Idea against Undercutting at the Marketboard (The next.. )

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Originally Posted by Sibyll

If someone is able to do this then that means the other sellers in the market were listing well over the value of the item.

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What the market deems it to be sellable at is the value of the item. If the item is selling well at 200k and it only takes 60k to make the item, 200k is not well over the value of the item if it sells at 200k consistently. If I undercut to 60,001 gil and hold it there, no one else is going to make any gil until I move out.

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Originally Posted by Sibyll

If this product moves quickly then one person selling a few items at minimal profit could either be bought and resold at a higher value by the competition or will be bought immediately and the higher products will be purchased as well.

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When individuals with a small supply of goods come face to face in competition, demand will eat them both out, or in your example you can buy them out but when someone who has a large supply comes in to competition with someone with a small supply of goods, you can't buy them out.

I'll throw up 3 items at the minimal profit margin and you'll buy them thinking your going to make profit off me because I've priced them so low but what you don't know is that I'm about to dump another 3 on to the market. You buy and next thing you know, I have 3 more at the same price on the MB. You can't make any profit until I move. You can attempt to find out how big my supply cache of goods are at your expense but most people are logical enough to realize they were just converted from a competitor in to a consumer.

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Originally Posted by Sibyll

Kind of a loaded argument.

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We've seen it in action for as long as WoW has been around. Go play the auction house there and look around, you'll notice people using the listing fee as a tool to lock people out of the hotter/higher end markets.

Here, without listing fees, you can compete fairly all the way down to the minimal profit margin, against any size merchant, big or small.

I undercut and I love it.

A lot of interesting ideas. Personally, I just want something to stop the small undercuts on big items.

Most of my sales are above 1m gil. The problem is, these items do not sell often. So what ends up happening? Me and 3+ other people spend the entire day undercutting each other by 1 gil hoping to get the next sale.
People tend to buy the first item listed, even if the next one is only 1g more.

I just want a Market system where I can set the price and expect it to sell without me babysitting it. FFXI did this well, as the prices were hidden and players just made bids to "guess" at the price based on the history. I think the biggest issue with the current market is having access to live, real-time prices, without any cost to change your own price.

I've handled this recently by just playing chicken on the market board. Undercut me by 1g, I undercut by 100k. People eventually stop, and if they go below the material cost of the item, I buy it and start fresh.

What PopeHat does .... best method ever :P

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Originally Posted by PopeHat

I've handled this recently by just playing chicken on the market board. Undercut me by 1g, I undercut by 100k. People eventually stop, and if they go below the material cost of the item, I buy it and start fresh.

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Yea. I do this because I don't have time to reach an equilibrium price one gil at a time. I basically decide a minimum price I'm willing to sell for and when I get to that I stop undercutting. At the very least I'm killing that persons profit margins and tanking the market for that item which is a win in my book.

Look, what it all comes down to is supply and demand. If there is too much of a commodity, then buyers will be less inclined to purchase the commodity. in turn, that leads to competitive price wars from sellers, lowering prices constantly in an attempt to sell that commodity. This is where undercutting stems from.

But if a commodity is rare or in demand, such as new items from a recent patch (ie: furniture when personal houses came out), then demand will be so high that most sellers can slap whatever price they want on a commodity and know that someone will still buy it. That's where price gouging comes from.

This is the basic function behind the market. It may not be fair to some, but that is how it is.

That doesn't mean you can't win.

In many cases, if you see prices being undercut to stupid low levels, simply buy it and resell at a higher price. In the end, everyone wins. the seller sold their commodity, you have adjusted the price to a satisfactory level, and the market stays relatively stable.

BUT, the one thing that blows this all to hell are the gilsellers. I cannot express enough my disdain for their tactics. For example, on Leviathan, elemental shard prices were doing pretty well at roughly 100 or so per shard. Suddenly, there would be groups of three retainers with either similar or nonsensical names, all from the same city, selling tens of thousands of the same shard every day for 70-80 per shard. That is a 20% drop in value. Unfortunately, the only way to compete is to sell lower than them. The next day, it repeats. Tens of thousands of shards, at an even lower price. I have a hard time believing an actual player harvests roughly 80,000 shards per day for this, so I feel I can safely assume it is a gilseller.

Undercutting by 1gil or matching the lowest price is the most sensible thing to do in all cases.

Why?

Because FFXIV is not a "commodities" type of economy.

No one buys an alchemist's coat in anticipation for when their alchemist hits 50. They're gonna buy that coat the MOMENT they hit 50 on the alchemist, and they're going to pay nearly any price (so long as it's not unreasonable) when they get there.

FFXIV's economy is a "want it now" economy: when people want something, they'll buy it then and not a moment sooner, no matter how good the price may be because they're not LOOKING for it until then.

The only exception to that rule are people hunting for items that are listed far below normal value. It's kind of astonishing how many people don't use the price history (or choose to ignore it) and routinely list items for 10k+ below what they normally sell for.

I've recently taking to just buying those items and relisting them. They usually sell before the day is out...

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Originally Posted by PopeHat

I've handled this recently by just playing chicken on the market board. Undercut me by 1g, I undercut by 100k. People eventually stop, and if they go below the material cost of the item, I buy it and start fresh.

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I deal with people like you all the time (and win) so I'll share my own perspective. You undercut by 100k at a time? I will still undercut back. You destroy my profit? Guess what? You're destroying your own profit too. I will use your undercutting method against you and drive the profit margin to the bottom and then let yours sell. Market board fighting is as much about maximizing competitor loss as it is maximizing personal profit. In the end, you will either remain persistent and deal with low profit margins for an extended period of time, or you will give up and look for better opportunities elsewhere.

Undercutting is a double-edged sword. The more recklessly you swing it, the more likely you are to lose something big.

Just happened today: someone listen an item for 20k that was selling for 38k regularly.

Bought it last night, mine sold this morning and I absentmindedly made another one. Then IT sold like 20 mins later so I relisted the one that I had bought for 20k.

Seriously, I don't know whether I should encourage people to use the price history or if I should just keep making money off of them...