GTN Price Fixing

[Estelindis]

I'd like some advice please. [TL;DR version: I don't like people reselling my crafted gear to fix prices; is this just something I need to get over?]

 

EDIT (just a line before the original post resumes!): The issue is currently solved to my satisfaction, as you can see from later posts, but I think a lot of people are just reading the first bit and providing duplicate suggestions. Thanks all the same!

I craft a lot of orange gear. On the whole, I price things at three or four times the cost of materials initially and then increase or decrease the price a bit depending on how quickly the item sells (if it does at all; some armour types and level ranges never seem to sell, even though the gear looks good). I don't really feel comfortable charging a huge amount more than this, however.

 

Now, recently, I noticed that all my light orange level 19 circlets were being bought and resold for 12k. I think I'd been listing them at 5k. I had a ponder about it and reluctantly started selling them for 9k instead, reasoning that this way the reseller would get less profit if s/he even found it worthwhile. S/he clearly did, and keeps on buying. I earn more, but I feel some disquiet at the same time. I don't like the idea of putting an item that doesn't even cost me 1k to make for sale for 12k. I'm sorry if this makes me an aberration, but to my mind one charges a fair price for fair work. (I kinda had to work my way up to even charging four or fives times more than materials, not gonna lie.)

 

Anyway, I had seen the reseller selling an item by a third character, so when I saw the third character posting a link to the item in chat I whispered him and asked if he'd been forced to raise his prices to 12k by the reseller's actions. He explained that, to the contrary, he had been the first person on the server to learn the schematic, and had charged 12k from the start; perhaps, however, the reseller had bought one of his circlets long ago when he priced a couple down to 10 or 11k, and was only recently getting around to selling them. He explained that when he realised that the other seller knew the schematic, he reached an arrangement that each would list two circlets at any given time for 12k: that was to be the price of the item on our server. He asked me if I wished to join this arrangement.

 

I had a brief think about it, because it seemed to make sense in economic terms, but ultimately I declined. It just seems wrong and unfair to me. An orange item is generally a keeper, but I don't want to think of it bankrupting a character for a few levels. I like to make nice-looking items, to sell them at a fair profit, and for people to be able to afford them. But the latter factor has been taken totally out of my control: if I list my items at less than 12k, they'll just be resold at 12k. The guy said so himself. A lot of you will ask what my problem is, I'm sure, since in any case I get the asking price. But I don't like it, all the same. I feel like I'm being forced into being a party to something a bit underhanded.

 

Anyway, for the time being, I've limited myself to posting the occasional message in /trade asking anyone who wants me to make them a circlet to mail or whisper me. Some of my guildies have suggested flooding the market with sufficent circlets that the resellers won't be able to buy them all, but, frankly, given the profits these people have been making, I don't see myself coming out on top of that one. I imagine they could afford to keep at it for longer than myself and it honestly seems like a lot more trouble than it's worth.

 

Any thoughts? Should I just accept that this is a situation I can't change? Thanks.

Edited February 28, 2012 by Estelindis

[bantros]

You need to be more ruthless, the amount of good loot drops from mobs and mission rewards you don't have to buy much, if anything, from the GTN whilst levelling unless you want to.

 

People will pay reasonable prices for items they want and credits aren't exactly hard to come by, even at low levels. At higher levels there isn't much to spend money on so most people don't even care about spending over the top for an item they want because they've nothing important to spend it on!

 

Find your niche and exploit it until you have a load of credits, then you can start giving away items cheap and piss off other traders if you so desire!

[malspeed]

There is always some wanna be Wall street trader/gold farmers playing the market and trying to push up prices, it happens in every MMO.

 

Either accept their methods or raise your prices to be comparable but a tiny bit less. Worse case check on the other side and neutral AH on your server or on another server of comparable size to get a price check. I sell my implants on both side playing which ever market is paying more (Empire for now). I stopped selling on Republic because of lower population and demand leading to lower prices. I make 5K more per purple implant by moving it across sides with an alt.

[Nightfox_]

Supply and Demand.

[Estelindis]

All right, thanks for your input folks. I'm new to MMOs, so I didn't realise this was such a typical thing. I'll take your advice on board!

 

The main thing I'm thinking is that it would do no harm to keep posting them on the GTN, even if they're going to be resold. It costs the sellers about 1k to make them (assuming materials gathered from missions), but it costs them much more to buy from me. At least that's something.

Edited February 20, 2012 by Estelindis

[pokota]

There isn't much you can do about a gap that big, to be honest, except to wait until more people learned the schematic and the market naturally falls by itself.

 

I had an idiot message me a few weeks ago, telling me to raise my prices on ship upgrade parts. I explained that I didn't want to bankrupt people who were leveling up, and that 100% profit was fine with me, but he informed me that HE set the prices on our server, and that he had SEVEN MILLION CREDITS (haha) and that he would totally ruin the market if people didn't do what he said. I laughed at him and told him what he could do with himself. The funny thing is, I was one of the first people on the server to sell purple ship upgrade parts, and I had my price set way before he came along.

 

A week later he messaged me again, laughing, saying he bought my ship upgrade parts and was going to selling them for 3k credits more! When I stopped laughing, I asked him to please keep doing that, because having my stuff sold instantly was worth a 3k difference.

 

After that, it looked like he got mad at the world, because he was selling for 10k under the next lowest price. It was hilarious. Everyone ignored him, for the most part, and now prices are back to normal.

 

Er, back to the OP, there isn't much you can do in an open market. No rules and regulations exist like in real life. The best thing you can do is to set your prices close, so that they aren't making that much of a profit by buying up your stuff. Then you flood the market and see what happens!

[Vealage]

The only thing I can think of you doing would be selling the piece for 12k, then refunding someone what you deem to be an appropriate amount. Obviously, everyone only needs 1 of these pieces, so you would only refund once.

 

That increases the amount of work you have to do for each piece. But, that was what I thought of off the top of my head.

[Battilea]

Any thoughts? Should I just accept that this is a situation I can't change? Thanks.

 

If you are making something and selling it for a fair price, then just make more. Attempting to control a market only works well if you can control the supply. So if you put 10 up at your normal price and they buy them all, and then you put another 10 up...well, eventually either they'll get the hint or they'll run out of bank space

 

And if are limited in what you can make, then definitely charge a bit more to cut into their profit margin while raising yours, and offer special in person deals in chat.

 

Oh, one other thing you can do...put a couple up 1 or 2k below his prices, while the rest are lower. That way, he either has to buy those for very little profit or else sell below that, eating into his own margins.

Edited February 20, 2012 by Battilea

[Maxell_Snow]

If you are making something and selling it for a fair price, then just make more. Attempting to control a market only works well if you can control the supply. So if you put 10 up at your normal price and they buy them all, and then you put another 10 up...well, eventually either they'll get the hint or they'll run out of bank space

 

And if are limited in what you can make, then definitely charge a bit more to cut into their profit margin while raising yours, and offer special in person deals in chat.

 

Oh, one other thing you can do...put a couple up 1 or 2k below his prices, while the rest are lower. That way, he either has to buy those for very little profit or else sell below that, eating into his own margins.

 

or has to restock the gtn every 2 days when his items never sell. If he is not watching you undercut him then he will just think it has become a dead market and move off to another item.

[Khayoss]

If you are making something and selling it for a fair price, then just make more. Attempting to control a market only works well if you can control the supply. So if you put 10 up at your normal price and they buy them all, and then you put another 10 up...well, eventually either they'll get the hint or they'll run out of bank space

 

And if are limited in what you can make, then definitely charge a bit more to cut into their profit margin while raising yours, and offer special in person deals in chat.

 

Oh, one other thing you can do...put a couple up 1 or 2k below his prices, while the rest are lower. That way, he either has to buy those for very little profit or else sell below that, eating into his own margins.

 

This works. That's what I've always done with someone trying to fix prices on something... flood the market with whatever they are trying to monopoize and you either force them to hoard an unsellable number of goods or move on to something that they arent competing with you for. The re-sellers market only works if you let it.

 

Having said that, if I've established a price I feel is reasonable for an item and then someone else doubles it, I generally stick to my price in the short term, and if they never lower their prices then I know that there must be enough of a demand in the market that once mine sell then theirs are being bought too. Knowing that I'll adjust my price upwards to match, but still below their price because I want mine sold first.

 

As a crafter in an MMO, you should never feel guilty about making profit on an item you create. Its not just the resources that set the price. It's the time and effort you put in to get to the point of being able to make that item, the rarity of the item/ingredients and the demand for that item that set the price. Some items will give you 100x what you put into it while others will barely break even. That's just how it goes. And economies fluctuate so much that you might as well take the money while you can because down the road whatever it is that you are making is probably going to be obsolete or unprofitable because of changes in the market.

 

 

he informed me that HE set the prices on our server, and that he had SEVEN MILLION CREDITS (haha) and that he would totally ruin the market if people didn't do what he said.

 

Sorry, question. The guy in this story is a douche, understood. But the haha to 7 million credits piqued my interest. Is that somehow unbelieveable?

[Battilea]

Sort of hard to believe.

 

If he truly controls it, he ought to have way more than 7 mil. I've got 5 mil each on two of my characters. One just from selling purple earrings at 50k a pop...and I don't sell that many due to the undercutters, plus spend a lot of money on UT stuff, the other an armormech who just specializes in cunning medium armor bracers and belts.

 

So, the guy is an idiot. 7 million credits is nothing.

Edited February 20, 2012 by Battilea

[Raelstrom]

I'd like some advice please. [TL;DR version: I don't like people reselling my crafted gear to fix prices; is this just something I need to get over?]

 

I craft a lot of orange gear. On the whole, I price things at three or four times the cost of materials initially and then increase or decrease the price a bit depending on how quickly the item sells (if it does at all; some armour types and level ranges never seem to sell, even though the gear looks good). I don't really feel comfortable charging a huge amount more than this, however.

 

Now, recently, I noticed that all my light orange level 19 circlets were being bought and resold for 12k. I think I'd been listing them at 5k. I had a ponder about it and reluctantly started selling them for 9k instead, reasoning that this way the reseller would get less profit if s/he even found it worthwhile. S/he clearly did, and keeps on buying. I earn more, but I feel some disquiet at the same time. I don't like the idea of putting an item that doesn't even cost me 1k to make for sale for 12k. I'm sorry if this makes me an aberration, but to my mind one charges a fair price for fair work. (I kinda had to work my way up to even charging four or fives times more than materials, not gonna lie.)

 

Anyway, I had seen the reseller selling an item by a third character, so when I saw the third character posting a link to the item in chat I whispered him and asked if he'd been forced to raise his prices to 12k by the reseller's actions. He explained that, to the contrary, he had been the first person on the server to learn the schematic, and had charged 12k from the start; perhaps, however, the reseller had bought one of his circlets long ago when he priced a couple down to 10 or 11k, and was only recently getting around to selling them. He explained that when he realised that the other seller knew the schematic, he reached an arrangement that each would list two circlets at any given time for 12k: that was to be the price of the item on our server. He asked me if I wished to join this arrangement.

 

I had a brief think about it, because it seemed to make sense in economic terms, but ultimately I declined. It just seems wrong and unfair to me. An orange item is generally a keeper, but I don't want to think of it bankrupting a character for a few levels. I like to make nice-looking items, to sell them at a fair profit, and for people to be able to afford them. But the latter factor has been taken totally out of my control: if I list my items at less than 12k, they'll just be resold at 12k. The guy said so himself. A lot of you will ask what my problem is, I'm sure, since in any case I get the asking price. But I don't like it, all the same. I feel like I'm being forced into being a party to something a bit underhanded.

 

Anyway, for the time being, I've limited myself to posting the occasional message in /trade asking anyone who wants me to make them a circlet to mail or whisper me. Some of my guildies have suggested flooding the market with sufficent circlets that the resellers won't be able to buy them all, but, frankly, given the profits these people have been making, I don't see myself coming out on top of that one. I imagine they could afford to keep at it for longer than myself and it honestly seems like a lot more trouble than it's worth.

 

Any thoughts? Should I just accept that this is a situation I can't change? Thanks.

 

Charge more. Quit whining.

[Lumocolor]

if someone is buying all your stuff at 5k and reposting it at 12k just start posting yours at 11999 if he wants to buy all your stuff then grats to you.

[Raelstrom]

if someone is buying all your stuff at 5k and reposting it at 12k just start posting yours at 11999 if he wants to buy all your stuff then grats to you.

 

Said much better than I

[Inarai]

So... Why the hell are you underpricing your gear?

 

Frankly, you're only harming the ability of people to make money. Besides, it's not like orange armour are really targeted at a level - if they're popular enough that people are paying level 50 credits for a supposedly level 15 item, well, that's the way of it.

 

Normally, this does not require interaction between the vendors. However, MMO players seem to at large be, quite frankly, too stupid to get it right.

Edited February 20, 2012 by Inarai

[Cleet_Xia]

If people will pay his prices for goods- then he's selling them for the price they should be marked sold for. There is nothing wrong with that. However, this individual sounds like an arrogant d-bag for other reasons. And seems to suffer from some sort of delusions, because 7mil wouldn't be enough to wreck a server economy for any noticable length of time. Sure he could screw it up for a few hours, but that is about it. And then he wouldn't have 7mil in the bank to repeat the process with.

[Kunovega]

Sorry, question. The guy in this story is a douche, understood. But the haha to 7 million credits piqued my interest. Is that somehow unbelieveable?

 

its funny because its not nearly enough to "control the market" as he claims to be doing with his 7 mil credits

 

i routinely make and spend 2 to 3 mil a day as a crafter and while i destroy the bulk of my earnings (reverse engineering for schematics, the biggest money sink in the game) i wouldnt even be able to buy out my competition with such little funds

[Inarai]

All right, thanks for your input folks. I'm new to MMOs, so I didn't realise this was such a typical thing. I'll take your advice on board!

 

The main thing I'm thinking is that it would do no harm to keep posting them on the GTN, even if they're going to be resold. It costs the sellers about 1k to make them (assuming materials gathered from missions), but it costs them much more to buy from me. At least that's something.

 

They're not doing anything wrong at all, though. The entire purpose of the exercise is to make money. There's a minor monopoly issue, which you can solve by pricing competitively (undercut them by a small amount, such that it's not really worth it to resell due to GTN tax) which would lead to their prices dropping.

[DoctorVanGogh]

its funny because its not nearly enough to "control the market" as he claims to be doing with his 7 mil credits

 

i routinely make and spend 2 to 3 mil a day as a crafter and while i destroy the bulk of my earnings (reverse engineering for schematics, the biggest money sink in the game) i wouldnt even be able to buy out my competition with such little funds

 

Yeah, you cannot really do a lot with 7 Mil to the server economy as a whole. You might be able to severely affect one or two targeted players by constantly underbidding their prices no matter what they sell, but even that takes way more effort than it's worth, and can easily be sidestepped by selling through an alt...

[Mephane]

Supply and Demand.

 

No, what the OP describes is the equivalent of a cartel, the very opposite of free market, supply and demand. Free market works by competing producers and traders trying to out-do the others by better quality, lower prices, better services etc.

 

Multiple or even all traders of a product banding together to sell their stuff for a fixed price is the very opposite of competition and free market.

[Baelish]

I'd like some advice please. [TL;DR version: I don't like people reselling my crafted gear to fix prices; is this just something I need to get over?]

 

Yep. It's a market. If someone will pay the inflated price you can either let others profit from your hard work, or you can bump your prices to where people don't buy for resale.

[Squatdog_nz]

I'd like some advice please. [TL;DR version: I don't like people reselling my crafted gear to fix prices; is this just something I need to get over?]

 

I craft a lot of orange gear. On the whole, I price things at three or four times the cost of materials initially and then increase or decrease the price a bit depending on how quickly the item sells (if it does at all; some armour types and level ranges never seem to sell, even though the gear looks good). I don't really feel comfortable charging a huge amount more than this, however.

 

Now, recently, I noticed that all my light orange level 19 circlets were being bought and resold for 12k. I think I'd been listing them at 5k. I had a ponder about it and reluctantly started selling them for 9k instead, reasoning that this way the reseller would get less profit if s/he even found it worthwhile. S/he clearly did, and keeps on buying. I earn more, but I feel some disquiet at the same time. I don't like the idea of putting an item that doesn't even cost me 1k to make for sale for 12k. I'm sorry if this makes me an aberration, but to my mind one charges a fair price for fair work. (I kinda had to work my way up to even charging four or fives times more than materials, not gonna lie.)

 

Anyway, I had seen the reseller selling an item by a third character, so when I saw the third character posting a link to the item in chat I whispered him and asked if he'd been forced to raise his prices to 12k by the reseller's actions. He explained that, to the contrary, he had been the first person on the server to learn the schematic, and had charged 12k from the start; perhaps, however, the reseller had bought one of his circlets long ago when he priced a couple down to 10 or 11k, and was only recently getting around to selling them. He explained that when he realised that the other seller knew the schematic, he reached an arrangement that each would list two circlets at any given time for 12k: that was to be the price of the item on our server. He asked me if I wished to join this arrangement.

 

I had a brief think about it, because it seemed to make sense in economic terms, but ultimately I declined. It just seems wrong and unfair to me. An orange item is generally a keeper, but I don't want to think of it bankrupting a character for a few levels. I like to make nice-looking items, to sell them at a fair profit, and for people to be able to afford them. But the latter factor has been taken totally out of my control: if I list my items at less than 12k, they'll just be resold at 12k. The guy said so himself. A lot of you will ask what my problem is, I'm sure, since in any case I get the asking price. But I don't like it, all the same. I feel like I'm being forced into being a party to something a bit underhanded.

 

Anyway, for the time being, I've limited myself to posting the occasional message in /trade asking anyone who wants me to make them a circlet to mail or whisper me. Some of my guildies have suggested flooding the market with sufficent circlets that the resellers won't be able to buy them all, but, frankly, given the profits these people have been making, I don't see myself coming out on top of that one. I imagine they could afford to keep at it for longer than myself and it honestly seems like a lot more trouble than it's worth.

 

Any thoughts? Should I just accept that this is a situation I can't change? Thanks.

 

Be thankful you have a profession where you can make such a large profit margin.

[Estelindis]

Er, back to the OP, there isn't much you can do in an open market. No rules and regulations exist like in real life. The best thing you can do is to set your prices close, so that they aren't making that much of a profit by buying up your stuff. Then you flood the market and see what happens!

Thanks for sharing your very interesting story about ship parts and for the advice.

 

The only thing I can think of you doing would be selling the piece for 12k, then refunding someone what you deem to be an appropriate amount. Obviously, everyone only needs 1 of these pieces, so you would only refund once.

 

That increases the amount of work you have to do for each piece. But, that was what I thought of off the top of my head.

That's an excellent idea. Thanks for thinking outside the box!

 

The only trouble, I suppose, is that quite a few people would probably be sufficiently put off by the price that they wouldn't buy in the first place (unless I advertised the refund via chat, but advertising via chat hasn't done much for me so far; mind you, I don't do it a lot, as I don't want to spam people). Contrary to the idea that people would be only too glad to pay 12k, a guildie just mentioned that he had checked the GTN for a light circlet (not knowing I made them), but just could not justify spending that amount on one empty orange item at his level. Obviously he has one now, as I make stuff for guildies for free, but I wonder how many other people were put off by this. This 12k price might be biting the cartel in the ***, even if they don't realise it. They might be able to sell five or six (or more) a day if they priced it lower and come out with a better profit. I mean, it only takes seven minutes to craft anyway...

 

If you are making something and selling it for a fair price, then just make more. Attempting to control a market only works well if you can control the supply. So if you put 10 up at your normal price and they buy them all, and then you put another 10 up...well, eventually either they'll get the hint or they'll run out of bank space

 

And if are limited in what you can make, then definitely charge a bit more to cut into their profit margin while raising yours, and offer special in person deals in chat.

 

Oh, one other thing you can do...put a couple up 1 or 2k below his prices, while the rest are lower. That way, he either has to buy those for very little profit or else sell below that, eating into his own margins.

Thank you; this makes sense and largely agrees with my own instincts on the matter, except for one thing: why worry about bank space when you can just buy an item and leave it in the mailbox for quite a long time? Maybe I'm missing something?

 

So... Why the hell are you underpricing your gear?

 

Frankly, you're only harming the ability of people to make money. Besides, it's not like orange armour are really targeted at a level - if they're popular enough that people are paying level 50 credits for a supposedly level 15 item, well, that's the way of it.

Obviously we may not have an agreed definition of underpricing, but I feel I was not underpricing my gear. I set the price at one I thought was both fair and profitable. (The first few times I sold it, I checked to see the prices for others, but there were no others on the GTN at those particular times.) People can still make money (quite a lot, in fact) selling the item for 400-600% of the value of the materials it costs to make, so I'm not harming their ability to make money at all, just their ability to rip people off - though, frankly, it doesn't even look like I'm doing that, given the reselling.

 

Of course orange armour can be used by higher level people, but it's also desired by those of the minimum level required to use it, especially when there's so much ugly headgear out there. I also make a higher-level circlet that has no class requirements, and can thus be used by companions, and I charge appropriately more for that. Honestly, though, given that orange circlets are available from commendation vendors from, if I recall correctly, Balmorra onwards (Republic, not Empire!), I would have always seen the real market for this item as being 19-35ish. Orange circlets are harder to get in other ways at level 19 compared to later on, so more people of this level are likely to be looking for it. I would have thought that selling the item at a price they can afford even if they're not alts of wealthy mains would be a decent way of making money.

 

They're not doing anything wrong at all, though. The entire purpose of the exercise is to make money. There's a minor monopoly issue, which you can solve by pricing competitively (undercut them by a small amount, such that it's not really worth it to resell due to GTN tax) which would lead to their prices dropping.

Point: to you, the entire purpose is making money. To me, it's making money and providing people with nice things at a reasonable price. That's the experience I enjoy.

 

As far as I'm concerned, they're free to sell their circlets for whatever they like! I'm not saying it's wrong to sell them for 12k. My problem is them forcing a price of 12k on all circlets, including mine. I don't feel like I need to go on some grand crusade to make them drop their prices, only that I'd like to be able to keep selling mine at whatever price I like to the people who will actually use them. Anyway, lots of good advice has been given in this thread, and I now feel I know better what to do.

 

Be thankful you have a profession where you can make such a large profit margin.

Believe me, I'm extremely thankful! I don't have any great ambitions to dominate the marketplace, so I'm sure I make far less money than most, but it's still nice to come back in the morning and see that 200k worth of equipment has sold overnight: stuff I know was priced fairly and that people will enjoy wearing because it looks good. I feel I am making a profit but also improving people's game experience, which is win-win. (Yes, I know that high-level dailies give you more money, etc., but I like making things and providing them to people who want them.) Mind you, lately my orange sales are mainly funding my reverse engineering of non-orange items, since I feel I should expand my repertoire a bit, but hey.

[Battilea]

Thank you; this makes sense and largely agrees with my own instincts on the matter, except for one thing: why worry about bank space when you can just buy an item and leave it in the mailbox for quite a long time? Maybe I'm missing something?

 

Well, even that has limits, so depending on how long you keep making the same stuff Plus the hassle he has to go through to check all the time that you haven't put new stuff up, and so on.

 

But anyway, since your goal is to make a good product at what you deem a reasonable price, just keep putting ones up at your price, plus a few set up to force him to spend extra money buying you out or to lower his own price. Eventually, he will get the hint and move on the greener pastures. And if not, you'll have made a lot of money off the one guy.

[Estelindis]

Well, even that has limits, so depending on how long you keep making the same stuff Plus the hassle he has to go through to check all the time that you haven't put new stuff up, and so on.

 

But anyway, since your goal is to make a good product at what you deem a reasonable price, just keep putting ones up at your price, plus a few set up to force him to spend extra money buying you out or to lower his own price. Eventually, he will get the hint and move on the greener pastures. And if not, you'll have made a lot of money off the one guy.

The mail limits seem fairly large, but yes, they're there. I think you've hit the nail on the head and I'm going to do just this. Thanks to you and to everyone else who gave thoughtful advice.