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 Post subject: Expansion for hire
PostPosted: Mon Mar 24, 2014 5:52 pm 
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Bellerive Chamber of Commerce
One of the businesses that arose naturally in this game is "expansion for hire", where a smaller company will take a building from a larger player and expand it for them, freeing up the larger company to do more profitable things. This is a reasonable idea. In an economic game we like that players have come up with ways to find value. However, people tend to think that because the goal is valid, the end justifies the means and they can break rule regarding cash transfers. This is not true.

If you want a company to make an expansion for you, the only way it can work is like this:
  1. Sell them a small building at fair value
  2. They use their own cash and materials to expand
  3. They sell back the larger building at (higher) fair value
Thus they make a profit at the end by selling a larger building for more than the costs.

But this is important - they must have the cash on their own to run the expansion. You cannot give them the materials for free, nor can you transfer cash over to pay in advance. If the company you want to do this for you is too small to afford that, then they're too small to be your business partner at this time.

Knowing how popular this is, it would be nice if we could come up with an in-game system to let you handle it more smoothly. But I'm not aware of a design for that yet. Perhaps Amarsir has something in mind, but I haven't seen any design docs on it.

So I hope that's clear. I know some of you mean well, and think "well I'm just paying in advance not trying to cheat." No. Paying in advance is breaking the rules, regardless of what you think. The closest you can get is ticket gifting, and if that's not an option for you then you need to stick to fair value.

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 Post subject: Re: Expansion for hire
PostPosted: Mon Mar 24, 2014 6:00 pm 

Joined: Jan 22, 2012
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Abalesk Chamber of Commerce
Nice move :thumbup:


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 Post subject: Re: Expansion for hire
PostPosted: Tue Mar 25, 2014 1:23 am 

Joined: Feb 19, 2014
Posts: 122
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User avatarDark Horizons
 
So I assume this also applies to USA Products claims that he has developer approval to sell people bricks at 0.01$ / unit?


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 Post subject: Re: Expansion for hire
PostPosted: Tue Mar 25, 2014 3:36 am 

Joined: Mar 4, 2014
Posts: 38
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The Network
@ Committed. Quite a few times people ask for buildings and usually retail stores. When the stores are finished one cycle of expansion they will go for another. now how do we get money for the first round it'd be like investing without any guarantee of returns. Also what if when 1 cycle is completed during which the customer has got another store and has no slots and cancels the deals? Taking money in advance was a method to ensure return on investment and then if the customer player doesn't want buildings he'd be doing at his own cost not at losses of others.


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 Post subject: Re: Expansion for hire
PostPosted: Tue Mar 25, 2014 5:22 am 

Joined: Mar 22, 2013
Posts: 670
Location: Dallas, TX. USA
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User avatarLake Tanganyika
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Jennis's construction business took tickets in advance, and cash on delivery. There's no reason that can't be the model someone else uses.

If you can't use tickets, perhaps having a reputation system (see my other thread) would be worth something. If you're an unsavory type with a low reputation, a builder (and others) are significantly less likely to do business with you.

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 Post subject: Re: Expansion for hire
PostPosted: Tue Mar 25, 2014 8:25 am 

Joined: Feb 19, 2014
Posts: 122
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User avatarDark Horizons
 
Agree with tang on this one.

A construction business is just inherently one of the higher-risk ventures you can choose to participate in. If you cant afford to build it on your own you're not big enough for that kind of business yet. And its a risk whether someone will actually buy your product, same with manufacturing any product. You need to have a certain level of trust with the person you expect to buy your stuff before you make it. Buildings dont need to be any different.


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 Post subject: Re: Expansion for hire
PostPosted: Tue Mar 25, 2014 12:37 pm 

Joined: Mar 25, 2014
Posts: 3
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Usa Product
seronis wrote:
So I assume this also applies to USA Products claims that he has developer approval to sell people bricks at 0.01$ / unit?


AHHAHAHAHA NO WONDER YOUR IN THE DARK@!@!@!@!@!@!@!
Usa Product sells Clay +water to Brick Producers for 0.01$; ensuring low startup cost, while competing with the thousands of brick producers by creating a larger chain. This measure, has prevented the failure of not meeting the demand established on bricks. Please read the message before you respond


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 Post subject: Re: Expansion for hire
PostPosted: Tue Mar 25, 2014 12:39 pm 

Joined: Mar 25, 2014
Posts: 3
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Usa Product
Committed wrote:
One of the businesses that arose naturally in this game is "expansion for hire", where a smaller company will take a building from a larger player and expand it for them, freeing up the larger company to do more profitable things. This is a reasonable idea. In an economic game we like that players have come up with ways to find value. However, people tend to think that because the goal is valid, the end justifies the means and they can break rule regarding cash transfers. This is not true.

If you want a company to make an expansion for you, the only way it can work is like this:
  1. Sell them a small building at fair value
  2. They use their own cash and materials to expand
  3. They sell back the larger building at (higher) fair value
Thus they make a profit at the end by selling a larger building for more than the costs.

But this is important - they must have the cash on their own to run the expansion. You cannot give them the materials for free, nor can you transfer cash over to pay in advance. If the company you want to do this for you is too small to afford that, then they're too small to be your business partner at this time.

Knowing how popular this is, it would be nice if we could come up with an in-game system to let you handle it more smoothly. But I'm not aware of a design for that yet. Perhaps Amarsir has something in mind, but I haven't seen any design docs on it.

So I hope that's clear. I know some of you mean well, and think "well I'm just paying in advance not trying to cheat." No. Paying in advance is breaking the rules, regardless of what you think. The closest you can get is ticket gifting, and if that's not an option for you then you need to stick to fair value.




Define "Fair Value"


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 Post subject: Re: Expansion for hire
PostPosted: Tue Mar 25, 2014 1:50 pm 

Joined: Feb 19, 2014
Posts: 122
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Usa Response wrote:
Define "Fair Value"

The obvious (from both common sense and the rules) answer is that fair value means you may not have any individual step in any transaction be considered intentionally unprofitable. Commited was unmistakingly clear in his post above that "but i'll profit from this later down the line" is not acceptable.

If you can produce a brick at LESS THAN 0.01$/unit is the only way selling them at that price is considered fair value. Its not possible thus its not 'fair value' and is a blindingly clear violation of the rules.


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 Post subject: Re: Expansion for hire
PostPosted: Tue Mar 25, 2014 4:42 pm 

Joined: Mar 22, 2013
Posts: 670
Location: Dallas, TX. USA
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User avatarLake Tanganyika
Triple Soap Adept
Usa Response wrote:
seronis wrote:
So I assume this also applies to USA Products claims that he has developer approval to sell people bricks at 0.01$ / unit?


AHHAHAHAHA NO WONDER YOUR IN THE DARK@!@!@!@!@!@!@!
Usa Product sells Clay +water to Brick Producers for 0.01$; ensuring low startup cost, while competing with the thousands of brick producers by creating a larger chain. This measure, has prevented the failure of not meeting the demand established on bricks. Please read the message before you respond


Lets make an example here, to show you why your method is useless.

USA sells inputs for 0.01 each. A total of .12 per brick.
USA buys the bricks for 50 each. A loss of 49.88 per brick.
USA sells the bricks for 500 each. A total profit of 450.12.


Now, lets pretend you were selling the inputs at a more fair price.
USA sells inputs for fair prices. A total of 80 per brick.
USA buys the bricks for 130 each. A loss of 50 per brick.
USA sells the bricks for 500 each. A profit of 450 per brick.

Obviously the numbers will change a bit based on your exact inputs, but the point remains the same, it doesn't matter.
By selling the inputs cheaper, you accomplish absolutely nothing except confusing new players, upsetting everyone else, and possibly getting banned.

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We are more than the parts that form us.
- Founder of Synergy Trade Group
We all become what we pretend to be.


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 Post subject: Re: Expansion for hire
PostPosted: Wed Mar 26, 2014 6:43 am 

Joined: Oct 28, 2009
Posts: 803
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User avatarAPCE Production
Automotive Genius
Committed wrote:
One of the businesses that arose naturally in this game is "expansion for hire", where a smaller company will take a building from a larger player and expand it for them, freeing up the larger company to do more profitable things. This is a reasonable idea. In an economic game we like that players have come up with ways to find value. However, people tend to think that because the goal is valid, the end justifies the means and they can break rule regarding cash transfers. This is not true.

If you want a company to make an expansion for you, the only way it can work is like this:
  1. Sell them a small building at fair value
  2. They use their own cash and materials to expand
  3. They sell back the larger building at (higher) fair value
Thus they make a profit at the end by selling a larger building for more than the costs.

But this is important - they must have the cash on their own to run the expansion. You cannot give them the materials for free, nor can you transfer cash over to pay in advance. If the company you want to do this for you is too small to afford that, then they're too small to be your business partner at this time.

Knowing how popular this is, it would be nice if we could come up with an in-game system to let you handle it more smoothly. But I'm not aware of a design for that yet. Perhaps Amarsir has something in mind, but I haven't seen any design docs on it.

So I hope that's clear. I know some of you mean well, and think "well I'm just paying in advance not trying to cheat." No. Paying in advance is breaking the rules, regardless of what you think. The closest you can get is ticket gifting, and if that's not an option for you then you need to stick to fair value.


Its a great shame that no truly new player will ever grow from expanding a larger players buildings again.

Not that I disagree, it has to be done. It just means that, because the 'fair value' of a huge building (800kft2+) is more than the 'fair value' of a new player's whole company, if they are a few months old, these expansions won't be happening anymore. It wasn't nearly as much of an issue when tickets sold for 30m and the largest buildings were 100kft2. The whole spectrum was just closer to the bottom back then.

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 Post subject: Re: Expansion for hire
PostPosted: Wed Mar 26, 2014 8:51 am 

Joined: Feb 19, 2014
Posts: 122
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User avatarDark Horizons
 
A construction business isnt a small business. Not a shame to me.


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 Post subject: Re: Expansion for hire
PostPosted: Wed Mar 26, 2014 6:35 pm 

Joined: Oct 28, 2009
Posts: 803
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User avatarAPCE Production
Automotive Genius
seronis wrote:
A construction business isnt a small business. Not a shame to me.


You know RV? The undisputed largest player ever in simunomics? He started as a construction for hire business, for the largest company in the game at that time (Habars). By started, I mean he was basically out of that deal within 6 months of his account creation, so he started between one and two months of his start date.

I made a lot of money by expanding for RV. Then Milkco made a lot of money expanding for me.

Expansion is inherently a small business activity, because it relies on the fact that you can make more money by expanding a larger players buildings than you could make running your own, but the large player could make more money running their buildings than expanding their own. In other words, you must logically be smaller, and probably fairly significantly smaller.

That said, expansion for hire hasn't really been a significant and legitimate activity (as in, done by many players in mutually beneficial deals) since taxes were erased every month, and buildings could be transferred despite overdue debt. Needless to say, this has been a long time, and thus expansion for hire is largely a relic of the past.

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 Post subject: Re: Expansion for hire
PostPosted: Wed Mar 26, 2014 7:36 pm 

Joined: Mar 25, 2013
Posts: 1019
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I doubt any big players will expand for other big players. So this leads me to believe there will either be inhouse expansion or at least we can consider some sort of work around or expansion slots in the future?

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 Post subject: Re: Expansion for hire
PostPosted: Wed Apr 02, 2014 4:26 am 
Developer

Joined: Feb 8, 2008
Posts: 2046
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Quote:
Its a great shame that no truly new player will ever grow from expanding a larger players buildings again.

Not that I disagree, it has to be done. It just means that, because the 'fair value' of a huge building (800kft2+) is more than the 'fair value' of a new player's whole company, if they are a few months old, these expansions won't be happening anymore. It wasn't nearly as much of an issue when tickets sold for 30m and the largest buildings were 100kft2. The whole spectrum was just closer to the bottom back then.

The problem with the existing method, aside from the fact that it involves untraceable unenforceable cash transfers, is that it's kind of lousy for the small company. They get their slots filed with a building that isn't doing anything, it wasn't even their choice whether or not to expand it, and as a small company they don't have a lot of alternative buildings to keep interested. This makes it very popular with second companies OR makes a new company do that with their main and then want a second company.

What I need is an idea for some sort of "play", some activity that's interesting and involves a few decisions for the construction company. On top of that, we need some protection for the client so they're protected if the construction company goes away. And ideally we tie it all together with a top-down business concept.

My concept at this point goes something like this:
1) Builder buys a special land slot, a "shell" slot.
2) By default a "shell" slot can handle expansion at speed 1, but it can be upgraded to handle higher speeds. (There's no level restriction on what a shell slot can handle, but some action / cost is required.)
3) Shell slots need to be pre-prepped for X days, using some action/cost TBD.
4) Once prepped for X days, it's listed with a rental price.
5) Anyone with a building can shift it into a shell slot where X is greater than the expansion time left, by paying the rental price. This way it stays their building and they are the only one who can control it. However, it will take up the builder's land slot and free up one for the owner. They can then take it back at any time provided they have a free slot.

Good:
1) Building owner is protected and maintains control
2) Owner takes responsibility for the expansion and doesn't need to transfer any build kits.
3) Profit built in
4) Builders can differentiate with their own prices. We'd probably auto-match with the lowest price that meets the requirements.

Bad:
1) There's still no actual activity while the construction is underway, but there's at least a little prep work involved.
2) The level 1 company still won't be doing expansion at tier 8 for people, but they can build up to that. You guys will have to work that out. (This may not be bad.)

Ugly:
1) I don't know what happens if the owner never logs back in to take it.
2) I'm not sure how to handle the accounting.
3) I don't know if we should transfer the rental price up front or do it over time. (Or how we'd do it if the latter.)
4) Still not sure exactly how the "some activity / cost" will shake out.


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