The best business during inflation are the ones that you buy once and don't have to invest again, Warren Buffett, the 90-year-old chairman and CEO of Berkshire Hathaway had said. In the wake of rising inflation, Buffett's this piece of advice is once again gaining traction among investors.

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He had said, “The best businesses during inflation are the businesses you buy once and then you don’t have to keep making capital investments subsequently... Any business with heavy capital investment tends to be a poor business to be in during inflation and often it’s a poor business to be in, generally.”

Currently, the US is recording a dramatic jump in retail inflation. The consumer price index jumped 5.4 percent last month from its July 2020 figure. This is the biggest jump in the country's CPI since 2008 when the home loan crisis in the US triggered a global recession.

The Berkshire Hathaway chief added,

“Businesses like utilities or railroads keep eating up more and more money and aren’t as profitable," Buffett had said in 2015, during an annual Berkshire Hathaway shareholder meeting.

For high inflation times, Buffett suggests investment in real estate. “It’s particularly handy to own real estate during times of inflation because the purchase is a one-time outlay for the investor, and has the added benefit of being able to be resold,” said the billionaire investor.

He added, “If you’ve got something that’s useful to someone else, it tends to be priced in terms of replacement value over time, so you really get the inflationary kick.”

To minimise risk, Buffett suggests investors should invest in low-cost index funds. He has also been advocating investment in “funds that hold every stock in an index, making them automatically diversified”.

Meanwhile, Buffett-owned Berkshire Hathaway has been investing heavily in tech stocks. Berkshire owns billion-dollar stakes in Apple, Amazon, and Snowflake.

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