Trade and arbitrage

Traders must invest in trade goods, which are an abstract resource costing one bank note (1000 coins) each. Trade goods must be purchased with bank notes, which requires a bank relationship. Nobody is going to entrust their merchandise to a group of vagabonds with a sack of coin. Each trade good requires a wagon and team, making it obvious at a glance the approximate value of any caravan. For simplicity’s sake, the cost of wagon and driver is subsumed into the cost of trade goods.

Arbitrage gained is equal to the number of random encounter checks due to travel braved for each unit of trade goods. If the journey was not perilous, characters other than adventurers would already be moving goods. Upon reaching a destination market, the party gains a return of 50 coins in exchange for each point of arbitrage.

For example, a party with three units of trade goods that faces four random encounter checks accumulates four arbitrage points. This translates to a return of 200 coins on each unit of goods, yielding a total of 3 (trade goods) x 4 (arbitrage points) x 50 (arbitrage return) = 3 x 200 = 600 coins, which must then be divided among the party and is treated the same way as treasure. The way I usually run wilderness travel, each hex takes one day to traverse at standard overland speed, with one random encounter check (1 in 6 chance) per day and one per night. This means that the “cost” of the above example return is 3 bank notes worth of capital (3000 coins) and 6 random encounter checks. Increase either the capital invested or the distance travelled and the return increases proportionally.

There should probably be some limit to the amount of trade a given town or stronghold can absorb, but that can be handled by common sense and ruling. Return can be adjusted for goods that are particularly in demand if desired, though this requires slightly more settlement elaboration on the part of the referee. Perhaps tags per settlement for goods exported and imported would be enough to support this added level of detail. I vaguely recall An Echo, Resounding and Dungeon World (the steading system) to have some related ideas, so perhaps they can be mined for approaches to managing settlement information.

12 thoughts on “Trade and arbitrage

  1. Tom H.

    It’s probably overkill, but the ACKS system for determining supply and demand ends up with modifiers in the range +3..-3 for each of ~20 categories of goods at each market; that feels like a reasonable scale to tie in with this system: haul a caravan from a -3 to a +3 and you’re getting an extra 300c per load; haul from a +3 to a -3 and you’re not going to make any profit unless it was an absurdly long trip.

    (And yeah, that does show that the system starts to break down a bit when you have particular categories of goods, but the categories are wide enough that you can say “Yeah, your caravan has arrived at a farming center, so they don’t much care for grain, but they grow wheat and you brought in rye, which is unusual enough that they’ll pay *something* for it.”)

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    1. Brendan Post author

      @Tom

      I guess the major decision would be flat premium no matter the distance (as I think you are suggesting, with the bonus being applied to arbitrage points at the end point?) or a scaling of the value of each arbitrage point. My not carefully analyzed initial thought as a simple rating of “standard,” “in demand,” and “not in demand but not worth nothing” (with value multiples of 1, 2, and 1/2 respectively) would work well.

      Or summarized: double return (100 coins per arbitrage point) on things that are in demand and half return (25 coins per arbitrage point) on things that are less in demand.

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  2. Scott Anderson

    1. TOTALLY EXCELLENT! As usual.

    2. Since you have abstract trade goods already, would it be impossible to add various rarities of goods in order to lug more for more risk?

    3. Courtney over at Telecanter’s Receding Rules put together a great list of treasure that ain’t coins, gems or magic items. That might be useful to spice up your trade goods minigame.

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    1. Brendan Post author

      @Scott

      Yes, I think rarities could easily be modelled with increased arbitrage modifier. Though, being rare, they should perhaps require adventures (or at least greater investment), even to find. I will also note that strictly speaking just buying more units of standard trade goods is also more risk (as you could be robbed on the way, or lose all your wagons during a river crossing, or have some other disaster befall the trading expedition).

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  3. Scott Anderson

    4. In your exposition, you mention that each hex takes one day to travel, all things being equal. Are these solipistic hexes? How do you figure a road across a plain takes the same amount of travel time as a dense forest, for instance?

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    1. Brendan Post author

      @Scott

      Yeah, I’ve been using the solipsistic hex approach. Tracking exact distances just doesn’t seem to have much payback relative to the work required, though I know that will not be satisfying for folks that like more exact numerical correspondences. So the real answer is that “I just don’t look that closely at that part of the fiction.” That said, it is, I believe still logically consistent. Since a hex has no specific numbers attached, a hex of dense forest can represent less area than a hex of open plains. Yes, it is true that the resolution of such mapping is limited, but in practice I have found it plenty good enough. Most of the time, players are interested in getting from A to B and seeing the sights along the way or poking around C while they look for some hidden thing. And this system seems to have all the detail needed to support those activities in an impartial manner, while allowing structured off road exploration (something that I find hard to do with, for example, a point-crawl approach).

      All that said, if using an approach where distances are considered more concretely, the random encounter check metric should still work, I think. So if it takes three days to cross the tangled forest, that’s worth three arbitrage points even if the same distance, had it been plains, could have been covered in a single day. Essentially, it is just a measure of cumulative danger faced.

      One point that I didn’t raise in the post that is probably worth mentioning is that the number of random encounter checks is a proxy for hazard degree assuming a reasonably smart path is chosen. Obviously you should not be able to rack up arbitrage points by travelling in circles prior to arrival at the destination. So some common sense is required there, though in some cases I could see counting the the encounters from getting lost, especially if the route is completely new, if that is the kind of thing other NPC traders would reasonably have to face also.

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  4. Scott Anderson

    After reading critically and digging a little bit I can see my questions were largely answered in the original post. That’s one of the pitfalls of reading on the mobile look-at device while doing other things.

    I have another question and it’s earnest, and not tongue-in-cheek. How do solipistic hexes “fit together” as it were?

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  5. Gus L.

    I missed this when it first went up, I like it and it fits well with an idea of abstract values based on population size and 1,000GP lumps of ‘resources’ to define a settlement. Obviously it could be made more complex with even simple good categories based on resource type (i.e. food, luxury, security, magic), but that’s unnecessary. The only issue on the arbitrage is that it seems high. I might set the specific arbitrage multiplier based on the destination itself and at lower then 2 points per day of travel, unless one was using some kind of automatic encounter system. Of course this would also depend on game world size, danger associated with wilderness encounters and such. I might allow thieves the ability to ‘carouse’ for a increased arbitrage points/return in the form of smuggling with a failed roll leading to either an ambush or getting caught as a smuggler.

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    1. Brendan Post author

      @Gus

      Yes, the arbitrage return should probably be adjusted to the danger of the setting, though I would say that dangerous wildernesses are more fun to adventure in. Otherwise, I think this sort of activity would lose interest and start to feel a bit like a grind.

      The assumption here is approximately OD&D in terms of encounter hazard.

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    1. Brendan Post author

      @Charles

      That’s a good point. The bank note requirement is probably superfluous in this case. Removing it also simplifies the systems slightly, which is always welcome. Possibly, some other option involving credit might justify using banknotes, but that is maybe needless complexity and also does not fit quite so well with the treasure hunter riches that are not uncommon in D&D.

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