Corporations all losing money

Greetings all,

I'm a returning player, though it's been a few years.

My enterprise (Blackadder Enterprises, on WG) has 18 corporations, and every single one of them is losing money every single month.

They are all producing items that are in high demand. Wages are at 315% and hiring hits 100% each month.
I think I have a good buying strategy (starting at 77% and increasing by 4% a month, with a 20-month low water mark).

The problem seems to lie with sales. I have it set to start selling at 189% of the market price - plus quality. Everything sells alright, but I don't receive that much.
It doesn't add up, and makes it impossible to make a profit!

Is the price deliberately capped by the game to prevent inflation?
If so, how does anyone make any money from their corporations?

Shouldn't the game have enough high-demand corps in the C3s to keep things roughly in balance?

Strangely, I don't seem to be having the same problem with most of my country's (Lagonda) corps, despite using the same strategies.


Any help and advice would be much appreciated; this game's not being much fun because of this...

I've found that most corps will not be profitable until the quality of the goods they are producing get to a higher level. What level this is I have not really looked at too closely but corps producing 100q goods will be less profitable than corps producing 200q goods. The quality and effectiveness upgrades costs will be quite a drag on your bottom line until they are upgraded to the maximum. Probably doesnt help you much but maybe give you a little more insight.

I just set it to best price for sales, you'll see profit more often. Market prices will affect it of course.

Thanks for your reply, Jauterson.

They're losing money even before allowing for the cost of upgrades.

I suspect the magic number for output quality is 180...

However, take a look at one of my corps: https://sim03.simcountry.com/cgi-bin/cgi2nova?SN_ADDRESS=wwwCountry&SN_METHOD=ccorp&miCorpNumber=5091823

The Production Process Quality is currently 132 - due to upgrades, but the Quality of the Product is only 140.2, despite the materials in stock having an average quality of about 170.

Surely, this corp's overall quality output should be about 200, should it not?

Thanks for your reply, Khome.

But that makes me wonder what the point is in having a sales strategy...

The stuff's in high demand; I want to cream the market before reducing the price for the stock that doesn't sell. Surely I should make more income that way!

I might try switching a few corps to best price though, as you suggest - see what happens...

Nearly all my corporations are profitable.

example:

aluminum corporation. (There is shortage on the market).
product quality 211
raw materials quality 170

welfare index 124
Production and hiring at max levels.

sale strategy quality -10 (201)
Purchasing strategy 108
Everything is always bought and sold on time.

profit about 230 M before tax.

I could probably earn a bit more but this is reasonable and does not require any manual interventions.

Blackadder - I think I get you're intention though. Kinda like the stock market, setting a desired price and waiting for a matching order despite market prices. So I agree, I don't see purpose to that function besides best price for sales.

You'll need to have higher production and quality upgrades before your overall quality of goods reaches a higher level from what I've seen. I believe you are on track with your thinking though. I would say 180 quality goods would be pretty close to profitable. If you stopped purchasing upgrades at that point then even more potential for profit. I would upgrade to the max however.

Ceo's will always lose money most time at the start(i always have only recently gotten better at it after years of no goodies!!) Sucks really, but you do need to work with your strategies, make sure the countrys have low tax/employment+welfare for your corporations to advance and produce profit. Other ways to but those are the most straight forward.

Thanks all!

I'll keep persevering with it then...

All my corps are ordering as many upgrades as possible, so it will be interesting to see at what point they become profitable.

Though I'm also tempted to halt production (by setting hiring to zero) and simply let them keep upgrading using the cash they already have.

I might split my corps into three groups; one carrying on as now, one selling at best price, and one (containing the biggest loss-makers) halting production.

You know I have wondered about halting production too. I haven't heard of anyone using this strategy. I could see potential benefits to a CEO using this type of strategy, however the effect to host countries would be negative for sure. Would be interesting to hear from someone that has halted production while they do their upgrades.

Have just tried setting my two worst offenders to zero, but it won't let me set it below 10%.

So have done that, and will see how that works out.

They're both in C3 countries, so shouldn't cause any bother.

I'll report back later this week...

Some of the costs of a corporation are fixed and do not go to 10% when you reduce production to 10%.

Corporations are at their best when working at 100%. The fixed costs are then relatively low.

all corporations are by design profitable if you assume that the cost of materials and the sale price are at about the same quality level and the market price is not depressed by oversupply.

the profitability increases with the upgrading level of the corporation.

I am not sure what the result will be if you reduce the quality of raw materials you purchase in the early stages of the corporation.
Raw materials are the highest cost for many corporations.

also experimenting with salaries can make sense.
If you pay 300% level salaries and the output quality is low, then the increase in production (due to high salaries) may not compensate for the triple cost of salaries.

Reporting back, as promised...

I found cutting hiring to the minimum of 10% approximately halved the losses of my two *very* badly performing corps. These firms were losing 0.6bn-1.0bn a month; it's now less than half that - though upgrades will account for some of the improvement, so I'll say 'about half'.

It's worth noting that it took 9 game months for the full effect to occur, as hiring only gets reduced by 10% a month. Presumably, it will take as long to bring them back up to 100% when the time comes.

I also switched three other poorly-performing corps onto Best Price for sales, as suggested by Khome. Looking at their profit graphs, I can't really see any change from doing this. I suspect the Best Price is close to the maximum price the game will allow for products that are in high demand.
Was worth a try though - Thanks Khome!

Overall, my enterprise is gradually reducing its losses; this is mostly attributable to upgrades. The corps are still all losing money each month, but by a lot less than when I started this thread.

Re Andy's comment:

300% salaries seems to be the new 100%...
(100% was the default when I last played.)

I found that out the hard way when I built my first few corps and set the salary levels to 100% because I thought the 3C countries wouldn't care. Those corps' hiring levels were terrible until the salaries finally got back up to 300%, and 100% hiring can only be assured, it seems, with salaries set to at least 315%.

While this must be great for the workers - and countries' exchequers - it makes life harder for corps, which I think is only adding to the problem of insufficient supply of those high-demand products which use a lot of expensive high-demand materials.

I understand the need to cap/control market prices to prevent hyper-inflation, but I suggest you look at the way these caps affect supply and adjust them enough to allow the market to work more freely.

It would also be nice if it was made clear when a price is being capped.

I hope all this makes sense - It's been a very long day!

I wish we could let prices go without any limit.

we always assumed that players will build corporations if prices were very high and the market will regulate itself.
Fact is, it did not happen.

In the past the limits were much higher and players did not react.
Once, we had an error and one product did not have any max.

we discovered it when the system alerted us to weird situations.

The price of that product at that time was 30 times higher than the base price! Nobody created any corporations. You could get very rich very quickly building such corporations.

we have also this situation with Electric power and nuclear power.

Many times, electric power costs much more than nuclear power.
you can just purchase nuclear power and cut your cost.
it does not happen.
you can even purchase nuclear power and sell it directly as electric power and make a profit. This too does not happen.

We will be able to let the prices go without any limitation when we see clear reactions to opportunities in that market.

I'm always checking the supply/demand.

Thanks for your reply, Andy.

To clarify what I meant about price caps, it seems to be that if a significant proportion of a corp's required supplies are trading at their price limit, then those supplies will cost so much that it will be impossible for that corp to make a profit, ever, even its own product is also at its price limit.

My point is, I think the price limits should take account of the effect they have on each other, otherwise the market will never work.
I realise this isn't a five minute job, but I suspect it is necessary...
Perhaps you could set the limits by creating a model based on every product being at its price limit, with an objective of ensuring that in such a circumstance it would be possible for every product to be sold at a profit (even if only by a well-run fully-upgraded corp.)

Also, would it not make sense for the C3s' state-owned corps to change their product output to help balance the market?
I'm sure such an automated system would be far more responsive and effective than even the most dedicated human player...

And, I had no idea that one could trade nuclear power as electric power; How?!
I do love a bit of arbitrage... ;-)

If a corporation buys all the materials at top price and sells its products at the top price, the profit will be higher.

Material cost is much lower than the sale price of the produced products.

multiply the cost of the raw materials by 1.5 and also the price of the produced products by 1.5 and the difference between them will be larger.
All corporations, by design, are profitable in every upgrade level although the profit is very low if not upgraded.
Only in cases when the produced product is in oversupply and the price is down, the corporation will not make a profit.

The market works in this way from the first day of the game and most corporations are profitable, and countries are profitable.

C3 countries build new corporations.
They always make a choice to build corporations that will reduce the largest shortages.

When you purchase nuclear power, it is added to your electric power stock.
countries have only electric power, even when they purchase nuclear power.