Update 2.

[Aziphirael]

For some odd reason I can't get into the thread to post a message. Especially when I log in. So I'm going to post my replies here. Had quite a few queries and to answer P-J's points. So I thought I would try and pull together the current plans as we have them. Neverdie as lord and master of the resort has final say

Right now apart from those that are invited to the association, people will buy their shops at market rate on auction. However, by applying to the association and if you are accepted this entitles you to a discount that is paid to you based on the market price of the shop that you bought.

The other plan I want to do is that only Association members can advertise on realityport.com, something I'm chatting with Neverdie at the moment. Since I feel membership to the association should entitle you to some heavy marketing benefits.

The third area, is efficient supply chains, whether its networks of crafters suppliying goods, or miners and hunters selling their raw materials to you. This is a tricky one too pull of, so will take a bit work to set up right. But again a crucial aspect of the association.

So in that sense sure you are buying a shop, but also buying into a network and a rebate if you apply to join the association. If you're running the shop for fun in the game context, then the association may not be for you and I'm quite happy to say that.

As I've said, I'm quite flexible on business plans or perhaps a better statements of intent. What I'm really looking for is creativity and the ability to communicate your ideas.

Now that we can see what the shops are like, we should be able to finalise the plans and start to launch this thing.

[The Ripper]

hi...

Not sure if this has been mentioned before but have you an idea as to when you would be intending to release the shops?

also if the shops are to be put onto auction how would you be keeoing track of owners and making sure that they fit? Or will they be released on a public auction through the forum etc? but only ppl approved by yourself and ND would be able to Bid?

Thnx

Rip

[P-J]

Thanks for your reply – there are some really interesting ideas – marketing on the CND website will be helpful. Before you read this post – please note that I am highly supportive of CND and think NeverDie has a really interesting vision – which I want to support. So treat these as questions from the inside .

If I was playing for the hell of it I may just buy the shopkeeper to have some extra fun, for the convenience and maybe to make a small profit. If I was buying it as a business then I would have some hard questions to ask:

This will be a speculative ‘capital’ investment of between 3000 and 6000 PED (whether through the auction or yourself). In order to make an investment decision and ensure a reasonable chance of a return on investment could you supply answers to the following questions

1. Taxation: The price structure around shops seems to exclude the selling of high value high mark-up rarer products. The consensus on Entropia Forum is that it is more cost effective to sell these through your existing contacts or through the auction. Is this an accurate perspective? If it isn’t please explain why. I get the distinct feeling that you know more about the way these work than we do!
2. Restricted product range and misfit with clientele: If we are only competitive when using a shop to sell low value items is there a misfit between what we can sell and our potential client base? I see CND as a place which is aimed at the more experienced player who is willing to deposit and pay more for the experience. These players won’t want to buy low value products.
3. Location: People will travel distances to buy rarer products, however, will not travel far when they are buying low value products where the alternative/ or similar product is easily available at a nearer location. It is vitally important, therefore, that there is a high density of passing trade. I understand that the current location doesn’t seem to provide this passing trade. What actions will be taken to either improve the passing trade or move the location of the shops?
4. Length of period before ROI : In order to gain a return on my investment I need to ensure a high values of sales . If we estimate a generous maximum of a one ped advantage over selling on the auction price, my back of the envelope figures indicate that in order to get a RO on my investment I would need to sell 1 times the cost of the shopkeeper (please note the fantastic mathematical ability). If it sells for 3000 Ped then I need to sell 3000 items to break even. Otherwise I could have just invested my 3000 ped in other ways in the game and simply used the auction to sell items. This would, therefore, be a long-term highly speculative investment. What actions will be taken to support and encourage players investing in the vision?
5. Supply Chains: Most players already have good supply chains - based on mutual trust, friendship and mutual profit. How will you be able to get suppliers to sell to the network rather than their existing customers (price/ convenience of sale…)?
6. Reselling of shops: Once a shop has been bought by a player – what sanction will be put in place (if any) to persuade them not to sell to an unsuitable shop? What characterizes an unsuitable shop (if one exists in PE)?
7. What will be the structure of the association: Will it be an autocracy, democracy, committee based….?

Please don’t PDF up the answers – a post to the forum will do (no graphics/ pie charts or fancy backgrounds)

[Aziphirael]

I'll try and go through your points:

1) It should be noted that the tax appears to be paid by the consumer and not by the shop owner. So in effect its a VAT style tax (Value Added Tax). I found out whilst fiddling with my shop stall at Hades C, that the system adds the tax on top of the price you set. Whether this makes more expensive items less attractive to buy is something that may require experimentation but from my experience there is a negligible difference as long as you are within narrow band around the the supposed "market rate".

2) If this tax, which for the time being we shall call VAT, is actually being paid by the consumer then as a shopowner you can sell expensive items. Expensive items or high end items extract a premium that is difficult to quantify by auction alone. At the same time it looks like you can still place a shopkeeper teleport pad in place in a shop, so you can sell expensive items through this and only have to pay the decay costs. I'm not sure if this is a loophole or feature and whether this will be disabled in the "proper" shops.

Also bear in mind that CND is not just a destination for Vets or high end people. It will become, through Neverdies marketing efforts a place for new players to turn up, via the special PE client that causes people to spawn directly on the space station.

3. This is one reason why shops will be release on a very schedule to ensure we don't dilute the shop's trade. Again when CND goes into full marketing swing to attract new players, the population will start to increase. I believe the current plan is to only release perhaps 10 a week. The same can be said for Treasure Island in the early days. I bought my estate there to run shops for 10,000peds, which at the time people thought expensive. For a few months there was no traffic but as TI became an important destination business picked up and I found that within a year I had recoup my 10,000peds investment and was in a profit.

4. Yes its a speculative long term investment, however there are key advantages about why I am a proponent of shops. Firstly there is no time limit, I've seen items on auction constantly going back in each week because no one buys. Those 1 ped fees start adding up. You are building a PE prescence for your "brand" or identity. People will know where your shop is. People can also see your products in an easy fashion. Certainly clothing in my view sells better on shops because people can see a variety to choose from. Shops are 24/7 and with no time limit you can go on holiday and things will keep ticking over. And finally for the odd people like me, its fun ;-)

5. This is a very difficult topic I'm trying to tackle. We currently have a "village" style economy and I like to step it up a bit. I suspect that one of the ways of doing it is to create an environment where suppliers and association members can meet and make deals and trade. One of the things I have found from my own supply networks is that crafters work on big runs and will produce hundreds of items. Most get TTed, whilst I'll buy a small quantity (Say 30 or 40 items a go). That means crafters have spare capacity where economy of scales can fit in.

6. An unsuitable shop would be one that is constantly empty ;-) I like the Deathifier model of doing things, which involves buying back a shop and then recirculating it back into the market. However, we can't stop people from doing PvP trades and most likely what happens is that if a person sells, that shop is removed from the association, so the new person has to join again.

7. The association will most likely be run by myself and Neverdie in, Neverdie holds the control over the deeds and most likely will have the final veto, since its his Space Resort ;-) At the same time I'm being tasked with the application process and put into place help & support for members of the association. And at the same I think my experience over the last two years running shops in PE means I will be here as an advisor/consultant. Something that I have done for a number of people. We do need a dispute resolution process as well and a way for suggestions to filter through.


Hope that helps! On a sidenote, it looks like the shop deeds haven't turned up yet. So hold onto your hats for the moment.

[NEVERDIE]

Before I post, I want to make it clear that the Shopkeepers association is run by AZ, so my comments are from NEVERDIE and only from my point of view..

Obviously Sales tax is a new thing and everyone is trying to figure out how it affects them. Here's my take on it so far....

Firstly I'm really focused on building CND to the point that it is marketable to the general public as an all in one solution for a virtual experience...

So lets focus on the future for the moment and not the pre-existing community.

Consumer hears about CND via, Banner AD, News Article, TV commercial, Whats on listing etc...

Arrives at CND surrounded by other noobs. Sees Billboards etc floating in Sky... Discovers massive shopping mall with every virtual goodie you can imagine on sale... Marvels at the prices....

Sees people wandering around in cool looking gear, figures hell they must be paying these prices. looks at self all dressed in orang thinks ugh, I need to deposit.

Explores resort finds easily accesible hunting grounds, lots a people buying and selling goods, sees all the globals zipping past chat window...

GOes to club area and enters a trance listening to cool music, seeing cool avatars dressed in cool stuff dancing their virtual asses of.. Chats for a minute with his favorite DJ in the World... Realizes it is 4am, logs off and goes to sleep, Wakes up in the morning still dreaming about PE.

Goes to work, cant think straight, still thinking about getting himself some shades and techno pants...

Gets home, doesnt turn on the TV to watch American idol, logs into CND , Deposits $10... Goes back to mall and manages to find a cool pair of pants, but cant afford a shirt...

Goes back to the club dances chats, makes some friends, goes on a noob hunting trip, finds way to mega stadium... His Mind is blown as he says Ubers Competitng for $10,000 Prizes

realizes it is 5 am, cant sleep, goes to work, barely manages to make it through the day.. Checks Bank card statement, finds MA code, raised deposit limit, Doepositis $100... Goes on ashopping spree in mall Neverdie..

Logs on 2 or 3 times a week... for a couple of hours here and there to find cool new clothes, hang out in the clubs...

Never hunts or mines or crafts seriously, HE is a consumer.
Visits planet once, gets lost, killed by robots, finally gets a ride back to CND and swears never to leave again.

Eventualy buys an apartment, furnishes it at the shops at CND mall.
Cant find a light fixture he likes... Goes to auctioneer, tries to bid on one, gets outbid, tries again following week byuy out is too high, cant login intime to make the end of the auction...Finaly Does a buy out the next week in auction and then pays the shipping cost on top
goes back to mall sees same lamp in shop 5% cheaper. Swears never to bother with auction again.

The point is - CND in my mind is an entertainment complex that is geared toward the future of PE...

There are of course lots of new costs involved in operating there.
Transport, Shipping, Zero Public Storager/ Rental fees and sales tax...

this ultimately raises the cost of the Goods. The solution is simple Mark the items up accordingly in the shops to cover all these extra expenses and also add some to put a little more value on your own time and experience...

In Real life not everyone always seeks out the lowest price. Most people simply shop at their favorite shops...

Now from my point of view as the owner operator of CND, every month I will calculate the revenue generated from Sales tax and I will think how I can re-invest a potrtion of that revenue into marketin the Mall so that i can increase those revenues...

Therefore a portion of the taxes will go into Real World and Virtual marketing. I will have lots of money to spend on Billboard advertising in PE to bring people up to our wonderful mall.

As long as the shop owners mark up all goods accordingly cheap and expensive, then the extra overhead costs are covered..

CND is particularly unique given that it is a major shopping Mall,
therefore it will have some muscle when it comes to advertising. Also it has its own Portal... and Live entertainment to draaw consumers... So it will hopefully be worthy of the premium paid to operate from there....

---------------

Back to the issue of the exisitng community, since they are all we have right now we must cater to them. Well it is already proven that they are willing to pay hunting and mining taxes, to hunt in exclusive areas, so there is a good chance they will eat the mark ups in the shops for the luxury of wandering through a magnificent shopping mall and being able to see so much stuff, instead of fiddle around in the auctions and bid and wait etc... Not everyone, but a portion of the people...

So altogether I'm obviously gald about the new system, because it will enable me to grow the business and compete with real businesses in reality for advertising space etc.

Ultimately my success is also dependent on the success of the inhabitants of CND, so you can bet i will be working to promote your businesses

[Dannei]

Originally Posted by NEVERDIE

Sees people wandering around in cool looking gear, figures hell they must be paying these prices. looks at self all dressed in orang thinks ugh, I need to deposit.

Omg som much text in this post that my head goes berserk

So does this means that there will be CND exlusive cloth, armors??

[Epictetus]

Two very thoughtful posts...thanks.

-Aziphirael, I like what you say about supply chains and economies of scale because it's very true that things are TT'd when they don't have to be. Imagine a crafter down on the surface TT'ing 30 pairs of pants when 30 "clubbers" in CND are in need of them. This will, however, require that the CNSA keep contacts planetside to acquire extra items. The CNSA may also need its own hangar to ensure cost-efficient transfer.

-I wonder what the role of Limited items will play. It seems to me that MA is slowly attempting to make all actionable items Limited. Obviously, the greater value a Limited item has over TT value, the better incentive to sell it out of auction in the CND shops (if, indeed, there will be a way to sell big ticket items without charging the buyer a hefty sales tax).

-I agree with both of you that an advantage of the mall is that the auction is so time-sensitive. However, as water always finds its level, the mall's prices can't be vastly higher than the auction buyouts plus transfer fee or it will not work. Unless the items are exclusive enough.

-The general public seems confused about the difference between the shops and the stalls. Now with VU 8.1 the confusion is magnified because of tax and maintenance fee issues.

[Aziphirael]

Aha. Now I know why these threads aren't working for me. Dosen't like Firefox, but can post in Internet Plexplorer.

Well right now my key concern is usability rather then Tax. The interface to buy an item on display is too put it bluntly convoluted and frustrating, especially for new players who may not realise that "hold right button over item in cursor mode" brings up the interaction menu to buy.

Right now Shopkeeper Teleport Pads are still more user friendly and potentially cost effective. I'm still running them at my Hades C stall and the display items are not selling as fast as the ones in the pad, highlighting the usability issue. I have to say if shops allows the placing of SK pads, then I would suggest using them.

The auction pricing versus shops is very interesting. Too be honest I've been running retail operations since shops came out and the trend I've found is that "market price" is a somewhat broad ranging concept. So much so that the relationship of pricing between auction & shop is not as clear cut in terms if I'm more expensive I don't sell as many. For shops branding, perception and marketing are more critical rather then price.

[NEVERDIE]

Ahh now i have the first Deeds, it appears the buyer is thew one who pays the sales tax not the seller, so no need for the shop owner to mark items up to cover the tax...

[Tussi]

Hi NEVERDIE,

Originally Posted by NEVERDIE

Ahh now i have the first Deeds, it appears the buyer is thew one who pays the sales tax not the seller, so no need for the shop owner to mark items up to cover the tax...

I'm glad to hear that you start to open the shops now.

Regarding the tax: If the buyer or the seller pays the tax dosn't make a difference, the effect of it is the same: Capping shops to low-price items.

Tussi