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TheSeahag

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Stall Owners Who Run at a Loss

I've been noticing more and more stall owners recently on Midnight who either don't know or don't care that their business operates at a net loss.

I'm most familiar with Papaya's economy, but I'm sure such individuals are distributed relatively evenly (or at least in accordance with the population density across the Ocean). Has anyone else noticed a recent surge in "anti-profiteers"? I've actually run the numbers for some of the usual suspects, and found that some of them lose as much as 30-35K a month from both lost rent *and* per-order loss. Note that this figure varies substantially across stall type. I intentionally take a conservative approach when running these calculations (i.e. assuming ocean-wide low bid prices etc.), and try to give the benefit of the doubt. Even so, the results have blown my mind.

From the perspective of a Shoppe owner, I see it as sort of an unavoidable but relatively temporary annoyance since these stalls eventually go out of business anyway (whereas the brick & mortars are in for the long-haul). But conceivably the anti-profiteers could really muck up the experience for other stall owners who are trying to make an honest go of it with a smaller backing of cash and for a shorter period of time. Eventually, the logical conclusion of extended competition between a legitimate owner and an anti-profiteer is bankruptcy for both, assuming the latter attracts a greater number of buyers. At the very best, the legit owner would be out the stall-opening fee in the event that s/he relocated.

From the perspective of a Governor it presents sort of a dilemma for me, because it seems more reasonable to let the market forces determine the value of products which leads me to default toward a "hands-off" approach. On the other hand though, I hate to see the legit folks get screwed because of one bad apple in the barrel, so I feel compelled to intervene.

In some cases, I've contacted stall owners in an attempt to explain the situation, and hopefully encourage them to be a little more circumspect about their business. These interactions have always been friendly (at least on my part), and I've actually been very pleasantly surprised by a few individuals who seemed really appreciative of the information. But alas, it seems there are just still a substantial number of "don't care" versus "don't know" folks out there.

Then again, maybe I'm just bored at work.

Seahag,
Venting.

Edit: Why does MS word funktify my formatting?
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Briggs Says, "Dr. Hag is bringing the Prescription for pain!"
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[Edit 1 times, last edit by TheSeahag at Jun 28, 2006 12:27:47 PM]
[Jun 28, 2006 12:25:57 PM] Show Printable Version of Post        Send Private Message [Link]  Go to top 
sweetnessc

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Re: Stall Owners Who Run at a Loss

Back to the old standard, if they are willing to sell you goods at a 35k discount off of cost, man, buy them out and resell! Woohoo!
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My friends, love is better than anger. Hope is better than fear. Optimism is better than despair. So let us be loving, hopeful and optimistic. And we'll change the world. ~ Jack Layton

Sublime is shame.
[Jun 28, 2006 12:38:31 PM] Show Printable Version of Post        Send Private Message [Link]  Go to top 
TheSeahag

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Re: Stall Owners Who Run at a Loss

 
Back to the old standard, if they are willing to sell you goods at a 35k discount off of cost, man, buy them out and resell! Woohoo!


Yep, it's my understanding that this is exactly what happens. There are a few watchdog stall-owners who really do a good job of keeping the barrelstoppers in check on Papaya.

It tends to be a little bit more problematic though when a one-shot buyout isn't really possible. For instance, in cases where end-state products are not sold on the commodities market, buyouts tend to be a little trickier. Tailors are probably the best example of this.
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Briggs Says, "Dr. Hag is bringing the Prescription for pain!"
[Jun 28, 2006 12:44:48 PM] Show Printable Version of Post        Send Private Message [Link]  Go to top 
Sagacious

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Re: Stall Owners Who Run at a Loss

Some fool has opened a furnishers on Spring - the prices are amusingly low. It's not possible (even with the cheapest possible commod sources) that they are making any profit.

People like them belong on Coblat - where numerous clueless players open stalls...
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[Jun 28, 2006 12:47:53 PM] Show Printable Version of Post        Send Private Message [Link]  Go to top 
sweetnessc

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Re: Stall Owners Who Run at a Loss

 
Tailors are probably the best example of this.


Talk to Zarhirra, she'll buy them out for you. :-)
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My friends, love is better than anger. Hope is better than fear. Optimism is better than despair. So let us be loving, hopeful and optimistic. And we'll change the world. ~ Jack Layton

Sublime is shame.
[Jun 28, 2006 12:49:42 PM] Show Printable Version of Post        Send Private Message [Link]  Go to top 
quiglin

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Re: Stall Owners Who Run at a Loss

 
Back to the old standard, if they are willing to sell you goods at a 35k discount off of cost, man, buy them out and resell! Woohoo!


Yeah, Pie, I'm with you, but I think seahag is looking at it from a governor's POV rather than the competition's.

Hmmm, although I'm a laissez-faire type, I understand Seahag's position...on one hand, you don't want to play too heavy a hand, but you do need to protect your island's economy (or rather, what semblance of a particular economy you hold).

[derail]I want tariffs. I may just have to hit the search button and *shivers* go to GD. And even if there is another thread, I'll just open up another thread in GD b/c I think my opinion is worth its own thread. Well, that's precedence there, I've heard...if you're special.[/derail]
[Jun 28, 2006 12:49:46 PM] Show Printable Version of Post        Send Private Message    http://www.quiglin.com    bquiglin    bquiglin [Link]  Go to top 
Rick9109

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Re: Stall Owners Who Run at a Loss

These watchdogs almost never stop at just stopping the unprofitable stalls. They start moving on to "not profitable enough" and then on to to the point where "you can't sell any rum on your island three arches away because even though you make a lot of money selling it and pay really nice labor wages, we have to charge more in diamond so we're going to buy out your massive stock of rum every single day so you have to raise prices if you want your citizens to actually have rum"
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Rome
Pirates of the Damned, Crimson Tide.
I don't care what it did to them, the game's been good to me.
[Jun 28, 2006 12:55:45 PM] Show Printable Version of Post        Send Private Message    rick9109    cactusrome [Link]  Go to top 
DreadedChris



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Re: Stall Owners Who Run at a Loss

 
These watchdogs almost never stop at just stopping the unprofitable stalls. They start moving on to "not profitable enough" and then on to to the point where "you can't sell any rum on your island three arches away because even though you make a lot of money selling it and pay really nice labor wages, we have to charge more in diamond so we're going to buy out your massive stock of rum every single day so you have to raise prices if you want your citizens to actually have rum"


Uhm... but at that point, so what? If I could make rum for a cost of 40 ppu and sell it dockside at 55 ppu and have someone buy 500 units a day to sail to another arch where they sell it at 60 ppu, who am I to stop them from giving me 7500 per day in profit?

Or, more to the point, it seems to me that that problem is largely self-limiting.

(Clarifying a bit on self-limiting: Note that the savvy stall-keeper will raise his prices until they are just -at- the point the 'watchdog' will keep buying, or just one poe -above- that point, and either maximize income from the watchdog or be the lowest price that sells to 'real' customers. My hope would be that out of the assorted distilling stalls at least a couple would have managers-with-a-clue.)
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~< The Dread Pirate Chris >~
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[Edit 1 times, last edit by DreadedChris at Jun 28, 2006 1:12:49 PM]
[Jun 28, 2006 1:09:19 PM] Show Printable Version of Post        Send Private Message [Link]  Go to top 
TheSeahag

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Re: Stall Owners Who Run at a Loss

I'd agree with that one, Rome. Although it seems like there's a difference between what I'm thinking of as a "watchdog" who snatches up the anti-profiteer's goods to resell at the fair (local)market value, and someone who is trying to jack up prices unreasonably.

We actually had a similar situation on Papaya in recent months, where someone would periodocally hoard every unit of a particular ship supply (SCB, MCB etc. etc.) and then release it back onto the market at a pretty substantial markup. *That* is definitely not okay with me, and DP contemplated for some time how to proceed with this individual.

After several warnings, we dealt with him pretty severely and ran him off the island.
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Briggs Says, "Dr. Hag is bringing the Prescription for pain!"
[Jun 28, 2006 1:15:35 PM] Show Printable Version of Post        Send Private Message [Link]  Go to top 
Rick9109

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Re: Stall Owners Who Run at a Loss

 
 
These watchdogs almost never stop at just stopping the unprofitable stalls. They start moving on to "not profitable enough" and then on to to the point where "you can't sell any rum on your island three arches away because even though you make a lot of money selling it and pay really nice labor wages, we have to charge more in diamond so we're going to buy out your massive stock of rum every single day so you have to raise prices if you want your citizens to actually have rum"


Uhm... but at that point, so what? If I could make rum for a cost of 40 ppu and sell it dockside at 55 ppu and have someone buy 500 units a day to sail to another arch where they sell it at 60 ppu, who am I to stop them from giving me 7500 per day in profit?

Or, more to the point, it seems to me that that problem is largely self-limiting.

(Clarifying a bit on self-limiting: Note that the savvy stall-keeper will raise his prices until they are just -at- the point the 'watchdog' will keep buying, or just one poe -above- that point, and either maximize income from the watchdog or be the lowest price that sells to 'real' customers. My hope would be that out of the assorted distilling stalls at least a couple would have managers-with-a-clue.)



I don't care about my profit, I have enough money. I want my island to have rum at an affordable price so that people sail from it cheaply and I don't want to have to babysit a stall eight hours a day to fight people who are waging economic war on us. Why should my entire island be subject to a price point of people who don't go to my island or get comoddities in my arch or really have anything to do with my flag? We shouldn't have to +1 or equal Diamond when it doesn't cost us what it costs to make rum in diamond. Embargos don't work, they just start sailing at a different time if you find them and hunt them, and they can buy your rum faster than you can make it no matter how much you make, even if you save stock for a month.

I really wish there was some realistic way to set teriffs or things of that nature.
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Rome
Pirates of the Damned, Crimson Tide.
I don't care what it did to them, the game's been good to me.
[Jun 28, 2006 1:27:42 PM] Show Printable Version of Post        Send Private Message    rick9109    cactusrome [Link]  Go to top 
sweetnessc

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Re: Stall Owners Who Run at a Loss

 
Why should my entire island be subject to a price point of people who don't go to my island or get comoddities in my arch or really have anything to do with my flag?


Because your island is in the ocean? If you don't want to play with other players there is always the single player game. Or I hear Ice is pretty quiet!
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My friends, love is better than anger. Hope is better than fear. Optimism is better than despair. So let us be loving, hopeful and optimistic. And we'll change the world. ~ Jack Layton

Sublime is shame.
[Jun 28, 2006 1:32:33 PM] Show Printable Version of Post        Send Private Message [Link]  Go to top 
quiglin

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Re: Stall Owners Who Run at a Loss

Rome wrote: 
I really wish there was some realistic way to set teriffs or things of that nature.


Quiglin, 4 posts above that wrote: 
I want tariffs


Well, I have to admit that I never thought I'd find Rome and I on the same side of the fence, but seriously, it's time to give the governors a little power over their island.
[Jun 28, 2006 1:38:53 PM] Show Printable Version of Post        Send Private Message    http://www.quiglin.com    bquiglin    bquiglin [Link]  Go to top 
Kurisutofaa

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Re: Stall Owners Who Run at a Loss

 
fight people who are waging economic war on us


Uh.... are they really watchdog price evangelists waging economic war out of some twisted altruism, or are they, y'know, profiteering merchants that see a price difference worth making the sail for?

I mean, when the difference between here and there is only a couple of poe, it may not be worth bothering to sail it, but if you hit a ten-poe gap or so you're looking at a motivating profit margin on a 55-65 poe item. The only way to keep your rum local then is to price it high enough that it isn't worth sailing interarch because there'll always be someone making the runs. Especially if they're already at your bid-market for something else to run and have surplus cash to sweeten their profit.

That's not any kind of 'economic war', that's market forces.

(Also, if tariffs are implemented, there should be a way to evade tariffs so that we can smuggle... mwahaha!)
[Jun 28, 2006 1:49:20 PM] Show Printable Version of Post        Send Private Message [Link]  Go to top 
quiglin

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Re: Stall Owners Who Run at a Loss

 
(Also, if tariffs are implemented, there should be a way to evade tariffs so that we can smuggle... mwahaha!)


I'm all for smuggling, as long as it's either a) difficult for you or b) there is a way I can slow you down if I want.
[Jun 28, 2006 2:05:11 PM] Show Printable Version of Post        Send Private Message    http://www.quiglin.com    bquiglin    bquiglin [Link]  Go to top 
SeattleBrian

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Re: Stall Owners Who Run at a Loss

gov's have enough power. I've had many people accuse me of selling under cost. But I don't, I just don't buy Weld when it costs 100 poe, I buy it <70 and buy lots. I actually make 50%-75% profit on everything and I'm still the cheapest on the island. I'm all for gov's controlling their island (what buildings go up, how much tax is), but not for gov's controlling me or how I run my stall.
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quiglin

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Re: Stall Owners Who Run at a Loss

SeattleBrian wrote: 
gov's have enough power.


What about a governor like me? I was given the island with the specific point of protecting the island and its merchants. I will not place any more buildings or raise taxes. How am I supposed to protect my merchants from these individuals mentioned in the OP? The economy of the island should be the responsibility of the governor, but currently, it cannot be, due to lack of control.
[Jun 28, 2006 2:33:10 PM] Show Printable Version of Post        Send Private Message    http://www.quiglin.com    bquiglin    bquiglin [Link]  Go to top 
TheSeahag

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Re: Stall Owners Who Run at a Loss

 
I've had many people accuse me of selling under cost. But I don't, I just don't buy Weld when it costs 100 poe, I buy it <70 and buy lots.


Perhaps whoever did your numbers didn't assume lower buy prices. Entering conservative figures makes it very easy to figure out who is booching and who is not.

 
I actually make 50%-75% profit on everything


I'd be astonished if that figure is correct. If so, you can expect me to be your new neighbor.

 
I'm all for gov's controlling their island (what buildings go up, how much tax is), but not for gov's controlling me or how I run my stall.


This is why most Governors take a laizzes-faire approach to stall owners. However your right to swing your fist ends where someone else's nose begins.

If a stall owner has bolloxed the management puzzle badly enough, it can potentially cause problems. So, I think most legit businessmen & businesswomen would probably appreciate someone watching out for their best interests.
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Mlik

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Re: Stall Owners Who Run at a Loss

Embargo the person's flag, the flags of their managers, their allies and hearties and get the governor's flag and friends to PVP them, their crew, flag, allies, and hearties?

I like in-game solutions, especially when it involves making people do stuff. You can even dress it up with some role playing.
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Chavez67

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Re: Stall Owners Who Run at a Loss

lol @ this thread.




First rule of free market capitalism:

Something is worth what someone else will pay for it. That?s the definition of worth.

If someone's willing to pay 60 for the rum at Xi, then it's worth 60 to them, and you guys are no different than everyone else selling below the margin. "Trying to keep prices low" was the same altruistic excuse the anti-Zarhirra Newb Brigade used when they posted bloody pictures of her portrait on their website.

FYI: A tariff would apply to all dockside buy prices, meaning it'd be worthless as a tool to keep dockside buy prices low. Unless it was a selective tariff, that is.

There used to be some interesting ideas on turning embargos into selective tariffs over in GD.

If someone's selling below the margins, you're supposed to buy them out. There's no reason governors need more powers when anybody can just buy their products and resell them.
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I did it.
clarify
It was me.

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[Edit 1 times, last edit by Chavez67 at Jun 28, 2006 2:59:33 PM]
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Cocchinelle

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Re: Stall Owners Who Run at a Loss

Sagacious wrote: 
People like them belong on Coblat - where numerous clueless players open stalls...


Aww, isn't that cute? Uninformed forum newbie. In case you didn't know, clueless players were opening unprofitable stalls on Midnight ever since stalls were introduced.

This doesn't happen on just sub oceans either. My boyfriend and I made a lot of our early profit on Sage buying and reselling from clueless stall owners.
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[Jun 28, 2006 3:13:53 PM] Show Printable Version of Post        Send Private Message [Link]  Go to top 
quiglin

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Re: Stall Owners Who Run at a Loss

Chavo wrote: 

FYI: A tariff would apply to all dockside buy prices, meaning it'd be worthless as a tool to keep dockside buy prices low. Unless it was a selective tariff, that is.


Is this directed to me or the group? I never said I wanted tariffs to keep dockside prices low. I only agreed with Rome up to the word tariffs.

The 67 wrote: 
There used to be some interesting ideas on turning embargos into selective tariffs over in GD.


I read those ideas, and while cute, I didn't see the practicality in them.
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[Edit 1 times, last edit by quiglin at Jun 28, 2006 3:16:42 PM]
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tarajayne

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Re: Stall Owners Who Run at a Loss

I have a few things to throw in. I have 4 stalls in total in the emerald and opal archs. While I don't pay particular attention to my profit margin in my tailor/weavery (because weavery is in existence purely to supply my tailor), the profits at my Apoth and Furnisher are basically enough to pay the rent each week. Therefore, no I don't make a profit. But, I have to keep the prices that low to sell anything.

The reason I dont care that much about my tailor profits is because I'd never get rid of it no matter what. My order prices are comparable to the other island prices and I make a 50% profit buying and selling things from my rack.

To me running the shops are more about fun and getting my own stuff at good prices than anything else ;)

Off topic but since a lot of shop owners are here... how many people do an employee discount system? I currently do flag discount but am considering changing to employee discount because of my endless queue's these days. Have you been successful getting more workers with this incentive and is it more trouble than it's worth to keep track?
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[Jun 28, 2006 3:39:45 PM] Show Printable Version of Post        Send Private Message [Link]  Go to top 
Chavez67

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Re: Stall Owners Who Run at a Loss

The fyi was to everyone, not you, sir. I know what you'd use tariff's for. ;)

 
I read those ideas, and while cute, I didn't see the practicality in them.


They were the only really good way to do what Rome's wanting to do with rum. If you can make everything cheap on your island, you can rig it so your friends can buy it cheap, but your enemies can't buy it for resale elsewhere.

...at least I think that's what Rome is trying to do. Feel free to correct me if I'm wrong, sir. I have a habit of misinterpreting things of late.
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I did it.
clarify
It was me.

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Sagacious

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Re: Stall Owners Who Run at a Loss

 

Aww, isn't that cute? An informed forum expert. In case anyone else didn't know, clueless players were opening unprofitable stalls on Midnight ever since stalls were introduced.

This doesn't happen on just sub oceans either. My boyfriend and I made a lot of our early profit on Sage buying and reselling from clueless stall owners.

Of course it happens on other oceans, but on cobalt it happens far more often.
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ponytailguy

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Re: Stall Owners Who Run at a Loss

But it isn't inherently self-limiting.

Look at the airline industry. Quite literally once a month, an upstart discount airline opens in one part of the US or another. Often they'll make next to no profit, if they're making a profit at all. But because they have low overhead, cheaper staffing (more inexperienced people and weaker unions, if they're unionised at all), and so on, they can make these razor-thin profits with cheaper ticket prices than the "Legacy" airlines.

They go bankrupt quite often, too. But since new airline turnover is so rapid, someone else just starts up afterwards, the prices stay depressed, and the entire airline industry is slowly bankrupting itself as a result. (You think fares have gone up while service declines? You're halfway right! Rising gas and staffing costs, as well as good old inflation, take away much more than the fare increases ever bring in. So service gets cut, and maintenance gets cut, and companies either need million-dollar government donations, or they go bankrupt.) There are airplanes that have been in service for 20 years, yet have never been owned by a company that was in business longer than eight months.

Ditto for stallkeeping. Sure, individual cases of bad stallkeepers are self-limiting. But turnover's so high that another idiot just sets up shop and the prices keep going down.

(And I say this as someone who keeps sloops all over Midnight to buy from idiots. Often you can resell it back to them at a profit after sitting on it for a few days.)
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[Edit 2 times, last edit by ponytailguy at Jun 28, 2006 4:17:49 PM]
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JTheBear

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Re: Stall Owners Who Run at a Loss

 
how many people do an employee discount system? I currently do flag discount but am considering changing to employee discount because of my endless queue's these days. Have you been successful getting more workers with this incentive and is it more trouble than it's worth to keep track?


Reesyann does one at her tailor stall (which I manage) and it seems to keep the queue moving... you have to have been employed there for 2 weeks to qualify, keeping people from signing on to get the discount and then quitting...
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[Edit 1 times, last edit by JTheBear at Jun 28, 2006 4:17:07 PM]
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SeattleBrian

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Re: Stall Owners Who Run at a Loss

The simple solution is to buy the extremely low priced stall owners out of their finished products and sell them yourself. They are limited as to how much they can produce by their labor restrictions. Talk to the other merchants on the island to help out as well, form a merchant society that agrees to not sell green paint for less than X, and to buy out any stall that tries to sell for less. If the cheap stall can resupply before you can sell, then you have too much supply on your island and not enough demand, thus your island is going to have lower prices. Until some stalls close and supply is decreased, or your govenor attracts more people to your island (through events and fun things) and increases demand prices will still be deflated. There are many ways to take care of this issue if you are willing to actually get in there and work for your poe.
More gov powers over individual pirates does not need to happen. And will only lead to abuse, blackmail, and nastiness towards other players. The economy on midnight is surprisingly stable and does not need tinkering.
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TheSeahag

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Re: Stall Owners Who Run at a Loss

 
The simple solution is to buy the extremely low priced stall owners out of their finished products and sell them yourself.


I hadn't thought of that. Apparently neither had the first person who responded to this post.
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[Jun 28, 2006 4:57:13 PM] Show Printable Version of Post        Send Private Message [Link]  Go to top 
Sagacious

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Re: Stall Owners Who Run at a Loss

The reason that supposed solution doesn't work is these new stall owners have next to no employees - and so production of their products is rather sluggish. That is, if some bright spark hasn't already flooded the stall's order list already.
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[Jun 28, 2006 5:01:55 PM] Show Printable Version of Post        Send Private Message [Link]  Go to top 
IantheKorean

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Joined: Dec 29, 2004
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Re: Stall Owners Who Run at a Loss

Tangent solution: You can't start your own crew till you meet certain requirements on the duty puzzles. Why not set a similiar requirement for opening a stall? As far as I know, the only current requirement is a monetary one. I'm sure this wouldn't appeal to a lot of owners, but perhaps if you had to get your crafting skills up to narrow or whatever and maybe at least be providing sforce more information on them before they can buy a stall so they aren't completely clueless and mucking up the economy.
[Jun 28, 2006 6:26:48 PM] Show Printable Version of Post        Send Private Message [Link]  Go to top 
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