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Retaining slush money, versus investing in improvements
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eric scott RJ: Erik Scott CO: Sappo Post Rating: 0 + / - Total Posts: 130 Karma: 29 Joined: Apr 5, 2012 |
Posted on May 10, 2012 At what point do you guys recommend to invest your cash?Right now I have a decent setup, with a few 1000m2 production units, and a handful of 500m2, also 2 400m2 stores to sell the products. I am averaging between 30-50M revenue after taxes etc per day. With 100m~ in slush, should I be dumping it into improvements ? I am not sure where the sweet spot is, when you just sit back and let everything work. Or is that never an option, to be competative do you have to be constantly throwing money into upgrades? I just hate to see my facilities down for 30-40 hours at a time to upgrade Besides, I kind of like having cash in my bank account :) |
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Gamma Alpha RJ: Gammatron CO: Gammatron Post Rating: 1 + / - Total Posts: 104 Karma: 62 Joined: Apr 7, 2012 |
Posted on May 11, 2012 The golden business rule which works not only in a virtual world is that if you keep money in your pocket, this money is not "working" for you, so essentially you loose money. I suggest that you keep enough cash to easily buy all the goods on B2B market you need to produce or resell them in your stores and invest all your $$$ in buildings. Me, I'm investing all the time, upgrading one facility after another (apart from R&D, which I keep around 200m, but soon I'm gonna expand them too to reach Q45+ level quicker). I started with just one, but now I've got 14 factories of 4 different kinds and 4 of them are constantly being expanded one after another. Right now, after reaching an average size of 1200-1500m, I set the maximum expansion time of 168h, so in a month I'm gonna have 4000+k square meters facilities. The stores however are much slower and much more expensive to expand, so I work on them slowly, whenever I've got some influence to spend, I can't afford the hiatus period when they both grow and don't work. Also, you can follow someone's else's advice here (I did) and take as much loan as the bank can give you. The current loan payment margee is so low that this money cost virtually nothing. |
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eric scott RJ: Erik Scott CO: Sappo Post Rating: 0 + / - Total Posts: 130 Karma: 29 Joined: Apr 5, 2012 |
Posted on May 11, 2012 Hmm Yes I see.Thats the major reason for having multiples of a storefront/production facility, to transition ease of upgrades I really see no reason for a loan though, with positive income and cash in the bank... that goes against every principle of finance :D |
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LP Paradoxian RJ: LP Paradoxian Post Rating: 0 + / - Total Posts: 18 Karma: 10 Joined: Apr 10, 2012 |
Posted on May 12, 2012 Margins in the game are extremely high. So every $ you invest you will get back in a few days at the most. If you can profitably invest money at a higher rate than 1% taking a maximum loan actually makes a lot of sense.Ideally you should spend all your money, and then some, all the time to maximize your profits and minimize your taxes (everything is written off immediately, meaning no taxes if you spend everything). |
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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 May 12, 2012 Yea with the exception of the last few days I've usually never had more than a million or two in cash.
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Gamma Alpha RJ: Gammatron CO: Gammatron Post Rating: 0 + / - Total Posts: 104 Karma: 62 Joined: Apr 7, 2012 |
Posted on May 12, 2012 Jesus, so what to spend you hard earned moneo on? You can'n expand all the building at the same time? Shall I buy more goods in order to save on taxes?
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eric scott RJ: Erik Scott CO: Sappo Post Rating: 0 + / - Total Posts: 130 Karma: 29 Joined: Apr 5, 2012 |
Posted on May 13, 2012 Yeah thats the problem now, my buildings are big enough 1000+m2, that expanding them anymore is into the many many hours range, so to spend all the money I make a day, is almost unfeasable, because it will drop my production cycle down.am I really complaining about having too much money? I think so... |
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Josh Millard RJ: Tex Corman CO: J. Quaff Arabica Post Rating: 2 + / - Total Posts: 167 Karma: 231 Joined: Apr 3, 2012 |
Posted on May 13, 2012 I recommend buying yachts on B2B. Buying them, and then not selling them.
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Victoria Raverna RJ: Victoria Raverna CO: Victoria Raverna Post Rating: 0 + / - Total Posts: 107 Karma: 43 Joined: Apr 11, 2012 |
Posted on May 13, 2012 If your company is private then you try to spend as much as possible. If you have too much money then you can afford to spend some of your money to upgrade all your buildings and waiting for several days with no income so that 7 days later you'll be able to generate far more money. Then you save up "too much money" again and repeat the building process again.If your company is public and you hold large percentage of the share, then you might want to keep cash around because that will increase your NW of your company which in turn will increase NW of you as owner several times over. 1 G extra in a company NW can result in 5 G extra or more in personal NW from the increase in share price. |
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Alexia Perdhaer RJ: Alexia Perdhaer Post Rating: 0 + / - Total Posts: 100 Karma: 30 Joined: Apr 6, 2012 |
Posted on May 14, 2012 There are limits to growth. If your factories are all 2500 m2, and you've bought the 100 million dollar parcel, you probably want to focus on moving the money into your personal account (1 click if you didn't ipo; more involved and time-consuming if you did) to use in building new companies, where you will have a day to auto-expand (if you have enough influence).If you expand a 2500 m2 factory, you can only expand it 96m/ day, which will take 26 days to recoup (a little less because of economies of scale, but you're already into the flatter part of the economies of scale curve if you are doing 24 hour shifts in 2500 m2). Or you can pay the expansion fees (and the influence). But if you are at 30K m2 total, expansion fees are very expensive. Much more than starting new companies. |
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Scott (Admin) RJ: Ratan Joyce CO: Ratan Joyce Post Rating: 0 + / - Total Posts: 1175 Karma: 5083 Joined: Jan 13, 2012 |
Posted on May 14, 2012 Thanks for the reminder on EoS on buildings.
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Brent Goode RJ: BB Goode CO: BB Goode Post Rating: 0 + / - Total Posts: 506 Karma: 180 Joined: Apr 5, 2012 |
Posted on May 14, 2012 You can always start a new company and branch out toward an impressive economic empire.Of course, with the new shelving application coming, you find yourself all kinds of screwed up. |
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