Architect Archive
Thread: 8k for a medium house! Holocrons and the State of Things
Oh I know I am hurting others business, but that is not my goal, that is a side effect of working toward a larger market share and especially in a declining market. I could have sworn you just said I couldn’t hurt anyone’s business a post or two ago.... did you change your mind?
I believe you are the one that needs to study economics. I actually do run a small side business in the real world.....guess what I base my prices on?
Serbinator wrote:
You, sir, need to study some basic economics. You cannot "capture as large a market share as I can in a declining market" because you cannot produce more goods than other architects. You therefore, cannot sell more goods. Other architects can afford to buy resources can sell more goods and thus, capture more market share.
You, sir, seem to be somewhat misguided in your understanding of economics.
There is, at this point in time, no difference between the goods that you offer and the goods that Dylan offers. There can't be because of the current code written in the game (no decay and no benefit from experimentation). So there is no reason to buy from one architect over another on the basis of quality that leaves price and customer service as the only things that differentiate between suppliers. Let's assume for now that both of you offer the same customer service (since customer service has not to this point been an issue in this thread).
Dylan produces 100 houses and charges 10,000 credits
Serbinator produces 100 houses and charges 40,000 credits
There is a total market for 200 houses.
Both Dylan and Serbinator sell all of their houses at the asking price. Giving each a 50% share in the market.
Now assume a total market for 150 houses.
Dylan will sell all of his houses and serbinator will sell 50 of his houses. Dylan's market share will increase to 66% while Serbinator's market share decreases to 34%.
Because of his lower prices Dylan will always sell all of his houses as long as there is a market for more houses than Dylan has produced. The higher priced architect will only get the left overs. Again this is if the only difference between the architects is price.
Dylan doesn't have to produce more goods to catpture more of the market when the market is decling.
Your choice is to compete with him or take his left overs. It's a free market, do what you want.
You have to understand that I am providing the money to support 6 other people in my PA as they advance to master in thier profesions.I would have a lot more if I didnt do that, but I like doing that.
Money as I have said is not really my only goal.
Also I didnt start out in the begining of SWG, I started a monthor so after releaseand made tons of mistakes and lollygagged around, I only made master architect about7 weeks ago.
But yeah,I could have had a lot more money by following different models, but I am happy with what I have done. The folks I argue with are not wrong about that, it is true. I could be richer now.
But I dontbelieveI would have the kind of business I have now doing that. Most orders come in via e-mal when Im not online, never having to hawk my wares in town,I donteven advertize my vendor on the map. I dont darebecausemystock of finished products is always pretty low.
Im having fun, and I honestly hope everyone else is too.
I am with ya 100% on this Dayln. I have had up to 50 harvesters running thanks to my guildmates for over 2 months but only have 1.25 mil in the bank. My PA is generally a crafting bunch of people and they don't pay for anything, which is more fun than having 10 mil in the bank. The bottom line is having fun so why are people here raining on your party?
I have had numerous arguements with people on how much resources really cost. I have a hard time staying under 0.5 cr/u but never go over 0.8 cr/u either. And boy are these calculations easy, total maintenance divided by total resources collected. Total maintenance of course includes the fusions and re-deed costs, but I only move about half per resource shift. The flip side is that waiting for new resources to appear often means I harvest junk so the true cost is maybe 0.01 cr/u higher 
And I could be wrong about .5 too, probably .8 is closer to it if you add overhead. I think my .5 is just on my metal extractors, ore isnt as good becasue of the percentage. Just in power and pay mantenance it is less than .3
I do have the advangate of a lot of lots ( although not as many as you ) and the advantage of merchant skill that lowers my mantenance rates.
But they believethe fantasy of 3 cr a unit, it has been a while now since bulk resources started selling for a lot less than that on my server, butsome believe in it like a kid believes in Santa.
Its an open market, there is no fixed price for much of anything.
Or rather why am I stupid? Because I accidently hit tab and then enter on my last post.
Dayln is stupid because she sold a bunch of stuctures for roughly 750k and used 263,612 units of material to do so.
This week I had 775k in sales selling a 2 spec rate 10 Heavy Minerals for 275k and spec 16 Fusion for 225k. I used 81,605 resources, spent a LOT less time doing it, and made (assuming we both have a .5 cred cost/unit) 91k less profit. Increased sales does not equal increased profit. Period. Furthermore a spec7 medium can, should and does sell for more than a spec7 heavy!! It uses less maintnance and less power. It is a more valuable item than a standard heavy! Stop selling them for 30k because they require less to make! Stupid is as stupid does. Ergo, Dayln is stupid.
Eastshire wrote:
...
There is, at this point in time, no difference between the goods that you offer and the goods that Dylan offers. There can't be because of the current code written in the game (no decay and no benefit from experimentation). So there is no reason to buy from one architect over another on the basis of quality that leaves price and customer service as the only things that differentiate between suppliers. Let's assume for now that both of you offer the same customer service (since customer service has not to this point been an issue in this thread).
Dylan produces 100 houses and charges 10,000 credits
Serbinator produces 100 houses and charges 40,000 credits
There is a total market for 200 houses.
Both Dylan and Serbinator sell all of their houses at the asking price. Giving each a 50% share in the market.
Now assume a total market for 150 houses.
Dylan will sell all of his houses and serbinator will sell 50 of his houses. Dylan's market share will increase to 66% while Serbinator's market share decreases to 34%.
Because of his lower prices Dylan will always sell all of his houses as long as there is a market for more houses than Dylan has produced. The higher priced architect will only get the left overs. Again this is if the only difference between the architects is price.
Dylan doesn't have to produce more goods to catpture more of the market when the market is decling.
Your choice is to compete with him or take his left overs. It's a free market, do what you want.
Three MAJOR issues with your arguments...
1) Architects *can* experiment. Ore Mining Units from 50%-74.99% Experimented produce SpecRate 10 harvs, 75%+ = 11 SpecRate, 0.1-24.99%= 8 spec Rate, etc. There *is* variation in product. Yet, I am still assuming that Dayln has identical product to my own.
2) You assume we are in a declining market. While we may be in a declining market, there are still MORE than enough buyers to accomodate all total output from all architects. If you wandered around the streets and asked people if they could use a heavy harvester if it was 2k, I'm sure you would find plenty of people to buy. These are all players who cannot afford heavy harvesters, and who will eventually be able to purchase them. We don't have repeat buyers, but we do have new players...
3) In your first example (200 houses demanded) Dayln would get 1mill, I would get 4mill. Furthermore I would probably make a profit of 3.5 mill to his .5 mill (assumes Dayln's house sells for twice its cost to make). He just LOST 3 million credits in income because he chose not to charge 40k. This is the current situation with harvesters.
In your second example he made 1million credits, and I made 2 million credits. Furthermore, I probably profited 1.5 mill to his .5 mill. Despite selling half the product, I would make thrice the profit. To take it a step further, there is a matter of availability, even if he continues to sell at 1/4th my price and demand falls to 100 houses, I will *still* sell houses because he can't be on, or people will make convinience purchases based on our travel habits, vendor locations, etc. In a worst case scenario, he will probably sell 85 houses to my 15. That yields 850k for him (425k profit) and 600k for me (450k profit). Even in a scenario in which Dayln has achieved almost total market domination, he is making less profit than I am.
Assume that 6 months from now we achieve market saturation, and I am finally crushed to my 15% share. (or even no share!) in the 6 months that Dayln was competing with me I probably outdid his profits by a factor of 5. Even if I had NO market share, he would spend YEARS equaling the profits I garnered in the 6 months we are in competition.
4) The "Dayln" method may increase market share (at the cost of massive profits) if the economy dwindles to below total architect demand, but his method is *causing* the dwindling market.
massive profits... that is really cute.
My prices are only 20% ( at the most ) less then the average prices of architects on my server. I know this because that is what I base my prices on, the going rate for items on my server. I am a good organizer and I personally believe that my actual profits are only 10% or less than that of the profits of the average of other architects on my server. Mostly due to the advantages I already mentioned ( for one my Pay maintenance is less than many architects because of my Merchant skills )
You are trying to make a mountain out of a molehill.
Profits are of course not my only goal, but I like to keep them healthy, and I do.
p.s but lets take your example,
My large housesare 120k each and I can only assume by your exampe that your are 480k each.
ya know, I dont really think you have a booming business selling Large houses for 480k each. If you do then good for you, but you customers beter never hear about my prices. 
Or are you just trying to use unrelaistic and outrageous examples, which of course will give you an unrealistic result. On my server, and specifically on my planet you will not sell one large house for 480k.
You will ahve dificulty selling them for over 200k, but I have a boombing business selling them for 120k, in fact I sold 3 this last weekend
And I sold a PA hall today
How much it costs you to mine resources is irrelevant to how you should price your architectural goods. How much would you pay for those resources on the bazaar? 3cpu, pretty standard (better stats are higher, etc etc, but let's keep it simple).
The miner is getting a profit of approx (assuming about .8 cpu to mine) 2.2 cpu. This is the mining profit. If you are mining your own resources to produce arch goods, you deserve a mining fee, too. Believe me, most of those deeds you sell are being used by miners to make a profit.
You also deserve a combine fee for constructing the arch good. The combine fee covers your architectural overhead and a reasonable profit for you. I, personally, insist on a 2 cpu combine fee over and above resource costs, so in most cases, I charge 5cpu for structures. (More for the better extraction rates).
If you are only charging 3cpu for your arch goods, you are only getting a mining fee and are getting ZILCH for being an architect. You might as well just mine resources and sell them. Would take you less time for the SAME profit, after all.
Do I get hassled by people inquiring how much I charge for Structure03? You bet, all the time.
Does my vendor sell out completely every week? You bet.
Why would I want a bigger market share? I have more work than I can get to as it is. Others may enjoy constant clicking and scrambling to cover orders and restock, but I do not.
The Grumpy Master Architect