Learning to trade

22nd April 2009 – 10.56 am

In producing modules and ammunition to sell to capsuleers in New Eden I have to pay some attention to my costs and the market. As I buy minerals from the market and the manufacturing plant costs ISK to run there is an overall cost per unit to be considered in order to make a profit, and that's without considering the initial costs of buying and researching the BPO. Because there is no point in manufacturing modules to sell them for a loss I cannot simply undercut everyone in the market or I will eventually bankrupt myself despite selling all my product.

Unfortunately, sometimes there are modules that are too readily available as rat loot, which end up on the market being sold below the cost of manufacture and make it difficult to earn any kind of profit on the item. It is possible to list the item with a suitable profit margin and wait for the cheap items to sell first, which also happens to be a useful strategy to keep prices on other items reasonable instead of desperately undercutting the competition just to sell your own units first. As long as the cheaper units sell quickly and are not then replaced you will still see the expected profit on your own units.

I have managed to manufacture one of the modules that sells apparently below cost, which is disappointing. I have a hundred of them sitting on the market, hoping someone would buy them so that I would at least not lose any ISK from the run, even if the profits were negligible. But some entrepreneur makes a bold move, buying up all the stupidly cheap listings of this module in the region and relisting them at a cost about twenty times what they were. It's a valid strategy, if risky. Only a twentieth of what has been bought needs to sell to make back the investment and anything after that is profit, but this assumes both that the initial modules aren't resupplied quickly and no one comes along to undercut the vastly inflated prices.

The new, outrageous prices work for me. I modify my sell orders quickly to increase my prices by an order of magnitude, sufficiently below the higher costs to look attractive yet now only requiring me to sell a tenth of my production run to recoup my costs. It takes a few days and although the sales only trickle I make back my ISK from the production run. The market price remains high but as each unit is under a hundred thousand ISK it is pocket change to capsuleers and I can expect a few more sales at least. I doubt I'll be making another production run of these modules but at least I found out that they are not generally profitable items whilst still recovering my costs.

Keeping track of the market and staying on top of prices is quite interesting. This is not like Elite, where there are generally fixed prices in certain areas and it is simply a matter of investing time to haul cheap items to expensive markets. Although there is still opportunity for buying low from NPCs and selling high the market is created and driven, and occasionally manipulated, by capsuleers. It is not just in the vacuum of space where capsuleers stalk quietly and strike hard, looking behind the scenes can offer just as rich an experience.

  1. 2 Responses to “Learning to trade”

  2. You can simply change your sell order to .1 less than what someone is selling it for and keep doing this until he no longer wants to sell those items on the market. Then you adjust your price to a much higher price if you are the only one selling that type of item on the market. This of course is based in .0 space and depends heavily upon other people not selling the same items in your region.

    For instance
    Im selling survey scanners at a ridiculous rate of 800k per scanner.

    By zigboyd on Apr 22, 2009

  3. One of my goals is to get in to a blockade runner and try to make my riches diving in to low- and null-sec space. It certainly sounds like there is a lot of ISK to be made.

    By pjharvey on Apr 23, 2009

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