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blankseplocked Profitable Manufacturing? Pull the other one!
 
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FuzzyLogik360
Caldari
Posted - 2010.06.25 06:04:00 - [1]
 

Ok, this issue may have been touched on before, but there are too many posts to go over and check (so apologies if this is the case).

I'm new to EVE and was just doing some sums to see what sort of profit I could make manufacturing things. Taking a "Merlin" as my example, with zero wastage, I have the following calculations:

Req. Minerals / Qty. / Source / ISK per unit / Cost
----------------------------------------------------------
Isogen / 531 / Mine it / - / -
Megacyte/ 2 / Buy it / 4911.5 / 9823
Mexallon/ 2814/ Mine it / - / -
Nocxium / 2 / Mine it / - / -
Pyerite/ 8444 / Mine it / - / -
Tritanium/ 18964 / Mine it / - / -
Zydrine/ 2 / Buy it / 2071.3 / 4142.6

Total Cost: 13965.6 (excluding job setup and taxes, and the cool 2.5 million ISK for the BPO)

Based on the cheapest Merlin on the market, at around 185,000 ISK, that means I would make a tidy profit of just over 170,000 ISK.

But then I thought, what if I were simply to sell the minerals that I have mined instead. Using "Buy" prices in Jita as my guide, I found out that I could simply sell the mined minerals (excluding Megacyte and Zydrine) for just over 201,000 ISK. I would therefore be losing a potential 31,000 ISK in extra earnings by manufacturing the Merlin!!!! Shocked

Now that means I have to sell my Merlins at over 201k ISK to make this scheme work. But with such a competitve market, with may sellers selling at what seems to be below cost, how can I ever expect to make any money this way!

Now I think I have heard it said elsewhere that manufcaturing Tech I items is not efficient, but does anyone know of any Tech I items that have a decent business case behind them that supports producing them for profit?

Cheers.

Billy Cornpipe
Cornpipe Tactical and Logistics
Posted - 2010.06.25 06:41:00 - [2]
 

Congratulations. You have just discovered that the minerals you mine are in fact, not free.

Dr Lii
Posted - 2010.06.25 08:06:00 - [3]
 

Ships are rarely any good to build since everyone seems to think that it's cool to build ships so the market is over saturated with them, and there will probably not be anyone here that will tell you a good item to produce since that would ruin their profit for that item.

Celia Therone
Posted - 2010.06.25 08:29:00 - [4]
 

One thing to bear in mind is that many people wont un-dock their ship and fly to another station in the same system to save 20,000 isk let alone fly half a dozen jumps because they can earn far more than that by doing something useful in the same amount of time.

This means that you don't have to have the lowest price in the region to get sales, you just have to be selling the stuff that people want to buy closer than other people and have it be within their time-efficiency tolerance.

utboy
Posted - 2010.06.25 08:44:00 - [5]
 

the answer to your problem is you need to set up market buy orders you may have to pick ur mins up in cheaper area. and sell your produced item in an area with higher demand less supply.
here you can take what i used to do (got bored with it).
buy apprx 20 scourge bpo's
ammo is always in high demand and more ppl make ships than ammo in my opinion. profit margin is much higher on ammo too.
now take 10 of those bpos and research the time and material or just the time if ur cheap about it both to 100 or less

great thing about the scourge is just trit and nocx needed to build so its great to start practicing with.

now you need to set buy orders out to buy ur minerals i recommend a mission hub, lets say motsu. tons of demand for this very common missile and all the mission runners dump minerals right there cheap.

now begin manufacturing and dont sell untill u have say at least 500k missiles. your also gonna be rotating your bpos out for invention eventually you'll be producing 10's of millions a week and since your dealing in bulk you can afford to sell at much lower prices than others and if someones drops it too low just buy all theirs up and add it to your piles. now you also want to set cheap buy orders for the same ammo also when ppl wanna just sell a small pile of it on quick sell.

if you master this its a very easy passive income and you can always expand to more ammo types or even add more ppl to your group ie: miners merchants, logistics.

get real good and head out to 0.0 theres a killing to be made everywhere its not uncommon to sell out daily at 300% mark up plus build cost is cheaper out there too since minerals in abundance

and when you get bored of this you sell your 20 bpos for some quick cash ppl always looking for researched bpos









Ryuga VonRhaiden
Caldari
Deep Core Mining Inc.
Posted - 2010.06.25 09:02:00 - [6]
 

Originally by: FuzzyLogik360
Ok, this issue may have been touched on before, but there are too many posts to go over and check (so apologies if this is the case).

I'm new to EVE and was just doing some sums to see what sort of profit I could make manufacturing things. Taking a "Merlin" as my example, with zero wastage, I have the following calculations:

Req. Minerals / Qty. / Source / ISK per unit / Cost
----------------------------------------------------------
Isogen / 531 / Mine it / - / -
Megacyte/ 2 / Buy it / 4911.5 / 9823
Mexallon/ 2814/ Mine it / - / -
Nocxium / 2 / Mine it / - / -
Pyerite/ 8444 / Mine it / - / -
Tritanium/ 18964 / Mine it / - / -
Zydrine/ 2 / Buy it / 2071.3 / 4142.6

Total Cost: 13965.6 (excluding job setup and taxes, and the cool 2.5 million ISK for the BPO)

Based on the cheapest Merlin on the market, at around 185,000 ISK, that means I would make a tidy profit of just over 170,000 ISK.

But then I thought, what if I were simply to sell the minerals that I have mined instead. Using "Buy" prices in Jita as my guide, I found out that I could simply sell the mined minerals (excluding Megacyte and Zydrine) for just over 201,000 ISK. I would therefore be losing a potential 31,000 ISK in extra earnings by manufacturing the Merlin!!!! Shocked

Now that means I have to sell my Merlins at over 201k ISK to make this scheme work. But with such a competitve market, with may sellers selling at what seems to be below cost, how can I ever expect to make any money this way!

Now I think I have heard it said elsewhere that manufcaturing Tech I items is not efficient, but does anyone know of any Tech I items that have a decent business case behind them that supports producing them for profit?

Cheers.



1st: your brand new BPO wouldn't be researched. A fully researched BPO will use some 10% less minerals.
2nd: those mega/zyd prices are terrible, i have sell orders for mega @3600 and zyd @1600 in a mission hub system and not much is being bought as there are lots of better orders (i just can't bother to go make 15 jumps and change prices)

so there goes most of your 30k loss...

BTW people probably set buy orders for minerals for MUCH less, i never buy them via sell orders 'cause i often can save some 20-25%

Lutz Major
Posted - 2010.06.25 09:25:00 - [7]
 

Originally by: Ryuga VonRhaiden
1st: your brand new BPO wouldn't be researched. A fully researched BPO will use some 10% less minerals.
OP was talking about a perfect ME Merlin - which by the way would take about 600 days of research ...

Ivorr Bigun
Posted - 2010.06.25 09:56:00 - [8]
 

Originally by: utboy
i recommend a mission hub, lets say motsu.


Unless the OP likes clicking every 5 seconds I recommend a quieter hub.

Hub niches you could look at are:
high/low pipe entrance hub
high/null pipe entrance hub
specialist mission hub (such as SoE)

OP will find less competition and more chance of following the rest of your advice.

utboy
Posted - 2010.06.25 11:02:00 - [9]
 

yes ivorr ur right the hubs are more fast passed with the penny wars. find you a quieter spot to start but a mission hub is an ideal place to sell whatever product you decide to make

Indeterminacy
THORN Syndicate
BricK sQuAD.
Posted - 2010.06.25 14:28:00 - [10]
 

and believe it or not, there's more to manufacturing in eve than merlins/t1 frigs.

so yes, manufacturing is profitable.

merlins in your market? not so much.

FuzzyLogik360
Caldari
Posted - 2010.06.25 15:00:00 - [11]
 

Thanks all,

Some really insightful comments here. It seems to me you need to pick your niche, specialise, and kill the competition where you can (which is perhaps the most important point if you want good markups). But this sounds like a full time job to me? But then I guess to be good, it has to be that way.

With so many items, how do you pick? I guess ammo might be a good place to start - but let me guess - the market is saturated with all the noobs doing the same thing?!

hmm.. no easy solution here.

Casmy Blue
Gallente
Power and Water
Posted - 2010.06.25 15:44:00 - [12]
 

Much of Eve seems like a full time job in order to optimize your results, but I've found over years of playing that it doesn't have to be that way for you to still be wildly successful.

You've started off on the right path by making sure you're using spreadsheets and thinking about the math involved in your investments. The next step is to make sure your profits are predicated on reasonable market assumptions, such as the demand for the items you intend to manufacture and their likely actual sale prices.

Once you've done that, a lot of the work that your average trader has to do several times a day is effectively automated. All that's left is for you to devote the time to getting the base resources and then continually re-evaluate whether you're spending your time in the most profitable way, then watch changes in the market to determine whether or not it became more profitable to manufacture something else.

Typically, I find that if you diversify your manufacturing jobs, you can skip that last step, since it's not usually wise to change your entire manufacturing setup because you discovered on any given Sunday that one item is more profitable than the other. By the time you're able to sell your newly profitable items, the market may be saturated with them as a result of many others drawing similar conclusions.

Aldor
Posted - 2010.06.25 17:29:00 - [13]
 

1. Diversify. I usually have anywhere between 10-50 (large swing I know) of items up and selling. Some items I have to hold off on because some knucklehead mines all his mins and sells waaay below current mineral refine prices.
2. Buy orders for your mins are your friends. Unless your in a major pinch NEVER buy from a sell order (unless it is the lowest order in your region).
3. Roids and pure mins from the market aren't the only places to find cheap minerals. It is simple but I'm not going to elaborate on this. I would have many industrialists after me if I revealed this secret.
4. You don't have to limit yourself to one station, system, constellation, region. Find a centralized location to produce and then ship your product to multiple locations for resell. I build alot of ammo and take it to 4 or 5 stations to resell.

Start small. If all you can afford is one ship BPO you'd be better off buying all ammo BPO's instead. Keep an eye out on contracts for someone selling an Original researched BPO. You will pay more but sometimes its worth it. When I got into the cruiser market I bought all cruiser BPO's. Same with BCs.

And learn to adapt and take advantage of current trends. Some people are making big money with deployable structures.

Good luck!

LHA Tarawa
Posted - 2010.06.25 17:45:00 - [14]
 

Industry is every bit as cut throat as PVP.

You battle other builders for mins, while batteling the sellers to give them the least ISK for their goods.

You fight over research slots, over manufacturing slots (unless you run a POS, crushing your profitability when POS fuels are added to costs).

Then you fight with other sellers to have the lowest sell price, while not wanting to sell for a loss.


Letrange
Minmatar
Red Horizon Inc
Cascade Imminent
Posted - 2010.06.25 17:53:00 - [15]
 

Originally by: LHA Tarawa
You fight over research slots, over manufacturing slots (unless you run a POS, crushing your profitability when POS fuels are added to costs).



Actually if you manage to keep all the important slots filled 90% of the time, POS research is cheaper than high sec research. Not to mention MUCH MUCH faster. Course with the price of fuel heading to the stratosphere atm....

Scout Ops
Red Federation
Posted - 2010.06.25 18:05:00 - [16]
 

Edited by: Scout Ops on 25/06/2010 18:06:52
Highsec manufacturing is broken... since a long time ago.

Everyone and his dog can manufacture T1 ships, but just a few buy them and are rarely blown. In conclusion, thousands of orders sit on the markets for 90days and they return to your hangar LaughingLaughingLaughing

But hey on the mean you may sell 1, or maybe 2 units LaughingLaughing

Or you can take the brute-force path and sell under manufacture cost LaughingLaughing



Now notice the hints I have pointed out:

- Highsec manufacture sux ---> Do it on lowsec/0.0
- T1 ships sux ---> Do anything else
- Crowded markets are crowded ---> Sell on rare places

FuzzyLogik360
Caldari
Posted - 2010.06.25 21:17:00 - [17]
 

Wow, I see this has generated a lot of interest. Some good advice out there.

I had a little play and bought small quantites of ammo off other people and put up sell orders in the same stations for less than they were selling. Within an hour I was able to determine which hubs sell a lot, and those that wither.

Armed with this info (which has cost me some ISK, but worth it), I'm now manufacturing ammo, I know where best to sell it, and I know I'll make a profit "above" the mineral cost used in the manufacture.

Cheers all, thanks for the help.


 

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