"><span class=\"ez-toc-section\" id=\"Under_Armour_and_Lululemon\"><\/span><strong>Under Armour and Lululemon  <\/strong><span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>A good example is Under Armour (ticker: UAA), which is an example of a failure to challenge Nike. After Under Armour went on the market, there was a period of great success, and it once threatened Nike to a certain extent; it fail, mainly because all product lines almost overlapped with Nike. With the brand advantage established by Nike in 40 to 50 years, it is too difficult to defeat Nike. <\/p>\n\n\n\n<p>The Canadian manufacturer Lululemon Athletica (ticker: LULU), which was almost the same period with Under Armour, succeeded and became a super growth stock. There is no other reason, because Lululemon chooses sports and leisure clothing that Nike is not good at. At the beginning, it locks in female-oriented yoga clothing and supplies. These are exactly the two weakest areas of Nike (women and yoga sports).<\/p>\n\n\n\n<p>Below is the stock price chart of Under Armour (orange red) and Lululemon (green) from 2010 to mid-May 2021. The stock price movements of the two reflect Lululemon&#8217;s success as a super growth stock, while Under Armour fails.<\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Contents_of_my_book_about_civilian_production_industry\"><\/span>Contents of my book about civilian production industry<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<p>In my two recent books, I have discussed the growth stocks of Minsheng industry. included:<\/p>\n\n\n\n<p>In my book &#8220;<a href=\"https:\/\/www.books.com.tw\/products\/0010889106?sloc=main\" target=\"_blank\" rel=\"noreferrer noopener\">The Rules of Super Growth Stocks Investing<\/a>&#8220;:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Section 2-3, page 131, taking Nike as an example, discussion on brand advantages<\/li>\n\n\n\n<li>Sections 5-6, pp. 385-392, discussion of stock splits in the case of Nike and other companies<\/li>\n<\/ul>\n\n\n\n<p>In my book &#8220;<a href=\"https:\/\/www.books.com.tw\/products\/0010935641?sloc=main\" target=\"_blank\" rel=\"noreferrer noopener\">The Rules of 10 Baggers<\/a>&#8220;:<\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li>Sections 3-5, pp. 156-161, discussion on livelihood industries<\/li>\n\n\n\n<li>Section 5-2, pages 227-229, the entire section is devoted to the Lululemon company<\/li>\n<\/ul>\n\n\n\n<figure class=\"wp-block-image size-full\"><img loading=\"lazy\" decoding=\"async\" width=\"538\" height=\"289\" src=\"https:\/\/www.granitefirm.com\/blog\/us\/wp-content\/uploads\/sites\/2\/2021\/09\/1-5.png\" alt=\"\" class=\"wp-image-575\" srcset=\"https:\/\/www.granitefirm.com\/blog\/us\/wp-content\/uploads\/sites\/2\/2021\/09\/1-5.png 538w, https:\/\/www.granitefirm.com\/blog\/us\/wp-content\/uploads\/sites\/2\/2021\/09\/1-5-300x161.png 300w\" sizes=\"auto, (max-width: 538px) 85vw, 538px\" \/><\/figure>\n\n\n\n<p><\/p>\n\n\n\n<h2 class=\"wp-block-heading\"><span class=\"ez-toc-section\" id=\"Related_articles\"><\/span>Related articles<span class=\"ez-toc-section-end\"><\/span><\/h2>\n\n\n\n<ul class=\"wp-block-list\">\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/04\/13\/nike-growth-role-model\/\">How does Nike make money? The role model of growth stocks in non-tech industry<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/07\/06\/cintas-selling-uniforms\/\" target=\"_blank\" rel=\"noreferrer noopener\">Cintas makes a lot of money from selling uniforms<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/05\/16\/civilian-production\/\" target=\"_blank\" rel=\"noreferrer noopener\">Discover the possibility of super growth stocks in the civilian production<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/08\/17\/ultra-beauty-retailer\/\" target=\"_blank\" rel=\"noreferrer noopener\">Why Buffett bought Ultra Beauty, the largest beauty retailer in the U.S.?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/12\/29\/procter-gamble-pg\/\">Stocks Better than the S&amp;P 500, Procter &amp; Gamble (P&amp;G) <\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/09\/16\/how-colgate-makes-money\/\">How Colgate makes money? and the benefits to invest in it<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2024\/04\/26\/how-mcdonalds-make-money\/\" target=\"_blank\" rel=\"noreferrer noopener\">How does McDonald&#8217;s, the world&#8217;s largest fast food leader, make money?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/05\/11\/monster-beverages-monster-level-stock-returns\/\">Monster Beverage&#8217;s monster level stock returns<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/09\/22\/how-yum-make-money\/\" target=\"_blank\" rel=\"noreferrer noopener\">How does ubiquitous Yum! Brands make money?<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2023\/11\/10\/chipotle-mexican-grill\/\" target=\"_blank\" rel=\"noreferrer noopener\">Chipotle Mexican Grill, a new generation of fast-casual food that performed surprisingly well<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2021\/07\/02\/coca-cola-has-been-inferior-to-pepsi-in-and-even-return-rate-is-negative-in-past-10-years\/\" target=\"_blank\" rel=\"noreferrer noopener\">Coca-Cola has been inferior to Pepsi in and even return rate is negative in past 10 years!<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/22\/pros-and-cons-of-coca-cola\/\" target=\"_blank\" rel=\"noreferrer noopener\">Pros and cons of investing in Coca-Cola<\/a>&#8220;<\/li>\n\n\n\n<li>&#8220;<a href=\"https:\/\/www.granitefirm.com\/blog\/us\/2022\/06\/11\/starbucks-predicament\/\">How does Starbucks make money? and the current predicament<\/a>&#8220;<\/li>\n<\/ul>\n\n\n\n<p><em><strong>Disclaimer<\/strong><\/em><\/p>\n\n\n\n<ul class=\"wp-block-list\">\n<li><em>The content of this site is the author\u2019s personal opinions and is for reference only. I am not responsible for the correctness, opinions, and immediacy of the content and information of the article. Readers must make their own judgments.<\/em><\/li>\n\n\n\n<li><em>I shall not be liable for any damages or other legal liabilities for the direct or indirect losses caused by the readers&#8217; direct or indirect reliance on and reference to the information on this site, or all the responsibilities arising therefrom, as a result of any investment behavior.<\/em><\/li>\n<\/ul>\n","protected":false},"excerpt":{"rendered":"<p>Discover the possibility of super growth stocks in the civilian production industry. Since the chapter 3 of my book &#8220;The Rules of Super Growth Stocks Investing&#8221; discussed in detail how I discover super growth stocks in the technology industry, I also advocate that investors should guard their own ability to select stocks. But here comes the problem. <\/p>\n","protected":false},"author":1,"featured_media":14232,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[184,185,392,131,33,112,35],"tags":[137,139,186,187,63,183,188],"class_list":["post-567","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-consumer-cyclical","category-apparel","category-circle-of-competence","category-food","category-growth-investing","category-household-goods","category-long-term-investing","tag-cl","tag-ko","tag-lulu","tag-nke","tag-pg","tag-sbux","tag-uaa"],"_links":{"self":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/567","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/users\/1"}],"replies":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/comments?post=567"}],"version-history":[{"count":38,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/567\/revisions"}],"predecessor-version":[{"id":30440,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/posts\/567\/revisions\/30440"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/media\/14232"}],"wp:attachment":[{"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/media?parent=567"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/categories?post=567"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.granitefirm.com\/blog\/us\/wp-json\/wp\/v2\/tags?post=567"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}