Rock Star Pricing

Posted by J.E. Douglas at 1:50 PM

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Mommar here.

As JMTC in snow bound camp Iowa starts to get into the Christmas spirit.   The crew are drawn to the idea of pricing as it's found in the retail stores.

Most people don't search by who is listing an item.   They look specifically for what is the cheapest they can get an item,  and it's value to them.   Whether it's a vanity pet or the sword of uber smackdown.   Players want the biggest bang for their buck.   Which is why undercutting of items becomes very popular.

But a shrewed gold goblin can determine exactly what pricing they are willing to go on an item.   It's a very simple idea but has spectacular benefits.   Determining your bare bones minimum profit point allows you to know exactly where you can price an item and still not lose gold.   Then you can build your listing to exactly how much your server market is willing to pay for something.

Some items such as raw materials are more dependent on the ebb and flow of the server economy.  Once one player starts to undercut for something like [Ghost Iron Ore] then there is a long line of players that will be undercutting to be the first ones to sell their items.

Individual in demand items can become much more important in the gold making arena.  High quality items where there are only two or three of them on the Auction House can be manipulated more,  keeping a closer line to your profit margin.   Even listing a high sales item 10-20 times can net you a large amount of profit for just the 30 seconds or less of listing and relisting.

I have written the idea in stone that information is what determines your future Gold Goblin status.   Being a rock star at pricing means to know exactly that breaking point where the economy will glance over your item and call it unbuyable.   Or setting such a price that a player has to have it at exactly the cost that makes both you and them very happy with the purchase.

Good Luck and Good Hunting


Want to get in contact with me? . Email me at Dragonbearjoe @ gmail. dOT com or find me on twitter at "@JMTCMommar" You can find me hanging out on the Shandris Server, chat me up and I will buy you a glass of juice. 

Previous Entries

Follow Your Strength
The Go To Gold Goblin???
Keep Your Head Up Gold Goblin
Plant Pvp Enigma Seed vs Songbell Seed
The Short List
Decking Out Your Farmer
Winter Veil Farming: Head Start
A Perfect Circle of Goblin Life
Addon Abandonment Issues
The Guild: Striking Tone For Sales
Controlling Your Reputation
Are You Experienced
Farming Post Patch 5.1
The Hours of Power
Profit Calculation 101:  GPH
THIS IS GOLD MAKING!!!!
Prepping For Darkmoon Faire
Limited Item Is My Favorite Word
Patch Me Now
Old World Farming
Shake Off The Bad Days

My Rod shall comfort thee... and make gold

Posted by J.E. Douglas at 8:00 AM

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Now is a great time to start looking at markets to get back into.   Many warcraft players are starting to level alternate races and professions again.  One of the most popular to level is an enchanter.   As an enchanter levels his craft,  he has to create the rods used for the next level enchants.

Each rod has it's own material requirements and is many times in high demand.   Many Blacksmiths look at the big ticket items for their sales.  But crafting and selling the plain rods can augment your sales.

• Silver Rod (2x Rough Grinding Stone + 1x Silver Bar)
• Golden Rod (2x Coarse Grinding Stone + 1x Gold Bar)
• Truesilver Rod (1x Heavy Grinding Stone + 1 Truesilver Bar)
• Arcanite Rod (3x Arcanite Rod + 1 Dense Grinding Stone)
• Fel Iron Rod (6x Fel Iron Bar)
• Adamantite Rod (10 Adamantite Bar)
• Eternium Rod (4x Eternium Bar)
• Elementium Rod (15x Elementium Bar)
• Titanium Rod  (2x Saronite Bar + 1x Titanium bar)
• Elementium Rod    (15x Elementium Bar)

As with anything you craft,  keeping your material costs low will increase your profits.  This becomes especially important when it comes to the arcanite rods.   Arcanite is only available through an alchemist who has the transmute arcanite pattern.   There tends to be a large demand for both the arcanite crystals (mined from thorium level areas like silithus or Plaguelands).   Now would be a good time to start to stock up on these when you see them cheap.   For both continual sales now,  as well as future sales during the MOP expansion.

Fel Iron and Titanium bars become difficult to find at times.  Few are doing the Outland and Wrath Expansion areas,  making these two items will become in demand on many servers.  These also might be good targets to use both a craft and long term storage option.  Titanium Bars are also able to be transmute from 8x Saronite bars by an alchemist.  Allowing you to have two paths to obtaining these materials.

These type of niche markets might seem trivial in regards to your larger cost items.  But small and medium profit sales can add up many times to one large ticket sale.   In baseball 4 singles still score the same run as one home run with the bases empty.

Want to get in contact with me? . Email me at Dragonbearjoe @ gmail. dOT com or find me on twitter at  "@Dragonbearjoe" or leave a comment here.   You can find me hanging out on the Shandris Server,  chat me up and I will buy you a glass of juice.

Past articles by Mommar:

Your milage may vary

Would the owner of the saronite please stand up?

Stars are full of gold

You got your jewelcrafter in my alchemist

join the fun ... buy the t-shirt

Tools of the Trade

  

The Gold Per Hour Myth

Posted by Aleithia at 8:00 AM

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A lot of articles I read talk about how much gold/hour you can earn by following a certain technique. If only the process were so simple! The idea is this:

Sale Price - Cost of Creation = Profit / Time to Make = Gold/hour.

It seems simple, but should this be the primary method for determining our gold-making strategies?

The Real Cost of Items
Items don’t just cost gold to procure. There are lots of factors that go into an item’s cost, but not all are as easily defined by their purchase price. While you should definitely be concerned about the purchase price, there are other factors involved :

• How much bag space does this take up? Every slot you fill with this item is one slot you can’t use for something else. This affects your total gold-making potential as you have limited space to store cheap items for later use. We sometimes label this Opportunity Cost.
• Where’s the best use for this item? Volatile Earth could be used for making leg armor, belt buckles, dream cloth, or other items. Where is your best bang for the buck? We sometimes call this Return on Investment or ROI.
• Should this item even be purchased? How much Gold can you make with this item? If you aren’t sure, you’ll have to spend time researching it. You might even have to take a loss on some items before it starts turning a profit.
• How much processing time is involved? It might be cheaper to buy ore and prospect it for your gem business. But the processing takes time. Is it a better return than buying the raw gems and cutting them for profit? I prospect very little ore myself, instead relying on the purchase of cheap gems off the Auction House. Could I make more by prospecting? Probably, but all my play time would go into the prospecting/gem cutting and I wouldn't be able to profit off Enchanting or Leatherworking as much. I might also only be able to prospect and sell 50 gems, but I can purchase and sell 100 in the same amount of time.

Maximizing Profit
The trick to maximizing your profit is not in running a simple gold/hour formula to find the most profitable item, but the sweet spot between supply (raw mats and processed goods), demand (sales) and time. Hypothetical example:

• I can procure 300 Volatile Earth/Day for my desired price or lower.
• I can sell 100 Volatile Earth via Drakehide Leg Armor (5 sales/day).
• I can sell 40 Volatile Earth via Ebonsteel Belt Buckle (10 sales/day).
• I can sell 50 Volatile Earth via Enchant Bracer – Major Strength (2 sales/day).

Now, in the above scenario, I have a balance of 110 Volatile Earth that I couldn’t process each day. How do we optimize this? I have a number of options to improve my overall return on investment on Volatile Earth:

• Buy less for a lower price.
• Process more finished goods and lower the price to try increasing sales.
• Sell excess Volatile Earths for a small profit.
• Expand into more items to produce.

Now, this is a single raw material. Start focusing your efforts on total Gold/Hour or ROI instead of a single item and you'll really start to bring in the gold.

Evaluating Your Business
As you look to optimize your total gold/hour, consider the following:

• Think in terms of weekly and monthly throughput. My scenario was a single day, which has lots of variation in it. Your weekly or monthly sales will be a more accurate reflection of total output for items.
• Consider where your time is being spent. Don’t be afraid to drop out of some industries to focus on others. You might be making profit on PvP gear, but maybe the time could be spent better elsewhere. It might be more profitable to mill herbs and produce glyphs than to process ore for gems. Shift processing time to glyphs and buy raw gems to cut for Jewelcrafting instead. Try to find the most efficient use of your time. If you produce more than you can reasonably sell, you're leaving money on the table by not dropping out of that really high gold/hour item that doesn't sell and instead focusing on a lower gold/hour item that does.
• Look for the sweet spot on raw material inventory. Ideally, you should never run out of raw mats or their finished products, but you also shouldn’t sit on a ton of mats either unless there’s a big pay-off at the end.

Where are you most efficient? Do you have too much raw material usually, or not enough? Are you short on time to process everything?