Hawk & Badger Railroad

Strategy

Railroad Tycoon 3 has changed quite a bit in its economic system from that of its previous version. You cannot just haul passengers from station 1 to station 2. Often they pay almost nothing. No longer can you try the stop-the-train trick. On the other hand, the AI has not improved much over the previous version.

The Industry

The key to winning many of the scenarios is to play the industrial game. Often building rails and running trains is just a sideline to achieve some goal need. The real money is in industry. To make money in industry it is important to know how cargo and industry work.

Each farm or mine produces some cargo. Usually 2.2 car loads a year. This will move on its own toward some building that demands it. If there are none on the map, the cargo will just spread around within a few cells of the original industry. But if there is a demand building within - say - 30 or so cells, this will move slowly toward that demand. Note that cells where industry is concerned are large 'demand' cells. These are 4 x 4 of track placement cells. (See Analysis on scales.) To view the cargo flow, click the world/globe button and then the cargo box button on the side menu. You will see a bunch of black box cars or fragments thereof strewn all over the map. Click on a specific cargo type. Here only a single cargo type is shown. A pink triangle shows the sources and a light blue triangle shows the sink or demand sites. The cargo moves from the source to the sink at about 8 cells per year if the land is level or there is a water route. Over hills, it is a bit slower and over mountains at about 4 cells per year.

If you see cargo collecting into thick streams of whole boxcars this is a good point to build in industry that uses that cargo. Check first if there are competitors near by. Also, check to see where that processed cargo is demanded, if there is demand for that nearby. Your industry will still make money as its cargo moves by itself but unless there is demand nearby it may not for long.

Another helpful way of viewing industry is to use the profitability mode (middle button) of Global View. This shows industry as well as trains that are profitable as bright green, barely profitable as dull green, and unprofitable as red. A good industry to buy might be a dull green color but with a cargo stream developing.

If you want to poach on an existing industry, build your factory upstream in the cargo stream a few cells from the other one. Make sure it isn't within the city limits or another one might pop up and you will have more competition.

The AI

The AI is not very good. You can generally beat it even at hard. In many maps, the AI goes bankrupt. That is as long as the density of the towns isn't too great. The AI do sometimes make money, especially if they can get 3 or more cities connected, or if they can connect up to yours or another AI's rail lines, then they do pretty good. So, if you need to take them over check these points. Campaigns like Flying Scotsman are prefect for the AI. German Town is at least good for one AI maybe two if they can connect to each other.

The Stock Market

The Stock Market is the basic avenue to increasing your own Personal Net Worth (PNW).

Other than a new look, the Stock Market is the same as it was in RRT2. You can still buy stock on margin and sell short. As in RRT2, you cannot sell short your own company's stock. Making money in the stock market becomes harder as the old 'Stop the Train' trick of crashing your company stock then buying it up cheap only to run your trains and making a windfall as they all deliver their heavily demanded product all at once. In RT3 if you don't deliver those products someone else will and your halted trains only lose money as they sit idle.

There are a couple of schemes and tricks that still work.

1. Short selling AI stock. Since in most cases the AI will eventually do poorly or even fail it is a good bet to sell their stock short. You must though make sure they are really losing money. If the AI takes out a bond and connects to another city, it probably will turn around and make a profit. Time to buy his stock and settle accounts. If on the other hand the AI has been losing money for a number of years and takes out a bond in order to just pay his bills and keep operating he is doomed. He will never recover. You can short him till the cows come home, or he goes bankrupt and is finally liquidated.

2. Another way to make money off your own railroad and get it from the company coffers into your own is to buy an AI that you have stock in at an inflated price. Find a smallish AI company that is doing so-so. You can buy a few shares of his company here and there. When your company can afford it, take out some bonds, or use its own cash. Pause the game. Sell most if not all of the shares you have in other companies. Buy as much as you can of the target AI. But, you must be able to buy at least 51% of the stock. Go to the merge screen and merge with this RR. Pay as much as you can. Once you merge, your own money will soar. Now buy back the stocks that you sold. Even though you will have to pay the brokerage fees in the trading you should make quite a tidy sum. You can now expand your holding in other companies or your own.

3. If you don't have time or the opportunity for these shenanigans then the surest way to heighten you own Personal Net Worth is to buy your companies stock on margin while you have your company buy back its own stock. Buy a few K of shares on margin, then as the price starts to dip and before your broker calls you about a tight squeeze, have the company use its cash to buy back stock. Watch out for recessions if your company doesn't have a pile of cash as you may get into real financial trouble.

The Stock Market can help you increase Company Book Value (CBV) too. In this case, you would only need to access the Company Detail Stock menu about once a year and issue stock. Issuing stock has the opposite result as buying back stock to your PNW. It lowers your net worth as it reduces the stock price and lowers the percentage of the company that you own.

Stop the Train Trick

Yes, you can still do the old stop the trains trick to gain vast Personal Net Worth. The only thing is that it doesn't work very well early in the game when there's not much demand or cargo at your stations. You need to wait from 5 to 15 or more years. At which time your railroad should be pretty big. You may have invested in your railroad or others and gotten a bit of cash. When you do this, you should be mostly divested in stock from your own company. To do so may take a full year or more. When you are ready, get as much free cash as possible. Also, have your company sell bonds to get a lot of cash on hand too. In January of the year, stop all your trains. Look through your industries for any that are losing money or are about to lose money. Selling these in the same year as you stop the trains just piles on the stock price losses. Your stock price doesn't usually go down very fast during the year so you may be able to sell out your stock in the same year you stop the trains. In December of the year, sell any industry that you ever plan on selling. This not only gives your company working cash but also lowers its profit.

In January of the following year, your stock price should be very much lower than the previous year. It is the time to buy. Buy with both hands. Probably by March, you should start your trains again. It takes awhile for the stock prices to react with the profit so you probably can buy stock for the rest of the year. If anything like a recession or crash happens use the company cash to buy back stock to keep the price up. Even if not, you can reduce the number of outstanding stock and thus increase your percentage of ownership by using the company cash to buy back stock. It is cheaper now so buy more. By the next Jan., the stock price should take a nice pop and you should have doubled or even tripled the percentage of ownership you had.

Stock Price Spirals

We all have encountered the market's downward spiral effect. Where after buying too much on margin we get a call from our broker when we are a few thousand short. If we sell stock but this reduces the price of our remaining stock so that we are now in greater debt. Selling more only in creases the amount we owe. Until eventually, we are forced to sell everything and end up broke owing thousands if not millions. When you do this in a SP or MP game the market does not have time to react to your selling and your stock prices don't recover. You usually find some other player buying up all your stock for a song.

There is another spiral that goes along with this one. It is the upward spiral. This one can be used for good as well as for evil.

If you own 25-35% of a company's stock and want to take it over you can use the upward spiral to help you.

The Upward Spiral - In most cases you will need to already own 25% or more of a company's stock. Have a Purchasing Power (PP) of several million. As you purchase stock in the company, it will drive the value of your stock up. This will increase your PP early on. (Or, it will only drop it a few thousand per hundreds of thousands that you spend.) This lets you make more purchases. Buy stock get more PP. Eventually as you approach the 35% of ownership your PP will start to drop as the stock price doesn't rise so fast. This is good too as it is easier to purchase more stock. You may get to the 50.1% ownership mark without selling any other of your held stocks that you own. But if you do sell, sell the stock in which you own the least numbers. You should be able to acquire 50% + 1k of the stock before your PP goes to zero.

Once you own over 50% of the stock take over ownership of the company. Then immediately sell back all of the over-margined stock or your broker will call and you will go into the downward spiral.

The Hub and Spoke Route System

This is a way of designing your train routing to optimize the passenger service. The following is aphrochine's explanation of the system.

Overview

You find a major city and you turn it into your "hub," this will be referred to hub in the rest of the post. Surrounding this hub are several spoke cities that you connect directly to the hub. Think bike tire. The role of the hub is to be the cross dock for all goods and passengers. Essentially, you will never have a train go from one spoke to the others. There are some cases where it would be better to have a specific route for raw/production materials supply to keep a key industry supplied. You'll have specialized trains running in three specific capacities to supply your cities and help them grow.

Cargoes

I classed all cargoes into 3 types based on the behaviors of their supply/demand.

Express: For the most part, mail and passengers. These loads will find their way to their destination through you network and require no real routing techniques. I usually have a single train cover 3 cities on a looping route. Later, high-speed trains can cover more.

Raw Materials: This also covers production materials (plastics, steel, etc). These are defined because they are demanded by specific industries and are not demanded by houses in general. Hauling these cargoes will be limited unless you set specific routes. This will be covered further down by routing types.

Finished Goods: These are demanded by houses, and therefore all cities in your hub. It's important that you limit supply of these loads into your cities to keep prices high. These goods will be delivered by Custom Consisting your trains to deliver only what is required by the city. You may need 2 trains if the city is a decent distance from the hub. But you have to be able to deliver all the goods in your hub & spoke evenly and consistently.

Routing Standards and Schema

Out of your hub, you'll run these two route types to your spokes directly and exclusively: Express, General Cargo

You'll run the Supply Specific usually from Spoke to Spoke depending on where and when extra hauling is needed.

Express: As mentioned earlier an express route will stop at multiple cities, usually 3-4 including hub. These should be geographically close and you'll want to consist low load counts. This will help the train cover its city route as often as possible with higher speed. You can load out higher load counts but for me (a romantic gamers) I prefer to stay in the concept of "express." Unless the scenario tracks Express speed, there isn't much benefit to leaving passengers behind for the next train. Naming standards are based on its route. I might have a train running to the cities north of the hub, so I'd name the train "[hub name] Express North." Later as passenger loads increase, I'll separate passengers and mail into separate trains. Mail trains can cover a much larger area with the help of Post Offices keep mail around for a longer time.

General Cargo: Set 1 train to run back and forth between a single city and hub hauling cargo. You can route a single train to cover two cities, but you must be able to cover the city's basic needs annually. Sometimes this may require 2 or more trips to a specific city in a year. Later with faster trains, you can do more with one train. Custom Consist your train to deliver 1-2 loads of specific goods/food found within your hub & spoke. You may not have Meat in your system, so do not specify a load slot for Meat for example. However, later if you introduce Meat to the system, you'll need to add it. I usually add 1-2 'any cargo' loads to my consist to help insure the train is running and making money. You may or may not wish to add minimum load requirements. For the return, set X number of any cargoes to return with supplies to the hub and drop off. The idea of these trains is to ration out goods to cities to encourage city growth and keep pricing high. This is much better than saturating 1 or 2 cities with goods which drops prices which and kills revenue for both industry and rail.

Supply Specific: When you have a lot of Iron supplied near a spoke city for example, and a Tool & Die near another spoke city, you may wish to carry this iron directly and then carry the goods to the hub for redistribution. I try to have these loads carried by the General Cargo routes in a 2-leg journey through the hub, but General routes cannot supply large quantities of cargo for industry. A specific supply route is in order in these cases, especially if you own the industries involved. This would mean you need as much of the raw product and finished product to be shipped as possible to maximize the industry profits.

Pricing

I know what you're saying: "Mike, how does the product ship if the laws of pricing don't allow a product to ship."

I have an answer: The hub needs to be delivered as much cargo as possible, so much in fact that the price for said goods fall a little (enough for the price to be lower than the spokes).

The lowest price in the network for finished goods will be where the products are produced. The next lowest price will be the hub (which demands the goods, but is over supplied). The highest prices for these goods will be the spoke cities. You'll make money along the whole way hauling it.

For raw materials, the further away from the demanding industry, the lower price. Assuming the Hub city is somewhere in between the supply and demand points, it achieves its 'median price' role in the network. This isn't always the case and Supply Specific routes are needed.

Situations I've encountered, and how I dealt with it.

Spoke has industry, then same industry pops up at my hub:

The problem here is that the hub price will fall to the point that any finished product will not ship from the originating spoke city. If you don't own the spoke industry, simply move the core of your industrial supply to the hub industry. If you own the spoke industry, block as much raw material going into the hub as possible. This will keep the spoke price lower, based on production. Even if only a couple dollars. You may need to set up specific supply or customize consists on your general routes' return to the hub to keep other higher priced cargoes from blocking out the supply because the revenue on running the goods to the hub will be nearly nothing.

Raw Materials are supplied in too small amount to effectively supply the network. (this is usually raw materials that are consumed by industry and houses; coal, produce, milk, etc. Else you'd have no reason to haul them):

Build an industry at the hub that consumes the raw materials to convert them into a more pricey good. You'll make more hauling the goods and you'll make money with the industry that produced them.

I cannot drive down the price at the hub on finished goods to run them to the spokes:

I've added industry to (assuming the raw materials are there) to produce more to help saturate the hub driving down prices.

I cannot keep raw materials from going to another industry, which is outside my network.

This is definitely a case for Supply Specific routes. Build a large station in an intercepting point for the raw materials. Use multiple trains to have a train sitting at your station 9-10 months out of the year collecting cargo as its produced. In this way, you can catch cargo en route to an out-of-network industry and take it to yours. On the Texas tea scenario, I have 4 trains dedicated to running Oil from Naga to Houston.

In Closing

I can post a detailed example of this if requested. Be warned it'll be longer than this post. I used this hub & spoke system as a starting point for all my scenarios now.

I usually have a healthy network up by the 8-year mark and working on a second network to connect to the first one, keeping an eye on the win conditions. This is also a long-term strategy, as you'll grow cities fairly well in 10-15 years meaning a solid foundation for the latter half of most scenarios.