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Profit Goal Per Item
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Sheeth Athonille
Rabid Dogz Mining
#1 - 2016-04-30 00:54:24 UTC
So I'm wondering what sort of percentage profit people are looking for when picking new items, especially considering the new higher tax and broker fees? I realize that it varies a lot based on the item, but any sort of guidelines you tend to look for? Like you want at least 10% profit when chosing an item, or do you look more for how much profit you can make in a day (including cost, sell price, and volume sold)?

Any advice would be appreciated Smile
Scarlett LaBlanc
University of Caille
Gallente Federation
#2 - 2016-04-30 04:29:32 UTC
That can be a hard question to answer, as there are a lot of things to consider.

In this years fanfest keynote, they gave data that the average spread is 15%, but there are things to consider. Broker fees and sales taxes are going to run you about 3% (dependent on skills and standings), manufacturing fees and taxes will cost you another 1% (depending on location). If your product sells with a 10% margin your overhead could be eating up almost half that. Gets kinda thin.

As a rule, I never work a product that returns 10% or less and prefer 20% or better. However, percentages don't tell the whole story. An item that retails for 50 million at 10% will make a lot more profit than one that retails for 0.5 million at 30%.

Then you have to look at volume. If you can sell 1,000 of the less expensive high margin item a day opposed to one of the expensive low margin item, then it swings the other way again.

I ask myself three questions.
1. What is the margin?
2. What is the gross profit (ISK profit per item after fees and taxes)?
3. What volume can I expect to achieve?

It is time consuming, but if it were easier than others would have already driven the market down to almost break even.
Lalika
Tulip Factory
#3 - 2016-04-30 07:16:56 UTC
I don't have a minimum margin, and I don't ever look at the profit per unit: that statistic by itself doesn't appear in any of my spreadsheets (though I will use it to calculate other things). I give priority to higher-margin items; but if I run out of high-margin items to buy, I keep moving on down the line until all my money is spent.

When seeding or station trading I tend to focus on profit per market slot the most (market volume * ppu), and when regional trading I look primarily at profit per m3 (ppu / item mass).
Lord Ra
Sicarius.
#4 - 2016-04-30 12:27:28 UTC
Minerals are free so don't forget to take items 20mil under build cost into account on market.


However there is no minimum but there comes a point when you can't expand any more on what you already do with regards to items and profitablity in station trading and every man has his own version of whats worth bothering with and what isn't. Once you reach that end point and cant find anything else you can really trade in go back to those items you once shrugged off as petty change and make bank.
Rhivre
TarNec
Invisible Exchequer
#5 - 2016-04-30 15:18:01 UTC
I look for 10% minimum margin, because I am lazy, and thats easy maths.

Ideally its above that, but that is the minimum I will work with.

Fluffy Bunny Pic!

Do Little
Bluenose Trading
#6 - 2016-04-30 16:34:09 UTC
I notice some of the replies are from traders and others are from builders. As a builder, I'll load a blueprint and use the Eve industry tool to compare average build cost and selling price as calculated by CCP. I add 50K to my cost for invention and will consider the product if the margin is over 25%. I then check my local market hub to make sure the current price is above average and there is reasonable volume. If everything checks out, I'll build them. Because I build my components and harvest my own PI, my actual margins are better than calculated. I have never had any difficulty finding a dozen high margin products to build although the mix changes over time.

It's a quick and easy process that has generated very good results for me.
Sheeth Athonille
Rabid Dogz Mining
#7 - 2016-04-30 17:43:49 UTC
Thanks for all the opinions Big smile

I was referring mostly to trade, though I've also been thinking a bit about getting into industry, so that was appreciated as well.

I've personally been looking for at least 10%, so it's good to see that's not a crazy amount for others as well. I was a little concerned with the increase in broker and tax fees, I feel like it's eating up a fair bit of my profit, but when I break the numbers down it isn't horrible... Figure about 2.5% on buy orders and 3.5% on sell orders, so 6% on total. Cuts a lot back from the profit, but it is still a profit, especially on higher velocity items. I just need to start keeping better track of how much profit I lose from adjusting my prices to move them to the top.
Lord Ra
Sicarius.
#8 - 2016-04-30 18:53:27 UTC
Sheeth Athonille wrote:
Thanks for all the opinions Big smile

I was referring mostly to trade, though I've also been thinking a bit about getting into industry, so that was appreciated as well.

I've personally been looking for at least 10%, so it's good to see that's not a crazy amount for others as well. I was a little concerned with the increase in broker and tax fees, I feel like it's eating up a fair bit of my profit, but when I break the numbers down it isn't horrible... Figure about 2.5% on buy orders and 3.5% on sell orders, so 6% on total. Cuts a lot back from the profit, but it is still a profit, especially on higher velocity items. I just need to start keeping better track of how much profit I lose from adjusting my prices to move them to the top.



costs are being passed on to the buyers across the board just give it more time its still well worth your time :)
Amy Inhibenson
Living Off The Land
Intaki-Business Logistics Union
#9 - 2016-05-02 14:32:20 UTC
I also used to use 10% as a minimum but now with the raise in taxes, 10% doesn't seem so good.

Things will stabilise after a while though. At the moment they're going loco and it's not the taxes that are harming the trades but extremely irrational trashing of the value of certain goods. People establishing new price barriers for no discernible reason.
Tipa Riot
Federal Navy Academy
Gallente Federation
#10 - 2016-05-02 19:39:51 UTC
As a "amateur" manufacturer I'm looking for margins above 50%, ususally 100%, everything else is a plus. I use 3 tools: http://eve-industry.org/calc/, https://eve-central.com/ and https://www.fuzzwork.co.uk/market/viewer/ and a maximum 2 step chain (build some components, then the products, buy minerals and everything cheap).

I'm my own NPC alt.