An economic moat refers to a company's ability to maintain competitive advantages and protect its profits and market share from competitors over the long run. The document outlines several types of economic moats that can provide advantages, including high switching costs for customers, efficient scaling, low cost production, network effects from larger user bases, and strong intangible assets like patents and trademarks.
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Economic Moat
1. Economic Moat created & Edited by Krishna Khandelwal
It is business ability to establish and maintain a competitive
advantage over market competitors.
This is important in order to protect the profits of the company in
the long run as well as market shares from competing firms.
Types of Economic Moats
High Switching Cost Stable switching leads to an improved
moat.
Efficient Scale- Efficient scaling leads to good moat.
Low cost Production lower the cost deeper the moat.
Network Effects- More people on your platform system lead to
good moat.
Intangible Assets More intangible asset (Trade marks, Patents)
deeper the moat.
Created and Edited by Krishna Khandelwal , Reference of word from Warren Buffett interview