Secon-Hand Dealers - Love 'em or hate 'em?

[Quichon]

Okay, I've been doing more potions on my little shammy, and I've found something interesting...

Wolf V potions I marked at 11pp/ea, and had about three stacks up. Well, I found out that a guy bought them all, then re-sold them at 15pp/ea.

Now, I'm making a profit off of the Wolf V potions at 11pp/ea. 5 stacks cost me around 700pp. At 11pp/ea, that's 1100 pp profit. Make me a generous 400pp profit. Not bad.

But then this guy buys 'em all up and sells 'em on his own potion seller at a 3pp/ea markup, for a 300 profit.

Clearly, I'm actually making more profit than he is on the deal, but the market is getting hozed by this guy buying up all my potions at my price and reselling them at a higher price.

So, I guess the views on this are:

1) Cool, he's gonna buy all the potions I make? Time to crank 'em out by the hundreds! Thousands even! Make plat while the sun shines!

2) He's screwing the market out of 3pp/ea markup and not making as much profit as if he'd just MAKE THEM HIMSELF and match my prices.

What do you think?

[melkorr]

Firstly, he's not "screwing the market". What he's doing is completely in the bounds of the semi-capitalistic society we have in EQ. You're saying that he could just make the potions himself, and make more profit. From that, couldn't you say that your other customers should just raise their skill and make the potions themselves? When it comes down to it, it's his choice to trade higher profits for less time invested. Personally, if he kept doing that, I would raise my prices to see how high I could sell them and have him keep buying. If he's raising the price high enough that people are unwilling to pay, then he will either lower his prices or be unable to sell his stock. It's that simple.

[Grenoble]

Doesn't bother me at all; I get the plat I want and move stuff out of my inventory. Better than sitting on it for a week.

[Turlo Lomon]

I totally consider this a win/win situation. First, I can flood the market with my goods. So, he can mark it up all he wants, I will still be unloading to him.

[greblhad]

Sounds almost like a real life market place, except the middle man (the reseller in your scenario) isn't marking up the items as high as a real life middle man would.

However, if you keep churning out the potions fast enough this guy will eventually become saturated through a) lack of funds b) lack of bank space. At that point he will become screwed or someone else will begin to resell.

At any rate you can't control it and you have to continue to make an EQ living so ignore it.

I've often wondered what the economy would be like if we had a refuse to sell list like the ignore list.

[Marissas]

A "refuse to sell list" like the /ignore list is a SUPER GREAT IDEA!

Nothing more of a let down to wake up and see your arch enemy has bought the spell you had marked at a loss. It's like a double kick in the ponch.

Just think what that would do to the market though... What would that do to the market? Would give those few "idealists" a choice to stand their ground, and probably not effect everyone else at all. Course it wont stop those level 1 ogres from buying stuff...(remake level 1 ogre, repeat)

Anyone else think thats a super idea?

[ithilhuan]

Why should you care? Why should you get offended, hurt, ticked off or whatever? If you are making ts items specifically to sell to others, set your price and be joyful when all your product is purchased. So what if someone buys up your inventory then sells it at a higher price. Take if others are willing to pay the marked up prices, so be it. If you have some notion in your head that you are providing a generous service to the populace, and that this character is undermining that service, just give them away for free. But dont knock someone for reselling item to peeps for a price that said peeps are willing to spend. Otherwise, raise your prices to match his, and reap the additional profit

[Zopharr]

If you will be making a lot of potions as a staple item to make plat, and he resold them quickly at 15pp, you may want to rethink your price. Maybe you can go to 14-15pp and sell them quickly too.

Or if you are making them to skill up, you may want to just stick with lower prices and take advantage of a sure market that will cover your skill-up costs. But reselling happens in EQ just like in real life. Not worth getting worked up over.

You can even have some fun with resellers. On high-end items that generally take a few days to move, I will never put more than one of them up for sale at a time - the rest are hidden in bank. (I may have half a dozen of them, but no reason to let the market know that I have a large supply - let the market think they are scarce). So every now and then I'll see that someone has bought my 'one' item from me and marked it up 50 percent . . . . whereupon I just send my bazaar toon to the bank to get another one out of storage to put up for sale at the old price. A few months ago I had two resellers buy from me, trying to 'flip' the item to make a profit. Once they saw me put a third one up, they started dropping their prices to try to undercut me, and finally ended up taking a 10k loss on the item.

Garshok

[Dutchy]

Imo, it all depends on why you're making them.
If you are getting mined by resellers, it's because you're selling your items below the market value and someone sees an easy profit to be made.

You chose to list them at 11pp each, the question you should ask yourself is why? Apperantly you can get 15pp each for them so theres a third option: Raise your price up to 15pp each and make the full 700pp profit yourself if profit is what you are after and you don't feel like making more then 5 stacks at a time.

If you chose 11pp because you think 15pp is too high for sow potions, or if you have plenty of time on your hands to keep them in stock at 11pp.... Then it's time to start making them in huge quantities. Make sure you have a decent amount on your trader, and have plenty of backups in your bank to restock them the moment you get mined.
You know you have a guaranteed buyer that will come buy your entire stocks out at the price you wanted =) that gives you lots of extra sales untill the moment he realizes you will just keep making more.

Personally I love resellers. They allow me to get rid of certain items that I don't want to take up my bankspace/traderspace for a long time a lot faster. I baked 1500 halas pies for fun and skill ups last week, gave a bunch away and put some in the guildbank, had 1200 left. I decided to put them on my trader per 100, at 30% of the market price and restocked when needed. I sold my entire stock within a week =) would have taken me a lot longer if I sold them for the usual going rate.
I made some players happy with cheaper food, but I have the resellers to thank for buying the largest part of my stock. I don't mind them making a profit for actually taking the time to sell my goods. (and they take the risk of getting stuck with hundreds of items they can't sell if people keep selling m low, or even lower then what they bought their items for.. forcing them to sell at a loss).

[Roanne]

Its a risky gamble the reseller is making.

He is betting you cant keep making potions faster than he can sell them.

You get your money out of your product guaranteed. Whether the reseller "wins" depends on whether you an make the potions faster than they sell to the general market.

If you cant, he gets the 4pp profit per potion (eventually). The players buying the potions "lose" in this case, but at 4pp a potion there arent many who cant afford it and care.

If you can, he has to keep buying from you to move the stock he has marked up. Youre still guaranteed your profit while he has to wait on the market for his. As soon as he quits buying from you, the best he can do is break even.

What would really hurt his plan is if you could restock faster than he could sell and inched your price up but stayed below his markup. He would be forced to keep buying your stock (or at least lower his price to match yours). If he keeps buying, keep inching the cost up. If he quits buying, lower your price to below what he paid.

Of course, he can just then starting buying from you again but when it becomes obvious you will just keep generating supply, he probably wont bother.

This business plan works best on items with limited rates to enter the game. Items made from rare, hard to farm drops, or time consuming recipes are best. Its rarely successful on mass recipes unless raw demand is so high a single supplier cant keep up with it.

[Bobaten]

Look at it from the other side:
What if tommorrow someone were selling sow potions for 9pp each?
Would you:
A) Drop your price to 9pp.
B) Keep your price at 11pp and only sell them when he is offline/out of stock.
C) Buy the 9pp potions and resell them for the 11pp you know you can get.

The person reselling your potions for 15pp apparently knows he can get 15pp, so rather than spend 10 minutes tradeskilling, he gets ~half the profit with only 1 min of shopping.

[Roanne]

That depends on what the potions actually cost you to make. I find the profit margin on potions to be so narrow as to make them unprofitable after I factor in the value of my time, so I only make potions for personal use (gate, levitation, ITU and the like). Im not very familiar with their costs off the top of my head.

If it only costs 7pp to make the potion and someone undercut me to 9pp Id probably lower my cost and get out of the market after my stock sold out (but I wouldnt be in the market i the first place as I explained). I still turn a profit, but if I paid 11pp for the potions in the first place Id have to sell at a loss.

Presuming the trader selling at 9pp could keep them in stock (the condition of the entire strategy), Id have no choice. Of course, if the competition cant keep up with the demand and occasionally goes out of stock, I could afford to wait for supply to drop and demand allow for the higher price.

This is what basically happened to the AAAA market. I can no longer make an AAAA for less than sellers with a free or below cost supply are selling them for so I left the market.

[Quichon]

Look at it from the other side:
What if tommorrow someone were selling sow potions for 9pp each?
Would you:
A) Drop your price to 9pp.
B) Keep your price at 11pp and only sell them when he is offline/out of stock.
C) Buy the 9pp potions and resell them for the 11pp you know you can get.

The person reselling your potions for 15pp apparently knows he can get 15pp, so rather than spend 10 minutes tradeskilling, he gets ~half the profit with only 1 min of shopping.

Actually, I would not adjust my price at all unless my undercutter had far superior size of stock and has shown he is willing to keep product on the market at that price. Neither would I try to buy him out.

I have a quality product, same as any others. I sell it at my price. It happens to be significantly below market value. As such, my product moves faster than I can keep it on my bazaar mule.

Reccently, I moved my price up to 12.5/ea for a total of 250/stack. I'm going to keep it there unless people start reacting to my prices, and not worry about the resellers. At that, they're only making 2.5pp/ea or 50pp per stack, so if they really want to go through the effort, go ahead.

And I'm trying to keep stock of 100-200 up, although I am mostly selling while AFK and find when I get back that I'm all sold out, so have to take time out to make more. I may have to keep 400 in stock at this rate. Fortunately, with profit generated just today with sales, I'll be able to afford to do that.

[Orelli Virbonus]

Whether or not it annoys me really depends on how much of a markup they're asking for. My trader mostly stocks tradeskill components that I no longer have a use for (like padding, swirling shadows, taelosian stones, etc.) I see it as mutually beneficial... people who still need that stuff can buy it from me for (what I consider to be) reasonable prices, and save themselves from a little tedious farming. I can use the plat to buy the things I need and save myself some tedium.

If they buy it and start asking (what I consider to be) ridiculous prices, I made my platinum, but it feels a little hollow.

Usually when that happens I'll farm a bunch and then leak it into the market in small quantities. Gives other people a chance to buy it if they can reach me quickly, and the resellers have to put a little more effort in to buy me out.

[Moonunit]

resellers

When resellers buy my stuff, they usually end up marking it up to stupid levels. This annoys me severly for 2 reasons. First, I spent the time money and effort to skill-up so I can make the item, and I believe that the price I set is what it should be offered to the public for. Secondly, when I price things, I keep in mind the cost to make it, and the amount of cash a player of the appropriate level generally has on hand. The reseller prices things so only plat buyers can afford them. (don't get me started on plat buyers!) So when resellers buy and mark up my tradeskilled items, I made a point to flood the market with the item. Price is controlled by supply and demand, and I AM the supply.

LOL, if this was me, I'd spend a vengeful night making about 3,000 potions and put them out in batches of 500. By the third or fourth batch, your reseller would have stopped.