I'm writing this post as a follow up to a long discussion i had with Nisha, Logboy, and one other; Reborn? can't remember clearly who it was now. However, I've heard some other people thinking this thought before and never quite understood why anyone would think it's cheaper to buy Beer rather than produce it.
So I went ahead and calculated the production costs for Beer and will display the results here. The short answer is that unless you're getting Beer at a price around 875 gold apiece or so, then no, it's not cheaper to buy.
First of all, why would any commodity be cheaper to buy than produce? That doesn't make any sense. If that was the case then the sellers are always making a loss. I understand that sometimes sellers simply want to offload something they have a major surplus of and so might set a very low price, but this isn't the general case. I don't know if spreading this idea that Beer is cheaper to buy was some conspiracy for Beer producers to make a profit selling it, or whatnot but it's simply not true.
The table below is a section of my spreadsheet. The production costs for a single beer (depending on batch size) are in the final column to the right. The batch size is the first column on the left. If you're wondering why I have different costs depending on the batch sizes then you should read my other post on how to set trading prices https://annoios.forumotion.com/t29-setting-trade-prices-the-cost-of-trading.
A final note, although already explained somewhat in my other post, the reason why using $/item is no good is because we want to compare the cost of producing beer to the cost of purchasing beer. Beer is never purchased in single item quantities, but in batches, therefore to compare you need to use the same unit.
Here are the results calculated using the same method explained in my other post. The only difference is that I have now added shipping times and variable ship upkeep depending on the sizes of the ships into my calculations to make them more accurate. Of course these costs include the production costs of wheat and herbs:
Other assumptions made:
So I went ahead and calculated the production costs for Beer and will display the results here. The short answer is that unless you're getting Beer at a price around 875 gold apiece or so, then no, it's not cheaper to buy.
First of all, why would any commodity be cheaper to buy than produce? That doesn't make any sense. If that was the case then the sellers are always making a loss. I understand that sometimes sellers simply want to offload something they have a major surplus of and so might set a very low price, but this isn't the general case. I don't know if spreading this idea that Beer is cheaper to buy was some conspiracy for Beer producers to make a profit selling it, or whatnot but it's simply not true.
The table below is a section of my spreadsheet. The production costs for a single beer (depending on batch size) are in the final column to the right. The batch size is the first column on the left. If you're wondering why I have different costs depending on the batch sizes then you should read my other post on how to set trading prices https://annoios.forumotion.com/t29-setting-trade-prices-the-cost-of-trading.
A final note, although already explained somewhat in my other post, the reason why using $/item is no good is because we want to compare the cost of producing beer to the cost of purchasing beer. Beer is never purchased in single item quantities, but in batches, therefore to compare you need to use the same unit.
Here are the results calculated using the same method explained in my other post. The only difference is that I have now added shipping times and variable ship upkeep depending on the sizes of the ships into my calculations to make them more accurate. Of course these costs include the production costs of wheat and herbs:
Other assumptions made:
- Transport ships are always fully loaded to their max capacity with only the product and therefore transport in one direction
- Beer is produced on the herbs island and therefore 2 shipments are required to get the final product to Newport; one taking wheat to herb island, another taking Beer to Newport. If you are producing both wheat and Beer on Newport then only 1 shipment is required to bring herbs to newport resulting in even lower production costs
Last edited by Tea on Thu Jan 08, 2015 10:37 am; edited 1 time in total