Captive Businesses

Today I had a pretty awful experience with parking that I would like to share. I parked at a carpark overnight and the carpark fee was $26. However, there was an issue with the gantry and I had to insert my cashcard manually. Lo and behold my cashcard got deducted again when I exited the gantry and as a result I got deducted twice. I was naturally not very amused.

I then called Wilson parking which told me to call Nets instead as the deduction of the cashcard was their issue. I then proceeded to call Nets and they told me to print the transactions of the cashcard and to email them the statement and they will investigate. No prizes for guessing that I was already fuming mad at this point in time. Nonetheless and however angry I was, I still had to use Nets and their services whether I like it or not. They appear in our everyday lives. I went on to check which entities own Nets and I was surprised that Nets is actually co-owned by DBS, OCBC and UOB.

This little anecdote taught me a lesson and it was something that ironically was shared with me by a fund manager during a recent meeting we had. It is really good to invest in businesses whereby customers have to stick with them whether they like it or not. This may be due to a near monopolization of the market or having big moats that surround the business. My anger was somewhat placated as I remembered that I have a fair share of OCBC shares. Oh well, the best way to convert this energy is to be invested in the companies that own these captive businesses. Same goes whenever I pay my Singtel bill, have a medical checkup at Raffles Medical or have to rush to a meeting on a Comfort cab. I have no choice but to use these services whether I like it or not. And that makes a pretty good investment proposition.

Signing Off
Transitioning Stock Investor