It makes me think of my college girlfriend. Her dad owned a bar, only one, that he eventually expanded to several, but even with only one, they had a home address on a canal on a small island south of Long Beach, vacationed all over the world for weeks at a time, owned a boat, dude bought his daughter a slightly less than million dollar Victorian in San Francisco in 2007 that is probably worth $10 million by now.

He'd started in his 20s as an industrial process engineer and eventually opened a string of carpet stores, then got into restaurants, earned a commercial real estate license and started buying his own stores instead of leasing, then had the opportunity to buy this bar, a rundown, tiny, poorly lit dive in Belmont Shore, a terrible place in a great location, and it eventually became the number one seller of Jameson on the entire west coast. What made owning a bar so profitable? No food, which is low margin, expensive and difficult to get approval for, requires more skill on the part of your labor to make well and handle. Low labor costs because they earn tips and don't need a real salary. Fixed space cost since he owned the building. But more than anything, sheer luck. At some point in the late 90s, his bar acquired a reputation as an easy place to get laid and it's had lines a hundred feet out the front door every night of the week ever since. Neither he nor his staff played any role in this. It's random rumors from college students creating a trend and he's the benefactor. Ended up with a cash business that 20 years ago was earning revenue in excess of a million dollars a month.

How is a competitor supposed to enter the market and replicate that? Land is scarce, so you can't just pop up into the same location if there isn't an empty building already. You can't replicate a multi-decade earned reputation except by waiting decades and earning it yourself. You can't magically become the place young people want to be even if you serve exactly the same drinks with roughly identical looking bartenders in a roughly identical looking interior. More succinctly said, you can't copy the intangibles.