Do I Need To Worry?

[Guest]

There appears to be a rising number of power producers on R2 which causes me to doubt the security of my own future. Are countless numbers of power producers threatening the future of larger power companies, or the future of any power company for that matter?

[Guest]

It's mostly a recurring issue.

See for example this discussion (Realm 1, but that doesn't mean much):

http://www.forum.kapilands.com/viewtopi ... sc&start=0

Or this one:

http://www.forum.kapilands.com/viewtopic.php?t=10520

From which:

What drives down the price of power is, like everything else here, supply and demand. When noobs join up, and ask here in the forum what business to get into, and they are told that power is the simplest thing, with a quick, easy and good profit margin, and they take that advice, they are removing themselves from the ranks of power demanders *as well as* adding themselves to the ranks of power suppliers.

Don't worry too much, though.

-m-

[Guest]

I was selling small amounts of power for a while, and I noticed the power market getting saturated with oversupply.

As I see it, the problem with power is that the power plant is a one-trick pony. If the power market collapses, you are stuck with buildings that can't be retasked. If you are selling coal from a mine, you can switch to minerals, iron ore, etc. Same with most buildings. Plus, power is always Q0, so the big-and-old companies have no research advantage.

I read a tip about steel being good, and I like the way it works. I own (a few) power plants, wells, mines, and factories for the steel production. If prices should change, I could switch to a more profitable set of products easily.

[Guest]

Also, from my own, limited experience, as steel is too capital intensive, investigate chemicals and gas. Gas is perhaps not worth it at low q, but chemicals are not too bad even for a beginner.

Always check your prices, though. Both buying and selling. That's what the game is about, methinks.

-m-

[Guest]

Well, I don't know if this is relevant to the question asked but I don't think you have to worry too much Eleknar.

I produce my own power but for a limited portion of my (eventual) company. I have a "core" of buldings that supply a product I don't use and produce strictly for sale. In that core are some building that make expansion products (Wood, Stones, Steel). This portion of my business will always, at least in the forseeable future, be market independent as far as inputs go.

But the retail end of my company, when I get to the point I can develop it, will rely heavily on power and water from the open or contract market because I simply don't want to waste building slots on items that are both plentiful and cheap. I have an idea (and this is just a guess) many people have the same or similar plan so I think a pure power producer may go through lean times but in the long run will do quite well.

Initially many players do produce their own power (I did and do) but once they grow they will want to use those building slots for something else.

Just my 2

[Guest]

Thanks for the encouragement