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New Server - Race to the bottom
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Jim Frazer RJ: Kenneth Noisewater CO: Kenneth Noisewater Post Rating: 0 + / - Total Posts: 25 Karma: 31 Joined: Apr 14, 2012 |
Posted on Jun 2, 2012 I have to ask... what is up with the bargain basement B2B pricing? Water is selling for .06 with only 2 people in the market? Electricity for .10? Fruit for $1? It seems like folks are pricing based on the beta, where some markets are overserved and contain players who can produce huge amounts for very low prices. Supply and demand. Production is in its infancy now, leading to a low supply. Everyone is spinning up stores with 8 shelves to fill, leading to high demand. Prices should be unusually high (below import but well above where they are right now) until production is built up around the board. |
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Brent Goode RJ: BB Goode CO: BB Goode Post Rating: 19 + / - Total Posts: 506 Karma: 180 Joined: Apr 5, 2012 |
Posted on Jun 2, 2012 What is with your race to the top?Qualities are low, imports are the median for price and quality, and there aren't any customers. The real demand right now is for capital. So people are trying to sell quickly to generate cash flow. |
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Jim Frazer RJ: Kenneth Noisewater CO: Kenneth Noisewater Post Rating: 0 + / - Total Posts: 25 Karma: 31 Joined: Apr 14, 2012 |
Posted on Jun 2, 2012 Actually, I'm not selling anything right now. All I'm producing is going straight to my stores. But if I was selling, yep, I'd be trying to get as much as I could while still selling. If I can get $500 for a copper bar (which sells for $800 at a store), why list it at $200? In both cases it will sell and the buyer will make a nice profit.It is more just wondering what the thinking is. Water is the main one I'm curious about; RJ posted up 50mil at .20 and the next 2 postings were both at .06. Seems like a weird choice to post a high demand item (this early in the game) at what is essentially minimum profit-producing pricing. I'm glad to be able to get it so cheap, I just don't understand why it's that cheap. |
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Josh Millard RJ: Tex Corman CO: J. Quaff Arabica Post Rating: 0 + / - Total Posts: 167 Karma: 231 Joined: Apr 3, 2012 |
Posted on Jun 2, 2012 Whether or not $0.06 per unit would in repeated market trials prove it to be the optimal price point is an academic question; whether or not you can capitalize on that $0.06 per unit right now is a short term business question.You make more money selling water at six cents than you do not selling it at twenty. It's speculation and it may not be particularly good speculation, but it's also a guaranteed sale. |
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Bruce Wayne RJ: Bruce Wayne CO: Bruce Wayne Post Rating: 0 + / - Total Posts: 37 Karma: 28 Joined: May 17, 2012 |
Posted on Jun 2, 2012 People make horrible business decisions is my only answer and the game reflects this. Eventually such business fail. I think there's also the idea that low prices sell faster without taking logic into account. That's the company selling the water for .07 cents you could message him and ask. http://www.capitalism-online.com/eos/firm/69Lastly could just be testing as the server will be wiped in a few days. |
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Richard Ripberger RJ: Rip CO: Rip Post Rating: 0 + / - Total Posts: 153 Karma: 78 Joined: Mar 28, 2012 |
Posted on Jun 2, 2012 Well I am not selling electricity even at .10 and I am broke. Of course I didn't get a starting tech or any influence etc. So just toying until the restart anyway.
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Andrew Naples RJ: Clemen Salad CO: Clemen Post Rating: 0 + / - Total Posts: 214 Karma: 89 Joined: Apr 26, 2012 |
Posted on Jun 2, 2012 Yea, was RJ running off an old build or something?
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Eric Ewing RJ: Peebles CO: Peebles Post Rating: 0 + / - Total Posts: 16 Karma: 56 Joined: Apr 16, 2012 |
Posted on Jun 2, 2012 I may not know all of the math behind the scenes, but I think Brent is right. At this phase, the money you make is going into capacity. Water serves no purpose to a business with a focus on retail, and being able to add square meters to stores NOW helps the cash flow. That investment in expansion starts paying off quickly, and if invested as soon as cash is available it's like compound interest. Six cents per unit of water today might be better than watching tick after tick after tick go by with your store not being big enough until people buy it at twenty cents tomorrow.At least that's my thinking. If the formula people correct me before the wipe, that would be appreciated. |
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Jayle Trigger RJ: Berry Punch CO: Applejack Post Rating: 1 + / - Total Posts: 93 Karma: 85 Joined: Apr 9, 2012 |
Posted on Jun 2, 2012 People are kinda... 'poor' when you consider it... Make money now, use money to make even more money. |
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Balon Swann RJ: Balon Swann CO: Balon Swann Post Rating: 0 + / - Total Posts: 19 Karma: 15 Joined: Apr 12, 2012 |
Posted on Jun 2, 2012 I'd rather sell for cheap NOW than sell for 'more' later. The immediate income is much more valuable; I can turn that into a lot more money faster then it would take for something to sell for a higher price.
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Brent Goode RJ: BB Goode CO: BB Goode Post Rating: 13 + / - Total Posts: 506 Karma: 180 Joined: Apr 5, 2012 |
Posted on Jun 2, 2012 The name of the game is Capitalism, not Money or Profit. And money is a tiny part of what makes up an economy's total capital. So cash-slow is crucial on the money side, but so is that expanded capacity, and even time, in some abstract ways. And so, actually, is a workable set of affordable resources in the over-all open markets.I find it so shallow to boil Capitalism down to money, or the simple acquisition of money. That shows such a lack of understanding of the term, and the "system." (I would argue that it is not actually anywhere near the status of a "system," but rather a dynamic within a system. And it is certainly not a political dynamic unto itself of any kind.)The very logic of that interpretation of capitalism is what has the RL world economy in a tailspin. The end result of that interpretation of capitalism is political fascism, and a self-induced implosion. Back to the game...as Peebles says, the growth is more important than the immediate profit margin, as you are increasing your ability to generate more margins and profits in a compounded effort. And to use a sports metaphor, that's why they play the games. If everything just "happened" the way you think it should, why bother playing? You would have predetermined every aspect of the game and it's end. We all know that you can not have omnipotence and free will at the same time. To go back to the thread on Motivation...we are not all motivated by the same needs or desires here. So you will definitely have different interpretations of how to proceed. And different results than you would expect. If you think it is odd now, wait until you get 3000 people playing, and not 30, or even 300. |
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John Galt RJ: John Galt CO: John Galt Post Rating: 621 + / - Total Posts: 23 Karma: 97 Joined: Apr 6, 2012 |
Posted on Jun 5, 2012 This is not a race to the bottom. It's a market trending towards sanity. Items that anyone can get into creating very quickly with little investment do not warrant an enormous markup. Water and electricity, in particular, are not products that require a large manufacturing chain to produce, and they require no research. Consequentially, the prices are going to trend towards fairly slim profit margins -- basically, whatever price the average player will see and say "OK, it's not worth making my own when I can buy it at that price". Because if the price is even a little too high, it is trivial to just make your own. There is still plenty of profit to be made selling these items, but you have to accept that these are commodities that can only sustain a certain price point. |
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