RM companies and economic math
The Libertine
I have concluded that from a purely economic standpoint (ie not caring about fighting) Q2 and Q1 RM companies are the most profitable RM companies to own. The only difference between the two is that with Q2s you need less buildings, but both cost exactly the same for the same output.
As some people may have seen, I recently shouted about my plan to build Q1 Iron Mines until I can build no more. I may be switching to Q2 WRM, but the thrust of the plan still holds. What follows is the math backing that theory up.
And yes, this means I (or anyone copying this method) would be doing less damage. Part of the reason I'm doing this is sheer boredom, but the main reason is that I'm beginning to get to the point where my military rank (ie Field Marshall, Supreme Marshall, God o' War, etc) will not advance to the next level until months into the future. Rather than click 200 times a day to rank up months down the line, I plan to build an economic conglomerate nearly unrivaled around the world. 200 buildings (not including storage) is essentially the goal.
All calculation are based on self-production and no workers. It is currently not profitable to employ workers at any Q of RM companies at job market wages (wages would have to drop below about $110 to hit the break even point for Q5 RM companies).
First: Basic Numbers (based on current 1G = 880 USD peg)
Q1 cost: 500 USD
Q1 cost (w/land): 1,500 USD
Q1 base output: 35 RM
Q2 cost: 2,000 USD
Q2 cost (w/land): 3,000 USD
Q2 base output: 70 RM
Q3 cost: 10G = 8,800 USD
Q3 cost (w/land): 9,800 USD
Q3 base output: 125 RM
Q4 cost: 7,500 USD
Q4 cost (w/land): 8,500 USD
Q4 base output: 175 RM
Q5 cost: 35G = 30,800 USD
Q5 cost (w/land): 31,800 USD
Q5 base output: 250 RM
Second: Cost (w/land) to output ratio
Q1: 42.85 USD per 1 RM
Q2: 42.85 USD per 1 RM
Q3: 78.40 USD per 1 RM
Q4: 48.57 USD per 1 RM
Q5: 127.2 USD per 1 RM
So the rank of best profit to least, using only self-production is:
Q1/Q2
Q4
Q3
Q5
Another way to conceptualize this is that if you purchase one Q5 RM company you are going to end up with only 1/3 as much RM as if you has used that money on Q1 or Q2 (or a mix) RM companies. One Q5 RM company will cost about 31,800 USD. It will get you 250 RM (base) per day. 31,800 USD will also buy 10 Q2 RM companies and 1 Q1 RM company. This will give you 735 RM (base) per day.
Why does it matter?
Well, if you own Q5 companies, it matters a lot.
For every Q5 tank or food worker/self-work you need 2 Q5 RM workers/self-works. So if you have one Q5 tank company with 5 workers plus your own self-work, you would need need two fully employed Q5 WRM companies to supply enough RM for the tank workers (ignoring the fact that it is cheaper to purchase RM instead of hire). For the same cost as two Q5 WRM companies you could have 21 Q2 RM companies. Working these companies each day would (roughly) provide enough RM for yourself plus 2 workers. No (well, negligible) RM purchasing would be required.
What if you have no Q5 tank/food company and are selling for profit?
Here are the (rough) ROI timelines of each Q RM company (amount of days it will take for you to recoup your investment in the company in full).
Each measurement is based on holding three resource bonus regions related to the RM, and @ a 0.30 USD selling price.
Q1: 1,500 USD / (56 RM * 0.30) = 90 days
Q2: 3,000 USD / (112 RM * 0.30) = 90 days
Q3: 9,800 USD / (200 RM * 0.30) = 164 days
Q4: 8,500 USD / (280 RM * 0.30) = 102 days
Q5: 31,800 USD / (400 RM * 0.30) = 265 days
So, no matter what, it will take a minimum of three months of working every day to pay back an investment made in the best RM companies: Q1 and Q2. Past that point you are making pure profit.
Also, you'll get a ton of experience points if you have more companies, if you care about that kind of thing. For each fight (10 wellness lost) you get 1 exp, but for every company self-work (10 wellness lost) you get 2 exp. So there's that.
The Ultimate Test
For the most part, I have been ignoring the relative cost of RMs off the market compared to opening RM companies. Time to stop ignoring that and conduct THE ULTIMATE TEST. Now, on an infinite timeline it is obvious that purchasing RM companies will be cheaper than purchasing RMs off the market. However, there are several ways for us to find the break even point or figure out whether it makes more sense to purchase companies now or later. Let's get to the numbers:
Everything that follows is based on WRM and tanks and based on current market prices of 0.30 per WRM and $32 per Q5 tank (a take home of 29.91 USD per tank based on current taxes) and on a wage of $155 per day.
It assumes:
- "You" own one fully employed Q5 tank company.
- The Q5 tank company is fully paid for (aka not treated as an investment).
- And it assumes that you will be fighting 80 fights a day with a Q5 tank (your self-work worth of tanks; 16 tanks)
- It is based on 3 resource bonuses.
Base
5 workers plus self for Q5 tank company, WRM purchased from market , no investments made along the way.
Tanks produced per day: 6 * 16 = 96 tanks
RM neede
😛4,800 WRM
RM cost per day: 1,440 USD
Tanks left after battle: 80 tanks
Tank sell value: 80 * 29.91 = 2,392.8 USD
Wage cost: 5 * 155 USD = 775 USD
Personal wage (from working at another job market company): 155 USD
Profit on day 1: 2,392.8 - 1,440 - 775 + 155 = 332 USD
Profit in 30 days: 9,960 USD
Profit in 60 days: 19,920 USD
Profit in 90 days: 29,880 USD
Profit in 120 days: 39,840 USD
Profit in 150 days: 49,800 USD
Profit in 180 days: 59,760 USD
Minimal Initial Investment
Enough initial Q2 WRM companies to cover yourself but not the workers.
Tanks produced per day: 6 * 16 = 96 tanks
Initial RM company investment: 22,500 USD (7 Q2 WRM + 1 Q1 WRM factories)
Extra WRM per day (self-produced RM minus self-work RM needed): 840 = 800 = 40 WRM
Market RM neede
😛4,800 WRM - 800 - 40 = 3,960 WRM
RM cost per day: 1,188 USD
Tanks left after battle: 80 tanks
Tank sell value: 80 * 29.91 = 2,392.8 USD
Wage cost: 5 * 155 USD = 775 USD
Personal wage (from working at another job market company): 155 USD
Revenue on day 1: 2,392.8 - 1,188 - 775 + 155 = 584.8 USD
Profit on day 1 (revenue minus investment): 584.8 USD - 22,500 USD = -21,915.2
Profit in 30 days: -4,956 USD
Profit in 60 days: 12,588 USD
Profit in 90 days: 30,132 USD
Profit in 120 days: 47,676 USD
Profit in 150 days: 65,220 USD
Profit in 180 days: 82,764 USD
**Right around 90 days, the model above becomes more profitable than the "all RM purchase" model**
Maximum Initial Investment
Enough initial Q2 WRM companies to cover everyone.
Tanks produced per day: 6 * 16 = 96 tanks
RM neede
😛4,800 WRM
Initial RM company investment: 129,000 USD (43 Q2 WRM companies)
RM cost per day: 0 USD
RM left over: 16 WRM
RM left over value: 4.8 USD
Tanks left after battle: 80 tanks
Tank sell value: 80 * 29.91 = 2,392.8 USD
Wage cost: 5 * 155 USD = 775 USD
Personal wage (from working at another job market company): 155 USD
Revenue on day 1: 2,392.8 + 4.8 - 775 + 155 = 1,777.6 USD
Profit on day 1 (revenue minus investment): 1,777.6 USD - 129,000 USD = -127222.4
Profit in 30 days: -75,672 USD
Profit in 60 days: -22,344 USD
Profit in 90 days: 30,984 USD
Profit in 120 days: 84,312 USD
Profit in 150 days: 137,640 USD
Profit in 180 days: 190,968 USD
**The break even is sometime between day 60 and day 90. By day 120 (4 months) you will make more profit than in 180 days of the second model and 250 days of the first model**
Conclusions
1) Well, first off, I didn't really run any ultimate test. Ultimate tests would have included some mid-test investments. But, to be honest, that sort of modelling isn't really needed. The simple fact of the matter is that if you plan to play eRep for a long time and don't care much about fighting less and want to build an empire then you should reinvest every chunk of 1,500 USD or 3,000 USD you take in to immediately (well, keep maybe a 5k or 10k USD buffer in you bank account at all times) make Q1 or Q2 RM companies.
2) I was going to conclude more, but the above point basically summed everything up.
3) The difference between Q2 and Q1 companies is different short term and long term. In the short term, Q1s are better for experience point gains, although you'll lose more fights at first. In the long term, Q2s are better if you plan to expand to full daily working capacity (ie 200+ buildings). Down the line you can dissolve Q1s for $250 and replace them with Q2s if you ever get close to full capacity.
4) if ur havin' money problems i feel bad for you son. i got 99 buildings but a Q3 ain't one. hit me
5) It is worth noting that in smaller countries it is more likely to be possible to turn a profit employing workers at Q5 RM companies. I believe it was profitable during my stay in eIsrael. In the bigger countries this is not the case, mostly because of RM market saturation that drives down prices.
6) Lastly, it is important to always keep a buffer of both RMs and cash (and even gold). Different "limited time" bonuses can and will change the economic landscape every few weeks or months. It is important to be prepared to capitalize on these changes and not be living day-to-day by reinvesting all of you capital as it comes in. If you have the storage ability, an RM buffer of anywhere from 10k to 20k is smart (in case you forget to re-purchase RMs for a day or two, for example). $5,000 or $10,000 USD is a good buffer level on the cash side. Some will prefer a much larger buffer. Some can get away with much smaller. Always be prepared!
7) I ♥ jerseygirldani
Race you to 200 factories,
CRoy
Comments
I stopped reading, but Q4 is better because you are getting more then double the production of a Q2. 2 Q2 doesn't even equal 1 Q4. So basically you are expending 20 health to get less production.
All Q4 is the best.
This is a guide for making money efficiently. I said from the beginning that it ignores the effect of losing fights.
slutsky
you are crazy and i respect that (:
what about the extra food you are giving to work Q1 companies instead of q2 or q4 ? have you taken that in mind ?
great article i didn't know that you get 2 xp for work xD,
tnx for new idea
v
nice study
very nice idea
it is crazy but high profitable
yust one question for you
so you spend 2400 wellnes (not counting energy bars) on work and you gain max profit
where will you spend money?
You can dissolve raw companies btw. (exept for those 3 free grain farms)
also with so many rm companies you 'll get a lot of Toolboxes !!!
interesting read!
voted
@malosanmaka Thanks, I'll make that change
@RE-M-PELLOS YES YES YES. It's very true. 😃
So since you can dissolve RM companies, if you have Q5 RM factories with no workers, it is more profitable to dissolve them for half of your gold back (17.5G), convert that gold to USD, then purchase Q1/Q2 factories with the USD. The Q5 factory will bring in 250 RM base. The Q1s or Q2s (doesn't matter which) that you will be able to afford with the USD will bring in 350 RM base.
Yum, science! Nice job.
Would be great to see a similarly detailed analysis on maximizing production for militia support.
I've heard that rotating workers seems to be the latest thing, but was curious if anyone has run the numbers on less cumbersome methods. in other words, what maximizes production in a commune-style operation when you have a steady workforce?
One more thing: if you can purchase 5 Q5 RM factories and use a Toolbox (double RMs produced) on them **every single day** then they become a better investment than a Q3 RM company and are much less useless. The ROI period would be cut in half, shortened to about 130 days. But you would need a giant farm of Q1 and Q2 companies to accumulate enough parts to use a toolbox once each day.
So 5 Q5s, with a toolbox each day, is probably the ultimate long term (4+ months) investment, if you already have an RM conglomerate put together. If you cannot use a toolbox each day then it is still an 8+ month investment like previously laid out in the article.
I have tons of companies and I seldom / never work in more than one daily. I used to have at least 20 employees, now I have none. That's the new eRep economy.
you must add the food cost to the equaction, Q1 take up larger areas but it also cost twice as much in food per day then the Q2 does
it aint much if you just have about 10 of them but if you want to build hundreads it will cost alot
I assume that everyone can produce their own food each day. If you have enough money for 200 factories or a Q5 company then you have enough to set up a food self-supply system.
Good one. Voted hard
PQ - this is why commune compensation has been steadily rising. As we invest in plant, net productivity rises and both bonuses and dividends rise accordingly. 99 buildings is pretty awesome, but I don't see storage capacity included in these figures. With this kind of volume, investment in storage is necessary as well.
This is what I love about this game. People who will take the time to analyze it. Excellent article.
@SamSea Yes! Thanks for pointing that out. I ignored the storage aspect. It certainly needs to be addressed before beginning to build an RM conglomerate. I treated that as an assumption.
Seeing that the cost to output ratio with Q2 and Q4 is negigible and that Q4 uses less health for same production then Q4 is better in the medium to long term. Add to it the benefits of toolbox and Q4 is much ahead. Recent article by dSokre confirms this.
Analysis is great and detailed. Good to read such analytical articles
@Chandra Yes, with toolbox each day the Q4 becomes a much better investment than Q1s and Q2s. Only problem is that you need a LOT of RM companies to get enough for a toolkit each day!
The output ratio difference is NOT negligible. It is a small difference, but it is a significant (in the statistical sense of the word) one. And again, with Q1/Q2s you will be gaining more EXP, if that is a person's goal. If a person is more focused on doing war damage then Q4s are certainly a better option.
And everyone should have 5 Q4s (or Q5s, if you already have them) for using tool boxes on, regardless of the frequency of completing a toolbox. Doesn't make sense to use that on Q1s or Q2s.
Thanks for the comment!
Agree with The Libertine for the most part.
Toolbox impact had been ignored in the initial 90 day payback period calculation. BUT, one does not need 5 Q5 rm compnies to 'cash in'....3 (or 2 with 1 q4 RM co. added)are sufficient because one 'activates' the toolbox when they have only 2 q5 RM cos left to work on day one; on day 2 you work the same companies FIRST; with this method, one can maximize tool box output with only 2/3 Q5 RM cos.
Also, since ePlato has wiped out (with no compensation) our production 'GUru***** skills', fighting is the 'only way left to go'...assuming we have the resouces ('communes') to fight with.
Ah, very true about carrying over the toolbox.
I thought about it long long ago just because I thought I did not write new information that I do not know the truth that little bit of time just before I saw someone if 135 buildings, so watch out for what he can run the whole competition has huge profits
Only problem is say if gold went to 250 usd per gold. Your results would change dramatically
I don't understand why you want to do this. Why not just get enough Q4's for 2,400 wellness per day? Wouldn't be that expensive, actually.
@Syrup 1 Q4s is 1,000 USD more expensive than the equivalent RM return from multiple Q1/Q2s. I can see converting Q1s to Q4s months down the line once I get close to 2,400 wellness a day of working. But that is a long way away. Along the way I will probably convert some each week.
@Lexone Very true. Can't see that happening, but it is a valid point, and it is a reason that I suggest always keeping a buffer of currency to prepare for the unexpected!
Mind if I link to the article in my paper tonight?
Go for it Chae
I invest in Q4s, got 11 now.
Anyone selling ARS, AUD, BEF, FRF, GBP, SKK or THB on the CC/Gold side, please drop me a message and take part in a little survey! Thanks!
Interesting article. I agree with all your points about going for Q1/Q2s over Q4s to start but once you reach your company target it's time to move into Q4s (that's what I'm doing). If you go from Q1 to Q4 you're only adding 250 currency more to the cost but it's 1000 if you go from Q2. I think you'd still make that extra cost back more quickly through Q1/Q2s but I haven't done the math on that to confirm yet.
Great article!
I am curious about storage solutions. Can anybody tell me if there is a limit on how many storage facilities can be built? There must be some reason people pay for the larger facilities.
There is no such thing as a limit. I think the people who can affort a huge storage just prefer having one building on their "my land" page instead of 9 of them. When money doesn't matter.. ; )
Please don't convince people to open tons of Q1/Q2 companies!
This isn't FarmVille, they need the fights.
The little gain in return on investment isn't worth losing the food fight. Q4 is the way to go.
And about the exp-gain: Why should one care?
Well, it depends on how much time the respective player wants to invest. If he can manage to spend ~2k health per day, I think it's not a bad thing. Especially when people only fight with weapons for saving their bazookas, they fight less than they could if they would be fighting barehanded and can use the health for working.
And, yeah, XP are useless unless you want to be in the rankings, but I guess there are enough people who want it.
And even though I find this article interesting, I'd also prefer Q4. Because of course the Q1 or Q2 companies pay their money back faster, but in long term view, Q4 is the best choice if you're investing dollars.
I just wanted to say that I think you actually do have to take into account the market price of food, whether you produce your own or not. The reasoning is that every unit of food you consume is a unit of food that you could have sold on the market, so you are essentially consuming the market value of that food, regardless of where it came from. I have a feeling that in the LONG run, a Q5 would be ideal because of that, but that would only be if you assume to have an infinite amount of money to spend. The cost of food is probably negligible, so in a Q5 it would take a considerable amount of time for the reduced expenses to pay back the price, but it should be taken into consideration anyway. Working from your conclusion, Q2 would probably be best, as it would allow you to construct more, therefore making money faster and allowing you to reinvest it sooner.
It's simple.
-1500+35*Price
-3000+70*Price
-8500+175*Price
Plot it. ; )
Although it may provide greater income in the long run, getting your investment back sooner means that you can reinvest it sooner, which means that the reinvestment will pay back sooner. In essence, it's better to have the money now rather than later. Of course, that is an oversimplification. One would have to take into account the opportunity cost of making the reinvestments sooner rather than later.
meow