Thursday, October 7, 1999

The APO Rule

By Frank Womble (

I've learned another way to value a company. I call it "The APO Rule." It's quite simple: If a retail company accepts my order by phone or on their website and doesn't blink an eye at the APO address, then I can rest assured that their service will be fast and efficient.

So what is an APO address? APO stands for Army Post Office. Fools who are in the active duty military and live overseas (like those of us here in Germany) are quite familiar with the APO, because that's how we get our snail mail every day. The third line of our addresses, instead of reading, for example "Alexandria, VA 22315" reads "APO AE 09096." The AE stands for Army Europe -- there is also an AA for Army America and AP for Army Pacific. The five-digit ZIP code works the same as the ones in the U.S.

Because our post exchanges have a limited selection of consumer goods and prices on the German economy are rather high, efficient mail order service is something to be valued.

The unpleasant surprise comes when you call a retail company to order an item and reach a sales agent who has never heard of an APO. I frequently get asked "What city is that? What state is AE?" I get tired of explaining it. The most unpleasant surprise is that some companies simply refuse to ship anything to APO addresses at all!

I like companies that are fast and efficient, because it usually means they are also competitive, and may therefore make good long-term investments.

The APO system has been around for a loooooong time and shouldn't be an unknown entity to any global company. Good companies -- efficient companies -- know that. It's reflected in their pricing, services, speed of delivery, and customer service. For example, here's a few companies that I've had personal experience with that offer superb service to APO addresses: (no surprise to Fools), Lands End, J.C. Penney, and MacWarehouse. All four will ship to an APO address the same day; all four have high-quality products at good prices; all have efficient return services. None of them has ever disappointed.

Granted, the APO Method will never replace the PEG, YPEG, or other Foolish valuation means. But subjective evaluation of a company's mettle measured by one's own experience gives a Fool one more bit of valuable knowledge. Ask yourself who provides YOU with high quality goods and responsive customer service at reasonable prices. I guarantee you will find some worthwhile investment opportunities therein.
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