Please Undercut Wisely

[Mitski]

*SNIP*

You're not the first person to mention low price/high volume retailers like Wal-mart, Amazon, etc. In the real world it's a valid business strategy, but it doesn't work very well in FFXIV. Just image if Wal-mart could only have 2 stores and each store could only stock 20 items at a time. See the difference?

[Lafiele]

Some people want to sell first. If everyone undercut like you guys did, the situations wouldn't change except for the fact that it would become an undercut war. Someone who undercuts big is telling you, go, I dare you, I dare you to undercut me more! So the smart thing to do here is, either wait it out or undercut him if you aren't patient enough.

Also low price high volume does work in ffxiv because those 40 slots yo u have will free up quicker than the 40 slots someone has at a 50 % marked up price.

[Faelandaea]

Undercutting by a difference of 2 gil or 200 gil makes no difference, you're not selling your items if someone has undercut you by either 2 gil or 200 gil. The person who undercuts by 200 gil have looked at their profit margin and checked how much they need to make before they earn an acceptable (to them) profit. If they have farmed all items (shards and materials) then they could sell them for 10 gil and make a (small) profit.

Let's use the Amazon effect. Amazon makes very, very small profits on each item sold, let's say you buy a book from Amazon which costs you £5, the profit for Amazon on that book may be £0.02, but they sell millions because the price is so cheap, lots of sales with small profits beat few sales with large profit.You want to make 60k profit, someone else is happy with 40k profit, so be happy with 20k profit and make 3 times the amount, getting you back to your 60k profit.

Sure, it's a little more "work" for you but as long as your items are unsold their actual value and your actual profit is 0 (and you're running at a loss if you purchased anything to craft the items in the first place).

This. I own my own business in real life and you know what? I compete there as well. It's nothing personal. It's business. As long as i don't violate the MSRP of the manufacturer and undercut them, I am fine. But in this case, YOU are the manufacturer of the product, competing with other manufacturers of the product, so as Lexxuk stated - learn to look at the big picture - it's better to have a "sale" and make lots than no sale and make . . . nothing.

P.S. - It's not just consumers buying the cheap stuff. It's also competition. Want to make that profit? Buy out the cheap sales and then resell at your own price. It makes people crazy amounts of money in the market, and you don't even have to craft anything

[SarcasmMisser]

yes economy blah blah.. but we are in charge of this economy..

No one is in charge it is an organic thing.

Also i will address your point because you assume pricing trends should happen with the long-term health of prices in mind. It was addressed in another thread but you can't use these assumptions because almost all of the market is a pyramid scheme, with the only market for most products being other crafters and therefore other sellers. Almost everyone is in it to make money so the overall effect is deflationary and people hoard money over reinvesting it (spending), as they know due to the increasing oversupply of sellers things will constantly get cheaper until there is no margin. It is basically a run on the banks and the gigantic undercuts are due to zero confidence in the sustainability of any high margin, any attempt to artificially control prices becomes less effective over time as cartels cannot exist in perfect competition.

This is actually a good economics lesson as to why (moderated) inflation is a good thing, as without inflation there is little encouragement for investment.

[DenzelTaru]

things and stuff

thankyou for the direct reply

i understand what you're saying and it makes alot of sense.. maybe then we need to go back to the blind AH of FFXI then to give people like me respite lol

[mindful]

You're not the first person to mention low price/high volume retailers like Wal-mart, Amazon, etc. In the real world it's a valid business strategy, but it doesn't work very well in FFXIV. Just image if Wal-mart could only have 2 stores and each store could only stock 20 items at a time. See the difference?

True more like garage sells with junk we got on hand. Limited stock. The way it working is like a free market, with big retailers, The smart ma and pa stores, and the ebay and garage sellers. In the end only the most smartest are going win the market with a handful of lucky people in between. Rest are just middle class and break even.

[Kat_Manx]

Or you could sell for 9,999 instead of 10k, and people will go "wow, that's cheaper than the one that sells for 10k!" And thus you will have made 149985 instead of 45k without completely destroying the market for a particular item.

Right.. and there's nobody around to lower the price of their item to 9,998? It's a quick and drastic cut to completely thwart all opposition unless they are in fact willing to destroy the market of that item. If they are, they will undercut me, and I will move on to a new item and the price will have fixed itself in 1-2 days. Every time, by the way. It has never stayed as low as I have caused it to go. If it does some day, maybe I'll start worrying.

Not to mention any potential shopper seeing an item for 9,999 instead of 10k isn't gonna go super shopping crazy like they do with my prices.

Also, let me point out yet again, it's not all because of profit. If it costs me 300 gil to make an item, you're simply cra-zy for asking 10k for it.

"I can sell it for what I want!" Well, so can I.

So. In the end, here's some pointers. Deal with the economy. Move with the flow. If you get undercut, move on or fight back. Have more than one item you profit on. Cycle them, return to the first one when market stabilizes. Keep breaks.

[Dragon_Lord]

In answer to Dorin's remarks.

Time is money if you have a deadline to deliver the goods. No such thing in this game. You make your own time. You have to level gathering anyways, but if you don't like gathering I can sell you a stack of materials, but you will pay the Piper's fee. LoL

[OldGeezer]

Hmph.

You know what they say about time, and how time means money, right?

You can make a lot more of money by buying the materials you need instead of gathering them yourself. By doing that, you are actually losing money.

Maybe when the game launched that was true, back when things flew off the shelves and you made profit on volume. But that's not the case anymore. Now things don't sell instantly, it takes a few hours typically. I can use those hours to gather the mats and still make it in time to sell it to a potential customer. As I stated with Tupsi I can sell my crafted items for 1/2 the price of someone who buys their mats on the AH, and make twice the profit that they would make. Whose items will sell first-mine, because they're 1/2 price. Who's made more profit, I did. So making it yourself does win out in the long run.

[Radacci]

It's just my opinion, but selling these mats for absurd amounts of money, is like selling relic progression/Titan wins.
Do you level up DoW/M, to make money from people? probably not. Do you level up DoH/L to make money? apparently.
So why is it ok to sell food for 1-3k/piece, but not ok to sell Titan wins? Isn't your time as DoW/M worth any money? And why is your time as DoH/L so F***** precious, that you need to sell food/mats for 1-3k/piece?