Architect Archive
Thread: A little pricing experiment
ZenDragonMLS
Sun Jul 25, 2004 8:57 pm
#14
Ok, sorry for the confusion. The basic point remains - if architects A and B have about the same cost structure, at the general pricing range (100-180K) that we are talking about, if B sells substantially cheaper than A, then B must sell a significantly higher number of them than A to achieve the same profit.
Bandola
Mon Jul 26, 2004 12:21 am
#15
I certainly agree here, the time used up searching for the item you want is crucial. This is one of the reasons that the higher priced architects (like myself) are still able to compete with the lower priced ones. I sell solely from my Vendor, I do not make special orders, the rationale is that my customers can come into my store and buy what they want, safe in the knowledge that I will have it in stock. It's really one or other, if I don't make special orders I have to be able to hold high stocks, which means continual crafting. If I made special orders I wouldn't be so capable of keeping my vendors fully stocked.
Instatnt availability is also often underrated. On our trade forum somebody put out a WTB for around 20 Heavy harvesters a short while ago, I won the order with a price of 150k per harvester, which is the price on my vendor, with the customer collecting when convenient for him. I did not need to do any extra work to meet his order, the harvesters were already there. I beat off the competition, one of who put in a price of 100k per. The difference was that his harvesters would not be available for at least 3 days, I was able to convince the buyer that mine was the better deal as the 'cost' of 3 days lost harvesting was at least 50k, probably over 75k, so my more expensive harvesters were in fact cheaper in real terms.
Sorry, I went off track a little there....
one of the points I was intending to make was that with so many players having sizeable fortunes now, the difference between 80k and 160k for a heavy is often not important, certainly not as important as being in front of the vendor that has them stocked (albeit at 160k) and being able to buy now, rather than searching for another hour or so to find the vendor that has them at 80k. Peoples gaming time is worth more to them than that, so it's usally no contest, 80k extra to save wasting an hour or more, easy choice.
Message Edited by Bandola on 07-25-2004 12:27 PM
Benjawa
Mon Jul 26, 2004 9:39 pm
#16
It sounds to me like it doesn't matter quite as muchwhat the price is as does location and availability. I have a vendor on Naboo, about 1200m outside of the starport. I have to restock the thing every day. Two days ago, I upped all my prices on a whim. There is no difference in sales, just a difference in my bank account. I also checked out the other vendors close by to see if I was over thier prices just in case I managed to lose some that decided to be frugal, but I am not that far above them and it doesn't seem to make a difference.
After examining all the comments from this thread, I am certain that one could conclude that the biggest boost to your sales is going to be finding the right place to put your vendors and then working hard to keep them stocked so that people find what they want when they want it. I think that is the key to success on any server, not low prices. I would imagine that you could be 20 to 100% higher than the rest if you had the prime realestate and could keep them stocked.
Making money, as a combat player, is terribly easy on this game. Even as a non-combat focus with some combat skills you can make a boat load of money. People are more concerned about having fun then having to spend the time nessisary to find the equiment they want. So, when they have a fat bank account, they are going to buy the things they want and need at the first location that has them. Most people on this server have fat bank accounts, at least the smart ones.
Elyssa
Mon Jul 26, 2004 10:46 pm
#17
That's always been my theory.
People have a LOT of money.
They'd rather pay my high prices at the first store they walk into rather than wander all over creation looking for what they're after.
That reminds me... I need to make more swoops. I have trouble keeping them in stock.
Location. Location. Location.
Crimsonsplat
Tue Jul 27, 2004 7:23 am
#18
When I inherited my shop and harvesters/factories from the guild's senior architect (he quit the game), he told me that his single most profitable item was -- get this: City Halls. At 435k a pop, and he averaged 1 per week. Sadly, I have yet to sell a one, and am messing around with my price scale.Dropped the heavy harvs to 90k, which was probably a big mistake,since its the first time I've stocked 13's inover aweek. (bad steel spawns.)
I was running on a basis of 5cpu for all structure types, with a slight bonus if I had to do multiple factory runs to produce the item. This put my small houses at 30k. Few sold, and I've dropped to 20k. I won't go any further down though, even if I get idiots going "I can get them off the bazaar for 6k!!!!" ("then do so ya bozo, but at that price, they're not worth my time.")
On furniture, I'm still searching for a good price. I've wandered around from 10-15 cpu, down to 5-6 on some items. I'm debating a structure that would make the low-box items much cheaper, and the higher, specialty items much more. I'm curious, how does everyone price furniture, if they make it?
Creadux
Tue Jul 27, 2004 8:04 am
#19
I have been a MA since maybe 3 weeks after launch and after the initial price gouging on deeds and such when everything was new I was selling heavies in the 90-100k range. I have been steadily raising my prices by relatively small increments say 10k more a month/maybe 2 for heavies and have seen no appreciable difference in the overall amount of items I sell. I am in fact making more money. I'm not guilded, I build everything myself and buy as little outside material as I can. Mostly what I buy is brick ore and brick metal. I do have 2 accounts so it's a little easier with storage and factory lots and what have you but I do very well for myself. I'm not stinking rich like some people in the game but I have a nice account balance.
The most important thing I have noticed in keeping repeat customers is having VERY stocked vendors. For instance I went looking for some high kinetic encumberance sliced armor for one of my guys yesterday. I wanted a whole set or at least most of it. 4hrs later I had found maybe 3-4 vendors with any decent stock on them at all. Guess where I will go next time I want armor ? The place with the items. SWG is repleat with credits. People will pay considerably more for things if they spend 2 hours looking at empty vendors only to get to yours and find out you have 20-50 heavy harvesters of every type on it. What's more is they come back to you when they need more or so it seems to me.
Sevardos
Tue Jul 27, 2004 8:11 am
#20
Crimsonsplat wrote:
On furniture, I'm still searching for a good price. I've wandered around from 10-15 cpu, down to 5-6 on some items. I'm debating a structure that would make the low-box items much cheaper, and the higher, specialty items much more. I'm curious, how does everyone price furniture, if they make it?
I sell a lot of furniture so I can tell you, you can do well with it.
First off, break all furniture into 3 groups - High level, Mid Level and Value (low level). I price my furniture based on these 3 tiers:
(1) 30 cpu for top tier (sometimes more if it requires pain-in-the-butt to get hide like Endorian Wooly). This is mostly your master stuff but again, depends on where you group furniture. Some of the stuff has the same appeal as master so I price accordingly.
(2) Mid Level - 20 cpu
(3) Value line or Low level is 10 cpu.
The advantage to this pricing model is that you're able to provide customers price ranges that suit their wallet size. If they can't afford, or don't want to afford, the higher priced furniture,they still have a wide selection of inexpensive furniture to choose from.
The key to furniture sales is not price, but selection and inventory levels. If you always keep it stocked, always have every furniture selection available, your business will build and sales will grow.
The other thing, which I find is overlooked, is how you name the furniture. Who the heck wants to buy a Style 2 plant when they can buy a Yavian Dwarf Tree? Or Beachwood Chair, etc. Put some time in 'branding' your furniture tiers with unique naming and you'll do well.
There are 3 types of furniture buyers:
1. Interior Decorator types. These customers usually will email you for custom orders. Either they want the furniture / items with certain names or they want the names blank. These are fun and high volume customers (one order could be 100-150 pieces of furniture).
2. Home Buyer types. These customers appreciate your naming scheme and will buy your furniture in clusters. These are also your repeat and referall customers ... your bread-and-butter customer group. These customers will either make you or break you.
3. The Bazaar Buyer. This group of customers generally coudn't give a damn about what furniture there is - they want a chair - they get the cheapest chair they find. This customer will buy from you, usually the low-tier pricing furniture, but will not be repeat customers. They're not repeat because of you, they just tend to buy once ... maybe twice and only 1 or 2 pieces at a time. Unfortunately, they also tend to be ones that will give you grief so don't get upset if they do.
Yikes ... sheesh, I just rambled on there didn't I ... LOL
Best of luck, hope that helped.
radientsams
Fri Jul 30, 2004 8:22 am
#22
I think the established architects out there are very able to sell at high prices. Like has been discussed, the key thing when players look to buy structures is that they are in stock. The established archs out there are able to have high prices beacause the customer knows that he / she will be able to go to one place and get exactly what they need.
Myself and other up and coming architects do not have that level of comfort with customers yet. I need to be able to get them away from your shop and allow them to see that I will always be stocked. As far as i see there are only two ways to advirtise this, Price and Location. Since I doubt that my location is any better than the established archs, I need to offer customer a better price.
Not to say that I won't raise prices in the future once i can depend on a steady stream of customers but right now I just need to get the word out and having low prices is the only way that i can do this.
ZenDragonMLS
Fri Jul 30, 2004 8:59 am
#23
Interesting premise. Do you think that the current crop of "established architects" had a completely blank slate when they started? That is, no competition?
In business you have existing customers and "new name" customers (ones that are coming to you for the first time). You also have customers who have been in the marketplace for a long time, and those just entering the marketplace (n00bs 
).
).As new architect you have no "existing" customers - everyone who walks into your shop is doing so for the first time. They *might* be some other architect's "existing customers" or they might be people who are just entering the marketplace.
If someone else's customers perceive that you deliver a higher *value* than their existing architect, then they will buy from you. Notice that "value" is made up of a lot of things - price, location, how well stocked your vendor is, the amount of "consulting" you provide, your attitude toward customers, etc. It is NOT just price.
For the new customer, you have as good a shot at capturing them as any other architect.
So you need to figure out your business model and how you will deliver value to your customer. My opinion is that you can capture *new* customers without having to chop your price below the "established" architects.
Remember - unless someone became an architect on Day 1 of the game, EVERY existing architect started out with someone else in that "established" role. And we all have prospered in spite of that.
Pawlin
Fri Jul 30, 2004 10:46 am
#24
I get new customers all the time. And the old customers only tend to last so long before they (I assume) have bought all the harvesters that they're going to need. New customers are up for grabs to anyone and they don't care if we've been an architect for a year or a week, our product is the same.
Most customers won't shop around for 6 hours to find the cheapest vendor either, thats pretty much a waste of their time. Any location will have some benefits. If you are in a high traffic area then your shop is just as likely as any other to be the first one that someone checks out or stumbled across. If you go look at the planet map for housing vendors around Corellia you're likely to find 50-100 vendors. Which one do people choose first? The closest? THe one on the top of the list? The one with the good name like "cheap ber thirteen harvesters"? With each shopper making different choices, its pretty random over all. If you are in a remote player city then you'll probably have the benefit of getting a lot of the local business. If you are on an unpopular planet like Rori or Talus then you might be the only vendor on the planet and have another benefit over others (I see this myself on Talus).
You'll never steal some customers with a pricing war cause they already have a favorite and they don't go shopping around every time they need something, they just go straight to their favorite architects shop. Think about the last time you bought a gun or some brandy, did you spend 2 hours shopping around or did you go straight to your favorite weaponsmith or chef? I do the later and I think most people do as well. Some customers will knowingly pay more cause they have loyalty to their favorite crafter and/or get other beneifts that outweight the additional cost.
Even if your price is higher you can grab new customers that know about cheaper alternatives if you provide the service they want or offer some other benefits. If someone posts a WTB ad on the forums then the first person to respond and deliver product is likely to get the business. And that customer is likely to stick with you. If you offer to deliver a product to a busy crafter's shop then they might think thats worth a lot more than saving a few thousand credits. There are a lot of other ways to keep cusotmers happy.
Most people looking to buy our deeds don't know much about the suppliers out there. Even the practicing architects don't know much about their own competition. Sure some names might be well known in some circles. A lot of people never read these forums so they won't see the ads we all see and therefore are unlikely to know of those architects.
I know for a fact that I have 3 competitors with stocked vendors that sell for 50% less than me. But I get business all the time. A lot of it is new business. Either my customers don't care too much about the price or I offer some other benefit like convenience or they are unaware of the cheaper architects and can't be bothered to find them.
SmarticusIOaG
Mon Aug 09, 2004 10:12 pm
#25
I took a different approach to my business than a lot of you on Bloodfin.
I wanted to build up to be the biggest volume dealer on the server. Period. I knew even doing things this way i'd still make more than enough money to satisfy any needs I have.
Here's where I am right now:
My vendors currently carry over 600 deeds.
I have over 40M credits in the bank
Daily sales of at least 10-20 items (and i dont sell furniture or personal harvs, this is all big stuff)
This is how I did it:
100k all heavies, 40k all mediums on harvesters.
Small houses 10k mediums 50k larges 100k
Factories 30k
City structures 100k except banks at 40k and City/Guild halls at 300k
And I dont do my own ore harvesting (although I do my own steel/chem harvesting)
Could I have made more money doing it with more markup? Absolutely.
Am I depressing the market value of architect stuff on Bloodfin? Nope.
Have I banned resellers from my shop? Only the really obnoxious ones. They're helping me by giving me money to expand my inventory with. Go ahead. Try to run my vendors out of stuff. Got 100 million sitting around to do it with?
Have I gotten hate mail from other architects? Absolutely.
Am I enjoying my profession? Completely.
Do my customers keep coming back over and over? All the time.
What I am doing is providing a service to all my fellow SWG players and still making more than adequate money doing it. I could make more money, but I don't need to. My 40M stockpile of credits work just fine, it's more than I ever plan on using for both characters.And all of the people I furnish deeds for go away believing they got a good deal, because they did. So did I.
saxmahoney
Wed Aug 18, 2004 10:28 pm
#26
I found this from a link in another thread. Great experiment I must say! I just recently discovered the great architech/businessman that pawlin is, and will be buying more stuff shortly.
2 things from my personal experience in the game:
- Higher Prices means that in a profession that do FULL factory runs (docs, CMs, chefs, and armorsmiths come to mind), you tend to think in profit per factory run.
- Lower Prices generate more word of mouth (especially if your stuff is good), and get a LOT of return customers. If you are known to sell high-quality composite armor, or cheapest brandy, you'll get people that will keep coming back. But again, this is for professions that people NEED to keep coming back. D'oh! you can get all your harvies in one trip and never have to return to shop...architech isn't a part of this reason much either.
So, in conclusion, I'm in the completely wrong place since I just realized that those 2 things don't pertain to architech...sorry about that. Oh well, I'm just fascinated by in-game economics. It's something I really enjoy and like to comment on. Hopefully I'm not too far off base with this post.