Wednesday, March 19, 2008

Trade IMTU

SO. Just hashing this out, IMTU.

Who's going to loan money for a starship?
Sometimes, it really is a bank: high tech, high pop worlds with A ports will have more established financial structures for funding starship construction.

Sometimes, you've got a group of nobles, merchants and financiers on world who are either actively seeking to fund a trade venture, or who are themselves solicited by a prospective borrower. A group like this might:
choose a loan arrangement - like a bank would - or would
choose to subsidize the ship for regular percentages of the profits as a government might or
choose to purchase shares of the ship, as stockholders.

Who's are they going to loan it to?
It's really not enough to have a good business plan. When a prospective shipowner is soliciting banks, patrons et cetera for a multi-million-credit loan, the lender is going to need incredible assurance that they aren't just venting money into space.

Roll up a Merchant. Go ahead. Roll up twenty. Roll up thirty. How many end up with ships? What sort of people are they? First, they're captains: they've a track record as merchants already. They're successful, either on their own behalf or on behalf of a company. Which means, effectively, that they've been serious players in trade already, and they'll be known to investors, bankers and fellow merchants. These are individuals who have been involved in multi-million credit business ventures already.

When a ship is received mustering out, it's usually already pretty old: perhaps the new captain has taken over the loan from a retiring captain before him, or from his old company. Sometimes it's a brand new ship. But it's important to remember he's not a brand new captain. He'll be a celebrity, within certain circles - certainly on his homeworld, and perhaps throughout the neighborhood of the "main" he's been navigating his whole career.

What kind of ship will lenders be funding?

If a captain can pay cash, up front, and fund the adventure from soup to nuts, then maybe a long-jump trader might be doable. A company or planet might arrange a subsidy for a jump-3 ship, if the captain has a non-stop reputation. But for a loan arrangement? Never. It'll be jump-1 ships all the way, like the free or fat trader. Ships are simply too easy to steal (when their crews are doing the stealing, anyway) - and too difficult to pay for - if they can do better than a parsec.

Now, it's possible that a resourceful captain with a nonstop reputation and powerful connections could organize a joint venture between private investors in order to fund a more audacious ship venture, but that individual will have to do his homework, have a killer plan, and do some nonstop fast talking with all the right people. And all the right people will be well within their rights to insist that their interests on board are protected.

It's a good rule of thumb to say that if a ship is more expensive to run than a Free Trader, it had better be equally capable of filling its holds and paying its bills on carried cargo alone. Any ship that can do that will be able to do oodles better carrying spec cargo, which is where the money really is. A bank funding a loan will be concerned that this bottom line be easily met. A group of investors, on the other hand, will want to know the profitability of the route, the ability of the ship to navigate it, and the ability of the captain and crew (especially that of the purser!) to fill the ship's hold cheaply and empty it dearly.

How will a merchant or trade company make money?

A merchant might well attempt to live on the fringes - buying up cargo that happens to be available that week, taking passengers, accepting cargo paid by the ton - but that's chancy. And it's not where the real money is. Also, it takes a bit more freedom than most ship financiers will be willing to offer: IMTU, "The Bank " or whatever other group paid to have the ship built will want those loan payments regularly, on-world, or to a representative of "The Bank". A successful merchant might be able to go on extended ventures if he's set up the next few payments in advance, but chances are The Company's going to want those payments delivered in person to a Company Agent. With the IISS maintaining interstellar financial networks and all, it's perfectly feasible to have payments sent back via courier (though I'd stick at least a 1% surcharge on that, maybe even 5% - Western Union, for transferring $1000 bucks internationally, charged around 35 bucks...)

The Company will then either install, or recruit factors on each of the planets along the route, who will establish warehouses - factories - to be able to more advantageously purchase goods and store them against the arrival of their ship, or ships. The ship does its rounds, and fills its holds with cargo from its own factories at. No charge - it's the company's, after all. If the ship has any extra space, either the captain and crew will speculate on some of their own cargo, or they'll take on cargo for the cr. 1000 fee; likewise, they'll take passengers.

Occasionally, overflow stock at the factory or unsold goods from ship's cargo might be left over and available for purchase by other ships and these goods are what generally comes up in the "available cargo" rolls. These might have come from just about anywhere: they might not be sellable at all to the locals - but the ship might have needed cargo space badly enough to warehouse the goods and free up space for something worth selling down the line. (hence the computers available on low tech worlds!)

Just as company cargo travels free on company ships, so does company money - but more often, company financial information. What matter if the company has 6 million cr on planet A, 4 on planet B, 10 on planet C and so on - it's all the company money, and there's no need to shift it most of the time.

Of course, when a company gets this big, it starts needing support staff: A warehouse needs more than just the factor: it needs security, stevedores, and other staff. Depending on the world and political climate, security might fall to some sort of mercenary outfit. More ships, or bigger ones, might be called for.

How does LBB1/2/3 play for all this?

Also see

And there's competition to think of: there's going to be other merchants trying the same thing. They might want to join forces... or they might want to take over. You might want to really consider a stronger security force...


Blogger Omer Golan said...

Sounds like Leviathan - I like that! :)

Anyhow, if the PCs operate a Company ship, you'd probably need a mechanic to determine how much of the hold the Company goods take on each run (that is, how much is available for side profits from speculation).

Also, as the ship's crew doesn't make most of the profit by itself (the factors do the buying and selling), the Company would probably have to pay for ship expenses.

4:14 AM  

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