I know this is being beaten up a bit but it deserves to be. I wanted to put some actual numbers out there for people who may not be as into the manufacturing and the market side of Eve and being to light why these changes are an issue.
For clarification my skills are all 4s and 5s in all related categories, mainly 5s. This includes all invention, production, market and research skills involved in the items I make. I have been in production in some regards since 2008 as it has always been my favorite means to play Eve. I want to look at one item that I have been working with for the past few years and discuss what the new market changes mean purely from a numbers view. I base out of the Domain area and sell in Amarr, a choice I made a long time ago because I prefer the middle ground markets of Amarr with average amounts of products and prices that don’t fluctuate as much as Jita does.
Lets look at the Hawk. It’s one my best selling items with steady demand and flexible use it generally never falls out of favor unless some outlier happens.
The base cost for me to create a Hawk is 31,774,789.
The going rate for a Hawk in Amarr currently is 46,490,000.
The total taxes from me to list 1 Hawk is 2.9million.
That leaves a profit of 10.5million isk.
That is an a very nice 23% profit return which is why I stated these are good items, this is not very common.
The cost to edit the prices of a single Hawk is 480,000 isk. Which is 5% of the total profit taking the profit to just over 10mill.
In the course of writing this there has been two hawks listed infront of mine. (See my bottom edit before jumping into the comments) While not a linear trend of orders being added my order is already obsolete in the sense of any return soon, it’ll sit as a sell order for the time being freezing isk in turn. More orders will be placed in front of it as is the natural order of the market. If I wish to edit my Hawk listing twice over the course of time to attempt to sell it while it sits in its sell order state I have lost 10% of my profit, if I must edit it four times that is 20%. The alternative many people are stating is to list more singular items and then undercut the latest orders, while this may sound like a decent idea it’s pretty terrible.
The initial orders which have been placed are essentially being viewed as too expensive to change if any new orders are placed infront and will force those orders to freeze for the time. Given the system of new orders undercutting, if we are too assume new orders with less quanitity is the way to go, (this paragraph is focusing on that, people seem to not have understood the aim here) there will always be another player adding one more Hawk to the market similar to the way you are adding one more Hawk to attempt to be the cheapest. It takes place of the .01, instead of price changing you drop a new Hawk order infront of the other. There is also no cool down on this, no 5 minute wait to add an order. I can sit on my orders and watch for new orders to undercut while forcing the previous order to pay an addition fee or wait until I release the observation on the orders. What happens is a bloated market where orders must either be canceled or die out naturally due to the volume of 1 quantity orders.
The cost of adding a new order is to the market is nearly 30% of the profit of the individual item (This is primarily what I was pointing out, not the fact that the orders were placed infront). Clearly it is the means of the market to have orders placed infront of old ones, it’s inevitable even if your price is increadibly cheap. Circumstance may have it that a buy isn’t looking at the time or somone drops and order right about the same time as you. If the previous order faded away in the wave of new orders you must tack on an addition relist fee if you wish to sell it in the future. That would be the Hawk I posted earlier writing this would have already accumulated 6million isk in costs before even being sold. Two listing fee’s wipes out a 60% portion of the total profits. Based on the sentiment that people should list single items and continue to undercut each time means these items won’t have the flow needed to ensure they sell the first time.
A side effect of this is that products will lose some of their flow, the market moves less as a whole and traders without large pockets experience difficulty turning a profit soley due to the mechanics at play. It’s especially difficult for new players to enter this kind of market.
If we imagine the same situation with an item that has a much lower profit margin, say an Adaptive Invulnerability Field II the issue becomes much worse because their is sell room for a margin.
The cost is 2,278,629
Going rate is 2,564,000
The total taxes are 161,000 to list.
Profit of 119,284.75 or 4.65%
Cost to edit 28,000 including loss of the 1,000 isk reduction. Which is 2.3% of the total profit bringing it down to 91,284.
All in all I think the changes had some what of the right idea but were poorly implemented. The ratios shouldn’t be as steep as they are. I didn’t mention the barrier to new players who wish to get into the market. The high taxes couple with the requirement for all the isk needed for an order and the lower product movement means a new marketeer will have times of pure stagnation. While Eve maybe a sandbox it is still a game, having to wait for anything to happen with your playstyle can limit the experience as a whole.
Apparently I need to edit in that I have no issues with undercutting or the changes themselves but the new mechanics, 4 significant figures and tax percentages are not reasonably in line. They limit the producers and marketeers scope too much when all combined together. I know many people dreaded the 0.01 game ( I was fine with it) but I’m not preaching to get that back.
There maybe some confusion about when I say relist, I am talking about if an order lapses or it is pulled, literally the relist of an item. Otherise it’s a modifcation fee. Additionally I’m not saying relisting is always something to constantly be doing but in the event items don’t sell you will need to relist them eventually. In the case of the Hawk being 30% of the profits hurts in the long run. The modification cost should be higher which makes sense for what CCP was trying to accomplish but the initial fees or fees if an order ends up not selling should not be as steep.