Business And Economy Archive

1. Lowest priced Steel is 1.5cpu


2. The Colat hasn't spawned in ages, so sells for 10cpu for the lowest price.


3. Class 7 Radioactive cost 3cpu for PE of 850 - Cost 5cpu for PE of 900 - Cost 10cpu for PE of 1000


4. Widget enhancers are a loot item, and extremely rare. 1 million on Trade Forums is going rate.


5. Item made without Enhancer is 30% less useful than items made WITH Enhancer.

Here's your challenge: Tell us if you would make with or without Enhancer, and what you would charge for your best possible finished good. Honestly use 2 scenarios - 1) The system as it is NOW. 2) the system with Galaxy wide search and purchase. Provide answers for both scenarios, please.

There is no right or wrong answer. This is only to see what different people would charge. Non-Crafters are encouraged to try their hand at this as well.

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Corso wrote:

I can not complete the scenario. A few things are missing that makes an item desireable.

Is it a weapon, house or armor?Exactly how good is it at what it does? Does it look neat? How rare is the item? Does everyone want one? Where are my vendors located?

Wait - Do you mean TYPE of item matters? Or uniqueness? or location? Imagine that...

Rough estimate though.

Current system with the enhancement = about 1505000 credits

New system with the enhancement = about the same.

Im an architech. We do not/ can not charge 30cpu like those lucky weaponsmiths and tailors.

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So, I see that you believe the enhancement is a neccessity, and 1,505,000 is the price. Thanks for teh response. Once we get some responses from other professions and some pure combat types, we'll begin to see if a pattern emerges...

Message Edited by FatEd060186 on 02-13-2005 06:58 PM

I cook food.

None of my recipes require widgets.

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FatEd060186 wrote:

You'll have more than one type of buyer, some will want the 30% more and be willing (and very able) to dish out an extra two or three million to have the best. Whether the galaxie wide search helps you find the resorces & or mysterious looted items at better prices I dont really see how it would effect the pricing of the finaly crafted item. Some people's time is worth more than others aswell so if you want the best (12pt crafters, ect..) "you" should be prepared to wait & pay extrafor it /shrug

So, to clarify - You support the ability of a Crafter to decide on his own pricing - And point out that pricing can be variable based on things such as Ability (12pt vs 10pt) and their own sense of what their time is worth?

Price the Item @ 3000 Credits with out the enhancement.

Auction the enhanced Item starting bid at least what you paid to aquire it....

Message Edited by FatEd060186 on 02-13-2005 06:58 PM

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Phaelyn wrote:

You'll find no information here. This isn't a diatribe by me, or any other Crafter or Merchant telling people they are wrong.

What this will be is an exercise in Pricing and quality.

As such, ladies and gentleman, this is your product:

WIDGET:

Takes 50 units of Steel

Takes 100 Units of Colat Iron

Takes 100 Units of Class 7 Radioactives.

Takes 1 Widget Enhancer. (Optional)

Needed stats: 100% PE (Potential Energy)

Now folks, assume these factors.

1. Lowest priced Steel is 1.5cpu


2. The Colat hasn't spawned in ages, so sells for 10cpu for the lowest price.


3. Class 7 Radioactive cost 3cpu for PE of 850 - Cost 5cpu for PE of 900 - Cost 10cpu for PE of 1000


4. Widget enhancers are a loot item, and extremely rare. 1 million on Trade Forums is going rate.


5. Item made without Enhancer is 30% less useful than items made WITH Enhancer.

Here's your challenge: Tell us if you would make with or without Enhancer, and what you would charge for your best possible finished good. Honestly use 2 scenarios - 1) The system as it is NOW. 2) the system with Galaxy wide search and purchase. Provide answers for both scenarios, please.

There is no right or wrong answer. This is only to see what different people would charge. Non-Crafters are encouraged to try their hand at this as well.

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Again, it's tough to answer without knowing how disposable or desirable the item is. For argument's sake, we'll say it's about the same as a weapon - highly desirable and necessary, semi-disposable. We'll also saythat there isn't a random factor in here, such as slicing - a lucky slice can change valuedisproportionately. And finally, it's tough to say how 'rare' something really is. Is it rare like krayt tissues are rare, rare like premium crystals are rare, or rare like exceptional acklay bones and GDK scales are rare? Krayt tissues are about as rare as CDEF nowadays, so they're not rare. Premium crystals come off elders, and are thus rare for those who cannot solo elders, but for those who can they're fairly common - can expect at least one or two per hunting trip. GDK scales and exceptional acklay bones are really rare - they aren't guaranteed results in a hunting trip even if you can get them (and since GDKs don't drop scales right now anyway, they're even rarer).

For the purposes of my answer, I will assume that the item is highly desirable and necessary, semi-disposable, and non-random. I'll also assume that the enhancer is middle of the road rare - not extremely rare, but not common either. An example might be a krayt weapon you don't slice before sale, before the krayt boom, or something similar.

Scenario 1, without Global Exchange:

Make it with the 1000PE Class 7 Radio, make it with the enhancer, and charge 2 million. Put it up on my Special Items vendor and either advertise that it and similar items are there, or don't advertise if I feel that my reputation and name are enough to pull browsers in anyway. It probably won't sell straight away, but that's fine - for something fairly rare, I almost prefer to have it on the vendor for a while so people can come by, look at it again and again, before finally deciding to take the plunge, much like you do before a RL major purchase, like a house or car. Fairly rare things should only be impulse buy instant sales for the stupidly rich.

Am I gouging with 2 million? I don't think so. Plenty of room for a junior crafter who doesn't have my connections to still make a profit while charging less than me. But I know full well that people are prepared to pay 2 million for this item, because they are concerned solely with having the best, and I'm prepared to offer that. I also want to make sure my customers know that they are getting something special, something rare, something that not everyone else has. Depending on the nature of the item, I probably know a way to make it that gives it even a little better tweak than just the raw enhancer and resource stats would imply, a crafting technique that a junior crafter doesn't know. And it's that knowledge and those connections that will make this widget that I make superior to the others.

Scenario 2, with Global Exchange (what I would do if I still wanted to be aserious crafter):

Make it with 1000 PE Class 7 Radio, make it with the enhancer, and charge 1 million. The reasoning is simple: the steel and colat don't matter for stats at all (since it is 100% PE), so I can use any old junk. I still have junk steel and colat that I mined personally for a fraction of a cred per unit, so their cost is negligible. The 1000 PE Class 7 Radio I probably mined myself in great bulk, also for a fraction of a credit per unit, but even if I didn't, I'm not mass producing these things, the cost is again negligible. The enhancer is probably something I can get myself easily enough with a combat alt (again, assuming it is about the level of premium crystal rarity), so in essence the 1 million is pure profit for me. Even if I didn't get it myself, I have many combat friends who will give me a substantial discount on it. If I wanted to, I could sell them at 500k and still make 500k pure profit on them. If the enhancer is as easy to get as a premium crystal is for me personally, then I'd probably charge 750k or so for every one. Again, I'll be undercutting everyone who doesn't have my connections/resources, but that's what I'd have to do if crafting was my major income source. Before, I could make less sales, but more profit per sale, and rely on my name, my quality, and my guaranteed stock selection to keep customer loyalty. Without customer loyalty, I have to simply be cheaper. The only real reason to even charge as high as 750k (given that I've demonstrated that the price is just about pure profit) is so the stock stays on there just long enough that I'm not constantly working to restock. I also have to make it high enough that a reseller has to at least think twice before trying to buy me out and listing it at a higher price.

Will this cut any crafter out who can't match my connections/resources/crafting suit? Yes, but I can't afford not to do it this way if I am relying on my crafting income. I need the sales, and making it better and cheaper than anyone else guarantees that.

Scenario 3, with Global Exchange (what I would really do, without wanting to be aserious crafter):

Make it with 1000 PE Radio, make it with the enhancer, and keep it for myself or give it to a friend. Or, if I and none of my friends needed it, toss it on the galactic vendor for2 million and forget about it. It won't sell until every other similar item is gone - it might never sell. But so what - I'm not a serious crafter, and as I've shown above, for me personally, making the item is not a crippling economic investment. I'm making my money in ways that are less soul-destroying than being a crafter. And you never know what people will buy - I used to list plain shirts on the bazaar for 3k, renamed as ADVERT!, back in the old days, and they sold out with terrifying regularity despite the fact that they were just a shirt that I'd renamed to be an ad. People are weird.

What I'd also do is make huge factory runs of the same widget, withouttheenhancer,using the highest PE radioactive I'd mined myself, 1000 PE if that was it (probably would be), or a slightly lesser one if not. Since the steel and colat are junk, and the cost price of all resources is just a fraction of a cred per unit, the whole thing costs me virtually nothing to make. Then I flood the galactic exchange with these unenhanced widgets at, I dunno, maybe 1-5k per item? Sell thembythe crate perhaps?The quality will still be the best unenhanced possible, given my crafting suit and my resources. Given the assumption that it's a highly desirable and semi-disposable item, there'll still be people who buy in bulk the unenhanced stuff, either for everyday use or just because they're new, or, if it's like a weapon, just to slice. It takes little time and effort to do large factory runs. The resource outlay is not huge, and all resources are inorganics, so I can keep supply up virtually indefinitely with little effort. Sure, I'm not making much money per sale, but so what. I can undercut anyone who has to buy the resources because I am established and can mine them myself. I'm not relying on crafting for my major income, so the constant steady tick of small sales is more than enough to keep me comfortable. And it takes comparatively little effort to keep the market cornered.

Alternatively, if it's like a weapon and slices can be used to disguise quality, I might preslice crates of these unenhanced widgets and list them for between 10k to a million, depending on slice quality. It's quite probable that most consumers won't be able to tell the difference after a slice between an enhanced item and an unenhanced one. Depending on my slice luck, I might make a ton of pure profit off them. But again, that really depends on how much time I want to devote, given that crafting is just a sideline for me.

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The above answers reflect my personal position. I am a longtime, well established, experienced crafter with a large resource stash, good connections, and more than one account. The global search would remove the joy of crafting for me, but it'd still be a simple matter for me to get a steady income from crafting without any effort. I'm not sure about the chances of others to do so in the same economy, though.

• Widget is a commonly used consumable item.


• Widget Enhancers cannot be obtained in unlimited quantities.


• I have sufficient Colat in reserve to last until it should spawn again.

Message Edited by Tirranus on 02-13-2005 11:20 PM

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Phaelyn wrote:

You'll find no information here. This isn't a diatribe by me, or any other Crafter or Merchant telling people they are wrong.

What this will be is an exercise in Pricing and quality.

As such, ladies and gentleman, this is your product:

WIDGET:

Takes 50 units of Steel

Takes 100 Units of Colat Iron

Takes 100 Units of Class 7 Radioactives.

Takes 1 Widget Enhancer. (Optional)

Needed stats: 100% PE (Potential Energy)

Now folks, assume these factors.

1. Lowest priced Steel is 1.5cpu
2. The Colat hasn't spawned in ages, so sells for 10cpu for the lowest price.
3. Class 7 Radioactive cost 3cpu for PE of 850 - Cost 5cpu for PE of 900 - Cost 10cpu for PE of 1000
4. Widget enhancers are a loot item, and extremely rare. 1 million on Trade Forums is going rate.
5. Item made without Enhancer is 30% less useful than items made WITH Enhancer.

Here's your challenge: Tell us if you would make with or without Enhancer, and what you would charge for your best possible finished good. Honestly use 2 scenarios - 1) The system as it is NOW. 2) the system with Galaxy wide search and purchase. Provide answers for both scenarios, please.

There is no right or wrong answer. This is only to see what different people would charge. Non-Crafters are encouraged to try their hand at this as well.

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With curent system- Use the lowest quality steel and colat I could find. Use the 900 PE class 7 rado. So cost to make(buying all resources at youre stated prices and ignoring defrayed startup costs) would be 1575 creds per item made. I would MASS produce them and sell at 2000, for a profit of 500 creds per item sold. So on one factory run of 1000 items, I would gross 2 mill creds, but after expenses would only keep 425k as profit, and thats not even accounting for expenses such as vendor upkeep, maintenect on factories or houses, the cost of a 12 pt crafting suit, crafting station, etc. etc...

I would only use the 900 PE rado in order to keep prices down, while still giving a quality, but not the best, product which means Id have to rely on the mass production to keep my vendors constantly stocked in order to attract the buyers that need the widget now but dont want to waste time searching vendors all day just to find the perfect one, so location would also be very important.

With propsed changes- To be honest, I wouldnt change a thing at first. Sure there will be much better products out there, and they will be bought first above mine with the ease of searching. But the number of higher quality products will be limited and there stock will run out before mine, so i will still be moving my stock selling to those who wanted the best but didnt get online in time to buy it so have to settle for the next best thing. But number of sales will drop and i think I'd eventually be forced to lower my prices in order to attract bargain hunters. Wheter Id end up having to lower my prices to the point where Im making no profit at all however is anyones guess. WE'll just have to wait and see how the propsed changes effect everything.

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RelicOMO wrote:

What I find interesting is that already, people have quoted prices that vary from 3k for unenhanced down to 1250. And all of them have taken into account a cpu price for sale. As in, 5cpu for sale is acceptable, or what have you.

Yet if people are prepared to pay 1 million for an enhancer that increases effect by 30%, what does that tell you? Does it tell you that the price difference for 30% effectiveness should be 800%? (1 million divided by 1250) 30%better is thus worth over 800% more in price?

What it tells me is this - if people are prepared to pay 1 million for something that improves a desirable item by 30%, then 1250 is ridiculously cheap. Ludicrously, insanely cheap. This example also operates in a vacuum - it's not an ideal example because we don't know what consumers have been paying for this item. I'd be prepared to bet that on any server, they would have been snapping these unenhanced items up at 10-20k. Particularly if it is a desirable consumable, as would seem to be implied by the price of the enhancer.

So, my question is, if 10-20k is easily affordable for the vast majority of players, and if they are prepared to pay that, why are crafters insisting on undercutting each other at 3k?

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If I drop a fusion on a 50% spot and a heavy on a 60% spot (and I can usually do better than that), then my cost per unit is 0.17cpu. So, I don't think that 5cpu is out of line. On the other hand, it others are selling for much more, then I supposeI would, if only to avoid driving them out of business (and forcing me to constantly restock). For example, when I was a chef, I think my cpu was more like 50 for Vasarian Brandy, otherwise I would have driven my BE supplier crazy.

But the fact is, I regard SWG as a game, not some sort of reality simulator.