Overflowing stupidity

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Originally Posted by scarebearz

You are missing the point of that example:

Tomb mats do sell a lot faster than crafted items.

In the example the mats total market value was 200k, the finished item undercut to 150k.

Regardless of if the 150k finished item sells faster than the other crafter's 250k item, the undercutter is still in effect losing 50k easy profit, by not just selling the mats.

The fact he farmed all the mats himself is irrelevant, while the 150k may be "pure profit", it's still a minimum 50k loss on the gil potential and a senseless move on his part.

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Your key point here is "gil potential."

There there are 2 assumptions that you are using that I would like to refute. 1) There is no guarantee that your material will sell for 200k nor can you guarantee when the materials will sell, but I do know my 150k product will sell before your 200k materials will. 2) you are setting a valuation on the sum of your materials that may not be universally held. See my quote below:

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Originally Posted by Wulfies

I do not know what your goals are, but when I put crap stuff on the market, I want the product to move and collect my gil as quick as i can. To me, as a person who farms everything, my CoGS (Cost of Goods Sold) are next to nil except for the time it took me to farm the mats. As a merchant, my goal is to sell first and sell it fast. I want to move more product and if i can do that cheaper than you and still make more profit than you, i can and I will. This is a basic business model.

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My theory is based on quick inventory turnover. This is my business model and works well for me (this may not be something you like but no one is forcing you to use this method.)

There is an old adage: "A bird in hand is worth 2 in the bush." I will take my gil-in-hand over the potential more profits for me.

Zigkid3 succinctly states my point.

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Originally Posted by Zigkid3

in some cases its better to sell for less if it increases your inventory turnover rate.
Say someone can gain a net profit of 20k at price point A, or or gain a net profit of 30k at price point B. Price point B is higher which will result in getting 10K more out of the sale but it'll sell less often.
Say after 24 hours, at price A you were able to gain 20k for each sale and sold 5, so 100k total. In the same amount of time of 24 hours if you sold at price B and gained 30k each you may only sell 3 and gain a total of 90k.
So in 24 hours, it was better to sell at a lower price and gain less profit per item, but you sold a lot more in the same time frame.

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Also, the fact that he/she farms all the mats has everything to do with this. By farming the mats, you are reducing your CoGS thus increasing your profits.

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Originally Posted by scarebearz

Demand is not the only influencing factor on prices.

If an item is overpriced, it will not sell regardless of the demand.

E.g. No wind shards on the market, so someone puts them up for 100000 gil each, they will be high in demand, but nobody would pay that for them.

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To use your example, if I really need a wind shard bad enough and I am unable to obtain it myself, then yes I would buy it for 100k a pop. More to my point, we both know that certain materials/product are farmed/crafted more than others.

Lets take something that isn't readily avail, for example lets use a Black Pearl Ring +1. Now this ring is required for your GSM lvl 50 quest. I was able to go 3/3 on creating +1s so I put the other 2 on the MB. Saw that there were no +1s on the market and the last +1 sold for 8k. So I put my 2 up for 20k (2.5x the market history rate.) Within 24 hours both had sold, but a few others found that out and price dropped (my "niche market" was over saturated but I sold what I wanted.) Yes, it was stupidly high compared to the "sensible price" yet it sold cause there was a demand.

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Originally Posted by scarebearz

You are missing the point of that example:

Tomb mats do sell a lot faster than crafted items.

In the example the mats total market value was 200k, the finished item undercut to 150k.

Regardless of if the 150k finished item sells faster than the other crafter's 250k item, the undercutter is still in effect losing 50k easy profit, by not just selling the mats.

The fact he farmed all the mats himself is irrelevant, while the 150k may be "pure profit", it's still a minimum 50k loss on the gil potential and a senseless move on his part.

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This is why I generally just up the tomb items and sell those... but if someone was stuck with inventory, they might cut the price to recover their investment.... especially if it has been sitting a while.

Frankly, the amount of time to farm the tomb mats isn't worth the marginal upgrade of crafted gear... and the more people that have comparable gear and collect myth stones... the less valuable that crafted gear becomes.... there are lots of factors as to why crafted stuff gets junkier and junkier with time.

Even so, better to cut your losses then have an overpriced inventory item that collects dust...but maybe someone made the junk, because -hey they leveled crafting and want to make the high level stuff at least once... even if it is junk.

(Don't forget the mats also fluctuate... if those dropped massively, it might have made sense to slash price on the finished product)

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Originally Posted by scarebearz

You are missing the point of that example:

Tomb mats do sell a lot faster than crafted items.

In the example the mats total market value was 200k, the finished item undercut to 150k.

Regardless of if the 150k finished item sells faster than the other crafter's 250k item, the undercutter is still in effect losing 50k easy profit, by not just selling the mats.

The fact he farmed all the mats himself is irrelevant, while the 150k may be "pure profit", it's still a minimum 50k loss on the gil potential and a senseless move on his part.

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You aren't completely wrong, but not completely right either.

if someone sold a good farming their own mats so COGS was 0, then they made money technically. You are right though in that if someone sold that item for 50k cheaper for no reason at all then they lost money due to their opportunity cost. (a drastic example would be farming for mats that took hours to obtain and then selling the finished product for a measly 5k, which means they lost money do to their opportunity cost because they weren't adequately paid for their troubles). So you are right in that sense.

However, there could also being a reason to sell for cheaper than the total mats required if someone farmed the mats themselves, and this depends on the inventory turnover which depends on the elasticity for the product depending on if it's inelastic or elastic. Of course this is assuming someone farmed the mats, in which the amount of time they spent gathering mats and how much they feel their time is worth is subjective. Also if someone is specifically farming mats over and over down to a routine, knowing what they're making etc... as opposed to people who happen to get the mats over time, then to them the mats would be cheaper (to themselves) than the ones on the marketboard, because they gained the mats more efficiently than most people due to economies of scale. Of course this is all assuming someone farmed the mats.

Now assuming if someone bought the mats from the MB, then made the finished product and resold them...then obviously they can't buy 200k worth and sell for 150k, as they'd lose from COGS alone. In this case, say item X costs 200k to make but it can only sell for 150k. this would be because if item X didn't have much demand to begin with. As a result, sellers won't produce item X because it is unprofitable to do so (assuming everyone buys mats), then supply would go down to drive the price up to the point where it would be greater than or equal to 200k.

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Originally Posted by Zigkid3

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I agree, my example does not take into account all factors, but it was used to hopefully illustrate the foolishness of someone selling an item cheaper than they could sell the mats.


In terms of 2 star items being sold way below cost due to silly undercutters, I believe this is the main reason:

A crafter has been selling a lot of 1 star items and other things fast on the MB, they gear up and think "I'm going to make and sell some 2 star items!".

They list the item and expect it to sell as fast as their other items.

After a few days or less they get worried that it's not selling and a large part of their gil is tied up in this item.

They keep dropping the price / undercutting in large chunks because they are desperate to get back whatever gil they can ASAP.

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Originally Posted by Wulfies

Hi,

As a merchant, my goal is to sell first and sell it fast.

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And what a great merchant you are.. Your goal should be to sell as high as possible with as little time required as possible. You on the other hand spend more time to sell at lower prices.

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Originally Posted by scarebearz

I agree, my example does not take into account all factors, but it was used to hopefully illustrate the foolishness of someone selling an item cheaper than they could sell the mats.


In terms of 2 star items being sold way below cost due to silly undercutters, I believe this is the main reason:

A crafter has been selling a lot of 1 star items and other things fast on the MB, they gear up and think "I'm going to make and sell some 2 star items!".

They list the item and expect it to sell as fast as their other items.

After a few days or less they get worried that it's not selling and a large part of their gil is tied up in this item.

They keep dropping the price / undercutting in large chunks because they are desperate to get back whatever gil they can ASAP.

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I want to try and tie this back to the OP's posting regarding "Overflowing Stupidity" (as he so aptly puts) so here goes:

It is the crafter's responsibility to find markets which are or are not profitable. When I decide on a market to sell stuff I look not only at the going prices for the product(s) I will be making but also at the history to see how fast said product is moving. The transparency with being able to see profitable markets helps me make very informed decisions in how I spend my time crafting. This is why I am vehemently against implementing the blind bidding system that FFXI has.

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Originally Posted by Zigkid3

A lot of these threads seem to be made by people who feel they are entitled to large profit margins.

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+1 billion to this sentence.

People should be treating selling crap stuff on the MB like opening a "mom & pop" at the corner. Just like with any business, without the proper research and information you are bound to fail.

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Originally Posted by Megido

And what a great merchant you are.. Your goal should be to sell as high as possible with as little time required as possible. You on the other hand spend more time to sell at lower prices.

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I think you're taking it a bit out of context. I think what Wulfies is saying is that a merchant shouldn't be solely concerned with just price alone, but also the amount that can be sold at certain price points in given periods of time (the turnover rate). Ideally you want to sell at the point that gives you the best overall combination of net profit x quantity sold within a given time period (hence my earlier example).

@scarebearz: I at least can see where you're coming from.

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Originally Posted by Megido

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Originally Posted by Wulfies

Hi,
As a merchant, my goal is to sell first and sell it fast.

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And what a great merchant you are.. Your goal should be to sell as high as possible with as little time required as possible. You on the other hand spend more time to sell at lower prices.

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Hi. Just a couple of things. First, please use the entire paragraph as it explains my stance on this and do not take my words out of context (you miss the whole COGS effect.) For your reference here is the full quote:

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Originally Posted by Wulfies

Hi,

To Ricon, I ask "why not?" I do not know what your goals are, but when I put crap stuff on the market, I want the product to move and collect my gil as quick as i can. To me, as a person who farms everything, my CoGS (Cost of Goods Sold) are next to nil except for the time it took me to farm the mats. As a merchant, my goal is to sell first and sell it fast. I want to move more product and if i can do that cheaper than you and still make more profit than you, I can and I will. This is a basic business model.

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Since you forgot to mention the CoGS, here is an example to illustrate my point. Lets use Mithril Ingots as the example (you can change this item to whatever you want).

Now lets say that the current "going rate" for said ingots is 150 gil each. Lets assume that if you were to buy the mith ore and the shards needed to make this ingot it would cost you 100 gil (this is your CoGS). Now me being a miner I can go out and mine the ores and the shards for free and all its costs me is 5 mins. Lets say i value those 5 mins as 10 gil (that is my CoGS.)

Now, if you were to sell your ingots at 150 gil your profit per ingot would be 50 gil per unit sold. To make the same profit per ingot, I would need to sell the ingots at 60 gil. Now, I want to make more than 50 gil and still sell it for less so I can/will sell for 125 gil. Since I have a lower CoGS, not only am I selling it for less than you (so people will buy mine before yours,) but I am making more money than you per item.

So....isn't that the goal here? So...how am I spending more time to sell at a lower price?

We can make many examples of people gathering their own mats, to argue against market stupidity. But the fact is there is a lot of market stupidity out there.

E.g. I used to check history for who had been buying tomb mats, out of curiosity. I've often seen new crafter's buy mats for a 18 mat item (560k in at the time + 15k for other mats). Craft the item that sold slowly for 900k (back then), then undercut their competition by 100k a time until around 500k.

This type of silly undercutting did get them their sale though, but more than a 75k loss. (tax)

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Originally Posted by scarebearz

E.g. I used to check history for who had been buying tomb mats, out of curiosity. I've often seen new crafter's buy mats for a 18 mat item (560k in at the time + 15k for other mats). Craft the item that sold slowly for 900k (back then), then undercut their competition by 100k a time until around 500k.

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Maybe they saw it listed at ridiculous prices and thought it was selling for that much... but once they actually made it realized that no one is buying it for those rip off prices because it is junk and lowered the price to the cheap level it should be at because those products are junk. At that point, they probably realized they overpaid for those tomb mats, because they are used to make junk and got out of the market.

Meanwhile, someone has stuff listed at 900k that is junk, but it might eventually sell to a gil buyer - if no other junk is listed at a better price.

Not surprisingly, at some point -said ripoff lister- comes to the board complaining that they got some kind of temporary ban because apparently they were involved with a transaction related to gil buyers....either that or is here whining that prices get slashed on this kind of junk and they aren't selling for those ripoff prices anymore.

Eventually, the tomb mats prices fall, the marginal upgrade junk prices fall... and everyone moves on except the people that were charging outrageous prices, who curse the "undercutters".

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Originally Posted by ApolloGenX

Maybe they saw it listed at ridiculous prices and thought it was selling for that much... but once they actually made it realized that no one is buying it for those rip off prices because it is junk and lowered the price to the cheap level it should be at because those products are junk. At that point, they probably realized they overpaid for those tomb mats, because they are used to make junk and got out of the market.

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Anyone considering 2 star items to be "junk" 1-2 months ago, is really showing their knowledge.

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Originally Posted by ApolloGenX

Meanwhile, someone has stuff listed at 900k that is junk, but it might eventually sell to a gil buyer - if no other junk is listed at a better price.

Not surprisingly, at some point -said ripoff lister- comes to the board complaining that they got some kind of temporary ban because apparently they were involved with a transaction related to gil buyers....either that or is here whining that prices get slashed on this kind of junk and they aren't selling for those ripoff prices anymore.

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Yes people should be suspended for selling items at the going rate on the in game market board, that makes a lot of sense.

There are always a lot of foolish people who believe "I can't afford that, so anyone who can must be a cheater!!"

Since when did gil-buyers Only buy expensive items anyway?

900k for a BiS ring (you may disagree, but many high end players believe they are BiS when melded) back when hardly anyone could make the and mats were over 30k each, is actually easily doable for "high end" players.

If a 50% mark up on items is a rip off, then you are likely being seriously ripped off for most things you buy irl xD

The only whining seems to be those calming prices were too high, it's all down to supply and demand etc, just because you could not afford something, does not make it overpriced.

The fact is there is a lot of stupidity on the mb, people selling at a loss will sell their items and prices will go up again, providing there is enough demand for the item.

Simple solution is simple:

Charge listing fees.

No, seriously. Most MMOs require that you pay a listing fee (usually some small percentage of the item's list price) in order to place it up on the market. Do this whenever an item is listed and whenever the item's price is changed and you'll see the rampant undercutting grind to a rapid halt. The markets will stabilize very quickly and people might actually be able to make a decent profit from gathering and crafting.

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Originally Posted by JeniLinsky

FFXI's economy was so bad, nearly everyone engaged in gil buying at some point. Having listed prices allows undercutting, which has so far kept prices reasonable, removing the gil buying impetus for most.

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I knew far more people who didn't buy gil and would qork to out camp gil sellers at NM camps then those who bought gil. I question this "nearly everyone" statement and demand some real numbers instead of hearsay.


And XI's economy was bad due to the fact that there was only a handful of crafters skilled enough to make the things people wanted, let alone people who would spend the time to do it, or have the resources to do it.

XIV has the complete opposite issue where resources and plentiful and there is probably a good 20X the amount of skilled crafters than XI ever saw. The undercutting is a serious issue because people will drop prices so low that for a crafter it's not worthwhile to make anything. I've seen so many markets ruined due to the reckless undercutting, where people will drop the price on something by a solid 50-75% and flood the market killing it for everyone else to net a profit worth our time.

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Originally Posted by synaesthetic

Simple solution is simple:

Charge listing fees.

No, seriously. Most MMOs require that you pay a listing fee ...

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Most MMOs don't have such ease of entry to multiple high level crafts. It's a solid idea but the market is already oversaturated, meaning the underselling would continue - people who list first will get screwed as they continue to either play leapfrog and take the fee hit, or try to wait it out and never sell. The fundamental problem of having a bunch of crafters out there who don't care about profits, don't value their gathering time (next person who says "I gathered it so my mats are free" gets smacked), or don't understand that halving the price and posting in volume does not double sales or improve your profits... all that would continue.

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Originally Posted by synaesthetic

Simple solution is simple:

Charge listing fees.

No, seriously. Most MMOs require that you pay a listing fee (usually some small percentage of the item's list price) in order to place it up on the market. Do this whenever an item is listed and whenever the item's price is changed and you'll see the rampant undercutting grind to a rapid halt. The markets will stabilize very quickly and people might actually be able to make a decent profit from gathering and crafting.

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Just because other MMO's do this it does not make it a good idea. That is fallacious logic.
I have explained time and time again in numerous threads why imposing a listing fee is a bad idea.

The real problem is not the undercutting, which is crazy enough in itself as the sales of items can (depending on the server) go quickly. What irritates me is when you have crafters who undercut the price it costs to sell to an NPC! I take the time to research prices and try to come up with a fair market price based on what NPC are selling it for and try to align myself with current sellers, often charging more than the lowest seller and my items still sell at a steady rate. The items I refuse to sell are the ones that are below rock bottom. If only everyone would use 1 brain cell to understand that markets are about making money and not about undercutting everyone and their mother, then the flow of the market would improve. Thank you for letting me rant.:mad:

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Originally Posted by synaesthetic

Simple solution is simple:

Charge listing fees.

No, seriously. Most MMOs require that you pay a listing fee (usually some small percentage of the item's list price) in order to place it up on the market. Do this whenever an item is listed and whenever the item's price is changed and you'll see the rampant undercutting grind to a rapid halt. The markets will stabilize very quickly and people might actually be able to make a decent profit from gathering and crafting.

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Isn't that what they are doing w/the tax on each item. Personally I just up my price by the amount of the tax, but still, the tax is still there & is not gained back. In order to avoid that tax you have to be in a market that is not charging it at that particular month & since you are only able to have two retainers, you might not have that advantage unless you dismiss a retainer from one market & go to another. I don't have that kind of time or patience so I just go with the tax.

This is what I don't get about alot of people who post on here... If you don't think that halving the price and moving more product can't gain more net profit... Then why would you have "buy one get one" sales on everything from mac & cheese to high end business suits. In real life, most businesses don't undercut each other by 1%, they generally do it on drastic levels like 25-50% to entice people to buy things that they might not generally buy. When you say people could just wait to sell their product for more to someone, you completely leave out the fact that they might be selling it to someone who would never buy it at your prices anyways.

It's not like your always losing business from someone undercutting you, sometimes it's just people adding additional business to the economy. As a hypothetical (using totally made up prices) I go to look for Iron ingots, 10 stacks are listing 10,000g which is a price that I decide there is just no way I'm ever going to pay for whatever reason, and 1 stack is listed at 5k which I think is reasonable, the person selling at that price isn't stealing your business because I wasn't ever going to buy your product anyways. People seem to act like everytime they are undercut by a large amount that they are somehow losing a potential sale. Same w/ a 2 star item, if everyone values it at 500k, which i don't want to pay, and 1 person decides they are willing to take the cut for whatever reason, and sells it for 100k, I might buy it. I get my item, they get the money they wanted, you haven't lost a sale.

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Originally Posted by synaesthetic

Most MMOs require that you pay a listing fee (usually some small percentage of the item's list price) in order to place it up on the market. Do this whenever an item is listed and whenever the item's price is changed and you'll see the rampant undercutting grind to a rapid halt.

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That won't stop undercutting. If anything, it will increase it, as the person who has to spend money to even list an item is going to list it at a price they're practically guaranteed it will sell. (It may prevent people from listing items at ridiculously high prices, but that isn't much of an issue so long as we have transaction history to let everyone know just how ridiculous their prices are.)

The real (or at least the main) reason for listing fees isn't even about prices. They serve as a gold sink. The rate at which currency enters an economy has to roughly match the rate at which it leaves the economy, or there will be rampant inflation. In a game, currency keeps entering the economy every time anyone completes a quest or fate, kills a mob that drops gil, or sells loot to an NPC. That has to be matched by the rate it's spent on gear repair, message board fees, housing costs, and items purchased from NPC vendors. Just passing gil around from one player to another doesn't get it out of the economy.

Hello everyone debating about FFXIV's economy! The servers are down for yet another maintenance so instead of playing the markets tonight, I'm gonna educate you guys on how the economy really works, and what the real problem is with the economy (I read this entire thread and not one person mentioned the TRUE problem with FFXIVs economy).

First of all, let me tell every one my background in ffxiv. I have been playing ffxiv since about 4 or 5 months after 1.0's launch. I had almost all 50 crafting classes BEFORE 2.0. (my cul was only 46) The economy of ffxiv has always fascinated me until lately. I played through 1.0 with the intent of becomming as rich as possible for 2.0. Now I'm sitting on millions of gil, I have all DOH and DOL with BIS gear at 50. The economy towards the end of 1.0 was vastly healthier than the current economy in 2.1. But before we get to that, I'm gonna cover many of the topics that you guys have brought up.

First of all, I will cover the OP's issue of blind bidding. If blind bidding was actually a superior form of economics compared to a market system, then surely at least one country on Earth would use this are their economic system. Of course none do. In a free market, transparency is a good thing. It allows people to make smarter decisions since they know more facts. Blind bidding also makes it take possibly a lot more time to make a purchase. Do you think Yoshi, a man who has gone out of his way to try to streamline ffxiv's gameplay, would want that? Blind bidding is not gonna happen

Next topic. Why is "Overflowing stupidity" a problem? I would figure that an intelligent person would welcome stupidity and use their vast intellect to figure out how to take advantage and gain from the stupidity of others.

Undercutting. I will admit, I do find it frustrating to put something up for sale and come back an hour later to see 10 people selling the same thing for 1 gil less. First of all, they could have just sold it for the same price as my item. The most recent item up for sale apprears lower on the list on the wards if they are the same price. I have a question for those who are complaining about undercutting? Do you wish to ban undercutting and make it so that someone can only sell items at a higher price, and watch the prices go up and up and up towards infinity? Undercutting is how the free market works. Undercutting is a very good thing. Yes it sucks when someone undercuts the stuff you have up for sale, but that's how the economy works. Asking people to stop undercutting is like asking them to just give you their money. It's not going to happen.

2 star synths: trying to make gil on 2 star synths was purely gambling. First of all, you had the risk of being unable to HQ the synth. And second of all, you were gambling that you would be able to sell the gear for more than the cost of the mats. On top of that, people didn't really buy much HQ 2 star gear. It only took about a week into 2.0 for there to be enough crafters geared for 2 star synths to be able to meet the demand for the 2 star gear. I personally made 3 mil that first week selling HQ gryphonskin tunics, but I had them left over from 1.0. If you want to make gil (or money) its a diversity helps protect you from bad luck with investments, but the up front costs of 2 star gear was so high that it prevented diversification of investments.

Next I wish to cover the "I farmed all the mats, when I sold whatever item it was pure profit." While this is technically true, it ignores a concept in economics called an opportunity cost. Yes a person who did this made gil, but they also lost the gil they could have made. For example, and I'm just making up these numbers, but lets say it takes 5 minutes to farm the shards for a single synth, and 5 minutes to farm a different material, lets say fleece, for a single synth. If fleece sells for 500 gil and shards sell for 50, it makes more sense to farm the fleece for 10 minutes and buy the shards off the market. You would net 450 gil from that.

Well, now that I coverd those issues, let me tell you guys what the REAL problem with the economy is, and why 1.0 had a much healthier economy that 2.0. I will give you a hint, its not gil sellers, housing prices, botters, undercutters, or stupidity of the people who play ffxiv. The problem is the lack of gear and/or item sinks. The biggest gear sink in ffxiv right now is materia. Materia as it is now is nothing like the gear/material sink it was in 1.0. To those who didn't play 1.0, back then, if you failed a meld, you lost EVERYTHING, you lost the gear, the materia, and the catalyst. In order to get all 5 slots melded, you HAD to succeed on your first try EACH time. I blew up 50 HQ gryophonskin tunics in 1.0 just to have 1 of them left at the end with a triple meld.

In 1.0 it was worth it to spend so much effort on melding because melded gear was BIS, and being able to buy BIS gear definetely helped the economy stay active. However I DO NOT want crafted gear to be BIS NOR do I wish to return to 1.0's materia system. What I want is a damn good gear sink like materia was back in 1.0. I think PVP might have some potions and food sinks.

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Originally Posted by Ricon

A blind market stops a market board with 100 items all 1 Gil lower than the next until the real value of an item is double the going rate. I don't feel we should have huge margins but in reality there maybe 10 items worth anything since all gear is replaced instantly.

This shouldn't have been a topic about the market as much as I should have said why are crafters so greedy they undercut until they lose money.

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A blind market encourages unfair or unethical selling/buying in order to artificially inflate the price of an item. An item is only worth what someone else is willing to pay for it and what someone else is willing to sell it for. If someone else is willing to sell a crafted item for 5% over cost of production then you have no right to complain you can't sell it for triple the cost of production.

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Originally Posted by Alzelia

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EXCELLENT breakdown, especially on the gear sinks. Identifying a market churn - commodities with lots of activity around them - is pretty much the "golden ticket" to making money. Market price isn't the only factor to making money - you also have to consider the opportunity cost (as you rightfully point out!) and time to market (in our case meaning the time from listing to sale). You would make more money in the long-term on selling highly active items at 500 a pop if you could sell 10 a day, compared to listing one item for 50k that didn't sell for 2 weeks.

Surely there are new markets heating up now that this content is out. Treasure Map items, specifically minions, seem to be SUPER valuable right now.

I think the only overflowing stupidity here are people who didn't do sufficient profit analysis, supply/demand analysis on an item that they want to sell, went on and craft the item anyway, fail to sell it at the price that they want, and then blame it to undercutters.

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Originally Posted by synaesthetic

Simple solution is simple:

Charge listing fees.

No, seriously. Most MMOs require that you pay a listing fee (usually some small percentage of the item's list price) in order to place it up on the market. Do this whenever an item is listed and whenever the item's price is changed and you'll see the rampant undercutting grind to a rapid halt. The markets will stabilize very quickly and people might actually be able to make a decent profit from gathering and crafting.

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They already have a tax system. See my quote regarding changing taxes on how SE is slowly shrinking the amount of gil to prevent market inflation (this is from a thread regarding changing taxes which i am not for):

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Originally Posted by Wulfies

SE has already implemented some seriously, imho crappy, ways to significantly destroy gil.

1) if you came over form 1.0 you lost 90% of the gil stored (my tens of millions of gil went to just millions of gil) :(
2) selling drops from a lvl 50 mob/gathering spot will only get you 10-12 gil at the max. Same with the high end crafting gear (i have yet to see anything crafter made that sells for over 100 gil)
3) Repair costs (till they "fixed/reduced" the rates) were just a way to suck money out of the economy.
4) Teleports! good god the amount of gil it takes to go rom Uldah to Gridana or Uldah to Limsa let alone anywhere to Mor Dhona or Coerthas.
5) Foreth-coming Housing - thankfully its not a buy the house (millions of gil just for the house w/o furniture) and have to pay a monthly rent cause that would be crazy talk.
6) tax on selling 5% is fine as is. With the Market Boards, there is no money being created in game, all we have is just money changing hands, less the fees of course.

To top that off look at how you make gil:

1) side quests (which to my knowledge can only be completed once) and even then, I finished a lvl 45 side quest and walked away with less than 700 gil.
2) leve quests, (now i have only experience from a few crafting and mostly gathering) give small rewards as well (eg. lvl 35 gathering/crafting leves give from 300-600). For crafters that barely would cover the costs of the materials.


Based on this, I think they are set on destroying money quickly.

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@Alzelia - Very Well said. People do expect obscene profits when selling their crap stuff on the MB and when they have to lower their price to compete they get worked up with "rage" and say the market system is broken. People feel that they are entitled to sell their gear for max profits but will only buy at the lowest price. This will never work

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Originally Posted by Alzelia

Next I wish to cover the "I farmed all the mats, when I sold whatever item it was pure profit." While this is technically true, it ignores a concept in economics called an opportunity cost. Yes a person who did this made gil, but they also lost the gil they could have made. For example, and I'm just making up these numbers, but lets say it takes 5 minutes to farm the shards for a single synth, and 5 minutes to farm a different material, lets say fleece, for a single synth. If fleece sells for 500 gil and shards sell for 50, it makes more sense to farm the fleece for 10 minutes and buy the shards off the market. You would net 450 gil from that.

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I've been trying to say this in most of my posts, there is more to selling than just at what price your object is selling for currently on the market. Some people do not seem to understand this.

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Originally Posted by Wulfies

It is the crafter's responsibility to find markets which are or are not profitable. When I decide on a market to sell stuff I look not only at the going prices for the product(s) I will be making but also at the history to see how fast said product is moving.

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Originally Posted by Alzelia

Well, now that I coverd those issues, let me tell you guys what the REAL problem with the economy is, and why 1.0 had a much healthier economy that 2.0. I will give you a hint, its not gil sellers, housing prices, botters, undercutters, or stupidity of the people who play ffxiv. The problem is the lack of gear and/or item sinks. The biggest gear sink in ffxiv right now is materia. Materia as it is now is nothing like the gear/material sink it was in 1.0. To those who didn't play 1.0, back then, if you failed a meld, you lost EVERYTHING, you lost the gear, the materia, and the catalyst. In order to get all 5 slots melded, you HAD to succeed on your first try EACH time. I blew up 50 HQ gryophonskin tunics in 1.0 just to have 1 of them left at the end with a triple meld.

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Oh the amount of Raptorskin Satchel Purses I had to burn through to get myself a tri-meld plus all those materia. Also you forgot that there were certain materia that could only fit into certain spots and certain catalysts worked on certain materia. That was fun trying to match up and kept people buying loads of gear.

Lets take steel. Prices on my server had stabilized pre 2.1 to a gentle fluctuation between 200-250 a bar. Surprisingly enough, the Amal'ja have a price point of 258, so either floor or ceiling, you would think that the price would generally centralize around this number to maximize profits.. High qualities sold well in modest quantities, being significantly more time consuming to craft, assuming you didn't quicksynth thousands of ingots.

Only instead the price crashed to 100-110. Apparently, everyone clamoring for gil over the housing fiasco did exactly that. Thousands of metal ingots flooding the market. Thousands of ores flooding the market. HQ cobalt and mythril ores going for 30 gil. bomb ash for 40gil. 20's of thousands of shards driving some flavors below the 10gil waterline. Darksteel Ore plummeting to 200 apeice. Gold ore doing the same. Other goldsmithing ingredients that were 'trash' to begin with saw an influx of oversupply.

The only person making money I know of right now is the guy with 16 retainers all selling 20 different ingredient/component/etc at a time in stacks of 1, and almost never leaves town.

Ores down, ingots down, plates & rivets. Equipment always was pretty terrible. Given these are my primary markets, I've had little choice but to abandon the boards entirely and go straight to the gil faucet for the scant few drops I can coax from the stone walls of the dungeon finder. I would make more gil running a dungeon than synthing over such small profit margins and losing most of it to repairs.

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Originally Posted by Zourin

... synthing over such small profit margins and losing most of it to repairs.

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In regards of repairs:

- if you craft lower recepies - use alternative gear sets without materia in and then convert it after binding
- don't use a full set if it's not needed to finish the craft
- do repairs yourself and only when it's at 0% - it will drop the cost of repairs to 1/3 - 1/4 if you'll purchase dark matter from NPC or you can even use extra GC seals to purchas dark matter (now a little better since 2.1 when they've dropped the "cost" of the dark matter in seals)

I am more bothered by the fact you can see what the item has previously been selling for. I have no issue with competing with current sales - smart players don't bother undercutting because they know their item will still sell (particularly for popular items). I have seen material selling from 40k down to 15k and still selling again regularly at 35k (by selling I mean ACTUALLY being bought) so the undercutters ultimately missed out on a lot of money trying to deflate the market costs. If someone undercuts too much I buy it and resell it.

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Originally Posted by Asteldian

I am more bothered by the fact you can see what the item has previously been selling for. I have no issue with competing with current sales - smart players don't bother undercutting because they know their item will still sell (particularly for popular items). I have seen material selling from 40k down to 15k and still selling again regularly at 35k (by selling I mean ACTUALLY being bought) so the undercutters ultimately missed out on a lot of money trying to deflate the market costs. If someone undercuts too much I buy it and resell it.

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For finished products, I would have to disagree. Two star accessories that used to sell dropped from 1+ million to 100k. Other two star gear similiar in the 700k range. I watched over a 1.5 month as people undercut me on those specific items until the patch came and now it's unrealistic to keep the items up there.

It's smarter to cut your losses as the markets change. Maybe if I had eight retainers, I may leave items up, but my inventory space / retainer included, is crying in the meantime.

2* recipes are an exception. Their cost was always going to drop significantly as time went on because less and less people need the tomes so just blow them on ingredients. Add in 2.1 giving more tomes more easily plus treasure hunts and the ingredient costs drop and therefore so does the gear

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Originally Posted by Asteldian

2* recipes are an exception. Their cost was always going to drop significantly as time went on because less and less people need the tomes so just blow them on ingredients. Add in 2.1 giving more tomes more easily plus treasure hunts and the ingredient costs drop and therefore so does the gear

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This is fairly true. We speculated on day 1 that 2 star items would drop significantly over time. The reason why they were so profitable was because 2 star crafters were scarce at the initial start of the game. Players monopolized on such facts and did anywhere from a 1000% to 3000% mark up for their services. In any MMO, early game mark-up of goods, results in easy gil and its very easy to execute by any level of marketer.

The time of early markup on monopolized crafts are gone. We are at the point where true MMO marketers will only continue to be well off at this point and further on.

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Blind bidding is bad because it doesn't allow people to see what the actual market looks like, and no one can make proper decisions and it would hurt market efficiency and cause large price gaps.

A lot of these threads seem to be made by people who feel they are entitled to large profit margins.

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Check FFXI AH. You can see markey history and therefore, market health and profitability, but you can't see what each individual seller lister their items at. Which means for constantly selling items, like food (Specifically Sole Sushi) it stayed at a constant 30k for a stack of 12 (this was prices when I played about 2 years ago) but people could list them for 29900, 29999, 27000 and people would place bids around 30k until they were able to actually purchase the item.

Yeah this lead to undercutting, but it certainly wasn't as rampant as it is here where I have to change my prices 5 times a day to compete with people who undercut by 1 effing gil constantly.

There is tons of money to be made with this market, its not broken, or at least not as broken as the last one. There will always be BOTS, in every MMO, always...get used to it. You have to watch the market and see what sells and what doesn't, just like a real market. You will get undercut, but guess what, that happens in real life too. And someone posted how seeing past sales is not like real life auctions etc....Really?! So there isn't google or KBB...or bing...or you name it, you can see what stuff has sold for in real life. All I see, is a bunch of lazy gamers who wanna list it and forget it and watch all their profits stream in. That's not how the real world works(since so many of you compared it to a real market) and that's not how a healthy economy works either, even on a game. Competition will breed better pricing for the consumer and that is exactly how a healthy economy works. If you want to be a successful seller, know your markets, and adapt to them. My 2c.