"Mark up": wazzaaaah???

Discussion about Production and Resources

Moderators: Balthagor, Legend, Moderators

FastBoy101
Captain
Posts: 148
Joined: Jan 21 2004

"Mark up": wazzaaaah???

Post by FastBoy101 »

What exactly is "mark up" and its effect? English isn't my first language so maybe it's me...

I thought it was a way to sell your product internationally with "cost + x%" but I saw some post considering it as a tax on domestic consumption. At first, I was using it so the minister wouldn't sell it too low to other regions, but maybe I was shooting in my feet instead !!!
Big stuff from K5
Decimatus
Brigadier Gen.
Posts: 734
Joined: May 18 2005
Location: The Empire

Post by Decimatus »

If you are talking about the "Domestic markup" then yeah, it is just another way to tax your people. Its main use is in making people use less of the product so you don't have shortages and whatnot.
Baloogan
Brigadier Gen.
Posts: 775
Joined: Aug 14 2004
Location: Canada, BC

Post by Baloogan »

Decimatus wrote:If you are talking about the "Domestic markup" then yeah, it is just another way to tax your people. Its main use is in making people use less of the product so you don't have shortages and whatnot.
And making money.
Missiles!! Nukes!
User avatar
tkobo
Supreme Ruler
Posts: 12397
Joined: Jun 04 2002
Location: In a vast zionist plot ...RIGHT BEHIND YOU ! Oh Noes !

Post by tkobo »

"mark up" is the price % a product is for sale at above the cost of the product.

So, if i can make lemonade for 10 cents a glass and i sell it for 20 cents a glass, my markup is 10 cents or 100%.

Markup in the game is a major part of the players possible income.In some economy types it can account for 60%+ of the player regions income.
Low unemployment and high wages can allow you to really raise those domestic prices with little to no negative dar effect.
This post approved by Tkobo:Official Rabble Rouser of the United Yahoos
Chuckle TM
User avatar
Sebastiaan
Colonel
Posts: 376
Joined: Aug 29 2005
Location: the Netherlands

Post by Sebastiaan »

tkobo wrote:"mark up" is the price % a product is for sale at above the cost of the product.

So, if i can make lemonade for 10 cents a glass and i sell it for 20 cents a glass, my markup is 10 cents or 100%.

Markup in the game is a major part of the players possible income.In some economy types it can account for 60%+ of the player regions income.
Low unemployment and high wages can allow you to really raise those domestic prices with little to no negative dar effect.

That´s right. Be warned that setting the markup to high markup level in a weak economy could potentialy crash your economy.
The_Blind_One
Colonel
Posts: 388
Joined: May 28 2005

Post by The_Blind_One »

Sebastiaan wrote:That´s right. Be warned that setting the markup to high markup level in a weak economy could potentialy crash your economy.
I have actually never seen that happen, but maybe that's because I have my economy in a tight grasp :P

I always tax as much as my people can afford. I noticed that the more u tax the more they will pay anyway, aka more profits per unit, and u can export more, meaning even more mucho money :D, ofcourse that doesn't really work on the world map :roll:

Always tax them mofo's untill they can no longer afford it, go below that line, and ur rich rich rich!!! :D

EDIT: I really think that's questionable now, increasing domestic markup DOES NOT decrease gdp/c nor does it make ur economy crash, in all cases it results in more income for u, more export for u (even more money for u) and because u tax u can redivert that money to other things (increasing ur gdp/c = increasing ur taxes = even more money!)
Muso
Corporal
Posts: 7
Joined: Jan 18 2006
Location: England

Mark up

Post by Muso »

Quick question on markup that I'm trying to get my head around..

I'm playing panama to try to teach myself the economy basics. In that scenario the economy seems to be in a bad way mostly because of the amount of imports needed (and the bond debt)

For instance, Consumer goods.. lots of them need to be imported and I have a large trade deficit. What I don't understand is, if I'm buying loads of consumer goods but then sell them at 100% markup, shouldn't actually be making money out of this? It might be costing me to buy them off the WM, but I'm selling them at twice the price to my people.. do I have this concept wrong? Also, where is the income from selling all this stuff shown?

I guess some stuff you import you don't sell as it's used in factories, although there's still a markup on that.. this is confusing me.

Can anyone shed any light on this?
User avatar
Balthagor
Supreme Ruler
Posts: 22083
Joined: Jun 04 2002
Human: Yes
Location: BattleGoat Studios

Post by Balthagor »

First question, do you have the latest updates? There was a bug in this area of the economy in the release version...
Chris Latour
BattleGoat Studios
chris@battlegoat.com
Muso
Corporal
Posts: 7
Joined: Jan 18 2006
Location: England

Post by Muso »

I do have the latest version, yes. (Digital Download)
User avatar
Balthagor
Supreme Ruler
Posts: 22083
Joined: Jun 04 2002
Human: Yes
Location: BattleGoat Studios

Post by Balthagor »

Then I am confident that if you are selling your goods at a positive markup for a target price above your import cost you are making money from that product. If you have a case where you can't figure it out, save the game and e-mail me the save, I'll take a look at it.

Be sure to see what the WM price for the product is to be sure you're not taking a loss on the sales.
Chris Latour
BattleGoat Studios
chris@battlegoat.com
Muso
Corporal
Posts: 7
Joined: Jan 18 2006
Location: England

Post by Muso »

Balthagor,

Thanks for replying. I'm sure the are no problems in the game. It's my lack of understanding really.

Can you tell me where the income from selling stuff (say consumer goods) is shown?

I understand that having to buy more from the WM than you're selling will cause a negative trade balance. What confuses me is that, if you set a 100% markup, you should still be raking in the money. Either I have the whole principle of markup wrong, or else the income from the markup should be shown somewhere else.

In my game I was making money. I think my daily profits were about 20M, and my daily trade deficit was about 5M.

So, if I was buying 2M worth of consumer goods per day then I get a negative trade balance.. fair enough. But, with a 100% markup, I should be getting 4M a day selling them.. is this the case? If so, is there a screen that shows this income?

Thanks
User avatar
Balthagor
Supreme Ruler
Posts: 22083
Joined: Jun 04 2002
Human: Yes
Location: BattleGoat Studios

Post by Balthagor »

Muso wrote:...if I was buying 2M worth of consumer goods per day then I get a negative trade balance.. fair enough. But, with a 100% markup, I should be getting 4M a day selling them.. is this the case? If so, is there a screen that shows this income?

Thanks
That sounds correct. There is no screen that shows domestic sales by product, but you can see your total domestic sales in the treasury department screens. There is a screen showing all income and all expenses. Compare your production expense to your domestic sales income and you should see if production is costing you money or making you money.

There is a way to prove that your making a profit. First shut off all military production since producing/importing Military Goods will always be costing you money. Then lock all production departments and set them to produce to demand. If this is done and you have positive product markups then you should see (production cost+trade deficit) < domesitc sales. Usualy military goods is the problem, sometimes it is the over production of goods that you're unable to export that is costing you money.
Chris Latour
BattleGoat Studios
chris@battlegoat.com
Muso
Corporal
Posts: 7
Joined: Jan 18 2006
Location: England

Post by Muso »

Thanks, it's starting to make more sense now.
Balthagor wrote: Compare your production expense to your domestic sales income and you should see if production is costing you money or making you money.
Does domestic sales only apply to what you've produced in your factories and not show sales from WM imports, or when you say 'production expense' here, does that include the cost to import an item from the WM?
User avatar
Balthagor
Supreme Ruler
Posts: 22083
Joined: Jun 04 2002
Human: Yes
Location: BattleGoat Studios

Post by Balthagor »

Muso wrote:Does domestic sales only apply to what you've produced in your factories and not show sales from WM imports...
That is correct, those would be foreign sales. The income value "domestic sales" is the revenu from sales of consumables such as food and timber.
Muso wrote:...or when you say 'production expense' here, does that include the cost to import an item from the WM?
No, that would be a trade balance (surplus or deficit depending if your makeing money or loosing money). The expense value "production" is the cost per unit x the number of units produced x the products being produced.

What you want is for domestic+foreign sales to be less that production costs+ foreign purchases. Trade is already lumped together so if it's negative it adds to production, if it's positive it offsets production costs.
Chris Latour
BattleGoat Studios
chris@battlegoat.com
Muso
Corporal
Posts: 7
Joined: Jan 18 2006
Location: England

Post by Muso »

Thanks again - I'll play the game and see this in action. I sorta have it.. but it needs to click into place in my head.
Post Reply

Return to “Production - Commerce Department”