Food Price Standardization Preposal
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by K1dz3r0
Some of you may already know me, but for those of you who don’t, I’m not surprised. I’m a returning eSA member who stopped playing a couple years back, forgot the email he used to make his original account, and has made a fresh start. After only being here a few days, I noticed that the Food pricing is inconsistent between Qualities, and developed some thoughts on the matter.
I believe, personally, that prices for Food should be scalar, with the price difference based on the difference in energy restoration. I will call this scalar pricing theory, for ease of reference, “worth-based pricing.”
Here is the current asking price for any Quality of food, taking only the first 5 listed prices into account, not including those listed by me. This does not include unreasonably high prices (those over 3.00 eZAR).
Chart 1:
Q1: 0.14-0.30/u
Q2: 0.07-1.25/u
Q3: 0.08-0.91/u
Q4: 0.59-0.90/u
Q5: 0.50-0.60/u
Q6: 0.79-1.09/u
Q7: 1.40-1.50/u
After analyzing these numbers, I found a trend line, but the numbers around it are remarkably out of synch. Assuming that Q1 and Q7 foods are priced fairly, I drew up a chart. Here is how Food Qualities should be priced in balanced supply-demand “worth-based” market, with regard to current Q1, Q4, Q6, and Q7 prices:
Chart 2:
Q1: 0.15/u
Q2: 0.30/u
Q3: 0.45/u
Q4: 0.60/u
Q5: 0.75/u
Q6: 0.90/u
Q7: 1.50/u
Those of you who think this is a little steep to pay for food, I have prepared a similarly scaled chart with you in mind, based on current Q2 and Q3 prices. It applies the same scalar principles, but assumes the natural price of Food is lower. MUCH lower, in fact. I want food suppliers to take a look at this one, too:
Chart 3:
Q1: 0.03/u
Q2: 0.06/u
Q3: 0.09/u
Q4: 0.12/u
Q5: 0.15/u
Q6: 0.18/u
Q7: 0.30/u
This is an extremely low price arrangement, and could quite possibly result in lightning market buyouts, followed by resales at rates likely to be higher than the ones in Chart 2. This would mean a combination of bloated inventories and empty wallets for days or weeks afterward.
This can be applied to any Q1 value, monkeyed around with for hours (which I did), and manipulated endlessly with no effect on reality.
If you have read all of this, and ONLY if you have read all of this, I want you to post, politely, what Q1 value you think this should be set by and why, in the comments below. I want you to keep in mind both the Supply and Demand curves on this one, let’s not do our economy homework halfway.
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Comments
Nice article. I have feeling the main issue is an over abundance of mid level food companies. For instance, I had 4 or 5 q3 weapons companies for while. I made it that far and decided it wasn't worth the investment to upgrade them farther. So, I typically priced my stuff to move quickly in order to get my zar and buy what I needed.
I agree. The majority of companies should be Q1, and they should become rarer from there, with the exception of Q7, which should be about as abundant as Q1, but still priced higher than Q6. True for both Food and Weapons, yes yes.
If you had to take actual production cost for food (by employing workers and buying FRM) as the basis for determining what prices should be (based on a realistic price for FRM and a salary of 20 ZAR for workers), prices should be something like: Q1 - 0.28, Q2 - 0.37, Q3 - 0.46, Q4 - 0.55, Q5 - 0.64, Q6 - 0.73, and Q7 - 2.00
20 ZAR? I get paid 16! Also, every food company owner can Manage to produce some of the Food they create, and I'm not sure about everyone else, but I have 3 personal FRM plants that I started with at Lv 1, no cost. Granted, I purchased an additional Food Factory, but I bought my additional FRM at a price of 0.03 ZAR/u. That's market price, as I see it right now. Taking that into account, and even assuming the pay rate IS 20 ZAR/day, the Q1 cost is closer to 0.11 ZAR.
The BIG mistake made is basing prices on the presumption of almost no cost for self-produced products. This totally skews the market and makes it impossible for anyone buying raw materials for production to compete. Whether goods are self-produced or not, the same cost basis should be used to determine pricing when selling on the market. This applies to RM, food, or weapons. You have to standardize costs before you can standardize prices.
P.S. The production requirement of WRM and FRM is exactly the same, but FRM sells on the market for less than half the price of WRM - another inconsistency that skews the market. I based my calculations on a realistic market price for FRM of 0.07
Voted. Great article! Join the discussion on the forum!
Voted. Great article!
wrm has real demand due to q7 weapons's requirement of 200 wrm per unit. q7 food... not so much.
Frankly, you should cost food on 0.01 per frm and thus 0.10 per Q level per unit (0.11 including VAT). Any lower and you are subsidising it with manager work. Its why I favour Chart 2 (a little fat to recoup buying the company).
Frankly, both FRM and WRM should be costed according to how much it costs to produce when paying a salary to produce it, and not according to the cost of manager production. Manager production has got nothing to do with the economics of the market.
Voted
The real issue here (as has been pointed out by other people) is that a structure like this doesn't take into account manager working. For instance I personally produce 6000 x Q2 Food per day with no expenses. Now I can sell that at 0.01 per unit and make a profit (the lowest I've ever had to sell was 0.02 per unit and that made me very very sad).
So the second you start trying to raise the average cost of food, someone like me will notice that there is a profit to be made selling in eSA...
The cost of manager work is not zero. At a minimum its the cost of 10 food -- realistically its the cost of a First Aid Kit at 0.5G (195 ZAR) since it costs you a food fight. But people see their 240 food fights as "free" or don't value gains in the war module.
The vast majority of production IS manager work production. To ignore it is to ignore the core of the economy. Employment for manufacturing is only viable for Q7 companies -- and even that is thumped by commune work.
Guys, we are not in a communist country.
there are sector and types of products which are making money, it is your problem to find them. If all prices where according costs and the market in equilibrium, there will be no profit to make in the economic module.
Calculate your costs, see your different opportunities and invest accordingly. The dumber people are, the more money you will make.