Any product or production building that is not the first in the chain is called higher tier. So wheat is a basic product, but flour is a higher tier (2nd tier in this chain) product while bread is also a higher tier (but more conveniently called the final) product. Residents only consume final products.
From the build menu, if you tap to build any building that is part of a chain you will get a diagram of the chain that tells you how much of each building you will need for a maximum efficiency chain. Here is the diagram for producing bread:
Notice it has 2 on the wheat farm, 1 on the mill, and 1 on the bakery. This means that for maximum efficiency you’ll need two wheat farms for each mill, and one mill for each bakery; a 2:1:1 ratio of farms:mills:bakeries. These numbers are based on the production times for each product of the chain. Here are the production times for a single item of each product in this chain:
Wheat: 7m 20s
Flour: 3m 10s
Bread: 3m 10s
Since wheat takes twice as long as flour to produce, you need two wheat farms to keep a steady supply of wheat for the mill to produce flour. Since flour and bread have the same production times, you only need one mill per bakery. Keeping a constant supply of resources for each part of the chain ensures maximum efficiency in the chain. This is what the ratios and diagrams are based on.
Note: This does NOT mean that 2 wheat are used to produce 1 flour!! It just means you need two farms to feed a mill, but in every chain only one of each resource is used to make the product, always!!
Here’s one more example of an advanced production chain for producing Tools. I pick this one because it’s one of the largest and most confusing chains I've come across. I certainly needed it clarified to me when I first unlocked it (thanks again Dudecorp!).
First thing to learn from this diagram is that when there are two different resources sharing a single arrow it means you need either one or the other; not both. In this case you need either charcoal (made from wood) or coal (mined). I haven't seen any other chains with something like this yet.
The second thing is that, due to the production times of the involved buildings, you need a large number of buildings running before you get nicely matching production times. See Myainsel's reply below for a full explanation on how it works out exactly to a 100% efficiency over the entire chain. To summarize, a fully efficient chain will require the following:
2 Iron mines, 4 Charcoal burner's huts, 3 Iron ore smelters, 4 Toolmaker's workshops.
Of course you will only start out with a single chain due to their high construction and maintenance costs so here's what you need to begin with for a fully functioning chain:
1 Iron Mine, 2 Charcoal burner's huts, 1 Iron ore smelter, 1 Toolmaker's workshop.
This will give you 100% efficiency on the tools production but not the entire chain since you will end up with a surplus of iron ore and charcoal until you have the full 2:3:4:4 chain.
Buildings from production chains require that resources be moved between them as well as to/from the distribution house. For example flour requires wheat, so a collection wagon will travel to the wheat farm, collect the wheat, and deliver it to the mill. Similarly bread requires flour and therefore it must be delivered from the mill to the bakery. Finally the bread is collected from the bakery and taken to the distribution house (or harbour).
Even though the description in the game says these buildings need to be in range of each other, technically speaking they don't, as long as they are all in range of a distribution house since the distribution house can pick up the required resource from storage and deliver it to the next building in the chain. However, for the most efficient setups, its best to have all the buildings part of the same production chain close to each other and also close to a distribution house so all the moving can be done swiftly. See various island screenshots on this forum for examples. Although not my style, Zenobia has possibly the most efficient product chain setup I've seen and you can see it here:
(see the post dated 2014-12-12)
Last but not least I want to talk about the Provision House. It is unlocked at city lvl 9 and allows you to produce the following items:
Cake: Increases production by 200% for 30 minutes. Uses 8 flour
Salad: Increases production by 200% for 3 hours. Uses 10 herbs and 12 spices
Roast: Increase production by 200% for 12 hours. Uses 5 grapes and 15 meat
What this means is that these items cut the production time in half for any building you use them on! So use it! I would recommend having a surplus of flour and having your provision house constantly producing cake, and then similarly for salad and roast when you are able to. Use these boosts on anything you need more of (usually building materials like stone, wood, and the tools chain, etc.). Also remember that you can build more than 1 provision house and because of the long production times of salads and roast, I recommend you build at least 1 for each product as soon as you manage a consistent surplus of the production supplies.
I would suggest using cakes while you are online since they only last half an hour and if you're online you can simply renew them when they run out and save salads or roasts for when you're about to stop playing since they last for 3 hours (or 12hours).
That's the end of what I have to say about production. I hope I haven't missed anything important and that you've found it useful. My next post will be the final 'basic skills/knowledge/strategies' post before I get into the stage-by-stage guides and it will cover Ascension requirements, tips, and strategies. Until then!
Last edited by Tea on Tue Jan 06, 2015 3:21 pm; edited 7 times in total (Reason for editing : Amended some info about the tools production chain after being corrected by Myainsel and TheDamien. Added a line on provision house section about having multiple houses)