The value of ubiquitous, the key is to find out the value of what, for a good investor, the discovery of great value is what he pursued her goal. Warren Buffett said he likes monopoly business. As a great investor, he did catch the essence of investment. Of course, this is the result of his joint efforts with Munger, and therefore have today’s Hathaway Empire Albert.
Standing on the shoulders of the previous study, you can save a lot of twists and turns to explore the ups and downs, but also easy to fall into the abstract general talk about the loss of self-exploration to obtain some experience of the detailed process, the devil in the details, only to grasp a great The specific details of the concept, you can really understand the concept, otherwise you only have the impression and the muddle of the feeling, to seriously serious application and make judgments, this concept can not help you. So, in the face of the idea of success, we have to do the opposite work. Predecessors get a successful concept, to all the links and events to be integrated and summarized, and finally come to a conclusion. In order to understand this conclusion, we have to do the analysis, to go back to the concept, what is the composition of the factors behind it, what is the meaning of these factors in the end, what is actually happening in reality. Although self-exploration is very difficult, pay the price may be no results, but the absorption of other people’s things, may also do not know where the mouth, there are quite difficult.
We proceed from the view of Buffett’s monopoly business, to an analysis and determination of ideas. Why invest in monopoly business? In essence, the monopoly is that you have demand, only from me to be satisfied, may be a product, may be a service. So theoretically, I want to earn you how much money I have the final say. I pay very little cost, you can sell high prices, get a high yield. Of course, the reality is that there is no limit to price increases, too high prices will allow consumers to find alternatives, or reduce the number of consumption. In a democratic society, this malicious monopoly will lead to government antitrust litigation, to bring their own great trouble. So, in the real business world, in the competitive field, do monopolistic business will set a reasonable price. The following are the same as the ”
Whether it is malicious pricing or reasonable pricing, monopoly of the business can be profitable, and has a long history, investment in such a business, not only benefit the year, and a decision can be long-term or even a lifetime benefit. The following are the same as the ”
What exactly is a monopoly business? Buffett can draw this conclusion, no doubt with him experienced the specific investment case. Retrospective of his past, bought hi poetry candy, invested in Coca-Cola, cover insurance and the Washington Post, wholly-owned acquisition of Burlington railway and precision devices, with 3G capital acquisition of Heinz tomato sauce and TIM HORTONS coffee. We can analyze the characteristics of the company from these cases, perhaps we can see the characteristics of monopoly. The following are the same as the ”
In general, monopolies include natural monopolies (monopolies due to natural geography), legal monopolies (the law gives the company a special status) and competition leads to monopolies. Monopoly is a very complex and interesting topic, I can only talk about the general. The three monopolies mentioned here are probably mentioned when they are monopolized. If you observe the history of the company’s development, these monopolies may eventually be broken. The government may be based on public opinion may limit the price of natural monopoly business, or simply reverted to state; statutory monopoly may be due to the new law to develop and lose its special legal status; competition led to monopoly will be due to antitrust litigation caused by spin- The well-known case is a division of Standard Oil’s division of 37 regional companies and the US telegraph company. Monopoly business can make a big profit but can not last forever. The following are the same as the ”
Has always been talking about monopolies are from the company’s point of view, the company has a monopoly position, the customer was reluctant to accept the company’s exploitation. But no one from the customer’s point of view to see the monopoly, in the consumer monopoly consumption, in addition to forced monopoly, there are consumers seeking to be monopolized. In the same category, there are a variety of company’s products, the quality may be the same, the price may be inconsistent. But consumers know that a certain brand of product prices higher than other homes, or even the number of small cases, still want to buy a special brand, know to be exploited also willing to accept. This monopoly does not appear in any legal text, my name is a psychological monopoly. This monopoly will not be subject to public demand because of the price limit, nor because of a single company too strong status of the antitrust lawsuit, but also because of the natural monopoly caused by the controversy of the reorganization of state ownership. This invisible position, without any external means can be destroyed, unless the technology platform based on this product or service is completely replaced by a new technology platform, unless the company has the status of the initiative to give up and self-destruction. For the latter case, this has been in the minds of consumers in the formation of a considerable time to lose, it is like some companies are unwitting to give up a monopoly of the product or service, and to open up new Of the business world, but consumers still buy it the old business, reflected in the earnings is the old business remains the same, and the new business stagnant. This can continue for a long time until the company finds the truth, or returns to the old business, or brings the company to the muddy beach. The following are the same as the ”
Behind the psychological monopoly is the company’s products or services in the minds of consumers occupy one of the best positioning, this positioning or the first to meet the new needs of consumers, and continue to meet the needs of consumers, to become such needs Leaders; or in the case of large categories of leaders occupied by the case, to open up new sub-categories to become one of the first; or to avoid the global or national market, only a regional market leader brand. All these, and so forth. But the essence is that when the consumer has a certain demand, first or unconsciously will run to your product rather than the competitor’s products. The essence of understanding the monopoly of the mind is to see the importance of the theory of positioning of Laurent and Rees. Depth study of positioning theory and this theory in the business world of specific practice cases, to understand the true meaning of positioning, which also learned to find a psychological monopoly business. The following are the same as the ”
Back to Buffett and Munger investment case, hi poetry candy, Coca-Cola, Heinz tomato sauce and so are consumers take the initiative to seek monopoly of the brand, they are in the market competition in the formation of the status, but this position is different from the competition Leading to the monopoly position, of course, Burlington Railway is a natural monopoly. Buffett likes monopoly business, if you look at this sentence abstractly, you may find a lot of specious monopoly of the company, but in time, this status will be destroyed, only in-depth and detailed analysis of the specific process, you will see, Monopoly business only to achieve the level of psychological monopoly, is the world’s best business, investors found that companies with such quality can embark on the road of great investors.