At Roadwell, our investment strategy revolves around focusing on industries that remain perpetually in demand: all basic needs and customer goods. Such sectors do not only give stability but also have good prospects for expansion notwithstanding the prevailing economic conditions. And here’s why we are convinced that investing in these areas is exactly what we want to do again and again as it is fully beneficial and provides long-term value.
Sustained Nature of Essential Services and Consumer Products
Utility and health services as a few examples are the services that individuals require on a day to day basis. This tends to make them utterly valuable in all circumstances, hence indicating that they are highly sustainable branches of the economy. Communal services include services that make life essential needs such as water, electricity and gas services provided by utilities while healthcare services maintain life and good health. Like durable consumer goods, non-durable consumer goods, namely food and non-food items are always on people’s checklist. These sectors work on the basis of need which guarantees the stable level of demand Aerospace, Defense Automobiles & parts Food & beverages Healthcare, Life sciences Legal Pharmaceuticals & biotech Support functions & professional services TechnologyTelecommunications & utilities
Thus, examining other industries, with cyclicality in terms of demand and, accordingly, revenue, essential services and consumer goods guarantee steady earnings. This charakter gives them a high appeal for investments: Such funds can somehow protect from adverse economic conditions and fluctuations.
The major opportunity that comes with investing in such sectors like essential services and consumables is their availability of cash at a relatively certain time. This shows that these products and services have a ‘steady’ demand and hence the constant revenue. Companies in these sectors can therefore ensure that there is steady cash inflows which is very important in meeting the costs of running the business and also planning for growth.
Furthermore, these industries pose less risk compared to others: this constitutes one of the bases we use while formulating our investment plan. Because of the nature of products and services that are offered by these companies they are in a better position to avoid volatile markets. For instance, whereas the sales of luxurious products are likely to be affected by such periods of economic downturn, necessities are always in high demand. It also contributes towards the reduction of investment risk and lays a beta for long term economic growth.
Examples of Successful Investments
Having chosen essential services and consumer goods as our field of investment interest, we have made several successful investments, thus supporting our line of action and proving its rightfulness.
- Healthcare Sector Success
One example of this is Roadwell’s recent investment into a regional health care provider focused on the delivery of primary and urgent care. Our work to improve organizational performance in such areas as operation efficiency and service delivery ensured that the company registered more patient numbers and enhanced revenue. Not only did it pay off the investors financially but also ensured better health of the communities which visualize the concerns of investing in basic amenities.
- Consumer Goods Expansion
One example that can be easily distinguished is the investment made in a company that focuses on production and sale of consumer goods that are environment friendly and are used in households. Due to our efforts in opening new markets and expanding the list of products we had to offer, the company was to capture a significantly greater market segment and experience significant sales growth. The rise further implies the existence of future opportunities within the consumer goods sector on account of changing consumers’ trends as well as growing concerns about the environment.
- Aligning with Roadwell’s Strategy
Spending money on basic services and goods fits perfectly with Roadwell’s overall plan of concentrating on robust, and steady demand sectors. These sectors ensure the stability to create long term worth in the organisation, while the steady cash flows that they generate sustain its direction for growth. This way, we do not only invest in businesses that will be safe investments but also the ones which are likely to continue performing well for long.
To the sectors we are committed to, we believe that they remain and will remain relevant and important in our economy. Thus, leveraging our knowledge and experience, we remain focused on the sustainable growth of our partner business, on the creation of the value for them, and on the strengthening of their positions as responsible and stable companies that operate within the communities which they serve.