Marketing: Cost To Produce List & More

Below you will find a Screenshot of Math done by a Marketing And Economics Major (Masters level of degree) Via a spreadsheet from our guild.
Please note VOMC = Profit so at 0 its break even, at a negative integer its loss, and positive its profit.




http://files1.guildlaunch.net/guild/...ice1744Pop.jpg


Please note some items (like sausage) should be sold for buff rates.
and some items like Iron bars, are a loss no matter what you do. But they are excellent source of income if produced into a finished good.

as it stands now these is the best money makers in game in order

Steelswords (123g a day per building at level 3)
Ironswords (121g a day per building at level 3)
Butcher (76g a day per building at level 3)
Steelsmelter (67.5g a day per building at level 3)
Bakery (48g per a day per building at level 3)
Breweries (27g per a day per building at level 3)

How are you assigning trade value? It's obviously not based on any data about actual production rates (or at least is very very soft about it), so is it just what people are trading for right now? Either way, I can immediately spot several very killer real(er) value trades I could make here that you would show as break even.

spreadsheets are nice, but not very helpful without knowing how the values are calculated, especially trade and material values in this case. also, i'm a bit confused how you derived the best money makers in game from the information presented, i don't see an immediate connection between the two. i guess we should just take your word for it??

What level(s) and production time(s) are you using for these calculations? Although I'm guessing these things aren't accounted for since you are only listing a single value.

The values differ. The finished production are based on
1) Production rate (building cycle rate)
2) Production amount
3) Production conversion to stack
4) Cost of Materials (assumed to be bought, not made)
5) Buff production (If applicable) (cost assumed and calculated in finished rates)

these are just a few
However, the raw are set manually.
Ie for example we (myself in this case) Added the raw material value rate. and as a result the calculations based profit off those rates while including all cost rates (IE cost of materials, buffs etc).

I hope thats clear.

Quote:

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Originally Posted by Talar

The values differ. The finished production are based on
1) Production rate (building cycle rate)
2) Production amount
3) Production conversion to stack
4) Cost of Materials (assumed to be bought, not made)
5) Buff production (If applicable) (cost assumed and calculated in finished rates)

these are just a few
However, the raw are set manually.
Ie for example we (myself in this case) Added the raw material value rate. and as a result the calculations based profit off those rates while including all cost rates (IE cost of materials, buffs etc).

I hope thats clear.

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What building levels were used to calculate?

Does this show that the only way to make a profit making iron swords is if the mines, smelters and weapon-smiths are all run buffed?

Am I also interpreting correctly that nothing you have listed makes any net profit over materials cost unless buffed?

Thanks.

@ Emah, This is based on level 3 Production with Buffs.
Let me post a sheet of all values.

Just so you understand what you are looking at.

PPD = Income Per Day

1,2,3,4,5 = are the levels of the building
Colors= whats cost effective (Ie the best buff for the building/level)

Light blue color = Fishies
Blue = Sammies
Purple = Basketies

http://files1.guildlaunch.net/guild/...nfo9307Pop.jpg

Please note, these values are based on the above at cost to produce values.

I find this list to be suspect at best. Since it does not take into account how the market is affected by non-player produced goods (i..e. swords gained from adventure rewards in large chunks that get dumped onto the market by people for easy gold). I recently did some cost analysis on steel swords taking into account the real value of the goods used in making them and then the value of a reasonable trade on the market. It came down to you would be better off selling the composite materials than making them into steel swords. Also they are going to continue to decline in value as more people hit the mid tier adventures.

So if you have an iron smelter, a coal mine, 2 iron mines, 3 marble masons, 4 hard sawmills, 2 hard cutters, 3 hard foresters, a copper mine, a bronze smelter, and a toolsmith, you would suffer a net decrease in total resource value per day as your iron ingot, hardwood plank, marble, copper and tool stores all go up?

Aside from a pittance of fir planks and stone to rebuild copper mines, this covers the mine rebuild costs and then some.

Also, you're not taking into account the cost of the buff items, but that seems like a small worry compared to other problems with the table.

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Originally Posted by Suzera

So if you have an iron smelter, a coal mine, 2 iron mines, 3 marble masons, 4 hard sawmills, 2 hard cutters, 3 hard foresters, a copper mine, a bronze smelter, and a toolsmith, you would suffer a net decrease in total resource value per day as your iron ingot, hardwood plank, marble, copper and tool stores all go up?

Aside from a pittance of fir planks and stone to rebuild copper mines, this covers the mine rebuild costs and then some.

Also, you're not taking into account the cost of the buff items, but that seems like a small worry compared to other problems with the table.

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Please read what i said.

All PDD buff values already factor

1) Material Costs
2) Buff Costs

In addition to other things like
Each license has a value cost thats tracked in another tab.
amongst other things

in other words if bakeries produce 50g a day each, that includes the XYZ wheat, water cost, and buff costs to keep the buffed.

If that includes mine reconstruction costs, that just makes it easier to pose an example question.

If you make an iron smelter and stop there with all the other stuff behind it factored in pefectly and have no other buildings, your net value in resources goes down as your iron ingots go up and everything else stays the same because it has a negative PPD?

I'll leave off any criticism of how you're doing buffs until this chart makes any sense.

Iron ore production is about equal to costs
Iron bars are ALWAYS a loss.
Iron swords are high income.
Steel Swords are high income.

There is not such thing as reconstruction costs.

"reconstruction costs are not different then build costs, as there is no discount"
the factor is based on 24 hours of productions

But with an iron smelter's PDD, you are gaining iron bars, not losing anything, and your chart shows this as a "loss". What is being "lost"? Speculative value?

Also mines do run out. If you're not factoring rebuilding mines in to PPD, then maybe you should include it in some fashion (even if you only include the base amount for level 1 over all the levels you will be more accurate than not doing so) because it can actually be quite a drag on your real production capability, especially if you do any of the upgrades. Mines, fishers and hunters inherently include a trade of one resource to another because they become depleted and are replenished by rebuilding mines or using provision house deposits, while all other buildings involve a one-time cost then produce forever. So yes, there are trivially obviously reconstruction costs for mines, fish and meat that exist and have an impact on your production.

Suzera, the loss is the opprotunity cost, i.e. the money you could have made by selling coal and Iron ore. There is a bit of a false economy here with the S and I swords and S bars becuase it is calculating the cost based on buying the bars from the market, rather than the total raw material cost (I assume) what this really tells you is that you should sell all your iron and coal, and buy the iron bars from the market to make the iron and steel swords.

Trading fluctuates too much currently for the chart to mean much without constant updating if that's the case (and also mean that iron bars are not "ALWAYS a loss"), and this chart seemingly gives no guides for upper/lower bounds for when you start getting real production loss by making certain trades, which is what you would want for determining when you should/should not start building X on your island, and for getting an idea of how to most efficiently produce a particular end product if you don't want to rely on being able to rip people off forever.

Suzera, you are correct it is a free market and prices and margins will react to supply, demand, and price fixing schemes :P
The real money is to be made when you can identify the areas of unbalance.

Market flux rates have nothing /little to do with production profit rates.
these figures are accurate on production cost / profit levels

There are many factors involved in the CEO Economy that cannot be put in a spreadsheet (it is a nicely put together Spreadsheet and it looks like a lot of work has been put into IT):

-Supply and Demand (as mentioned before)
-People buying up the under priced goods and reselling at a higher value (this is done often)
-Adventure Rewards - nothing like getting 1000 Steel Swords dropped in your lap a couple times a week
-Fools and ignorant people (which if you ever go into Global Chat there is no shortage of them)
-Progress of the game - all this information could be completely obsolete next week

Right now the market is still chaos but better than it was in October. Good luck in controlling the Market.
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we are not factoring trade rates here
i am posting what a building makes per a day and you guys are arguing about what prices they should be traded at. please read the post

This post is so people know what production cost of goods are.

Ok, then what basis are you using for tying Finished Goods to Income (i.e. Gold Coins) if not trade?

Quote:

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Originally Posted by imirk

Suzera, you are correct it is a free market and prices and margins will react to supply, demand, and price fixing schemes :P
The real money is to be made when you can identify the areas of unbalance.

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Exactly. And this chart doesn't do it, or at least not anywhere near well since it isn't based on any of the actual limiting factors that create the differences in value of item. There are three things that I have been able to identify so far, such as the most obvious one of building slots, that can be used as a proper basis for determining values of goods. Four if you count gems, but if someone is paying enough for gems to buy resources directly with them as opposed to the longer term option of more building slots, they're probably not too concerned with efficiency. "We'll just call the value of this raw material X because it seems right" is not one of these factors.

Also, the trades I have seen up involving iron ingots since I started looking due to this thread have so far been in favor of the person with the ingots, while ores seem to dip into bad for the person with the ore territory more.

Edit: If anyone is using this chart, I'd love to set up an exchange of my iron ore for your gold ore at 20 to 50. I'm serious about this. Send me a mail or whisper.

Its 20 iron ore, for 50 gold coins. not 50 ore.
That list is in gold coin value.

Quote:

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Originally Posted by Talar

Its 20 iron ore, for 50 gold coins. not 50 ore.
That list is in gold coin value.

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That makes no sense - 20 Iron Ore for 50 Gold Coins? I am assuming you have a typo.

Are you basing the Gold Coin Trade Value based on the Gold Chain Production of it?

The chart may make sense to the people who developed it, but those of us that are seeing it for the first time (and apparently only part of it) there are many things that could use some clarification.

Quote:

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Originally Posted by Talar

Its 20 iron ore, for 50 gold coins. not 50 ore.
That list is in gold coin value.

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I'll assuming something in here was a typo too for now. I was talking about the first list where iron ore has a trade value of 20 and gold ore has a trade value of 50. So it would be 20 gold ore (total trade value 1000) for 50 iron ore (total trade value 1000). A trade I will gladly accept.

No, he was thinking its 20 iron ore for 50g, but the list is 20g for 1 stack of iron ore, and 50g for 1 stack of gold ore.

400 iron ore / 20 coins = 20 ore per coin
400 gold ore / 50 coins = 8 ore per coin
20 iron ore / 8 gold ore = 2.5 iron ore per gold ore

Multiply that ratio by 20 on each side and you have 50 iron ore per 20 gold ore. Just like I said initially. It doesn't matter what scale you do the ratio at whether it is multiplied by 400 or 1. It's still the same ratio.

You guys are funny. Seems like your response to a very insightful way of looking at the game is you have chosen to look for reasons it is not always true. Of course the spreadsheet needs updated and it is based on market values that are irrational. Certainly, it does not compare adventure rewards to manufacturing. Yeah, the math behind it is not included.

Still, you got free perspective. Your welcome.

Maybe a better question is what does it show and why does it bother you so much?

Lets play pretend. What if the math is solid? What then?

Quote:

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Originally Posted by Alias1632

You guys are funny. Seems like your response to a very insightful way of looking at the game is you have chosen to look for reasons it is not always true. Of course the spreadsheet needs updated and it is based on market values that are irrational. Certainly, it does not compare adventure rewards to manufacturing. Yeah, the math behind it is not included.

Still, you got free perspective. Your welcome.

Maybe a better question is what does it show and why does it bother you so much?

Lets play pretend. What if the math is solid? What then?

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Okay, let's.

Well golly, it seems my ego just keeps getting in the way of logic.

This is CLASSIC "Can't see the forest for the trees" economics.
The limiting factor in this game is licenses. Everyone can have only 335.
If you take the big picture (Macro) view of the CEO economy there is an obvious answer.

The building with the highest economic value is THE WAREHOUSE!
A trader can generate more gc thru trading than any production chain!
The problem with being a trader is the he stops making a profit as soon as he stops actively trading.

The value of production chains is in their automation. You don't have to actively play to make gc from them.
The funny thing is that the most profitable production chain isn't even listed in any of the posts above.

So 334 Warehouses (gotta have a barracks, and there is a gem Branch Office, I mean you have 335 Lic, you probably have a the gem BO :D) gives you 500K storage, seems like diminishing marginal returns, and then the limiting factor will be your time and the fact you can only have one trade on the tab at a time.

Am I the only one who cannt see the image in post one?

I believe the charts/spread sheets have been removed.

Speaking of economics and economies of scale, how does everyone else feel about the drastic increase of costs from level 3 to 4 in buildings? The increase from one to 2 is roughly 75% increase in trade value of materials and from 2 to 3 is roughly 150% increase in trade value of materials cost but then from 3 to 4 is roughly a 1500% increase in trade value cost of materials. Obviously these are rough estimates and vary depending on the day, etc but the drastic increase of value can not be denied. Once we incur this rather large increase on basic and intermediate building increases (which should not be the same cost to upgrade basic should cost less) we then see the next level only obtainable by a slow grind of adventure rewards for upgrades. I do not mind a grind but the scale is way off for these increases. I would be surprised if there are more then 15 level 5 buildings in game (funny too that most of the updates to the game since I have played have been for level 5 building graphics few will ever see, especially this early) since the obvious choice to use those resources for is troop development and expert buildings. With these factors it would safe to say that it would be at least a year of playing before even and advanced player would reach level 50 and put resources from quests towards more building advancements and less troops. This makes the advanced levels of the game even slower then they are, which means less retention of the player base and also makes current players less likely to spend real money (why should I spend money when I have to wait anyway?). Just some thoughts.

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I would be surprised if there are more then 15 level 5 buildings in game

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I'm not really sure what that means - you think that of all the people playing, there are only 15 level 5 buildings in existance? I have that many myself. I've seen other people's islands with many, many, more level 5 buildings than me.

I do agree that the scale of the expert buildings' resource requirements and production cycle times seem out-of-balance with other areas of the game. On the other hand, though, what's wrong with it taking a year to reach level 50? I don't think the game was intended to provide an afternoon's diversion; they're hoping you get hooked, play for a long time, and buy gems from the store. And really, the goal is that you'll buy gems, the game simply provides a framework and reason for you to give them your money. The reason you'd spend money is to speed things up.

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we then see the next level only obtainable by a slow grind of adventure rewards for upgrades

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I think you've forgotten about the trading system, as you can quite easily trade for the items needed to build anything that you're eligble to build. It may take some time to do so, but again - the more time you spend playing the happier BB will be. Adventures certainly help, but if you're not using the market to advance your efforts, you're leaving a large part of the game un-tapped.