(A moat is this artificial lake around the castle that prevents the castle from external threats)

Almost all of us know the idea of the (Moat) in a war,but what do a business moat mean?


The business moat was a policy Warren Buffet used and for sure it made him great success.

I'll give you an example of one of Warren Buffet's companies,it's called (See's Candies).

Warren Buffet said: Imagine if you bought a box of chocolate for your girl friend on your first date,and she kissed you for the first time and she liked it so much,you'll come again to buy the same box of chocolate or at least buy from the same shop,and no matter how the prices changes you'll buy it,because you know your girl friend liked it,and you won't go to her on valentine's day and say: "I've got the best deal" it doesn't work that way.

The price is immaterial to a great extent,if you have an economic castle,everyone would want to take it down,and you better have a moat to protect it,and you better also have a knight that know what he does.


I know that you maybe didn't understand much,and I'll make it more simple right now.

You see that most people who bought their phones from (Apple),most probably they wont buy phones from another companies,and despite not liking this company personally,but I have to admit that they have a great business moat,and because they feel commited towards the company,they buy their phones even when the prices get high,and even when they didn't give out a charger or earphones with the latest mobile.

This exactly what Warren Buffet meant with a business moat.

The idea of a moat in business is so intelligent,because competitors could lower your market share with new technology or features all the time,but when you have a moat,you're much more secure.

Think how you could apply this idea in your job,business or whatever activity you do.

That's all for today,and I hope that was helpful,wish you great success in life.

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