This one isn't really Buffett on valuation per se, but I really like it and it's not widely known so I thought I'd include it in the category. Think of it as the retail course of the "Free MBA" Buffett has been giving all his career. It's a message on the Borsheim's Jewelry web site from Buffett to potential customers, explaining the economic advantages that allow Borsheim's to offer its merchandise at such low prices:
Buffett has confessed that he's not very good at the advertising and marketing side of consumer products, and this is a good example. For most people contemplating that most mystical and romantic of purchases, a piece of jewelry, the last thing they want to hear about is stuff like inventory turnover and overhead costs. Like Bismarck said about politics and sausage-making, you don't really want to know what's going on behind the scenes. But that's how Buffett's mind works--it's not enough for him to be told he's paying the best price, he needs to know why.