Architect Archive
Thread: Some of you architects dont understand the profit margin very well, or your too greedy.
Disclaimer: I'm not an architect.
I find it really funny when people come to this board in particular and lecture you guys about economics, when they truly have absolutely no grasp of how real economics works.
Charge what the market will bear, people. Charge what people are willing to pay that moves your product enough that you're constantly having to replenish your stock. Don't have any overstock, but don't have any backorders either. Find the price that means you sell product exactly as fast is at takes you to produce it. THIS is real-world economics.
Original poster: learn about REAL economics. A real business doesn't say "it costs me this much to produce this, so I'm greedy if I charge more than this amount". They say "how much can I charge for this and keep selling it?"
Maybe it costs the architect 2cr/rec to make it. If they charge 8cr/rec to sell it, there's NOTHING WRONG WITH THAT. If it's too expensive, no one will buy it and they'll have to drop their price.
A good example of real world economy in SWG is the personal harvester.Whenever I need to move my personal harvesters I don't even redeed them. I just destroy them and pick up another one on the bazaar for 1100 creds. At current prices it's cheaper to destroy one and replace it than it is to redeed. They're a disposable product.
Personal harvesters being disposable actually works in the favor of architects, because it means they'll keep selling them at a profit because all their product keeps getting destroyed. BUT the key here is to sell them for as close to the redeed cost as possible, to the point where the user still feels justified in destroying instead of redeeding. DO NOT charge any less than that.
And for the larger buildings, you should be charging as much as you can get away with for them. Why? Because, unlike the disposable personal harvesters, there's a LIMITED MARKET on these. Once someone buys house or any of the medium-large harvesters, they're not going to buy it again. If it needs to move, they'll move it because redeeding is FAR cheaper than just replacing it. This will not be a cuntinuously moving market like it has been in the past. Those of you who are cutting your margins down so much are going to really pay for it in the future when the demand isn't there any more.
The bottom line: charge what people will pay. DO NOT charge less. If you can sell your buildings consistently at 8cr/red, then sell them for 8cr/rec. This is NOT greed, it's simply smart business. Anyone who tells you it's greed just doesn't understand simple supply-demand economics, so make fun of them and send them on their way. Just don't listen to them. If you do, it'll ruin the market for your profession.
Falin
Speaking as an architect second and a merchant first and with only a bit of tounge in cheek, you were selling those 799 harvesters to me and I was travelling to wherever there was a "moving" market for them and reselling them for 1100-1300. This is not my major business, it is the pocket change type ofcommodity trading I do going about my real business.
I undertand your reasoning BBugMaster, I really do. I was there a month ago myself. Thought folks were idiots for selling over2 credits, as my time had no cost and I was having fun being busy and breaking even. Even dreamed of being able to offer resources 2:1 at some point, living off a 5-10% profit margin would be ok. (shakes head) EventuallyI realized I was doing the economic equivalent of hunting greens.
If you are happy, for god sakes keep doing what you are doing and have fun. Forget all of us and our advice. Butat least consider the good advice above. Somebody doing just as much hard work as you and having just as much fun as you is easily making 2-5 times what you are.One day when theirparty boatpasses by with that sameartisan on waterskis enjoying a different level of theeconomics game, you are going to either question if treading water is all it's cracked up to be or get motivated to achieve more.
Bless your trying BBM. And thanks for the 300 easy credits (grin)
"Some of you architects....."
hmmm... sounds like "some of you" do not put much value on your personal time.
You're time is worth 2cr per unit to you, mine is worth 4 to me.
Im looking for people to clean my house. Any takers at $8 hour? Going once, going twice... do I hear $1 an hour?
I often find it funny when people think they can turn a profit at 2 cr per unit and only factor in HALF of what you actually spend.
first they always factor in droping somthing on a 80% spot. well guess what 70% of what we go through is ORE and that doesnt always show up as 80% spots on the same planet. yes you can find a 80% spot every shift but that requires traveling to also for larger items you will need to travel to deliver your order not a lot of people will pay you for a PA hall if your not willing to go to them. HIDDEN COST 1: planetary travel fee 1500- 3500. now if your like me and have a few large orders per day and your running 26 harvs. your going to need to hit those every day to get resources to build your daily orders. so this cost is an every day cost for me and 90% of other archs.
second resources dont magicly always spawn around the same town so you also have to factor in the shuttle travel fee.. also if you deliver your goods you will be doing alot of this HIDDEN COST 2: shuttle
I often find it funny when people think they can turn a profit at 2 cr per unit and only factor in HALF of what you actually spend.
first they always factor in droping somthing on a 80% spot. well guess what 70% of what we go through is ORE and that doesnt always show up as 80% spots on the same planet. yes you can find a 80% spot every shift but that requires traveling to also for larger items you will need to travel to deliver your order not a lot of people will pay you for a PA hall if your not willing to go to them. HIDDEN COST 1: planetary travel fee 1500- 3500. now if your like me and have a few large orders per day and your running 26 harvs. your going to need to hit those every day to get resources to build your daily orders. so this cost is an every day cost for me and 90% of other archs.
second resources dont magicly always spawn around the same town so you also have to factor in the shuttle travel fee.. also if you deliver your goods you will be doing alot of this HIDDEN COST 2: shuttle fees 120-2000 per day.
third everyone always forgets the power gens and how much they cost to run if your running solars which most up and coming archs are thats another Hidden cost 3: 1400 per day + 3000 every 4-5 days to move them.
now lets say we facor all these in now there is another thing called a profit ratio most business men have to always keep in mind. now on most servers you can sell metal and ore at 4 credits per unit on the bazzar and they sell like hot cakes. Energy also sells for about 2-1.5 creds per unit on the bazzar fairly quick. so if you were to just put everything you mine for on the bazzar you should be looking at 4cr per unit + 1.5 per power = 5.5 <-- minum price your resources are worth before you need to do anything beside putting it on the bazzar. now lets factor in the bazzar cost and lets say we make that 5.5 in to 5 cr . now i like to work cheap so lets say i charge 1 cr per unit to craft somthing . that means i can sell at 6 cr per unit and be giving people a Fair market price for what my crafted item is worth.
I love these discussions 
Personally I always sold my stuff for 4-5c and my guildhalls for 500k. I got plenty of orders and made decent money. There were folk about selling guildhalls for alot less. Didn't much care. If they wanted to put a value on their time less than mine thats fine, I still sold as many as them and made twice as much money.
The comical thing about it is, that breaking even to get XP to reach the holy grail of master architect doesn't work. People soon realise that after they reach master architect that there isn't a pot of gold. I had about 3.5m in the bank when I gave up architecture, now I just sell resources. Its alot better, I just plonk all my harvesters down in the one spot, don't need to worry about getting this resources or that resources. I just get something and sell it on. No hassle, no worry of failures, just spend my time doing fun stuff and every now and then just collect stuff from my harvesters. A much better way to play the game for me.
I agree completely that most people who post stuff like "Medium houses should cost 150k, but I'm willing to sell for 100k and you had better stop undercutting me!" are wasting their breath. Too many players think they should be able to earn a living selling three or four items a week.
OTOH, I think you have badly underestimated the difficulty in keepin up with the resource types that go into medium harvesters.~750 for personals is 3cr a unit and that's not bad at all for "metal" and "ore". 10k for a mediumm mineral will probablynotget you more than you could have gotten by selling the resources, which hardly makes being an architect worthwhile. If you're still not a master, then selling for the price of the resources is your choice. I made lots of stuff for free for friends who gave me the resources. Cheap stuff for them, free xp for me (around 500k probably).
So IMHO when you're done giving a discount to keep the xp coming in that 10k will be too low. I charge 13k and I wonder if that's enough. Sooner or later carb ore,reactive gas, or aluminum wil be a chore to get. Then you'll be running down stocks of turbinesyou could be using to make 35k-40k factories making 10k mediums.
well I spent some time figuring out just how much it costs me on average to pull resources. I don't buy any on the bazaar's ... well ok I rarely do. I pull my own, luckily I have a friend who's a CH and has no ineterest in his extra lots above his house and lets me use them.
If you assume a 50% vein with all heavy harvesters and fusion gens for power this is what it costs to pull a unit of resource. ".77 creds / unit" that includes the cost to get the power to run the harvesters. Generally speaking my harvesters are on spots that are well over 50% so you can figure on less than .77/unit. I price my units according to those figures. 4x.77xunits to make... with a little rounding to even it off. One time for cost of resources, one time for my time and effort, one time to cover a failure if it happens, and one time for profit. It seems fair to me /shrug. Only thing I deviate on that from is some of the furniture that requires hides and the Master stuff such as PA halls which i just charge a straight 4 times resources.
Have no fear though economics run to the equilibrium. After enough time passes people will be willing to pay only so much for things and suppliers will be willing to only take so much for things. Remember this game is still very new. I expect things will be added to our repetoire after a while. there will be more to sell and prices will coalesce. In the meantime use your downtime to grind something else like chef or armorsmith
Actually the funny thing is, is that you are wrong. You're right that the cost of the unit of resource is around 1 cpu, but why would you base your prices off of that instead of the worth of the resource? And realistically in the real world you can't both mine/refine/manufacture/distribute a product. That, my friend, is called a verticle trust and is very dangerous to a capitilast driven economy, hence why it is illegal. A capitalistic economyis what the economy in SWG is based upon.
JazzmanianDevil wrote:
DireBountyHunter wrote:
This continues to blow my mind. Why architects continue to sell deeds at a price so low they'd actually get more for selling the raw materials. This is one of the major problem with the profession. Originally people complained about the fact that prices were too high, it has to be compared to the base cost of resources, everything in this game starts on that number, mind you that's only one of the numbers that should be worked in but base is always cost per resource.
What always blows *my* mind are the people who seem so close to atually understanding this situation, like Direbountyhunter here, but then veer off and miss it completely.
Look, you said it yourself. "base is always cost per resource." Now read that again, even though you wrote it. *COST* per resource. *COST COST COST*. "Cost" does not equal potential profit *IF* you were to go sell the resources on the bazaar. "Cost" is how much, in credits and time invested, it took you to obtain the resources, whether you bought them or harvested them yourself.
who exactly gets to judge what it's (resources)worth? the schmo who buys it on the bazaar? or the guy who knows how to acquire his stuff cheaply?
sigh, can we stop arguing this topic over and over again now?
It's simple supply and demand and market perception. The average player has no idea how many resources are used in making a small house or any structure. Someone finally finishes the grind to novice architect and joyfully makes their first house. They take this house and sell it for 5 to 10k and think they have hit the big time. Remember how broke you were grinding up to novice architect?
The problem is people get used to the idea that a house should be cheap, and that perception never goes away. The problem is made worse by the number of people taking up architect and creating an over supply of cheap houses, harvesters, etc.
I don't think there will ever be a good fix to this problem. Even if resource requirements were lowered prices would fall further.
How much are resources worth to me? I now pay more for resources than I was once able to sella finished product at.