Bottom-Up Trade: Pharos IV

[rust]

Since trade and merchant ships seem a major subject on this forum, I will try
to describe how trade develops in my setting, a frontier region of my non-of-
ficial and only partially-Traveller universe.

The center of my setting is a human colony on a water world, Pharos IV. My
group has played the history of this colony from the discovery of the planet
to the year 72 n.L., about 80 years of game time, and we are still continuing.

When the colony was founded, the colonists only had a single small modified
freighter, and had to charter transports from a megacorporation to bring the
necessary equipment and supplies and the colonists to Pharos IV.

Once the core of the colony had been established and the first deep sea cry-
stal mines had begun to operate, the transports of the same megacorporation
shipped the crystals to a developed industrial planet and equipment and sup-
plies (and more colonists) from there to Pharos IV.

At the same time the colonists used their old freighter for errands (e.g. to buy
urgently needed spare parts or pharmaceuticals, to take colonists to other
planets for medical treatment or to university, etc.) and to establish some ba-
sic contacts with other colonies of the region.

After a while the colony had become wealthy enough to think of imports and
exports in addition to the single route served by the megacorporation.
Pharos IV still had to import most of its high tech equipment, but it had also
developed the production of aquarobots, diving equipment and other marine
technology.

The colonists contacted the region's network of free traders and offered to
subsidize a merchant ship which would establish a trade route between their
colony and the other young colonies of the subsector, especially those which
might buy marine technology and could sell "land goods" unavailable on a wa-
ter world (e.g. grain, fruit, wood, etc.).
The subsidies would have to be very high in the beginning, basically covering
all the expenses, but would be reduced once the trade would begin to beco-
me profitable.

So the first subsidized merchant started as a kind of colony-owned "state tra-
de ship" run by a crew of free traders.
It took several decades before this ship made any sizeable profits, but during
this time it provided immensely important services to the colony, beginning
with a measure of independence from the megacorporation, including vital
political, economical and cultural contacts with other human colonies, and
providing the colonists with more and cheaper "land goods".

Once the basic trade routes had been established and created some profit,
the ship was turned over to its crew under the condition that it would con-
tinue to serve the region as a free trader.
Meanwhile other colonies had copied the model, and a small fleet of some co-
lony-subsidized merchants ships and some more free traders served the sub-
sector's trade routes.

The kind and number of merchant ships as well as the kind and amount of
subsidies developed not according to any economic models or rules tables,
but according to the setting's development and events.
Even slight differences in the history of the setting would have influenced and
changed the setting's "trade system": A failed business negotiation, a politi-
cal conflict, a new colony in a neighbouring subsector could have destroyed
trade routes and created other ones.

So, I do not believe in trade systems as part of the rules. For me, trade is a
part of the setting, not of the rules framework.
Trade routes, merchant ships and even commodity prices depend on the set-
ting chosen for the game, and no general rules can provide the necessary and
plausible informations that would fit any and all settings.

 

[Icosahedron]

Cheers, Rust, you've pre-empted my request.

I agree that, particularly on a developing frontier, the local setting is of paramount importance, but equally, the whole frontier region presumably needs links to the governing polity, and those links would be more formally established. What trade rules do you use to govern this?

The other important factor is how your traders set their local pricing structure. Yes, in reality it would be based on the best price they could get, but in a game you need some rules to determine what that best price is - unless your TU setting is so highly developed that those things just fall into place, but that's a level of detail I really don't want IMTU.
So how do you determine what prices goods buy and sell for, and how much passage costs IYTU?

 

[rust]

(...)the whole frontier region presumably needs links to the governing polity, and those links would be more formally established. What trade rules do you use to govern this?

In my setting there is no governing polity, the colonies are established by
whatever organization or corporation wants to do so and can afford to do
it.
Therefore the colonists had to find the financial means to build their colony,
and these were provided by the megacorporation, which was interested in
the resources of Pharos IV. It took the colonists more than 50 years to pay
back the loan they had received from the megacorporation.
The megacorporation's bulk freighters also provided the only link to a more
developed region, except for the colonists' own small ship and an occasio-
nal visitor.
Since the megacorporation had a monopoly on this most important trade
route, it usually charged rather high prices for all goods - "catalogue price
plus 25 % plus transport" was the average.

The other important factor is how your traders set their local pricing structure. (...)
So how do you determine what prices goods buy and sell for, and how much passage costs IYTU?

The pricing structure was the result of a series of (in-game) negotiations. The
colonists and the traders finally agreed on:
- all passages and freight would be paid for according to the number of weeks
the passengers or freight would be on board of the ship,
- an economy passage (equivalent to a middle passage) would cost as much
as the average monthly income of a colonist (ca. 3,000 ACr) per week,
- freight would be transported at 1,000 ACr per ton per week,
- the colony would provide the traders with free fuel (not a problem on a wa-
ter world), and its technicians would carry out minor repairs and maintenance,
- the colony would pay the necessary subsidies to make this price structure
work until there would be sufficient profit from trade and speculation.

Likewise, the prices of goods started with a basic value determined by the
costs of their production (here I used the colony economy ideas from the
World Tamer's Handbook, the equipment prices from various rulebooks - not
all of them Traveller - and some handwaving as a base), which had only to be
decided upon once, and then were modified according to the results of
(in-game) trade negotiations.

So, the leader of the farmers' union of the agricultural planet Samarran sat
down with the chief negotiator of the free traders' guild and the trade re-
presentative of Pharos IV, and negotiated the prices for the next five or ten
years.
Events in the setting (e.g. piracy, surplus production, etc.) could then raise
or lower these negotiated prices, although usually not very much.

Of course, this kind of in-game trade can only work well if the players are in-
terested in the economy of the setting and like to play negotiations once in
a while, otherwise the GM would have to make arbitrary decisions based on
his opinion on the setting's economy and his plans for the campaign.

Fortunately, my players like that much detail (but not more) of the setting's
economy, and the "traders" and "politicians" among them enjoy the occasio-
nal trade negotiation.

 

[Icosahedron]

No governing polity? At all??
That's the definition of an anarchy, and anarchies don't tend to last long before somebody smells a power vacuum and decides to impose some 'order' on the situation - even if it's only a cartel of corporations, somebody's gotta make the rules everybody lives by.

Riiight, that looks like a very involved, role-oriented trade system. I doubt whether that would suit my game - however, enough of my players lurk here that they could protest strongly if they disagree...

 

[rust]

No governing polity? At all??

Ah, no, I did not put it right. Of course there are nation states, both single-
system states and stellar empires, in my setting's universe, and the mega-
corporation mentioned above has its headquarters in a constitutional monar-
chy comparatively close to the Demara-Subsector.
However, in the setting itself, the Demara-Subsector with the various young
human colonies, there is no polity governing the subsector, all those colonies
are "independent nations" (or at least plan to become such).

I think this kind of trade system does only work for a comparatively small set-
ting with a limited number of inhabited planets. However, since my group plays
the history of a single colony in a region with few other settled worlds, and
the characters rarely travel outside this region, the system suits us well.