Science & Industry

If you were talking about an RL business, I would completely agree with you; doing something for less profit than doing nothing does not makes good sense. We’re not talking about an RL business; we’re talking about a game.

You can claim that they’re doing it wrong, or that they could make more doing this vs. that, or wave around the concept of opportunity cost; but if someone chooses to operate their game business at a loss and they enjoy doing it, so be it. The one and only goal of playing Eve is to enjoy yourself.

What you should be doing is buying their underpriced goods to re-list or reprocess and pocket the lost profit yourself. If you can’t sell either the goods or the reprocessed components at a profit, then they weren’t underpriced, your local market was overpriced.



I love this line of thinking. It’s nearly killed Detroit. When someone else is willing to work for 1/2 or 1/10 of what you expect to get paid for doing the same job, you don’t tell them that they’re foolish for working at a loss while they’re putting you out of business; you either figure out how to profit from them, or you lower your expectations.

Now this I can agree with. Whether you mine it yourself, use local buy orders, or have it shipped in, you should value your materials as if you bought them from sell orders on the local market. Many manufacturers would find that what they call manufacturing profit is actually trade or mining profit, and their manufacturing buisness is actually running a loss.

Not to say that their business model is necessarily wrong, just their accounting. If they can profitably move more material as finished products than as raw resources, they may have a greater profit over time by selling undervalued goods than well priced materials.

"If you can sell the minerals for more than building the item, just sell the minerals on the market!"

This doesn't always apply, but is a great rule of thumb. Some processed items consume less volume than the minerals they are composed of. This means, while I may not make any extra money, I can haul more of it which increases my revenue.

Also, if you're like me, I can move up to 1bil units of minerals per day on the weekend. Even with Jita's 10-30bil units/day, I would be adding more supply and devalue the minerals. I can increase daily revenue by converting some of my minerals into other items, which not only reduces supply and keeps my other minerals selling faster and for higher prices, but also increases my surface area for sales.

But it really comes down to what scale you're working at. If you're sub 1-2bil isk, selling minerals on the market will probably give you the same or better profit with faster turn overs.

edit: As for the OPs question, what mechtech said is pretty much correct. Don't calculate your manufacturing costs based on mined minerals being free, you have to calculate your costs based on the market value of those minerals.

Example. Say you assume your minerals are free. Now say you need 10mil trit to make a product and you sell it for 30mil on the market thinking "I didn't pay for the minerals, so it's all profit!"...

Nope. I can now come along and buy your product for 30mil, reprocess it back into 10mil trit and sell that 10mil trit for 34mil, making almost 4mil in profit.

That right there is one great reason as why mined minerals aren't "free".

Take it one ridiculous step further. Say you use 10mil trit to make your product and place it on the market for 30mil. thinking you just made 30mil profit. Then YOU buy it back from the market, paying yourself the 30mil+sales+brokerx2, then you break it down and make another 4 mil in profit.. WTF?.. just skip the whole manufacturing+market thing and just sell the dang trit.

I have a few items that take about 1/2 the volume of the minerals, so if I have the choice of moving 700mil of product vs 350mil of minerals and I'm 35 jumps away, I'm willing to suck up small losses.

Plus, who said anything about losses in the first place? Several of my products at least break even. The argument is why manufacture if you don't gain any profit. Assuming no losses or profit, I still gain the convenience of higher revenue.

Also, I don't repo on the other side, I just sell the items as is.

Nearly all of the items I produce make a profit above minerals sell prices, but I was just using my argument to say why even break even *can* be "fine" also if it helps increase your "surface area" for sales and increase hauling densities.

Just make sure you run the math on it.

To all the people tooting the "minerals you mine aren't free" horn: yes, you are correct - presuming that tangible costs are the only thing that you consider.

If you also consider intangible costs, then someone very well might come to the conclusion that it is better to mine than to run missions.

Mining requires very little attention and can be done semi-afk (if suicide gankers aren't around) thus allowing you to split your attention. IE you can flip trade orders while you mine, you can do homework while you mine, you can watch a movie while you mine.

Running missions requires considerably more attention (unless done with an AFK perma-tanking drone-boat), so running misisons as an activity in it of itself is more expensive than mining.

It is up to the individual to decide if the perceived intangible costs of running missions are significant enough to warrant switching to mining.


ON THE OTHER HAND: to all the people saying "It's too hard to profit off of production unless you mine your own minerals!" you are wrong. You are NOT profiting off of production because you are mining - you are losing money from mining because you are producing (the wrong items). A good production chain is one which *adds* value to your items along every step of the production chain. You should NEVER try to "add value" to your production chain by devaluing your own time/effort. If you do things this way, you will only be taken advantage of by others.

Yeah, I was working more with a corner case that better reflected my current situation where I found a system with cheap minerals, so I can buy and produce products then haul from that system to Jita, which is 30-ish jumps +-5 depending on route. While the minerals themselves can give me quite a bit of profit, the distance means I want to pack as much value as possible.

Unfortunately for me, Jita charges me 16k isk/hour for manufacturing, so I need to stick with my current faction that only charges 333 isk/hour.

Your situation is probably more common, where you're much closer to your consumer. Your argument works perfectly for the average case, I was just trying to show a not-so-average case, like my current case

edit: " yep, I misinterpreted the "extra money"" I don't blame ya, there's a lot of crazies out there, not to mention I'm horrible at properly conveying my thoughts through type. Some times I come back and re-read what I posted and think.. "WTF?"

Everyone knows everything you mine yourself is free!

Am I late to the party?