09 / 06 / 2020

Investing in a Time of Crisis (Or Bidet, Mate)

Crocodile Dundee didn’t know what to do with a bidet at first, but he soon figured it out. Today, more Americans are, too. There’s a lesson here for investors tempted by the idea of making a quick buck.

Carey Smith | Founding Contrarian

It should be obvious by now to most of us that nothing fuels humanity’s tendency toward short-term thinking like an honest-to-god crisis. We’ve seen it in the widespread layoffs at companies that can well afford to keep their staff, as well as in the panic-buying of everything from flour to toilet paper.

Times of crisis also bring out the profiteers looking to make a fast buck on people’s fears. The eighth circle of Dante’s Inferno awaits the sellers of “silver solutions” and garlic-water potions. My favorite “go-getters” were the Tennessee brothers who stockpiled hand sanitizer from every Dollar General in two states with the intention of reselling on Amazon. They never made it online, but, if they had, I’m sure Amazon would have pocketed most of their profit. So I feel sorry for them…just a little.

At our office, we’ve heard from various “entrepreneurs” pitching ideas for newfangled ventilators, disinfectants and other ways to prevent the spread of germs. Most of the ideas are just a more respectable branch of the flim-flam family:  short-term propositions chasing short-term gains. Thanks, but no thanks. I’m firmly of the belief that short-term thinking, no matter what form it takes, represents as big a threat to the nation’s economy than any virus. The fact is, investors who stick to their principles and stay focused on creating for the long-haul can profit in times like these, which can propel the public to suddenly appreciate an alternative to a standard product.

Take toilet paper, for example.

More than a year ago, we invested in bidet company Tushy because of my long-standing opinion that America’s toileting practices belong in the crapper. I have bidets in my house, and back at Big Ass Fans, I had bidet attachments installed in employee restrooms. (Word has it, when the new owners took over, they were set to remove them until employees rose up in protest. I heard tell that there were actually chants like “Hey, hey, whadda you say, better not take our bidet away,” but that might just be apocryphal.

Now, thanks to the run on toilet paper, sales of bidets are going gangbusters. There was even an opinion piece in The New York Times titled “Stop Using Toilet Paper,” that sang the bidet’s praises. What this shows is that if a product makes sense, its time eventually will come.

Will the demand for bidets hold up after the hoarding’s over? That remains to be seen. The humorist Will Rogers once said, “The short memories of the American voters is what keeps our politicians in office,” and those short memories aren’t limited to politics. It’s likely that the lesson many people will take away from the crisis is that stockpiling ahead of the next shortage is the way to go. But with the bidet now getting widespread attention, I feel pretty good about its chances of becoming a fixture in more American bathrooms. And I feel great about investing in something that improves public hygiene and is good for everybody’s “bottom” line, crisis or no crisis.