Architect Archive
Thread: Going rate for Homes
What a lot of archetects on SWG dont have is business savvy. To find what a sucuessfull busines should be look at the real world. Who is very sucuessful?
Look at Wal Mart, they are sucuessfull by providing low prices for standard products and even sell some at a loss to help attract customers.
After figureing what it acutally cost to generate a unit of resoruce ( I dont go by others figures, I figure my own out )I can easily sell for 2 cr per resrouce at well over 100% profit. With that in mind I am fully prepared to meet my customers desires for structures at costs well below what most everyone else sells for, while still making a profit at large margins.
My customers repeat, and they send thier friends to me.
Scortch pipped me to it, but I post my reply anyway.
With regard to the so-called "business savvy", Walmart sells tins of beans which customersconsume and needto replaceweek after week. Every item in the architect tree is non-decay and very often a one-off purchase.
Once an SWGcustomer fills his home with furniture, the only time he will return is possibly to upgrade it to a better design.
Secondly, and more importantly, if you're foolish enough to sell for 2cr as a general rule, why are you wasting your time and skill points being an architect?
Just mine the resources and sell them on the bazaar - you'll generally get a BETTER return and WITHOUT the risk of critical failures, factory expenses plus all the time and hassle invested etc. As an added bonus, you'll have another 60-odd points free to donate to another profession and enjoy the game.
If Walmart could sell their beans for 3cr by the sackful, or for 2cr in a fancy tin, which option do you think they'd take? There's your business savyy. Thanks for your part in helping to wreck a fun profession.
*sighs*
Skarra, Master Architect
I sell nothing for less than the 3 credits per unit price the raw materials would cost. Friends pay me cost for my buildings at 3 credits per. others pay between 4 and 5 credits per unit rounded up. I am not trying to gouge anyone but it would be foolish to sell for any less that that because there is the cost of criticals to consider. If I fail I get nothing. So that cost is amortized as a cost of doing business. I could likely get away with 6 credits per unit but that would be pushing the envelope. I will buy the rosources from strangers at 3 credits per then charge then my price for the completed building, unless they are willing to take the chance on the critical.
If people will not pay my prices then I simply run missions and wait until someone will pay, or sell resources to someone else who is getting sales.
The frightening part is.... yes I am foolish enough. Too many the the 3cr per resource is some kind of set price, it isn’t. This is not OPEC with a few people setting the price for everyone else, this is an open market. I never said people were not willing to pay 3cr per resource, I am saying that I charge less in direct transactions. People remember my name and that they got a good deal from me.
The prices of structures will come down over time, that is inevitable. While I am able too I undersell others at still over a 300% profit margin. Critical failures is a funny thing to mention. Do you fail 2 out of 3 times? That is what it would take for my current prices to drive me to just over break even.
I don’t come close to that.
What should really scare you is that I am fully prepared to cut my prices in half once the market starts to drop to in the direction of a realistic level of 100% profit margins. The current standard of 400% to 600% profit margins is hilarious.
Heck I am selling at well over 300% margins and other architects complain that I am stealing their customers. I have news for them, business is war, it is combat every bit as intense as physical combat.
This is not OPEC, this is an open market.You want business? Then be competitive.
Dayln wrote:
p.s I didn’t say I currently sell buildings at less than 3cr per resource ( although I have ) I said I sell base resources at less than 3. But I am fully prepared to do so when competition kicks in and profit margins lower.
You may well end up the Bill Gates of SWG. Take that how you will.
Personally my profit marging on my server is based on a starting cost of 3 credits per resource. That is the minimum I can sell them for on the local bazzars. So that is the starting cost of my buildings. I than add what I consider a reasonable profit allowing for critical failures etc. That brings my current price to4 to 5 cr per resource. I DO sell some things for cost or less. Hell some I give away. I make furniture for most people who buy my houses at cost or less. That is my little extra to get then coming back when they want something new.
I just feel that selling buildings and factories for under cost does the entire industry a disservice. And makes me wonder why bother to do it at all.
If others can afford to sell for less then I will just go back to using my fighting skills and having fun at least until I run out of money and quit the game. That is going to be the result for a lot of people if some of you keep floodig the market. You will own everything and no one else will bother to play because they can't compete.
End result... GAME OVER.
Currently there is room for your ( and just about everyone else’s ) insane profit margins ( I still think mine are insane too ). I am not crazy, I just sell for the highest price I can that still looks like a really great deal compared to everyone else's prices. I know my margins are still so large that I dont worry much about it.
I don’t know how this 3cr per resource unit thing got started, it isn’t even close to the actual cost, it is just an arbitrary number. I personally believe it came from the fact that you cant charge more than 3000 at the bazaar ( which I personally am glad for, I want to work directly with customers that buy things for more than that, or at least my merchant partners vendors I sell through ).
It is an odd thing, that the price got arbitrarily set that way, it is so fixed in people's minds they have lost sight of the actual cost. I constantly hear people refer to it as the actual cost of a resource, that really is funny.
It isn’t hard to figure.
Pay maintenance and resource % for a given power generator will make power at a set price per unit. Use that to figure pay maintenance for an extractor and the power that uses and you can come up with the actual cost of a unit of resource. I don’t count the cost of the generators and extractors to build as I would have been grinding for exp anyway, this time I was making stuff I actually wanted for experience.
It isn’t even close to 3, it is below 1. But if you sell for 3 per resource you will do well, as currently a whole lot of people sell for even more than that. I just like to sell my stock quickly, I move merchandise as fast or faster than I can make it. My customers come back for more and send their friends. I may need to take on another partner or two at some point. Currently there are three of us, but I am the only architect.
But I wont be Bill Gates, others out there I have started to notice sell for similar prices as me. Not actual competition as we all can sell at this price with a constant stream of customers. But I see a day comming when the war actaully begins. Nor for a few months.
If I pull my own resources it's about one credit per unit. But with the volume I use that would take me days to build one large house. With the limited lots I have that is simply not an option for me. I simply pass on the cost I pay on the bazzar or privately to vendors to purtchase their resources. If I could find someone willing to sell me ore at 1 credit a unit I would be more than happy to lower my prices. But my actual cost IS 3 credits per. That is not a made up number that is the reality of my server. I challenge anyone on Chilastra to show me a vendor selling LG Ore of any quality for less. I will be there in a heartbeat. The only way to lower it is to join a guild where I have a dozen worker bees supplying me with all my resources... not gonna happen.
Again I am not trying to tell you how to run your business. I wish you the best with it, and you may well end up as the new Bill Gates.
I really hate that I can't just edit my message!
I guess I really don't understand why even if YOU can sell for 2cr per resource if the market will support 3 or 4 why undercut and FORCE everyone else to your rate? Why not enjoy the profit. I assure you that you are one of the few, not the majority. Everyone else is not as fortunate as you in getting cheap supplies, however you get them. Either by mining constantly, or collecting from worker bees.
I do enjoy my large 300+% margins, and you are not forced to do anything.
But business is war, it is combat, as I have said before. My practices and prices work for me, and I make large profits with a constant stream of customers. If you have plenty of customers at your price then you don’t have to worry about me.
You want OPEC with a few people seting the prices on everyone else... no thank you. I dispise that in the real world, and I wont do it in SWG.
At no point have I told you to change your prices. I have simply been defending my prices from your comments about over charging. My entire point is my prices ARE based on my costs just as you say yours are. It is just that my costs areapparently higher than your.
As I saidI really do wish you luck with your business. I will continue to do things my way just as I expect you to do them yours. Clearly eventually you will win the "war" at this rate of undercutting. I simply can not compete sucessfully. That is not your problem and I am not asking for sympathy. As to who will benifit from that win, we will see.
Ya gotta love this conversation.
I wonder if this is what it would sound like to listen to Sam Walton and Bill Gates talk with each other. hehhe