The New “Buffettology”

According to the book “The New Buffettology”, there are 4 areas in which Warren Buffet discovers companies with hidden wealth:-

  1. businesses that have a repetitive consumer need with products that wear out fast or are used up quickly and have brand appeal
  2. the advertising business
  3. businesses that provide repetitive services that people and businesses are consistently in need of
  4. products that most people have to buy at some time in their life.

These 4 areas are very closely related to consumer demand and expenditure. In summary, they are a business simple to understand, with good management, attractive prices and has long term prospects.

Lets take a look at the options we have listed:-

  • an entrepreneur
  • joint venture
  • direct selling/multi-level marketing
  • stock market
  • property
  • mutual fund
  • Fixed Deposit/bank

invest in one business by oneself, be an entrepreneur
joint venture with some friends or business associates

There are lots of successful businesses out there for you to emulate but for a business to be worth your money and effort, you must be able to leverage your time, money and location. Also, the ROI must be quick and the income you are going to derive from this business must be able to beat inflation. Not to mention the facts that you have to know the business you are going into and for option2, you need to be in business with people can trust and even that, its safer to deal with business legally and officially, always ensure agreement is drawn up and agreed upon by all parties.

I always believe that “there is never a free lunch” so do not expect to throw in your money and your partners will work their butts out to earn a steady income for you.

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