User:Nikolaos II/Business Guide

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Can't see your own?

Everyone have probably thought about starting their own company at some time, but it's not easy to know where to start.
As an entrepreneur I have put together a little guide which might be helpful if you are considering to start your own company.
I recommend all to read this guide and not to make any rash decisions, so here are some things you might want to consider before.

The sections often refer back to each other, so I recommend you to read all and not just do one step at a time.

Information about company alternative and regional bonuses
- Raw materials, you can start a raw materials company which produce and sell raw materials to manufacturing companies.

The raw materials we can produce are:

Wood
Grain
Oil
Iron
Diamonds

High/medium decide how much a worker can produce, high regions produce twice as much as a medium. In many regions there is no raw materials at all, so look carefully which region you should start your company in.

- Manufacturing, if you start a manufacturing company you should think of two things. First you have to purchase raw materials and you also have to pay salaries, which means that you will have to have a higher initial capital than with a raw material company.

In manufacturing you can produce:

Weapons - Need iron
Food - Need grain
Moving tickets - Need oil
Gifts - Need diamonds

In construction you can produce:

Houses - Need wood
Hospital - Need wood
Defense systems - Need wood

1. Initial capital
To start your company you have to have an initial capital.
You should think about what, how, when, which Q and with who you are going to start the company with.

1a. Partners/cooperatives?
Many choose to start their company as a cooperative, which means that a couple of people start the company together and share the expenses and the income.
This is a good alternative if you have if you have a small initial capital, but it can be harder and you have a smaller profit potential because there are many people sharing the profits.

1b. Own capital
The very least you need to start a company is 20 gold, but I don't advice you to start with as little initial capital. You should consider buying an organization which you use to manage the company from, an organization costs 5 gold.
You should also think about if you have the possibility to start something else than a Q1-company? (more on this further down). I recommend that you have at least 40 gold to start with if you are the only owner.

1c. Get gold
You can get gold in a couple ways:

You get 5 gold every 30 days you work in a row.
You get 5 gold for every 5 skill you get in strength.
You get 5 gold for every medal you get.
You get 5 gold for every person you've invited who have reached level 6.
You get 5 gold for every level up from 16-24
You get 10 gold for every level up from 25-29
You get 20 gold for every level up for 30+

So you have many different ways to earn gold, but if you don't have the patience to earn it, you can always buy gold with credit card or Paypal.

1d. Requirements
The requirement to start a company is to be at least level 9, and to create a organization is level 11. If you are several people in a company it's enough if one of you meet the requirements.

1e. Organization
To be able to work in your own company you have to create an organization, at the cost of 5 gold.
The organization becomes like an own account with its own login information. This account can everyone in a company share without it being a multi. I don't recommend anyone to start a company trough there own account because you cant work at the same time as you have a company tied to your account.

Research

2. Research
Think about making research before you decide, so you don't create a company in a industry which is hard to make a profit in. Also think about which industries is dependent of wars, if you start a weapons company for example than you should have a larger initial capital so you can continue to produce weapons even when there's not a war and not many weapons are sold. You should not start hospitals or defense systems companies at all because these are companies who are often ran by the state and the products are hard to sell and very expansive to produce.

2a. Market
The first step for you is to look at the market after how much companies there are in the different industries, what Q and also how much products there is for sale. After that you can pick a "couple interesting areas", and after that follow up.

2b. Demand for goods
Step two for you is to estimate the demand for the goods you have selected, you can do this by looking at the market and see how much is used. But this way is not bulletproof as companies can change there offers, but it can give you an idea about what kind of demand there is.
If a company have had the same offer for a long time it's a sign that you maybe shouldn't go into that business. Or it can be so called "season goods", which is goods who is only sold under certain circumstances. Goods as weapons, gifts, iron, moving tickets and food, often increase there sale during war (read more of this under 3. Choose industry).

2c. Tax and VAT
Remember that there is tax and VAT on most goods. You can therefore not only look at the sales prices because the VAT will come as an addition on the price. Besides that you also have to pay income tax when you move money from your business to your organization. Therefore I advice you to check the taxes and have them in your calculations.

2d. Calculate marginal
At this point you should have collected much information and it's time to calculate what can be profitable.
You can do it with paper and pen if you want, but there is a very good calculator you can use: http://www.cccp-group.org/index.php?page=erep_prodcalc

You only write in the average skill you think your employees will have, the number of employees and what number is recommended to have. You should hire the recommended number of employees because with more the production/employee is lowered.
You must also calculate the average wellness your employees have.
You calculate the average salary by using "Human Resources", write the same for every Q.
After that you write the "production per finished item" after the industry your in (look at 3. Choose industry)

After that you will see your production/manufacturing cost for the different Q and after that you check that with the market and choose what you consider have the best profit potential.

Choose industry

3. Choose industry
When you choose industry you should avoid Defense systems and Hospitals, because they are very expensive and hard to manage. These are managed by the state but below is some information and tips about the different business types.

• Weapons
If you are going to produce weapons you should be prepared to wait until a war starts, in other word being able to pay salaries and to buy iron during the time when there is no wars. In the weapon industry you might have to produce for months without selling anything. Then suddenly there is a war and you sell out your stock in a couple of days.
This industry can be very though for beginners with a small initial capital. The alternative is that you produce as much as you can, then put the company on hold until you've sold out your stock. However, with the current world war you should to pretty well.
Here you should look at the access to iron, max productivity at 10 employees, production per finished item: 5

• Gifts
Gifts is used daily but not as much as it is during wars. In this industry there is often many companies so watch carefully if the demand is there, the marginals are sometimes very bad. Also it is often better to run with low-Q company here. Here you should look at the access to diamonds, max productivity at 10 employees, production per finished item: 2

• Moving tickets
When the military send you on missions and on election days, you can see a improvement on this industries sales. Otherwise this is a very slow industry which I don't recommend right now.
Here you should look at the access to oil, max productivity at 10 employees, production per finished item: 10

• Food
Food is needed every day, but there is also many companies who is selling. This in combination with foreign companies should force you to be very careful with your margins.
Here you should look at the access to grain, max productivity at 10 employees, production per finished item: 1

• Housing
This industry is at the moment overcrowded and don't have any real demand, which often pushes the price below the production cost. I don't recommend you to start a housing company right now.
Here you should look at the access to wood, max productivity at 20 employees, production per finished item: 200

• Raw materials
You have a lot to pick from here, make sure to check your margins and the competition. Also remember to start the company in a zone which contains the chosen raw material.
Max productivity at 10 employees.

3a. Buy a company
It can be good to regularly check "Companies for sale", sometimes you can find really cheap companies. Remember to look if the company have any export licenses, products in stock and employees. If you have decided to start a raw materials company you have many possibilities to buy cheap companies here. But check the company so it is placed in a region who produce the raw material you are going to produce. Many beginners create a raw materials company in a region who don't have that raw material that the company is producing, and try to sell the company cheap. With some patience you can do good deals in this way.

3b. Create a new company
If you have decided what industry you will have and don't find anything good in "Companies for sale", then you have to start your own company. You can do this from an organization, the company will be started in the location that organization currently is in. Be careful with placing the organization in the right region, especially if you are going to start a raw material company. It can also be good if you start a manufacturing company, then I suggest you to start it in a well guarded region which is not easy lost in wars.
The organization account can be moved around without it affecting the company but the company cant be moved.

3c. Choose Q
With consideration to your budget you have chosen a good Q for your company.
Q stands for the level on the goods and the company and decide how efficient the company is and the goods produced. If you have a Q1 food it will give you +1 wellness a day when you eat it, if you instead eat Q2 it gives you +2 wellness and so on.
Q in raw materials means that you get xQ at purchases/production, for example if you buy 100 Q3 Grain, your company gets 300 grain in inventory.
For every Q you upgrade your company your production decrease with 10%, but you can on the other hand sell your products for more.
For a manufacturing company it takes Q times more of the raw material you use to produce, for example a Q1 weapons needs 5 iron, but a Q3 needs 15 and so on.

You upgrade the companies Q by donating gold to the company and click "Upgrade quality level.
In general you earn more the higher Q you have invested in.

Budget

4. Budget
You have now spent your first part of your initial capital on buying/starting your company. Below follows some tips on how you should think in the usage of the rest.

4a. Purchase and storage
If you have a manufacturing company you have to buy a storage of the raw material which the company use. This can be done by clicking on "Buy raw materials", in the company page. You can also buy a moving ticket for your organization and move it to another country where the raw material is cheaper and then donate it to your company.

4b. Employees and skill
Depending on your initial capital in your local currency, you should think about what skill you should hire. People with higher skill produce more but cost more in salaries. If you don't have that much in initial capital (below 200-300 currency), you should hire people with lower skill, 0-4. Think about employ as many people to get Max productivity (see 3. Choose industry)

4c. Estimate sales
The amount of goods your employees produce should be in balance with the rate you sell, you can regulate this yourself by raising or lowering your employees average skill.
If you have export licenses to your company you can calculate the sales abroad.

Daily management

5. Daily management
To manage a successful company takes time, you must follow what is happening on the market.

5a. Employ
You send out job offers trough the company page, where you choose the skill you are looking for and what salary you offer. Look at "Human resources" before to see that you offer a reasonable salary. If you want more employees fast than offer jobs in many skill levels and with higher salary than other companies.

5b. Advertise
You can start a newspaper with your company where you can post articles and advertise your company. The newspaper cost you 2 gold but can be a good tool for your company. But remember not to spam a lot of articles about your company, because it can be seen as annoying. You can also write on your local forum that you're looking for employees and also ask questions, and lots more. You might also try using the new Ad-function.

5c. The employees
You should check your employees and make sure that they don't have low wellness (see 5e. Wellness, gifts?). Also watch when they last worked and follow the development, is there people in your company who rarely work then you should consider to fire the employee to achieve max productivity. In some cases it can be a good thing having inactive employees in your company, more specific when you want to slow down production without losing max productivity.

5d. Personal contact
I recommend that you make a standard letter that you send out to your employees that start working at your company. This creates a personal contact between you and the employees which you can need to have in the future.
If the players are of low level (1-12), you could also send out our beginners guide: http://www.erepublik.com/en/article/beginners-guide-to-erepublik1-890539/1/20

This has shown to improve the chances that they continue to play Erepublik, it's not easy to be new here.

5e. Wellness, gifts?
How much wellness your workers have affects how good they work, in other words how much they produce for the company.

If your country is in a war you can always recommend your employees to fight one time and then use the hospital to get a free wellness boost.

As you understand it's very important that your workers has a high wellness all the time. If you have to fire someone, choose the one with the lowest wellness first.

Some business owners decide to give out gifts to there employees. Free gifts can be sent to those that are working faithfully and good, to workers with low wellness or why not on holidays? But remember to calculate the expense for this in your budget, on one hand they produce more with higher wellness, but you get an immediate expense.

5f. Purchase and storage
If you have a good initial capital you can try to buy much raw materials while they are cheap instead when you don't have any left. This will pay off in the long term and will decrease the chance that the company will be without raw materials. But here it's important to stay updated and regularly check the market. If you import overseas you should look over the global market regularly to know where to find the cheapest prices.
You should also subscribe to the newspaper World Trade Center, who regularly publish reports about this: http://www.erepublik.com/en/newspaper/world-trade-center-180920/1

5g. Salary increase
When your employees increase in skill you should make sure you raise there salaries. This will give them a confidence in you and also let them know that they can stay in the company for a long period of time. Here you should check the "human resources" salaries and give them salaries that are reasonable after what the market gives. There are those who ignore this so they can have employees with low salaries, but if you do that you should remember that most of the employees will switch company.

5h. Market salary check
The current wages changes from time to time and so you are able to have a healthy sales price it's important that you check your workers salaries. If the wages are lowered you should also lower your employees wages so you don't end up in a bottom center compared to your competitors.

5i. Sales top vs storage
If you produce far more than you sell you can get problems with your purchase of raw materials and wage payments. This is usually fixed by being the cheapest on the market (but think of the marginals when you do that). Another way is to employ lower skill employees that produce and cost less.

5j. Export
If you are thinking about buying an export license you should also follow the global market. Which countries have low import taxes? Which countries have high prices on your product? Perhaps can you earn a bit by buying an export license and start to export.

5k. Daily controls
To run an efficient company you have to check it daily. If employees have left the company you need to hire new ones fast so you don't lose productivity.
You should also check the market prices and make sure you compete with you rivals.

5l. Patience
It's important that you have patience with your company, give it time and don't count with that you sell everything you produce every day. Sometime you just have to be patience and wait until better days come.

It can also be a good idea to talk with other company owners on your country forum or on your local IRC-channels.

Evaluation

6. Evaluation
When you had your company for maybe 10-20 days, it's time to do an evaluation of your company.

6a. Check budget
Have your sales gone according to your budget? Have you been able to sell your products at the price you counted with? Have the market change there demand for your product and/or has the cost for the raw material changed?

6b. Long-term plans
When you have checked your budget and gotten more substantial numbers to count from I recommend you to do a long term budget. Here you can calculate when you can afford with an Q upgrade, if you should employ people with higher skill because your stock runs out faster than you produce and so on.

6c. Politic changes
Follow the politics and watch how import taxes, VAT and income taxes develop. You can always get involved in politics and/or talk with a congressman and ask him to represent your view to the congress.

Expanding

7. Expanding
When you have an idea of how the business world is you might be interested in expanding your business. This can be done by getting another company, upgrading the Q level on the one you have, by getting an export license and so on.

7a. Market research
If you have raised the profit in your company you should not make fast decision and get more and just count with that they will go as good. With new companies applies the same rules as with the first, you have to plan carefully or else you run a big risk of losing money.

7b. Back to point 1
Therefore I recommend you to go back to point 1 in the guide and do your research before you decide what to do.

Sum up

8. Sum up
If you have gotten this far in the guide you probably have some business sense inside you. That will show that you are rigorous and serious with your thoughts of becoming an business owner, which will pay off in the long run. It's almost impossible to work to get rich in erepublik so if your after the big money or just to have some more to do in the game, than we welcome you as a company owner!

8a. Helpful links
Below follows some helpful links which can help you:

Beginners guide to Erepublik: http://www.erepublik.com/en/article/beginners-guide-to-erepublik1-890539/1/20

My guide on how to import raw materials: http://www.erepublik.com/en/article/how-to-import-raw-materials-898297/1/20

A very good companytool with lots of other features: http://truebluecreations.net/index.php

Salary/profit calculator: http://www.egobba.de/company.htm http://erepublik.ws/calculators/company/demo#

Expense calculator: http://www.cccp-group.org/index.php?page=erep_prodcalc

World Trade Center: http://www.erepublik.com/en/newspaper/world-trade-center-180920/1

User:Nikolaos II/Business Guide

Contents

Contents

Introduction

Research

Choose industry

Budget

Daily management

Evaluation

Expanding

Sum up

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