If you start each game of Railroad Tycoon II with the main focus of building a successful Railroad company, you will find yourself consistently on the wrong side of the track. Success rests in the hands of the unscrupulous rail baron that wrestles majority control of their company (and other companies) away from all outsiders and then uses that control to build their own personal fortune. Personal net worth opens the doors to victory in most every game.

Building the Company

The company you build facilitates your rise to independepent wealth. Therefore, it is important that we analize some of the basics for building a successful rail business.

Your First Decision is Huge

In scenarios where you must start a new company to begin the game, the first financial decision you make is critical. Contrary to the recommendation of the tutorial, never start the game using the maximum amount of outside investment. Always start the game with maximum investment on your part and the minimum on the part of external shareholders. Although the extra cash makes construction easy, the long term impact on your net worth is devastating. Allowing outside investors a greater share in the success of your railroad leaves you with a smaller piece of the pie.

Short Lines Lead to Profit

Starting with the minimum amount of cash, means you must be very careful how you set up your first two stations. If you spend too much money, you may not be able to purchase a train. Therefore, make your first track short and simple. In the Golden Age, I prefer establishing a double track line between Baltimore and Washington/Alexandria. Do not build water towers, sanding towers, roundhouses, etc. this would be a waste of precious cash at the start of the game. Your trains will let you know when you need to make these improvements.

Once you can afford to build a second train, do so immediatley. Can you afford a third train? Buy it! The most cost effective way to increase profits is with mulitple trains on short tracks, as opposed to laying miles of track that are only partially used.

Building up commerce between two cities not only helps your company get off to a healthy start, but it will also inspire growth in those cities. As a city grows, the amount of goods it supplies and demands increases as well. Consequently, your rail company will enjoy the benefit of this informal partnership.

Selecting Cargo

Early in the game, micromanage every load of cargo your trains haul. Double-click the train just before it pulls into their next stop and make sure to load them it with all the available freight and passengers (six cars max). Generally, freight (in demand) should take priority over passengers. Furthermore, if you have 3 or more passenger cars ready for transit, combine them together with a dining car to maximize profits. In many games I have one train dedicated to passengers between two major cities and the rest dedicated to freight.

As the game progresses, spending time managing every train may become too time consuming. Once the game reaches this point, you can set some parameters to allow the trains to 'manage themselves'. In the train dialogue use the cargo lights to determine when a train is allowed to leave the station. Red means the train will wait until fully loaded before departure. Yellow means the train will hold until it half the cars are full. Green means the train will leave the station without regard to the cargo load.

Expanding Your Line

The flow of traffic on your original line has now reached the point of steady traffic with an occassional blockage. The time has come to start laying more track. Keep it simple. Join another town/city onto your existing line or join two towns that are in close proximity to each other. If complimentary production sites stand close to your existing track you may want to consider connecting these sites to your original lines as well. However, this should not be the primary focus of track building. These sites only provide economic growth in one direction. For example, attaching a grain producer to a city with a bakery will definitely help the city. However, you will gain no profits on the return trip. Don't be afraid of sending your engine back without any cars.

Train stations that become the hub of traffic are the best candidates for maintenance improvements, such as water towers, sand towers, and round houses. Add the other buildings where appropriate. Also, consider using large stations to tie in more industries to a particular line. Large stations can overcome the costly 'boundaries' of rivers and mountains and in the long run the are usually cheaper than laying long lines of track and bridges.

Establihing Your Personal Empire

Once you have taken the reigns of any rail venture, you must at once begin rewarding yourself for your efforts. The pittance your board attempts to pass off as an annual salary is hardly just compensation for your efforts. You must capitalize on your position within the company to fatten your own wallet.

Elminating the Leeches

Believe it or not, the individuals that assisted in you in starting your venture are now the parasites that stand in the way of your ultimate achievement. Every bit of success your company enjoys must be shared with everyone that holds shares in your company. You must buy these people out!

There are two ways to eliminate outside involvement in your firm. First, when you have enough cash, you may buy the outstanding stock held by other investors. Second, when your company has enough excess cash (anything over $1 million), you may buy some of the stock back from the shareholders. You should spread these purchases out over several months or even years to prevent an over-inflation of the stock price. You want to systematically eliminate these external shareholders without damaging the cash position of the railroad.

Give Yourself a Raise

I have yet to discover a method to insure an increase in my annual salary. Even when the company performs well the board may choose to cut my salary. However, you can certainly increase the amount of income you receive from the business through the use of dividends. Early in the game, when the shares of stock are dispersed among a wider population, you do not want increase the dividends too much. You will be giving the company's money away to 'strangers'. However an increase to a $1.00 a share will help to increase your cash flow, so that you can continue to buy more stock.

Once you become the sole owner of stock in the company, dividends become the easiest channel for passing company cash directly into your wallet. A fifty-fifty balance between stock and cash enables you to still grow as your rail investment grows while helping to hedge against an economic collapse. Cash in hand also gives you the power to invest in another company.

Growing your net worth as quickly as possbile places you in a position in most of the scenarios, to achieve final success. Once you have establish your personal worth, you can go on to achieve the stated mission of each game.