Routes and communication and other bits

[Grav_Moped]

I disagree in this point.

While it's true that most published ships are J-1/J-2, those are not, IMHO, representative of the commercial lines of the imperium, but adventurer's tramp ships and the like. There are many hints (and ITTR some more specific notes, but I cannot give you exact reference) that most of big level resource and passenger movements are by large corporations that have and use J-4, ships following the X-Boat routes.

I get that. I'm looking at it from a purely economic angle: Under LBB2, only J-1 ships can cover their costs at Cr1000/ton/jump until TL-15 where the Size W-Z drives come into play (especially the Z drives) -- everything else has to be subsidized or run spec cargo. Aside from that flat-rate cost issue, the cost per parsec-ton goes up rapidly above J-2 (though for 2-parsec increments, J-2 is a little cheaper per parsec-ton than J-1).

 

[McPerth]

I get that. I'm looking at it from a purely economic angle: Under LBB2, only J-1 ships can cover their costs at Cr1000/ton/jump until TL-15 where the Size W-Z drives come into play (especially the Z drives) -- everything else has to be subsidized or run spec cargo. Aside from that flat-rate cost issue, the cost per parsec-ton goes up rapidly above J-2 (though for 2-parsec increments, J-2 is a little cheaper per parsec-ton than J-1).

The economic points are:

1. to have the planets of choice. By having more jump, you may choose them better
2. being large corporations, they are not subjected to mortgage, aas they have money enough to pay it
3. according MT:SOM, those large companies take more money from speculation than from cargo/passenger service
4. they probably have some kind of subside by the Imperial authorities, as they are the "main railroads" (or "sealanes" of the Imperium (but, being on another league than players, this is not featured in the game background)

Probably there are more that I cannot think about just now., and see that point 1 is limites, as they must follow some lines, but they use to include those planets of choice. OTOH, point 2 is quite important, and point 3 is too, as serving established lines, their brockersin any port of call wouldbe among the best...

 

[infojunky]

I get that. I'm looking at it from a purely economic angle: Under LBB2, only J-1 ships can cover their costs at Cr1000/ton/jump until TL-15 where the Size W-Z drives come into play (especially the Z drives) -- everything else has to be subsidized or run spec cargo. Aside from that flat-rate cost issue, the cost per parsec-ton goes up rapidly above J-2 (though for 2-parsec increments, J-2 is a little cheaper per parsec-ton than J-1).

Hence the reason I started with a common ship on defined routes. A liner on a route will have local factors in every port on the route arraigning cargo and passenger traffic.

The other reason for J3 is a TL12 drive I.e. the stated average of the Imperium.

looking at the discussion around this topic there is a lot of play potential in the routes ideas.

 

[Grav_Moped]

The economic points are:

1. to have the planets of choice. By having more jump, you may choose them better
2. being large corporations, they are not subjected to mortgage, aas they have money enough to pay it
3. according MT:SOM, those large companies take more money from speculation than from cargo/passenger service
4. they probably have some kind of subside by the Imperial authorities, as they are the "main railroads" (or "sealanes" of the Imperium (but, being on another league than players, this is not featured in the game background)

Probably there are more that I cannot think about just now., and see that point 1 is limites, as they must follow some lines, but they use to include those planets of choice. OTOH, point 2 is quite important, and point 3 is too, as serving established lines, their brockersin any port of call wouldbe among the best...

1. Doesn't matter that much. Lower jump numbers just take more time to get there.
2. They're still concerned with costs. Opportunity cost of capital figures in here.
3. So the spec cargo goes by fast movers; the bulk cargo goes by the cheapest method.
4. Very likely.

 

[Spinward Flow]

1. to have the planets of choice. By having more jump, you may choose them better

1. Doesn't matter that much. Lower jump numbers just take more time to get there.

I disagree.
The simple example of the Collace/District 268/Spinward Marches Jump-3 opportunities are exceptionally compelling. You basically have an Industrial world with 2 Agriculture+Rich+Non-industrial worlds and 2 more Rich worlds within 3 parsecs of Collace and only 1 of those worlds is adjacent to Collace at a distance of 1 parsec. By literally not wasting time and overhead costs on the systems in between these extremely compatible (in a lucrative sense) markets, a Merchant Prince ought to be able to maximize their profits most handsomely, particularly through the REAL moneymaker ... speculative cargo. The Jump-3 drive on the Subsidized Merchant then enables a "maximum revenue density per unit time" opportunity through every jump, rather than getting stuck with a "just passing through" jump (or 2) before being able to buy/sell fill up your manifest again with passengers, cargo and speculative cargo again.

2. being large corporations, they are not subjected to mortgage, aas they have money enough to pay it

2. They're still concerned with costs. Opportunity cost of capital figures in here.

Not needing to pay the usury rates of bank financing (pay for 2.4 ships in order to own 1 ship) does amazing things for the profit margins of a wide variety of ship classes. Some that are marginal at best on bank financing can be wildly profitable either under subsidy or when paid off and merely needing to account for operating expenses (life support, crew salaries, berthing fees, fuel, maintenance, etc.).

according MT:SOM, those large companies take more money from speculation than from cargo/passenger service

3. So the spec cargo goes by fast movers; the bulk cargo goes by the cheapest method.

Not to put too fine a point on things, but Adventure Class Ship hulls fall into the "fighting over table scraps" category after the "big boys" have had their fill gorging themselves on the economies of scale. And as pointed out, speculation can potentially be WILDLY profitable (just not on a predictable schedule or to a predictable degree). As a Merchant Prince it is your fiduciary duty to seek out the most lucrative opportunities to turn a profit (and expand your line of business), which means that speculative cargo is all about "stacking the deck" in your favor depending on the route you're planning to run. Set yourself up to "jackpot" more often Over Here than somewhere Over There and you're on your way to growing your wealth.

they probably have some kind of subside by the Imperial authorities, as they are the "main railroads"

4. Very likely.

Depends on the strings being attached with that subsidy. Mandatory conscription/mobilization in the event of a war being declared can sometimes seem like too high of a price to pay for people who prefer to choose their destiny, rather than having it forcefully thrust upon them.

To be honest, the megacorps have gotten SO LARGE in the OTU that they in effect don't "need" subsidies anymore, but if they're on offer they'll go ahead and take them ... partly to keep a competitor from getting it (and getting established as a rival concern).

 

[McPerth]

2. They're still concerned with costs. Opportunity cost of capital figures in here.

Once you have paid your first ship on full, buying another one is quite easier, as you may split the mortgage costs among both ships' benefits. If you own a fleet of them, you can probably wait for having the money to pay the ship without morgage, so saving (as Spinward Flow says) about 60% of what you have paid for your first one.

Another point related to this is that those large Corporations probably own their own shipyards, and so maintenance and shipbuilding is quite cheaper for them than what the regular customer pays for them

And as pointed out, speculation can potentially be WILDLY profitable (just not on a predictable schedule or to a predictable degree).

Speculation is unpredictable when you own a small tramp freighter and move from system to system, with the risk of finding an oversupplied market of whatever you carry. It's not so (or at least not so much) when you have large storage areas in ports where you can keep those same products (unless perishables, but I guess there's few of those) until prices rise again or you can take to another place where they will be more needed.

And this is if you're using LBB2/MGT rules, as if you're using Merchant Prince, speculation is no longer risky if you choose well your ports of call. Let me quote this from an old thread:

MP will allow you to find a golden pair that can be profitable:

e.g. at Glisten (SM 2036) the nomatterwats are purchased at 1500 Cr (KCr 4 -1 (Hi) -1 (In) -1 (As) -1 (stA) + 15*0.1 = KCr 1.5), while the same nomatterwats are sold at Tirem (SM 2233, 4 parsecs away) at 13500 Cr (KCr 5 + 1 (Hi to Hi) + 1 (In to Hi) +1 (In to Ind) + 1 (In to Fl) + 50% TL difference), 12000 Cr profit per dton, while the reverse trade is 5000 Cr per ton (KCr 4 – 1 (Hi) -1 (In) +1 (Fl) + 1 (stC) + 10*0.1) and sold for (KCr 5 + 1 (Hi to Hi) + 1 (In to In) + 1 (In to Hi) + 1 (Fl to In) – 50% TL diff) 4500, for a loss of 500 Cr/dton, but if you carry freight, this will give you 1000 Cr/dton, achieving a 13000 Cr/dton profit per round trip (modified by actual value table, that, if you have a broker in your crew will give you a 10-20% extra profit).

I have not run the numbers, but I guess this might maintain a J4 trader

And I'm quite sure, as told before, that those Corporatins have good brokers...

 

[Condottiere]

I assume that prices listed are retail, or at least manufacturer recommended.

Depending on vertical integration, anti Trust regulations, and I'll assume investor interests, megacorporations not only can leverage economies of scale, but subsidize production costs, by cooking the books, if not moving entire costs off them.

 

[Spinward Flow]

megacorporations not only can leverage economies of scale, but subsidize production costs, by cooking the books, if not moving entire costs off them.

Even when books are cooked, including moving costs off them ... those costs still need to be covered SOMEHOW otherwise they simply aren't getting paid (and work isn't getting done). It's really that simple.

Some people manage by the book, even though they don't know who wrote the book or even what book.
- Murphy's Law poster on a wall

 

[Grav_Moped]

Even when books are cooked, including moving costs off them ... those costs still need to be covered SOMEHOW otherwise they simply aren't getting paid (and work isn't getting done). It's really that simple.

This: opportunity costs. If you aren't shipping by the most cost-effective method (which is highly dependent on the nature of the cargo), you're leaving money on the table.

 

[McPerth]

1- to have the planets of choice. By having more jump, you may choose them better

1- Doesn't matter that much. Lower jump numbers just take more time to get there.

I'm afraid I disagree once more. Sending cargo to 4 parsecs away on a J-4 ship not only saves you money, but they cost 1000 Cr/dton in transport fees (1600 in MgT), while sending through a J-1 ship would cost 4000 Cr/dton to get them there.

And as per speculative cargo, the route told above from Glisten to Tirem could be covered with a J-1 ship, and the profit would be the same for round trip, but it would make at most about 1/4 of the round trips the other ship does....

 

[Condottiere]

Cooking the books doesn't mean nothing is being paid, it's basically accounting smoke and mirrors, meant to fool the auditors and (in)vested interests, usually to the benefit of the executives and the subsidiaries and/or departments they're running.

It's a gamble, not necessarily a Ponzi scheme, hoping that subsequent events and profits cover the bet.

In this case, the shipping line could order starships from the megacorporation's shipyards at cost, and the shipyards components from it's manufacturing arm, and the manufacturing arm raw materials from the mining subsidiary, while the financial arm finances each phase, but sells each set of invoices to a more obscure financial subsidiary.

 

[Spinward Flow]

but sells each set of invoices to a more obscure financial subsidiary.

When is MCr 100 not MCr 100?
When it's MCr 10+20+30+40.

Still needs to add up somewhere ...

 

[Condottiere]

It means that how the money was used, and where it's now, is falsified.

Why do corporations and/or executives do this? Either they're skimming off the top, or they need to hide their actual activities, which either their superiors, the stakeholders, and/or the authorities, would disapprove of.

 

[Bartleby]

I always assumed megacorps never pay retail prices as they (1) don't need the mortgages and (2) own all the manufacturing companies in the distribution chain. Remove all the markups and they are paying a significant less amount for their ships and their fuel.

 

[Spinward Flow]

Remove all the markups and they are paying a significant less amount for their ships and their fuel.

Even at wholesale rather than retail pricing, the price for constructing/operating/maintaining those starships is still going to be above zero to the accounting department.

 

[Bartleby]

Even at wholesale rather than retail pricing, the price for constructing/operating/maintaining those starships is still going to be above zero to the accounting department.

Very true. Costs would be lower than list price, but nonzero.