Cybertech Undercutters

[Kourage]

Something quite irritating to me has been to increasing number of Cybertechs willing to sell their Artifact pieces for less than the value of the materials used to craft it. Nevermind the countless "Commander's" prefix pieces I see listed . There are Vehemence, Supremecy and Endowment pieces for under 40k.

 

I can make just about all Expert and Veracity pieces that someone would want. The problem is, figuring out which someone else doesn't have so that they don't come along and undercut it to a point it's not worth crafting. A critted piece, I find I can not sell for more than 65-75k, depending on which piece.

 

On my server, I can usually quickly sell these mats at this price, often I sell at a higher price.

 

Zal Alloy - 2k (x4 = 8k)

Durasteel - 1.5kk (x2 = 3k)

Mandalorian Iron - 15k (x2 = 30k)

 

That's 41,000 credits just for selling the materials. I don't have to buy flux, or waste my companions time crafting them. I don't have to pour countless materials into reverse engineering to learn the schematics in the 1st place.

Edited March 5, 2012 by Kourage

[KaiHeilos]

Welcome to MMO economics.

[Ommadonn]

I would never sell anything on me server except mastercrafted fer more than that. I can barely sell veracity earrings/implants fer more than 30k. Im lucky to get 35K fer em. so mark em lower or sit on a ton of em... hopefully u can atleast get what u paid on missions fer em.

[Battilea]

On my server, I can usually quickly sell these mats at this price, often I sell at a higher price.

 

Zal Alloy - 2k (x4 = 8k)

Durasteel - 1.5kk (x2 = 3k)

Mandalorian Iron - 15k (x2 = 30k)

 

That's 41,000 credits just for selling the materials. I don't have to buy flux, or waste my companions time crafting them. I don't have to pour countless materials into reverse engineering to learn the schematics in the 1st place.

 

The problem is that, while you can sell at that price, they might not be buying at that price. For example, instead of buying mandy iron at 15k a pop, they might be buying UT missions for 40k, which will net them 4 iron, plus 8 ciridium, equal amounts of silk, and a gift. The Zal Alloy they might well be getting from harvesting and they therefore consider it free, or they run Control Measures, which for 1.5k will average about 6. Yup, it is stupid that they fail to see the opportunity cost, but, well, people are stupid. A person, usually not, but people, yeah.

 

The other thing is that you are assuming they are crafting to make superior versions. That assumption might well not be valid. They could be crafting to make mastercraft versions. Therefore, the superior ones are nothing but a byproduct and their goal is to recoup money from the failed mastercraft attempt as quickly as possible. Basically, the ability to crit and wind up with a mastercrafted item is bad for the prices of what you normally make.

[lueckjathom]

The only way to sell something is to sell it for cheaper than the next guy.

 

The prices of Zal Alloy or Durasteel don't always factor in, because people pick those up while doing their dailies or whatever for free. So really they are just turning their 2 pieces of rare mando iron into 40k.

 

Yes, you could argue that they could just sell all of the mats for more. On the other hand, if everyone started doing that, then the prices of the mats would plummet as people have to undercut eachother to sell those as well.

 

If undercutting gets to the point where prices are no longer profitable, then the supply is higher than the demand and you should in fact try to switch to selling the mats while the gettin' is good. Then when more people catch on to that and then flood the market with mats instead of earpieces, then you can try to sell your earpieces again.

 

You can't expect everyone to list the same item for the same price and just hope the buyer picks yours instead of someone else's. Undercutting makes the sale. Higher supply than demand is what drives prices to the point of non-profit.

 

I will say that some people are stupid with how much they undercut. If the next lowest guy has his up for 45k, they certainly don't need to go down to 40k. Simply going to 44.5k would get the same the result without driving prices so low when the next guy then has to undercut him as well.

 

Prices remain high when the demand is higher than the supply, and you don't get the undercutting train because the items are being bought faster than they are being supplied, so the seller can continually "reset" the price at its high point.

Edited March 5, 2012 by lueckjathom

[thewatcheruatu]

There are always going to be people in these games who consider gathered materials to be "free", though I'll agree it can be kind of frustrating. As a crafter, you kind of want to actually craft, so it's disappointing when economically, it just makes more sense to sell your materials.

 

Though it's kind of funny in this game how--even when there's an actual built-in cost to running underworld trading missions, and that's more or less very quantifiable--people still undercut. That's taking it to another level of silliness, since there's no "free" way to get that stuff.

Edited March 5, 2012 by thewatcheruatu

[Battilea]

The only way to sell something is to sell it for cheaper than the next guy.

 

Not exactly true. You do have to be the cheapest price for that item, yes, but you don't necessarily have to undercut the cheapest guy, not if his will sell, leaving yours the cheapest.

 

I sell my earrings for 50k. Others undercut me all the time. I still sell mine for 50k. And they sell. Why? Because 50k is a reasonable price and people will pay it. And for 50k, I'll make sure mine are always in stock, since on my server, mats are not as valuable as on the OP's, so I'm happy with the profit margin.

 

The undercutters? They come and go. Sometimes they undercut earring A, sometimes B. I don't really care, because I'll just sell a different one until they quit undercutting those and they start to sell again.

 

Now, if I joined in the pricing games, I'd just wind up lowering the price. But that wouldn't be worth my while.

 

Mind you, to make this strategy work, you need a variety of goods to sell, so that you can sell what isn't being undercut. But it works and my profit per item is higher than the silly people that undercut me.

 

So here I am, charging more than others, yet most likely making more money than them.

Edited March 5, 2012 by Battilea

[Kane_Ren]

I undercut by a lot, I always will as long as there is some kind of profit in it. There usually is profit simply because I find my own mats. No way would I ever pay overinflated mat prices I often see on the GTN. Why pay for what you can gather for free? Purple mats come from my slicing alt whos sends everyone out to find the missions, my other alts send constant mat streams to each other to do the crafting. I watch the GTN closely to see what the gaps in the market are and supply them, these net me big money. If I have gear that is surplus and the market is already busy, I drastically undercut to shift the stock, if it is really bad I'll send it to alts via email where it can be stored and retrieved a few days later.

 

I vendor off anything greens or bop i cant use and thats all there is to it, its all pretty much retail basics

[Arrys]

Manys ervers have someone playing a bankers role. Buy the cheap control the midpoint make a profit. Their costs are what goes on the auction.

 

I think the problem is less crafting than the fact money in general comes so easy people don't see much perceptual difference in the prices your complaining about. Which is why yours still sell as well.

[Battilea]

I think the problem is less crafting than the fact money in general comes so easy people don't see much perceptual difference in the prices your complaining about. Which is why yours still sell as well.

 

But that's the point.

 

I sell mine at a reasonable price based on the value of the mats it takes to make the item. And people pay it, no problem. The Undercutting isn't necessary. And, if most of those people had a lick of economic sense (and cared, of course, some have the sense, but don't really care, they just enjoy making things and selling them, and that's fine, it is a game after all), they wouldn't charge the prices they do. They could easily make more money selling at a higher price, a price people can easily afford, because 50k is nothing, super easy to earn at 50.

 

But if you see someone selling at 35k and you therefore jump in and start selling at 34.5k, well, you're stuck at that price until his goes off the market, which could be a day or two. And then you'd better hope he doesn't put it back up, which he probably will, for less than 34.5k. A silly and rather stupid cycle. Me, I let him sell it for 35k, he's gone, people go back to buying mine. Now, sometimes he'll come back and put up more for 35k, that's fine too. Eventually, he'll disappear, because the effort isn't worth the rewards. And it is likely some other person will do the exact same thing. But, I don't care. I've got a broad variety of goods and so I've always got something for sale that silly people aren't selling at a silly price.

 

Of course, you always have people like Kane_ren above seems to be, people who don't understand concepts of opportunity cost or at least don't care. They view a bit of Zal Alloy they harvest as free, which is true in a way, but neglect to consider the value of it, that is actually worth 1k (on my server, anyway) and that this should be factored into pricing. Or they don't calculate the cost of learning the recipe, they just look at the cost of the materials, not figuring in that, hey, at their prices, taking into account the opportunity cost, it'll take over 50 of the item before they actually turn a profit. Or they are poor, so figure most people don't have much money and can't afford 50k, and therefore, they charge based on what they think is a fair price, even though 50k is 4-5 dailies, easy money. 30m for a nice purple upgrade. You spend more time (and sometimes more money with a bad group) for a considerably lower chance of an upgrade in most HMs.

 

But there's nothing to be done about it. Either you join in and, in classic prisoner's dilemma, screw yourself and them. You can just quit bothering. Or you don't and just play around it, doing less volume, but making a higher profit per item.

 

I elect to do the latter, typically. And it works for me.

Edited March 5, 2012 by Battilea

[pokota]

I sell my Superior Earpieces for 40k, but the prices are quite a bit different on my server. I would never pay over 1k for a piece of durasteel, for instance, or 1k for a piece of zal alloy. So that part is relative.

 

However, Superior grade pieces are mostly just items that I'm trying to get rid of. My goal is Mastercraft, and I usually have an entire bay of Superior that I wouldn't mind simply breaking even on. Honestly, I would sell for less in a heartbeat, but I don't want to hurt less financially secure crafters who see a 40k as a big deal.

[lueckjathom]

Not exactly true. You do have to be the cheapest price for that item, yes, but you don't necessarily have to undercut the cheapest guy, not if his will sell, leaving yours the cheapest.

 

Very true when the supply vs demand is roughly equal. Sure, some guy puts an item up for super cheap, you don't have to undercut him because you know his will sell and then you'll be back to being the cheapest.

 

When there are more being listed than being bought however, it's an endless game of undercutting in which you just hope the timing works out that someone comes to buy one when yours is the cheapest, not after someone else comes and undercuts you, then someone undercuts them, and suddenly there's 5 items all cheaper than yours and people aren't going to buy that many.

 

I'm finding cybertech earpieces and biochem implants to be the most flooded markets. So many people went cyber figuring it would be really cool for leveling and just making neat stuff, and then so many people went biochem as the best endgame crewskill, now they are all trying to sell the same things. On my particular server, it's MUCH more profitable to just sell mats. There will always be people buying them up to work on reverse engineering and cranking out purples in hopes for that augment slot.

Edited March 5, 2012 by lueckjathom

[GnatB]

To give them the benefit of the doubt, they could also have never tried actually selling durasteel and Zall Alloy, and find it hard to believe people are actually paying so much more than they would seem to be worth, given the cost to get it oneself via missions and the fact that missions to get it are *always* available. (unless already being run).

 

They may see the price of them on the GTN as what they aren't going for. Possibly simply put there by opportunists hoping somebody misclicks.

[loyrl]

I have always sold mine at 40k and 150k for crits. I looked the other day and people were undercutting by 20k! I have never had a problem selling at 40k and yet people are shorting themselves by undercutting by that much.

[ColonelKer-Nal]

...on my server, mats are not as valuable as on the OP's...

 

Which is yet another reason the GTN should be cross server. Normalilzing/stabilizing prices with a larger market benefits everyone, buyer and seller alike.

[Marlaine]

Undercuts happen in a lot, if not most, mmo markets. Particularly in a commodity market like swtor or wow because there is no differentiation between goods. Even mastercraft gear is the same as other crafter's mastercrafts.

 

There are many reasons people will undercut. Perhaps they have cheaper materials or suppliers. Maybe they are switching professions and are dumping goods. Perhaps they bought something and realized they didn't need it. They could be ignorant to market prices or ignorant to markets in general. Maybe they're just kind-hearted and "don't want the buyer to overpay", or are ignorant of their labor costs. Or they just leveled up on too many of one good and don't want to sit on the stock. The list goes on but you get the point...

 

So it all comes down to picking the right markets, understanding your production costs, break evens, sunk costs, selling at a loss when the market is lost, making the appropriate profit for your time, and patience for markets to even out.

 

You do have to undercut due to the commodity market, but don't undercut retarded amounts. Just a one credit undercut will do it in most cases, maybe 50 or 100 credits for higher value stuff. Don't believe the myth that someone will buy a higher priced good just to spite your small undercut. It's pure bs. Always be the lowest price for your given market, assuming that price still meets your profit expectations. Sometimes it helps to make stockpiles and even undercut "yourself" if you've been undercut.

 

If you're in a market and someone puts a bunch up at lower prices, consider buying them out; or just be patient until they sell their excess goods and the market goes back to normal. But think long-term. Will the market ever recover? Remember goods never stop flowing in a mmo, so prices will steadily decrease over time, unless there is a demand bump (e.g. jewels in the last major wow patch). But prices generally don't drop like a rock overnight either, at least not permanently. So don't just dump your goods for cheap just because someone dumped their goods. Think it through, and if you think the market will recover just enter a different market and come back later.

 

In your situation, either your market is going down the tubes or you are paying too much for your materials. I suspect the latter. As others have suggested, perhaps it's time to make some alts and start your production line for materials, and your slicers to supply missions.

Edited March 6, 2012 by Marlaine

[uniz]

you really dont need to undercut anyone. you can just set yours at the same price and let the buyer(s) choose whose to buy. some people understand this but most are just impatient and want to dump thier wares. underpricing goes way back to eq1. it is here to stay. there are some methods that can be used to minimize thier effects. a few already posted some.

 

personally i make more from dailies per day than i do making anything as a cybertech. however i do have a few superiors that should sell well since i was smart and lucky on the re on the right pieces. it is all about having the right stats with the right re(s). you wont sell anything if you dont know some are just plain worthless while others have stats that the raid gear has already bumped up into dimishing returns. just because its purple doesnt mean it will sell well.

 

i seldom buy mats because why should i? i harvest every node i run by doing dailies and we rotate in my guild groups on the droids. i get more than enough. vary rarely will i buy missions. i have no need to do so. in a few months when enough people have a few alts the mat market will dry up as well as alot of crafted items. make your credits while you can as this happens to every mmo and this one is no different thus far.

[Sarmea]

I undercut by a lot, I always will as long as there is some kind of profit in it. There usually is profit simply because I find my own mats. No way would I ever pay overinflated mat prices I often see on the GTN. Why pay for what you can gather for free?

I vendor off anything greens or bop i cant use and thats all there is to it, its all pretty much retail basics

 

 

This. This is why people are selling items for less than crafting cost. "But if I gather it it's free...." mindset.

 

Once you've mastered retail basics (100), may I suggest the 101 course? It's called "opportunity cost". They aren't free. Every time you stoop down to gather that item, is time you aren't smashing some mob in the face for another fistful of credits. Every time you craft with those "free" mats, you are essentially selling those mats for less than they're worth, plus wasting crafting time. Look at the GTN. You don't have to buy any of those "overpriced" mats, but it will tell you what those mats could sell for if you didn't bother turning them into underpriced goods.

[Lemina_Ausa]

This. This is why people are selling items for less than crafting cost. "But if I gather it it's free...." mindset.

 

Once you've mastered retail basics (100), may I suggest the 101 course? It's called "opportunity cost". They aren't free. Every time you stoop down to gather that item, is time you aren't smashing some mob in the face for another fistful of credits. Every time you craft with those "free" mats, you are essentially selling those mats for less than they're worth, plus wasting crafting time. Look at the GTN. You don't have to buy any of those "overpriced" mats, but it will tell you what those mats could sell for if you didn't bother turning them into underpriced goods.

 

Here's one thing people pissed off about undercutters don't understand.: its a game. It doesn't affect if you'll get your meal each day or any other daily necessities. A lot of people just want a little bit of profit, and they don't care how large it is, as this is virtual currency, and maybe they just enjoy making stuff to sell. Punching a mob to get a fistful of credits gets dull after a while, and some of them don't even drop stuff.

[Lodril]

Once you've mastered retail basics (100), may I suggest the 101 course? It's called "opportunity cost". They aren't free. Every time you stoop down to gather that item, is time you aren't smashing some mob in the face for another fistful of credits.

 

The same can be said for the time you spend pondering prices on the GTN. The time spent 'gathering' is usually spent by my companion, and typically happens as I'm running towards the next round of blasting at stuff, or briefly resting up from the last one. The totality of the opportunity cost is 'incidental', or perhaps can be lumped in with 'overhead'. I think they cover that stuff in the 200 level courses though. Don't worry, you'll get there.

[Game-Hermit]

I undercut by a lot, I always will as long as there is some kind of profit in it. There usually is profit simply because I find my own mats. No way would I ever pay overinflated mat prices I often see on the GTN. Why pay for what you can gather for free?

There is no such thing as free. Everything you own has a value. If you sell 50k of materials for 45k you just lost 5k. Your net worth actually went down. Google opportunity cost. This is extremely basic economics. I understood this when I was like 8 so I'm sure you can.

[Game-Hermit]

Just a one credit undercut will do it in most cases, maybe 50 or 100 credits for higher value stuff. Don't believe the myth that someone will buy a higher priced good just to spite your small undercut. It's pure bs.

I'm actually one of the people who does that so obviously it isn't BS.

[Faulhaber]

Welcome to MMO economics.

 

^^This

[Yrneh]

I'm afraid I'm guilty of being a chronic undercutter but I mostly deal in gathering and mission items. When I undercut I do it by 500-1k unless if I get into a undercutting war with someone. Also OP count your blessings, on my servers the mats go for about half the price on your server.

[parmie]

I think I'm in the don't care category. I don't even check prices before putting my items on, generally I know I'm well under what others charge.

 

Why do I do this? well I gather everything including purple UT metals myself, I've built up a massive stockpile of quadranium which I'm using to either offload crafted blue items to vendors (I did sell one 99 stack for 86k but not since).

 

So my own view is that I can at least break even from a mission that doesn't return purple mats, I therefore happily ignore the materials market and my profit margin is based on a cost of around £3k at grade 6 to gather the materials. I'd put the artifact missile upgrade up for about 25k I guess, so 800% margin is pretty good in my book.

 

Personally some of the prices charged are attempts at exploiting the market so I have no issue being cheap