completed.
当然一份新闻也必须要有有深度的全国与国际性新闻，但一份地区性的
报纸也必须及时并广泛地报导社区动态，要把这点做好除了必须要有
足够的空间，并加以有效地运用。
It's vital, of course, for a newspaper to cover national and
international news well and in depth. But it is also vital for
it to do what only a local newspaper can: promptly and
extensively chronicle the personally-important, otherwiseunreported
details of community life. Doing this job well
requires a very broad range of news - and that means lots of
space, intelligently used.
如同往年，去年(1987年)我们的新闻比大约是50%，若是我们把这比率
砍到一般40%的水准，我们一年约可省下四百万美金的新闻成本，
但我们从来都不会考虑如此做，就算哪一天我们的获利大幅缩减也是一样。
Our news hole was about 50% in 1987, just as it has been
year after year. If we were to cut it to a more typical 40%, we
would save approximately $4 million annually in newsprint costs.
That interests us not at all - and it won't interest us even if,
for one reason or another, our profit margins should
significantly shrink.
基本上查理跟我都不太相信营业预算，像是「间接费用必须缩减，
因为预估营业收入不若以往」之类的说法，。如果有一天我们必须
降低新闻比率或是牺牲喜斯糖果的品质与服务，以提升疲弱不振的
获利表现，或是相反地因为Berkshire太多钱以致现金花不完，
就去聘请经济分析师、公关顾问等对公司一点帮助都没有的人。
这些做法一点道理都没有，我们完全不了解为何有些公司因为公司
赚太多钱就增加一些没有用的人来消化预算，或是因为获利不佳
就砍掉一些关键的人事，这种变来变去的方式既不符合人性也不符合商业原则，
我们的目标是不论如何都要做对Berkshire的客户与员工有意义的事，
(你可能会问那公司专机又是怎么一回事 嗯!我想有时一个人总会有忘了原则的时候)
Charlie and I do not believe in flexible operating budgets,
as in "Non-direct expenses can be X if revenues are Y, but must
be reduced if revenues are Y - 5%." Should we really cut our news
hole at the Buffalo News, or the quality of product and service
at See's, simply because profits are down during a given year or
quarter? Or, conversely, should we add a staff economist, a
corporate strategist, an institutional advertising campaign or
something else that does Berkshire no good simply because the
money currently is rolling in?
That makes no sense to us. We neither understand the adding
of unneeded people or activities because profits are booming, nor
the cutting of essential people or activities because
profitability is shrinking. That kind of yo-yo approach is
neither business-like nor humane. Our goal is to do what makes
sense for Berkshire's customers and employees at all times, and
never to add the unneeded. ("But what about the corporate jet?"
you rudely ask. Well, occasionally a man must rise above
principle.)
虽然水牛城新闻的营收最近几年只有些微的成长，但在发行人Stan Lipsey
杰出的管理之下，获利却反而大幅成长，有好几年我甚至错误地预测该报
的获利会下滑，而同样地今年我也不会让大家失望，1988年不管是毛利
或者是获利都会缩水，其中新闻印刷成本的飞涨是主要的原因。
Although the News' revenues have grown only moderately since
1984, superb management by Stan Lipsey, its publisher, has
produced excellent profit growth. For several years, I have
incorrectly predicted that profit margins at the News would fall.
This year I will not let vou down: Margins will, without
question, shrink in 1988 and profit may fall as well.
Skyrocketing newsprint costs will be the major cause.
o Fechheimer Bros. Company is another of our family
businesses - and, like the Blumkins, what a family. Three
generations of Heldmans have for decades consistently, built the
sales and profits of this manufacturer and distributor of
uniforms. In the year that Berkshire acquired its controlling
interest in Fechheimer - 1986 - profits were a record. The
Heldmans didn't slow down after that. Last year earnings
increased substantially and the outlook is good for 1988.
费区海默兄弟公司是我们旗下另一个家族企业，而就像Blumkins一样
是个非常杰出的家族，Heldmans家族三代几十年来，努力不懈地建立了
这家制服制造与销售公司，而在Berkshire取得所有权的1986年，
该公司的获利更创新高，此后Heldmans家族并未停下脚步，
去年(1987年)盈余又大幅增加，而展望今年(1988年)前景更是看好。
在制服事业大概没有什么出奇的事，唯一的惊奇就是Heldmans家族，
Bob、George、Gary、Roger跟Fred，对于这行业熟的不能再熟，
同时也乐在其中，我们何其有幸能与他们一起合作共事。
There's nothing magic about the Uniform business; the only
magic is in the Heldmans. Bob, George, Gary, Roger and Fred know
the business inside and out, and they have fun running it. We
are fortunate to be in partnership with them.
o Chuck Huggins continues to set new records at See's, just as
he has ever since we put him in charge on the day of our purchase
some 16 years ago. In 1987, volume hit a new high at slightly
Under 25 million pounds. For the second year in a row, moreover,
same-store sales, measured in pounds, were virtually unchanged.
In case you are wondering, that represents improvement: In each
of the previous six years, same-store sales had fallen.
Chuck Huggins持续为喜斯糖果缔造新猷，自从十六年前我们买下这家公司，
并请他主掌这项事业时，便一直是如此，在1987年糖果销售量创下
近二千五百万英镑的新高，同时连续第二年单店平均营业额维持不坠，
你可能会觉得没什么了不起，事实上这已是相当大的改善，因为过去连续
六年数字都呈现下滑的趋势。
Although we had a particularly strong 1986 Christmas season,
we racked up better store-for-store comparisons in the 1987
Christmas season than at any other time of the year. Thus, the
seasonal factor at See's becomes even more extreme. In 1987,
about 85% of our profit was earned during December.
虽然1986年的圣诞节特别旺，但1987年的记录比86年还要好，
使得季节因素对喜斯糖果来说越来越重要，经统计去年一整年
约有85%的获利是在十二月单月所创造的。
糖果店是个很好玩的地方，但对大部分的老板来说就不那么有趣了，
就我们所知，这几年来除了喜斯赚大钱之外，其它糖果店的经营皆相当惨淡，
所以很明显的喜斯搭的并不是顺风车，它的表现是扎扎实实的。
Candy stores are fun to visit, but most have not been fun
for their owners. From what we can learn, practically no one
besides See's has made significant profits in recent years from
the operation of candy shops. Clearly, Chuck's record at See's
is not due to a rising industry tide. Rather, it is a one-of-akind
performance.
这项成就当然需要优秀的产品，这个倒不是问题，因为我们确实拥有，
但除此之外它还需要对客户衷心的服务，Chuck可以说是百分之百地
为客户设想，而他的态度更直接感染到公司上下所有的员工。
His achievement requires an excellent product - which we
have - but it also requires genuine affection for the customer.
Chuck is 100% customer-oriented, and his attitude sets the tone
for the rest of the See's organization.
以下是一个具体的例证，在喜斯我们通常会定期增添新的口味并删除旧的
口味以维持大约一百种组合，去年我们淘汰了14种口味，结果其中有两种
让我们的客户无法忘怀，而不断地表达他们对我们这种举动的不满，
「愿喜斯所有做出这种卑鄙决定的相关人士嘴巴流脓长疮；愿你们新的
巧克力糖在运送途中融化；愿你们吃到酸掉的糖果；愿你们的亏大钱；
我们正试图寻求要求你们恢复供应原有口味的法院强制令」，
总计最后我们收到好几百封的抱怨信。
Here's an example of Chuck in action: At See's we regularly
add new pieces of candy to our mix and also cull a few to keep
our product line at about 100 varieties. Last spring we selected
14 items for elimination. Two, it turned out, were badly missed
by our customers, who wasted no time in letting us know what they
thought of our judgment: "A pox on all in See's who participated
in the abominable decision...;" "May your new truffles melt in
transit, may they sour in people's mouths, may your costs go up
and your profits go down...;" "We are investigating the
possibility of obtaining a mandatory injunction requiring you to
supply...;" You get the picture. In all, we received many hundreds of
letters.
为此Chuck不但重新推出原来的口味，他还将危机化为转机，所有来信
的客户都得到完整且诚实的回复，信上是这样写的︰「虽然我们做出错误的决定，
但值得庆幸的是最后得以以喜剧收场」，随信还附赠一个特别的小礼物。
Chuck not only reintroduced the pieces, he turned this
miscue into an opportunity. Each person who had written got a
complete and honest explanation in return. Said Chuck's letter:
"Fortunately, when I make poor decisions, good things often
happen as a result...;" And with the letter went a special gift
certificate.
See's increased prices only slightly in the last two years.
In 1988 we have raised prices somewhat more, though still
moderately. To date, sales have been weak and it may be
difficult for See's to improve its earnings this year.
过去两年喜斯糖果仅稍微地涨价，在今年(1988年)我们仍会继续调涨价格
，幅度还算合理，只是截至目前为止销售持续低迷，预计今年公司盈余
将难再有继续成长的可能性。
o World Book, Kirby, and the Scott Fetzer Manufacturing Group
are all under the management of Ralph Schey. And what a lucky
thing for us that they are. I told you last year that Scott
Fetzer performance in 1986 had far exceeded the expectations that
Charlie and I had at the time of our purchase. Results in 1987
were even better. Pre-tax earnings rose 10% while average
capital employed declined significantly.
世界百科全书、寇比吸尘器与史考特费兹制造集团皆由Ralph所领导，
很高兴我们能做这样的安排，去年我曾告诉各位史考特费兹集团在我们
买下公司的当年度-1986年的表现超乎预期，但去年1987年的表现更出色，
税前获利成长了10%，但所耗费的资金却较前年大幅缩减。
Ralph's mastery of the 19 businesses for which he is
responsible is truly amazing, and he has also attracted some
outstanding managers to run them. We would love to find a few
additional units that could be put under Ralph's wing.
Ralph同时掌管19项事业的方式实在是令人叹为观止，同时他也吸引了
一群优秀的经理人协助他经营事业，我们很乐意在多找一些事业交到Ralph旗下去经营。
The businesses of Scott Fetzer are too numerous to describe
in detail. Let's just update you on one of our favorites: At the
end of 1987, World Book introduced its most dramatically-revised
edition since 1962. The number of color photos was increased
from 14,000 to 24,000; over 6,000 articles were revised; 840 new
contributors were added. Charlie and I recommend this product to
you and your family, as we do World Book's products for younger
children, Childcraft and Early World of Learning.
由于史考特费兹的事业范围过于繁杂，在此不便详述，这里谨就其中一项
我们的最爱-世界百科全书加以介绍，去年底世界百科全书推出自1962年
以来改版最多的最新版本，全套书中的彩色照片从14,000祯增加到24,000祯，
超过6,000篇文章从新编写，840位作者参与；查理跟我衷心向您与您的家庭
推荐包含世界百科全书与儿童工艺等一系列的套书。
In 1987, World Book unit sales in the United States
increased for the fifth consecutive year. International sales
and profits also grew substantially. The outlook is good for
Scott Fetzer operations in aggregate, and for World Book in
particular.
在去年该套书在美国地区销售量连续第五年成长，国外地区的销量与获利
亦大幅增加，史考特费兹集团前景看好，尤其世界百科全书更是如此。
Insurance Operations
保险事业营运
Shown below is an updated version of our usual table
presenting key figures for the insurance industry:
下表是我们惯用保险业主要指数的最近更新数字
Yearly
Change
in Combined Ratio
Yearly
Change
in
GNP
Deflators
Premiums Written Incurred Loss
1981 3.8% 106.0% 6.5% 9.7%
1982 4.4% 109.8% 8.4% 6.4%
1983 4.6% 112.0% 6.8% 3.9%
1984 9.2% 117.9% 16.9% 3.8%
1985 22.1% 116.5% 16.1% 3.3%
1986(Rev.) 22.2% 108.0% 13.5% 2.6%
1987(Est.) 8.7% 104.7% 6.8% 3.0%
综合比率代表所有保险成本(发生损失加上费用)占保费收入的比率，一百
以下表示有承保的获利，一百以上则有承保的损失，若考量保险公司利用
保费收入(浮存金)所赚取的投资收益列入计算，则107到111之间大约是
损益两平点，当然这是不包含公司自有资金所运用的收益。
The combined ratio represents total insurance costs (losses
incurred plus expenses) compared to revenue from premiums: A
ratio below 100 indicates an underwriting profit, and one above
100 indicates a loss. When the investment income that an insurer
earns from holding on to policyholders' funds ("the float") is
taken into account, a combined ratio in the 107-111 range
typically produces an overall break-even result, exclusive of
earnings on the funds provided by shareholders.
保险事业的数字，若以上面那张简表来说明，事实上并不会太复杂，
当同业平均保费收入年成长只在4%或5%徘徊，则当年承保损失一定会上升，
原因不在于车祸、火灾、暴风等意外事件发生更频繁，也不是因为一般
通货膨胀的关系。主要的祸首在于今天社会与司法过度膨胀，法律诉讼费用暴增，
一方面是因为诉讼更频繁，一方面是由于陪审团与法官倾向扩大保险单上的
保险理赔范围，若这种乱象不能加以抑止，则保险公司每年至少要有10%以上的
保费收入年成长，才有办法收支打平，即使在通货膨胀相对温和的状况下也是如此。
The math of the insurance business, encapsulated by the
table, is not very complicated. In years when the industry's
annual gain in revenues (premiums) pokes along at 4% or 5%,
underwriting losses are sure to mount. That is not because auto
accidents, fires, windstorms and the like are occurring more
frequently, nor has it lately been the fault of general
inflation. Today, social and judicial inflation are the major
culprits; the cost of entering a courtroom has simply ballooned.
Part of the jump in cost arises from skyrocketing verdicts, and
part from the tendency of judges and juries to expand the
coverage of insurance policies beyond that contemplated by the
insurer when the policies were written. Seeing no let-up in
either trend, we continue to believe that the industry's revenues
must grow at about 10% annually for it to just hold its own in
terms of profitability, even though general inflation may be
running at a considerably lower rate.
过去三年来保费收入的大幅成长几乎可以确定今年同业的绩效都会相当不错，
事实证明也是如此，不过接下来的情况可就不太妙了，根据Best's统计预估，
1988年的每季的成长率将由12.9%按季逐渐下滑至11.1%、5.7%、5.6%，
可以确定的是1988年的保费成长一定会低于10%的损益两平点，很明显的
好日子已经不多了。
The strong revenue gains of 1985-87 almost guaranteed the
industry an excellent underwriting performance in 1987 and,
indeed, it was a banner year. But the news soured as the
quarters rolled by: Best's estimates that year-over-year volume
increases were 12.9%, 11.1%, 5.7%, and 5.6%. In 1988, the
revenue gain is certain to be far below our 10% "equilibrium"
figure. Clearly, the party is over.
然而盈余数字却不会马上滑落，这个产业具有递延的现象，因为大部分的保单
都是一年期，所以对于损益的影响会在往后的一年之间陆续浮现，因此打个比方，
在party结束、酒吧关门之前，你还可以把手上的那杯喝完了再走，
假设往后几年没有发生什么天灾地变，我们预期1988年的同业平均综合比率
将会微幅上扬，紧接下来的几年则会大幅攀升。
However, earnings will not immediately sink. A lag factor
exists in this industry: Because most policies are written for a
one-year term, higher or lower insurance prices do not have their
full impact on earnings until many months after they go into
effect. Thus, to resume our metaphor, when the party ends and
the bar is closed, you are allowed to finish your drink. If
results are not hurt by a major natural catastrophe, we predict a
small climb for the industry's combined ratio in 1988, followed
by several years of larger increases.
保险业最近受到几项不利的经济因素所困而前景黯淡，数以百计的竞争对手、
进入障碍低、无法大幅差异化的产品特性，在这种类似商品型产业之中，
只有营运成本低的公司或是一些受到保护的利基产品才有可能有长期获利
成长的机会。
The insurance industry is cursed with a set of dismal
economic characteristics that make for a poor long-term outlook:
hundreds of competitors, ease of entry, and a product that cannot
be differentiated in any meaningful way. In such a commoditylike
business, only a very low-cost operator or someone operating
in a protected, and usually small, niche can sustain high
profitability levels.
当产品供给短缺时，即使是商品化产业也能蓬勃发展，不过在保险业界，
这种好日子早就已经过去了，资本主义最讽刺的地方就是商品型产业大部分的
经理人都痛恨商品短缺不足，但偏偏这是唯一可能让这些公司有获利的机会，
当短缺出现时，经理人便会迫不及待地想要扩充产能，这无异是将源源不断
流入现金的水龙头关掉一样，这就是过去三年保险公司经理人的最佳写照，
