Please Undercut Wisely

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Originally Posted by Tupsi

I don't recall gouging anyone, unless in your definition of gouging = anything over 200g. Let's use an example of what I've been making:
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That's if I buy all the mats, which totals at present times, 3,091 cost, I sell for 4,100 singles or in sets of 5 for 20,500. So in reality, I'm actually barely making a profit as I don't gouge people, if I buy everything instead of farming it myself I made a 3 -4k profit depending on market, but the nice thing is, since many barely can do 1-2star stuff, those markets tends to be stable.

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That's a 25% margin and that's perfectly reasonable. However, what is the real out of pocket cost you're taking on. The only thing there that is not gatherable/craftable is the 2 buffalo milk to make the smooth butter for a whopping cost of 2 gil. 25% margin for 2 gil is 0.5 gil. So you're real out-of-pocket expense is 3 gil and you want to charge 4000. I can sell mine for 1/2 your price and still make twice the profit you do. Yet, I am the evil person who is undercutting you and should be banned. Maybe you can gather some of the materials and not hitting people with a glorified vat.

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Let's be honest, given that they chopped off a digit it's not that hard since your gil is worth less (or more depending on how you look at it.)

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Given the fact that people we're charging 10,000 gil for a level 7 weapon back in 1.0 compared to the few hundred it goes for today, it's still a valid comparison. Yes they did cut our money by 90%, and I still made money, doubled what I had (and I'm not even 50 yet, craftwise) even when people were bemoaning that the economy would crash due to the AH tax and repair bills.

This is why I don't bother with the market and just sell crap for whatever it'll sell for.

People whine about people undercutting them and killing the market, but yet they admit that they troll the board and undercut the undercutters... Your killing your own profit... Put something up for sale and then leave it there... If its a reasonable price people will buy it... Everyone expects to put something on the board and have their money back in an hour... I put stuff up and it usually sells in a few days... My prices are reasonable not undercuts...

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Originally Posted by OldGeezer

That's a 25% margin and that's perfectly reasonable. However, what is the real out of pocket cost you're taking on. The only thing there that is not gatherable/craftable is the 2 buffalo milk to make the smooth butter for a whopping cost of 2 gil. 25% margin for 2 gil is 0.5 gil. So you're real out-of-pocket expense is 3 gil and you want to charge 4000. I can sell mine for 1/2 your price and still make twice the profit you do.

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That was some impressive math. Will you share what you're smoking with the rest of us?

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Originally Posted by Ed_N_Ants

People whine about people undercutting them and killing the market, but yet they admit that they troll the board and undercut the undercutters... Your killing your own profit... Put something up for sale and then leave it there... If its a reasonable price people will buy it... Everyone expects to put something on the board and have their money back in an hour... I put stuff up and it usually sells in a few days... My prices are reasonable not undercuts...

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I undercut the undercutters and still make X00k daily. It's just a matter of playing the leapfrog game correctly. If two people are sitting there leapfrogging in 5 minute intervals back-to-back, then of course nothing good will come out of it.

I keep on see people say 'my mats cost X gil'. No that's not what your mats cost. What you mean is "I saw the lowest Water Cluster on sale for X gil", and good luck trying to sell another one at that price. Besides, no one actually cares what your mats cost. I once made the mistake of making some Pineapple Juices. Nobody cares for the fact that it uses 1 Fire + 1 Water Cluster for something that's strictly worse than Mulled Tea. I had two choices at that point:

1. Hope someone dumb eventually comes around and buys them.
2. Sell them really cheap and cut my losses.

I ended up going with #2, though I managed to sell the Pineapple Juices at a price slightly above Mulled Tea, but I was certainly willing to go below that if needed.

If there's a surplus, the price will go down.
If there's a shortage, the price will go up.
It's as simple as that.

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Originally Posted by Nouran

UNDERCUT ME AND ILL UNDERCUT YOU TO 1 GIL !!!!!

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Then I'll buy your 1 gil item and vender them :) Thanks, made me some money! :)

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Originally Posted by Mitski

That was some impressive math. Will you share what you're smoking with the rest of us?

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I'm smoking algebra. 1000 is 25% of 4000. 0.5 is 25% of 2. I realize the PISA scores for the US were disappointing, but there is no need to broadcast the failures of US educational system on these forums.

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Originally Posted by Borfin

This is why I don't bother with the market and just sell crap for whatever it'll sell for.

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Amen to that.


I don't know squat about economics, besides things in demand sell higher, things in don't sell cheaply.
But when I see people beginning to cut each other 5 at a time in the market, I question how much of an affect that'll have.
Usually I under cut by 1 gil, and sometimes I just match the lowest price. But then when I look at the current board and you see about 6 separate 5 gil cuts, I question if I should buy the lowest and sell to match near higher so that the market doesn't crash.

Sadly though, this would be a risk since I imagine if I did this, some person comes by, sees my prices and then just under cuts again - the supply comes in faster than the people buy, making it so the item I just bought never sells for the intended, higher price.

Is this what people mean by the risk involved when in economics? I've heard of people in games playing the Auction Houses before and making plenty but I'm just a common peasant who doesn't know any better. I go out, gather materials, come back and sell them for the lowest price to ensure that they actually sell.
If something takes an hour to get a stack of and only sells for 2k gil, at this current economy I wouldn't bother at all.