Nothing in life is free:
All I can do is shake my head and move on when I see stuff like this: A Free Tax Cut Recruitment post. But looking at the market, and the profitability of certain products, especially T1, its obvious how hard people like the above corp are driving the market.
Armageddon:
Lets look at a specific example of this failure. Armageddons are selling for 111M isk. Manufacturing cost is 183M isk. Looks like market volume is ~100 hulls/day. All prices/volumes are in Jita using ME 0, PE 0. That means that you are losing ~72M isk / hull. A single manufacturer can make ~6 hulls per day. That is nearly half a billion isk/day lost, or ~18M isk/hr.
Looking at the above ME chart, anything less than 178M is selling for a loss, and anything less than 228.75M (20% profit) is not very interesting to a manufacturer.
But mined minerals are free:
This is the greatest failure to understand the market that is prevalent in Eve. And its not just a miner problem either. I have heard of logistics directors thinking that moon goo from their POS's that they but into T2 Ships are free. This is simply not true. There is no argument, it's just fact. Whether it's an opportunity cost or the cost of your time, it must all end up in the final equations.
The cost of Free Minerals:
I was debugging Profiteer earlier today because I could not believe that battleships were losing this much money at the volumes they are moving at. I will post the isk / hour lost on each of these hulls. The fact that so many people are losing so much money so quickly is absolutely mind boggling.
| Apocalypse Blueprint | (1,852,503.52) |
| Maelstrom Blueprint | (1,961,225.25) |
| Raven Blueprint | (2,153,650.45) |
| Megathron Blueprint | (2,403,525.04) |
| Abaddon Blueprint | (2,717,849.96) |
| Cyclone Blueprint | (3,008,283.76) |
| Scorpion Blueprint | (3,250,852.11) |
| Ferox Blueprint | (3,632,733.71) |
| Typhoon Blueprint | (4,361,057.27) |
| Rokh Blueprint | (5,310,852.18) |
| Procurer Blueprint | (5,665,502.72) |
| Dominix Blueprint | (6,364,175.96) |
| Armageddon Blueprint | (17,770,671.87) |
Conclusions:
There needs to be some kind of education program to keep people from failing as hard as they are. But, this is Eve, and space is harsh. I have been lucky to work with Lockefox and have some serious and deep discussions on the realities and maths involved with running a successful industry program. In a few short months, I was able to start making multiple billions in sales per month. I was lucky enough to have a mentor who could guide me past the pitfalls of Eve Industry.
Another co-worker who mainly missions/rats in null expressed interest in Industry in Eve, and the advice that I gave him I would suggest for any aspiring Industrialist who does not have a mentor, Don't do it. There are a lot of ways to make money in Eve. High level industry is a form of PvP all its own. Just like market trading is a form of PvP. And while PvPers judge themselves by kill board stats and isk values, Industrialists do it with kit buy-ins and profit margins.
I would like to see T1 industry be a viable thing, and in niche markets, those with higher skill requirements, or that use non-minable materials, there still is some good profit, sometimes exceeding what can be made in T2. One of the big problems with that is that you have to be agile in what you make as you can easily exceed demand with the amount you can produce.
TL;DR
Nothing is free. If you don't have a mentor, don't do industry.
I don't suppose you'd be at all interested in becoming a mentor? I'm pretty new to Eve but the stuff you describes fascinates me, and I also found myself looking at the split of factional warfare (and supplying said FW) and industrialism.
ReplyDeleteI would make a horrible mentor. As you can see, it took over a week for me to reply to your comment. I would suggest talking to Sindell about getting a mentor if you would like one.
DeleteI agree that it is very true that having a mentor is extremely important to learn the pitfalls of anything quickly, I do not agree with your statement that you MUST have a mentor. I believe that with some very very simple spreadsheets one can realize that T1 manufacturing is non profitable 9/10 of the time but if you do some basic research you can always find something to make and come out ahead, just can't jump into something because you see something costs X isk so it must be profitable.
ReplyDeleteThe reason that battleships are selling below cost is that the costs rose in Odyssey by up to 50%.
ReplyDeletePersonally, I have sold out of my battleship stockpiles, but there are heaps of people who sunk multiple billions into battleship production who are reaping bumper profits.
serpentinelogic is right, people are still dumping battleship built before odyssey and making a nice profit.
DeleteWhich is also why many people are getting rid of their researched BS / BC BPO - market hasn't recovered yet and people prefered to liquidate those assets.
I've just started getting into industry without a mentor.
ReplyDeleteThat said I've got a mathematical background, so looking for the full costs makes sense to me. Of course you want to separate out the costs as much as possible, It may be the case that you're creating intermediate products that you're better off sourcing from the market. (This is especially true if you're doing PI factory planets where you have a hard limit on the number of structures you can put on a planet).
I'm an eve newbie but I've started with PI, some industry and a bit of trading to make the most of my products. The industry I do is in niche products that I've modelled using google spreadsheets and some of the various premade tools and websites out there.
While it's all very well dumping stockpiles built a while ago you have to wonder if tying that much isk in inventory is worth it overall.
--Quix
Thank you for very usefull information.. worldofmanufacturers.com/company-detail/IONQN8jNO5daKV
ReplyDelete