Everything you ever wanted to know about business, part 1 [WGC]

Day 721, 10:01 Published in Canada Canada by Alias Vision
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Everything you need to know about business... and now don't need to ask! Was conceived as a primer for newer citizens who have spent some time reading and informing themselves. It can also serve as introduction to the business of running a company. Hopefully the work contains enough pieces of knowledge that it will at least interest veterans as well.

What type of company should I start? Which one is needed most?

We read this type of question all the time by citizens looking to launch themselves into the exciting realm of business. The answer is both simple and complex. The simplest answer is that every country and market suffers some form of oversupply and the business owners currently exploiting those markets will counsel against starting a new company that will only add to the competition. The next simplest answer is that whichever company you can run successfully is the one you should start and the one needed most. Both those contradictory answers are true.

The more complex answer is that you need to understand the markets you are entering, you need to do your homework and you need a long term plan from the start. Success is possible in any market provided you have the time to put in the required effort.

Resources101.

We are all aware that there are twelve resources available distributed into the three categories of land, manufacturing and construction. What every new potential owner needs to understand is the dynamics operating those resources.

Diamonds and gifts.

Diamond is the raw material required for producing gifts. To understand the value of diamonds, you need to understand the usage of gifts. Gifts are meant to give immediate boosts to wellness. This method is often used by younger citizens to maintain or increase their wellness (especially during peace time) in order to more quickly become productive members of the workforce. However an even more common usage is during war as a strategic resource. By gifting soldiers, they can put in potentially many more attacks. This would be especially effective for higher ranked 'tanks' trying to conquer or secure a region.

Because gifts are a consumable good, there is a constant demand. The state of almost constant war of the past months insures that this is a dynamic industry. The industry, however, is limited by wealth. The gift and diamond resources would fall in the luxury category; meaning your citizen can survive and prosper without them. When citizens or governments have extra funds, they may invest in the purchase of these goods but when the belt tightens, so too will expenditures of gifts (and therefore diamonds).

Grains and food.

Grain is the raw material required for producing food. Food is the only critical manufactured good in the sense that you are required to eat. A citizen that starves is one that will eventually die. There is a loophole of sorts which allows a citizen to forego food by fighting in a war and healing in a hospital instead. However, if your goal is to live, work and fight at peak efficiency, then you must eat.

The basic rule of thumb is that every living citizen will require one food per day. For a nation like the US for example, that is a potential market of 20,000+ units a day. There is a lot of room in the grain/food industry but there are also a lot of players. The grain sector in particular has to take into account that it is the raw material with the most high production regions worldwide. Translation, more owners in more countries worldwide compete for the food industry’s attention. Food wise, every nation tends to have a healthy production, therefore you must be sure you can compete locally if you are to thrive there.

Iron and weapons.

Iron is the raw resource required for producing weapons. Iron is often considered the single most prized resource in the world. Wars are fought constantly to conquer or secure iron regions. Although not required to participate in a war, weapons offer a distinct advantage in a fight. Every organized military supplies their regular troops with weapons and every citizen is encouraged by their government to arm themselves.

We have just left a golden age of sorts when it came to iron and weapons. The massive scale of the global conflict that originated in North America saw the multiplication of iron mines and weapons companies. Because the demand was so important, almost all of these were profitable at first. However with stability and then peace in certain regions, most economies collapsed. With it, the demand for iron and weapons changed. These two markets will always be entirely depended on war. The more chaotic the geopolitical climate, the better these industries will do. The war also left an overproduction that will take a long time to be absorbed. Many companies lie dormant, just waiting for more conflict to reopen. A challenging sector but one that can generate a lot of wealth very quickly.

Oil and moving tickets.

Oil is the raw material required for producing moving tickets. Moving tickets are primarily used in two ways. The first is to allow movement for civilian use, most commonly for a foreign job or to run for Congress. As such the market here is modest. The second use, and the one that helps owners the most, is the increasing organization of national armies and paramilitary forces with a mobile corp. Soldiers will move where the fights are and then require to move back home. So once again war provides the greatest stimulus.

Moving tickets are a strange sector. Because of current mechanics, there is never any use in purchasing something other than Q1 tickets. This dearth of higher quality tickets also affects the oil industry as the potential market is also reduced. Because of these limitations however, oil and moving tickets companies are the smallest in number. With inactivity comes opportunity. However a really dynamic group of owners can more easily saturate the market and put newer companies out of business.

Wood, housing, hospital and defence systems.

Last but not least, wood is the raw material required for producing houses, hospitals and defence systems. Wood is the second most common high productivity region after grains, it is also the only raw material required in multiple sectors. Houses, hospitals and defence systems are the only non-consumable good. They can be destroyed by war or disappear with the death of citizens but they do not otherwise require replacement or repair. Additionally the construction sector is often the one that has the biggest challenge in attracting and retaining workers. The small pool of qualified workers means wage wars happen from time to time that will dictate which company lives and which goes under.

With hospitals and defence systems there is a second important consideration. These are the two sectors that governments will take an active role in. Also governments tend to only want Q4 and Q5 infrastructure. Some lower quality installation will be purchased and installed but it is not as common. Private investment into this sector is massive, almost prohibitively so. The housing sector is a bit more competitive and accessible however it runs into the same problem which is that we are dealing with a non-consumable good. So aggressive, well run companies with good contacts will do very well but the casual investor will find all these industries difficult.

Important production rule: all things being equal, one fully staffed raw material company will always produce more resources than necessary for one fully staffed manufacturing company. Therefore raw materials experience regular periods of overstock and prices drop.

Another common question is, "Which type of company is easiest to manage?" Again the answer here is both simple and complex. By their very nature, land companies are the easiest to manage because they do not require the administration of both payroll and stock. However, land companies tend to be the most popular and therefore the market shares for each is reduced. Reduced market shares means less profits which require more work to run successfully. In essence, if there were any guarantees everyone would jump at that opportunity therefore rendering it moot. That being said, land companies are still the most straightforward to run and construction companies the most challenging.

The nature of each market will change as players enter and leave it. An agile businessman will be able to take the opportunities that present themselves and increase his wealth.

Please continue reading with part 2 that will deal with workforce issues, quality questions and market forces.

*The above was an article from a Member Paper of the Writers' Guild of Canada*