Chef Archive
Thread: Undercutting Prices
This is a game.. andin this game you run a business as a Chef. You can't expect everyone to sell at the same prices.. what fun is that? If your looking to make millions from Chef.. look again. Those days are over. Too many Chefs selling at affordable prices on consumables... including me.. as it should be.
I charge 200 credits a use for Sunburns. I know there are people on my server charging more, and I know there are people on my server charging less, but that's what I have decided is a fair price for them, based on my costs involved in the making of them. I have a steady stream of customers coming into my shop and placing orders for crates of them. I've lost a few customers to the lower priced chefs, and I've gained a few customers due to my customer service, and that's what you should be focusing on. Ok, so I'm not making 100k a day, but that's fine. I'm paying for my harvesters, I'm leveling myself up, and I'm having fun playing a GAME.
There should be more involved in your sales than just price. Customer service should play a large part of it. For example, I had a customer come back to me complaining that his TS stack wasn't working. This is before I knew about the stack bug, and the work-around. I apologized, took the non-functioning stack, and gave him a new supply that contained more than he started with. This, and other acts of customer service have kept me with repeat customers, even with the competing chefs with lower prices.
There is also the 'instant gratification' factor. Sure, you can get yourself a nice stack of TSes from that cheap chef on Tatooine, but is it really worth waiting for the transport, and running around, when there is a vendor here?
Welcome to the wonderful world of economics. If you can sustain your business at your price, why worry what others are doing?
There was a sort of similiar discussion about this on other professions. Now that factories are now fixed, our time as chefs as come like all the other professions. In time, people will know the value of our buffs but even then, as a consumer(their point of view), they want max uses or stats for the cheapest price. Yeah it does suck that other chefs are now getting undercut (like me haha) but I decided to really think on this with some figures and estimates.
Here's what I came up with:
1x Sunburn = 110 resources (90 from 2x Starshines, 20 From TS Gas Requirement)
If you harvest the resources yourself then your cost would look like this:
Time to find the resources (minerals, gas, cereal). Time =~ say 4 hours a week(roughly). Harvester maintanence therefore is 1440 a day per harvester (using mediums) + power (another 1440 a day per any power generator). This is up to say 5 days, not 7 because it's almost hard for a lot of people to shift to a new resource patch that quickly. For me, I spend say 7 structures x 1440 per day up to 5 days, that's... 50400 in 5 days. Wow that's a lot of credits... However, cost of resources would be 50400 for 5 days worth of nonstop harvesting so at say 75% of 4kg/h (3000 units each day) for 5 harvesters and excluding the 2 hypothetical power generators, I get 5x 3000 units x 5 days = 75000 resources. Divide that by 110 and it's ~ 681 Tatooine Sunburns. So to make a little profit just sell all 681 TS's for a minimum of 51000 credits and you've made 600 credit profit (**edit** that's so low for all that work).
If you buy your resources then your cost would look like this: at 2cr/unit (very rare on gorath) then each sunburn costed 220 each plus power/maintanence used on food factory. Let's say you just buy power also at 2000 units for 3000 credits (very cheap now hehe) and 1440 for the factory maintanence a day for say one day. So now that's 220 per sunburn plus 4440 credits maintanence plus power. For making 99 TS's alone then, comes out to... 21780 base cost + 4440 = 26220 credits. So for the chef that "wants to take over the world! tm" or "screw every other chef over! tm" or "I just want to help my fellow players.(altruism is so rare, or is it?)" then these individuals can go as low as say 27000 credits for all 99 Sunburns and still come out with a little profit to keep it going. So each crate in essence can be 27000/4 = 6750 for each 25 item crate up to 4 crates. Wow, we're so dead...
at 3cr/unit (very rare on gorath) then each sunburn costed 220 each plus power/maintanence used on food factory. Let's say you just buy power also at 2000 units for 3000 credits (very cheap now hehe) and 1440 for the factory maintanence a day for say one day. So now that's 330 per sunburn plus 4440 credits maintanence plus power. For making 99 TS's alone then, comes out to... 32670 base cost + 4440 = 37110 credits. So for the chef that "wants to take over the world! tm" or "screw every other chef over! tm" or "I just want to help my fellow players.(altruism is so rare, or is it?)" then these individuals can go as low as say 38000 credits for all 99 Sunburns and still come out with a little profit to keep it going. So each crate in essence can be 38000/4 = 9500 for each 25 item crate up to 4 crates. Wow, we're so dead...
Conclusion:
For chefs who want to take over the world or screw every other chef over, well, unless the amount of them fulfilling all the demand of the entire galaxy, I wouldn't worry too much about it. If master professions taught me anything(like the weaponsmiths on gorath) it's this, they can never ever keep up with demand, there's too few of them. Look at my analysis, I didn't even factor in a complete amount of time it takes to obtain resources and how many factories you can have churning out all these sunburns, and it's very small since it's at least 5 hours per 99 TS's. However, the days of 70k credits per 25-item crate are over *cries.*
I'm at 37000 per crate (with 13 or 14 charge tat. sunburns) and it's continuing to go down. It does seem like we may need to head towards the 10k per crate very soon but then demand will begin(hopefully) to exceed supply so we can now bump it up to 15k/20k? a crate and still make decent profit. Still sucks though, I was hoping to make millions every 3 days lol. I guess that won't be happening. **edit** it, now to goto my vendor and slash prices again... Ah hell I'm reading a book in RL and giving the game another day to see if people buy it, nah I'm going to slash prices again on 3 items, *W#$KL#:$J#KJSDL:KFJ#$@#$*@(*$&.*
No chef "owes" it to the community or to his fellow chefs to make his products a certain price. If he wants to undercut the market and offer the cheapest available products, that is his choice and the galaxy is large enough that other chefs shouldn't be adversely affected. If the galaxy is new and the market for sunburns is small, then it is also the chef's right to try and maximize profit by "overpricing" his items. In a game where almost the entire economy is player driven, competition is both inevitable and necessary.
Chefs should also stop feeling like their only market is the power-driven melee-combatants that down Sunburns like light beer. Anyone with a little ingenuity and some thinking skills should be able to figure out that there is a HUGE market for other chef products, if you market them correctly. Doctors are unable to buff mind, and many people want an alternative to spices with no downtime. Many players want buffs but can't afford Sunburn or doctor buffs, and as a result actually want WEAKER items that they can more easily afford. The roleplaying market is larger than you might think, and playing the role of bartender or baker can actually be quite profitable, especially if you think of creative names for your products.
Again, it comes down to each their own...
Personally, I don't want to supply food to every single person on Radiant. I harvest none of my own resources so they cost me a bit more and are somewhat of a pain to acquire. Instead of running around feeding harvesters I spend the time consulting with a customer helping them get into their composite armor, experimenting with various resources and combinations to create custom-designed crates for specific customers, or even hanging out in a cantina making and handing out random stacks of food. The actual process of gathering resources and making the food isn't the fun part for me. My goal is to provide superior service so that my customers are buying the appropriate diet for their starting stats, weapon/armor penalties, and play habits.
Thus, I charge alot for my food compared to what I see listed above... but take on very few clients. If I was just churning out food and tossing it out on a vendor, there would be no way I could sell anything at the prices I charge. However, spending time with each customer, creating free samples for them to experiment with, creating special stacks of food to help them reach particular goals in order to wear armor, etc. builds strong customer loyalty and provides an added value for which they are willing to pay a premium.
Just pick a business model you enjoy playing and you'll make money at it. As I have stated before, Chef is probably the most flexibile profession around in terms of playstyles do the repeat nature of our product and flexibility. If people are flooding the market with cheap food and you want to be able to charge more, figure out how you can add value to your product/service beyond the stats.
Cheers,
Kaizen Jonzun
Proprietor of The Drunken Jester and Master Chef
Radiant - Keren
I think someone running their own harvesters can charge so much less than what someone that has to buy resources can charge. You get lucky one week and find a 80% spot you can produce stuff at less than 1 cr with ease. The next week you might not be able to find anything or its on another planet. I buy some things off the bazaar. It costs me 3-4 credts sometimes. Hides are going up in price by the second due to the reduction in quantities.
Few people will sell resources at dirt cheap prices. I can't find resources for sale at .5 credits or 1 credit per resource, but people will dump a house or food off at those prices.
There is a guy dumping wastril bread on the bazaar right now. He charges 40 credits for it. I can't compete with this. Subtract the 20 credits for listing and its going at 20credits per stack. Maybe he is making a great profit, but to me its jsut idiocy. For all the time it takes to gather resources and make food, I might as well just sell resources on the bazaar I'd make more money.
The guy dumping wastril bread on the bazaar is obviously grinding and looking for UXP. If he didn't throw it on the bazaar he would be throwing away the money for the resources anyway, seems fine to do. I personally will often throw Stewed Gwouch on my vendor for super cheap on a regular basis when I use that for grinding / ridding myself of small stacks of resources.
Honestly, there is no market for wastril bread. Maybe at those prices, and it will probably get used as pet food. Just be glad Tat Sunburn gives measly experience, or you'd find your main source of income undercut by grinding drinks.
I had to pipe in here, as I have just finished reevaluating my entire pricing scheme. Selling per credit makes no sense to your customers. You are NOT doing them a favor. You are letting them use you. You are also helping to insure that they do NOT know the full value of foods. How can I say this?
You are charging per credit - 2 starshines + 20 gas = 30 cereal, 50 gas, 20 mineral = 100 resources. (doing this from memory, I may be off)
the benefit: over 1500 strength, and 1500 con with a -100 (at worst) focus for approximately 6-8 minutes -- or as I prefer to put it over 19,000 buff*minutes
by your logic: Meatlump which requires 30 resource (30 percent) should be *worth* 30 percent of the price.
the benefit: approx. 140 con for 3-4 minutes - or about 500 buff*minutes*
So, you would offer your customer less than 3% of the benefit, for 30% or the price.
Or to put it another way: you would charge 10x the price for someone to get the same effect from meatlump - note: this carries over to EVERY other food. As a consumer, I would want the most for my money. as a Result I would buy nothing from you, save sunburns.
As I said, the only thing you are educating them in is what Sunburns can do... you are turning them off of the rest of the entire line.
Misterie
Bah, i dont know why people make such a big deal about "undercutting". I'll undercut any chef made item i can. I dont do it to be malicious. I do it because i just want to sell my food to people. Money is really the last thing i need. Whenever i need to use factories i use my friends factory. Whenever i need to use harvesters i use my friends harvesters. Whenever i need meat/hide/bone i'll either go out and get it or my friends will give it to me for free. Vice versa whenever my friends need harvesters i make them. Whenever they need weapon powerups i make them. When they need armor , i make it. Getting paid for my food is a little added bonus. The main reason i make / sell food is because i actually like sitting and crafting ( weird isnt it? I play a crafter and i enjoy crafting ). Heck alot of times if people ask me if i can sell them such and such i'll just give it to them for free.