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How do hauling corporations pool downside risk...
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AnnaBelle Bartlet
AnnaBelle Farms
#1 - 2012-08-25 20:48:37 UTC
Hauling corporations profit by saving pilots time and assuming the risk of transporting their goods.

Based on a quick review of Push/Micro and RFF, I find that I can move potentially move millions (even billions) in goods fairly inexpensively. For example, 20k m3/50M ISK in goods moved for less than 1M ISK in high-sec.

There seems to be huge potential for loss, with small return for that risk. In RL, there are insurance and re-insurance markets to spread this type of risk. AFAIK, there are no such markets in Eve...

What mechanism do these corporations use to mitigate the downside risk - is the volume of goods shipped so high that the risks are actually minimal?
Pipa Porto
#2 - 2012-08-25 23:12:56 UTC
The only significant risk of loss in a properly managed hauling corp is loss by Suicide Gank.

By ensuring that the cargo value/collateral is less than the cost to Suicide Gank the ship carrying the cargo, the risk is effectively eliminated. This effectively eliminates the need for Insurance (also, insurance companies in EVE are all Scams, just like banks).

IRL, re-insurance's primary function is to protect insurance companies from an event that would cause a large number of claims at once. That can't really happen in EVE; there's no real way to have liabilities like that.

EvE: Everyone vs Everyone

-RubyPorto
AnnaBelle Bartlet
AnnaBelle Farms
#3 - 2012-08-26 00:26:33 UTC
Thank you for taking the time to answer. That makes sense.

And you mitigate the threat of WarDecs against the actual hauler corporation by using out of corp subcontractors?
Markus Navarro
Osmon Integrated Robotics
#4 - 2012-08-26 01:34:34 UTC
Not a pro, but you may simply be in a NPC corp, undeccable.

I sell drones and drones accessories.
ashley Eoner
#5 - 2012-08-26 03:20:22 UTC
AnnaBelle Bartlet wrote:
Thank you for taking the time to answer. That makes sense.

And you mitigate the threat of WarDecs against the actual hauler corporation by using out of corp subcontractors?

You would use a low skill point alt in the corporation to pick up the contract and then hand the goods off to a NPC character who then delivers the goods.
Vito Tattaglia
Deep Core Mining Inc.
Caldari State
#6 - 2012-08-26 03:28:25 UTC
Pipa Porto wrote:
The only significant risk of loss in a properly managed hauling corp is loss by Suicide Gank.

By ensuring that the cargo value/collateral is less than the cost to Suicide Gank the ship carrying the cargo, the risk is effectively eliminated. This effectively eliminates the need for Insurance (also, insurance companies in EVE are all Scams, just like banks).

IRL, re-insurance's primary function is to protect insurance companies from an event that would cause a large number of claims at once. That can't really happen in EVE; there's no real way to have liabilities like that.


Expanding on this a little bit, what she means is that if the cost of suicide ganking a shipment is more than what may actually be gained in the gank itself, this wards off 95% of gankers. This is easily established by the use of freighters in the shipping industry. It takes A LOT of firepower to take down a freighter, and A LOT of collaboration amongst gankers. Chances are, the cost to gank a freighter carrying goods is MUCH higher than the value of the goods being carried. This takes out most of the risk in hauling.
Kara Books
Deal with IT.
#7 - 2012-08-26 03:59:34 UTC
Vito Tattaglia wrote:
Pipa Porto wrote:
The only significant risk of loss in a properly managed hauling corp is loss by Suicide Gank.

By ensuring that the cargo value/collateral is less than the cost to Suicide Gank the ship carrying the cargo, the risk is effectively eliminated. This effectively eliminates the need for Insurance (also, insurance companies in EVE are all Scams, just like banks).

IRL, re-insurance's primary function is to protect insurance companies from an event that would cause a large number of claims at once. That can't really happen in EVE; there's no real way to have liabilities like that.


Expanding on this a little bit, what she means is that if the cost of suicide ganking a shipment is more than what may actually be gained in the gank itself, this wards off 95% of gankers. This is easily established by the use of freighters in the shipping industry. It takes A LOT of firepower to take down a freighter, and A LOT of collaboration amongst gankers. Chances are, the cost to gank a freighter carrying goods is MUCH higher than the value of the goods being carried. This takes out most of the risk in hauling.


Dont let your guard down, there are groups out there who make their living on this!, ganking mission runners etc etc, highly experienced pro's out there.
MushroomMushroom
State War Academy
Caldari State
#8 - 2012-08-26 04:09:03 UTC  |  Edited by: MushroomMushroom
Actually, to economically suicide gank a freightor, it needs to be carrying at least 2x the cost of your gank fleet (as adjusted to account for friendly module recovery) to account for the item drop probabilities. More to account for the risk of someone else getting the loot, or shooting the wreck. Though you would want a good margin of error in your calculation to account for more effecient gank setups then you anticipate, or a scout calculating the value of your cargo to be more then you did.
AnnaBelle Bartlet
AnnaBelle Farms
#9 - 2012-08-26 13:30:16 UTC
Thanks for all the good responses. Great community: +1
YuuKnow
The Scope
#10 - 2012-08-26 14:24:54 UTC
RFF has a 'Freighters Only" policy even for small cargo. This decreases the risk for ganks. The other tatic they use is the 'double wrap' which eliminates the ability to scan the cargo's thrwarting gankers additionally. With these, ganks still happen, but less likely.

yk