A Dragon's Curiosity

After Nisha returned to the Dharnas estate, she informed the gatekeeper about the estimated time of arrival of the senior priests, lest the clergymen would be rejected at the door.

Thanks to her status as the young mistress of House Dharnas, the guards in charge of the gate believed her without the need to check with someone else.

Burdened by the grim descriptions she learned about from Miss Thana, the elf pondered about possible avenues to prepare better for the coming disaster, when she suddenly ran into Annabelle and Lydia in front of the dining hall.

Generally, the twin sisters spent their time at the trading house during the day, thanks to the arrangement by Luthais and learned about the trade of a merchant.

Recently, the two women had already learned the essentials and prepared to conduct their first own transaction to put their knowledge to use.

“Good morning, Nisha. Are you in a hurry?”

Annabelle spotted the uneasy air about the young girl and inquired directly about her thoughts.

She was always the more outgoing one among the sisters, and not afraid to speak out.

“It’s almost noon, though. I’m not exactly in a hurry, there’s just a problem I can’t quite figure out.”

The dragon spent most of the morning with the old priestess, the sun was already high in the sky and countless chimneys in the city spewed smoke as different cooks prepared lunch for their employers or families.

“What difficult issue has managed to checkmate our little lady? Why don’t you tell us, perhaps we can think of a solution together?”

Annabelle jested in good humor, while Lydia assented silently with a nod of her head.

It was quite strange for them to imagine that there were problems that stumped the elf, she had always been quite resourceful in the past and managed to conquer everything thrown her way.

Nisha did not reject their goodwill, as the core problem, the [Blackroot Plague], was already known to Lord Dharnas and he reported it to others anyway.

“Now the problem is that there is not much anyone can do to prepare for the coming outbreak, so I was wondering if there is anything I might have overlooked.”

Retelling the general trajectory of the last [Blackroot Plague] incident as well as the request from the [Thieves Guild] to acquire a great amount of food beforehand, the trio put their heads together to come up with more ideas.

“Actually, I was thinking that the order of grain from Sera Carmen might be a good first commission for our Merchant House.

I have to spend a certain amount of gold anyway to buy a favor from the [Thieves Guild], so there is no real burden when dealing with the prices and transport.

It would make a great test run before taking orders that actually bring in lots of money.”

Nisha shared her idea with the twin sisters, she had already accepted the fact that she was going to be one of the owners of the group.

Taking responsibility and contributing a good first deal counted as the dragon making a contribution to their business.

Once they had a working relationship with the underside of the business in Thurgau, there was much less of a chance to get robbed and pestered by thieves.

Lydia, who spoke more reservedly and had a quieter nature than her sister, pushed her glasses up her nose while she pondered the proposal.

“It’s not impossible to buy food and grain elsewhere and ship it to Thurgau, it is a good precaution according to the information you have told us.

The [Thieves Guild] picked up the information the earliest and is worrying about their members, which fits with the information you got at the [Seven Star Church].

Furthermore, it is indeed a good idea to hire some carts first and learn more about shipping goods around Leandar before we acquire our own means of transport.

It’s a possible trade method for the future, placing more attention on the quantity of sales instead of increasing the margin.”

Nibbling on her lip, the older sister mumbled some more technical terms she learned about  in regard to trade and funds, while Annabelle beamed confidently next to her.

Nisha would have bet that the younger one did not really understand the conversation right now, but she did not say so out loud.

Intrigued by the thoughts of a professional merchant, the dragon gave the girls some time for thought and inquired again.

“What’s the difference in margin? And why is quantity more important than quality?”

Nisha had no real background in peddling goods, her idea of making purchases only came from throwing large gold coins on the counter in exchange for packets of tea.

To the prodigious spender, five hundred gold spent on grain did not sound like a particularly big trade either.

Seeing that the elf’s curiosity piped up, Lydia knew that they were in for a longer discussion and led the other two girls to the salon on the second floor.

Once they were properly seated, the older twin sister organized her thoughts briefly before giving a quick overview to the curious girl.

“Merchants generally trade with two possible options in mind, at least here in Leandar.

First is quantity, meaning a lot of volume. By buying up a lot of iron, grain, or other commodities, it’s possible to get a cheaper price locally and send it to other cities, towns and regions, where they are scarce.

Although the difference in price is not big, through the big volume, the profit adds up and makes it lucrative to transfer it to other places.

The second avenue is a big margin of profit, which usually refers to luxury goods.

Rare materials and produce from the border of the Wilderness, for example, are still expensive to acquire in remote places, but still available due to a lack of use.

By making an investment and buying those undesired materials, a merchant can bring them back to the capital, where equipment makers and alchemists are willing to pay a higher price for them, who will in turn fashion finished goods out of them.

The difference in price for a sixth tier material in Thurgau and a remote city can go as high  as two or three times, making it profitable for the traders to import them.

As a rule of thumb, the idea is to buy low and sell high.

So the goods a merchant wants to acquire either have to be cheap and high in volume, or have a high demand outside of their place of origin.”

Reducing the essence of the lessons they learned at the Merchant House as much as possible, Lydia pointed out her understanding as a merchant to Nisha.

While it sounded easy in theory, there were many facets left unsaid that seperated a small trader from a great merchant.

The dragon nodded her head in agreement, thanks to the concise explanation she satisfied her curiosity.

“It’s a good idea to personally buy and import the grain then, it can act as a trial run for our own business idea first.

We need to decide whether we want to go for high profit margins or bulk trading in the future.

At least, we will have some experience.”

Nisha thought that it was not bad to spend some gold on experiencing an independent trade agreement.

There was no loss for their fledgling Trading House either, as the money was the price for protection from thieves and ruffians.

Lydia gave a silent form of approval again and started to ponder the ideal development path for their trades, an unexpected voice chimed in.

“Isn’t it a great idea to acquire a lot of food then?”

Annabelle scratched her head while she asked without much thought.

She had more enthusiasm for social aspects and bartering, not strategic buying decisions.

Hearing her confident tone, Nisha and Annabelle wondered why she suddenly had such an insight.

“Why do you want to buy more food suddenly? We only need to acquire enough grain and other foodstuff for the five hundred gold worth deal with the [Thieves Guild].

There is not much profit in trading grain in Leandar either, it’s one of the exports that often go to other countries because we produce so much, which makes it relatively cheap here.

Buying a large volume does not yield enough profit when you consider that there are a lot of costs coming from the carts and drivers that ferry it.”

In fact, a few large merchant houses did specialize in grain trade, but they mostly sold the local produce to other countries, which lacked the fertile soil in the middle of the area that Leandar occupied.

Otherwise, the sale price was too close to the buying price.

Annabelle did not share the same concerns as her older sister and cheerfully expounded her idea.

“Nisha mentioned that the thieves are concerned about food and asked for a large amount, right?

Similarly, the kind old lady at the church also mentioned that a great part of the harvest rotted on the fields when that plague happened last time.

I don’t know what else will change when there is an outbreak this time, but shouldn’t that sequence of events happen again?

Then there will be a lot of people that want to buy grain, increasing the demand sharply.”

The energetic young woman beamed as she looked at the other two girls, similarly to a happy student after answering a test correctly.

She quite liked the tale she heard about the past and noticed the overlap in the request from the [Thieves Guild].

Lydia wanted to point out a flaw in the hasty conclusion, but had to pause after thinking the proposal through.

It was true that the increase in demand would sharply raise the price with dwindling supply.

A margin that was normally not available made it profitable.

Nisha did not agree right away.

Sera Carman asked her to purchase the food at the current market price, which meant that they were aware of the steep cost increase.

There had to be a reason why they would hand this task to her instead of moving themselves and earning a lot of money.

Her family name might help with circumventing the monitoring for great grain movements, but there had to be other people who could do the same.

Discussing the possible reasons for and against a venture in buying grain and foodstuff, Nisha as well as Annabelle and Lydia did not manage to come to a proper accord, they were unaware of too much important information.

Unable to continue only by themselves, Nisha proposed to go to Duke Dharnas and discuss their idea with him, as an experienced veteran in the capital, he should be able to give them a definite answer.

“So you want my opinion on the first venture of your Merchant House, correct?”

Luthais Dharnas had barely started to deal with the slew of reports, investigations and preparations for the coming plague outbreak, when the three young women knocked on the door of his study and asked for his opinion.

Despite the heavy workload, he agreed to hear them out.

“Indeed. We were thinking about taking on a task to ship some grain to the capital in a large volume to learn the ropes and get used to shipping goods, without much expectation of profit.

But when we planned together, Nisha brought up the coming [Blackroot Plague] and a story she heard from an old priestess about the last time it happened, and there occurred a famine at the same time.

We wondered if it would be feasible to buy more food now when the prices are low and sell it for a profit later on.

The greatest concern we have is that there might be others who plan to do the same.

Other parties might be aware of the spike in demand as well and should be eager to reap a profit, making it difficult for us to succeed.”

Lydia skillfully concealed the task from the [Thieves Guild] in front of the marshal in charge of the soldiers and defense of the capital, afraid to earn his disapproval for such unspoken rules.

Next to her, Annabelle eagerly nodded her head like a hen picking up food.