Market Discussions

Hi all,

As you can read in the subject of my post, I'm looking for (a) potential investor(s) to support the growth of my solid manufacturing business. I already have 2 loans for a total of 6b (from Brollox and Pattux), but my profit is more than double the monthly intrest i have to pay and growing steadily. The only collateral i can offer are finished freighters, so you may already have guessed what business I'm in too by now...:-). If you are interested in a long (or short) term investment, just contact me ingame and i'll explain you all the details you need considering the safety of your possible investment. I'm sure we can also work out a decent intrest rate we can both live with. Even if you can't invest 5b or better, want to invest more than 5b, I'm willing to negociate too, as my ambitions and plans are large and flexible enough to deal with all sizes of investments.


yours sincerely,

Rex

"convo me to get details" never works on MD.

also why would you be able to offer finished freighters as collateral? do you have trouble selling them? if yes, why expand production even further?

I have to confess I'm rather curious myself.

Now, before I continue, it's worth noting that I'm in direct competition and as such it's in my interest to see Rexjustice crash and burn and be forced to firesale his prints to me in a futile attempt to stave off crushing poverty and oblivion. Resulting of this, potential investors really shouldn't interpret anything I say in any particular damning light. This is pure intellectual curiosity and, I'll admit, a little jealousy too as it appears I may be doing something wrong.

Some baselines:
It takes 12 days to produce a freigher from a PE0 print in an NPC station (it's 11 and a bit, but round up for real life).
It takes 11 days to produce a freighter from a PE1 print in an NPC station.
It takes 9 days to produce a freighter from a PE1 print in a POS (actually can just squeeze 8 days here but it's a tight fit)


With seven manufacturing slots I can churn out 2 freighters every 9/11/12 days
(BPO cost *very* roughly 9.6b and mineral tie up roughly 1.4b for total 11b capital)

With ten slots I can churn out 3 freighters every 9/11/12 days
(BPO cost *very* roughly 13.7b and mineral tie up roughly 2.2b for total 15.9b capital)

With twelve slots I can churn out 4 freighters every 9/11/12 days
(BPO cost *very* roughly 16.8b and mineral tie up roughly 2.9b for total 19.7b capital)

With fourteen slots I can churn out 5 freighters every 9/11/12 days
(BPO cost *very* roughly 19.9b and mineral tie up roughly 3.6b for total 23.5b capital)
(edit: this one's a little tight, dependent upon exact prints and research may need a fifteenth slot to run a fifth cargo bay print)


If we arbitrarily put profit per freighter at 100m (something which under present conditions is a tad on the optimistic side and certainly nothing like approachable if you include Obelisks in that mix) then extrapolating 9/11/12 day production to a standard 30 day month we may approach the following monthly profits:

2 freighters per 9/11/12 day cycle = 666m / 545m / 500m profit per month, or 6% / 4.9% / 4.5% profit on capital
3 freighters per 9/11/12 day cycle = 1b / 818m / 750m profit per month, or 6.3% / 5.1% / 4.7% profit on capital
4 freighters per 9/11/12 day cycle = 1.3b / 1.1b / 1b profit per month, or 6.6% / 5.6% / 5.0% profit on capital
5 freighters per 9/11/12 day cycle = 1.7b / 1.4b / 1.2b profit per month, or 7.2% / 5.9% / 5.1% profit on capital
(edit: worth noting that the figures for the 9 day cycle do not include pos costs)



Now from all of this, and it's worth bearing in mind the above figures are presently a little on the optimistic side, and the figures crash into the dirt the moment Obelisks get included, we can see that whether we go by percentage return or pure isk profit it's incredibly hard to finance any significant part of the operation or finance any part of the operation at reasonable interest rates. This is certainly what I found when a few months back I publically financed just a fifth of total capital at effective rates of about 4% (was a partial 3% collateralised / 5% unsecured loan).

Now I don't mean for this to be an attempt to destroy Rexjustice's offering, as noted above, it's in my interest to do just that so please take the above with a pinch of salt; I'm merely more curious as to what I'm doing wrong which would allow me to finance my operation in the quantities he's approaching and the interest rates he appears to be offering.

Hi Tekota and Flakeys,

After Tekota's post we talked a bit ingame, where I explained to him that i'm well aware of the small profit margins in freighter building. (His post is very detailed and is a faithfull represantation of reality)
But as the whole process is rather labour-passive, I'm now looking to expand production first, so i can later on increase my profit margin by repaying loans to lower monthly intrest payments. (of course i can't take on loans with too high rates, but i do can agree with high (several billions) loans over a longer time (several months at least) for a modest rate like 5-7%.

Thank you all for the good advice i received, its even more important then just a bit of isk :-)


Yours,

Rex