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T2 Ship production margins..
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Kaludar Toralen
KarmaFleet
Goonswarm Federation
#1 - 2016-01-14 01:42:29 UTC  |  Edited by: Kaludar Toralen
Hey guys,

So I'm looking at possibly getting into t2 production. I've been playing around a bit with some isk/hr tools to see if its worth the effort or not. I plan on producing in upgraded outposts in null, with materials sourced from jita. The trend i've been noticing however is that the smaller the ship is the higher the profit margin. T2 Frigates like the Malediction for example have a much higher isk/hr and profit margin than something bigger like a T2 Cruiser or Battlecruiser, can anyone explain to me why this might be? Am I missing something here? Why does anyone even manufacture bigger ships if you can essentially make more isk/hr making frigates?

EDIT: Just looked through every t2 ship on eve isk/hour tool and Malediction has the highest isk/hr out of any T2 ship. Am I doing something wrong with the calculations or is this actually legit?
Kenneth Feld
Habitual Euthanasia
Pandemic Legion
#2 - 2016-01-14 02:29:23 UTC
Kaludar Toralen wrote:
Hey guys,

So I'm looking at possibly getting into t2 production. I've been playing around a bit with some isk/hr tools to see if its worth the effort or not. I plan on producing in upgraded outposts in null, with materials sourced from jita. The trend i've been noticing however is that the smaller the ship is the higher the profit margin. T2 Frigates like the Malediction for example have a much higher isk/hr and profit margin than something bigger like a T2 Cruiser or Battlecruiser, can anyone explain to me why this might be? Am I missing something here? Why does anyone even manufacture bigger ships if you can essentially make more isk/hr making frigates?

EDIT: Just looked through every t2 ship on eve isk/hour tool and Malediction has the highest isk/hr out of any T2 ship. Am I doing something wrong with the calculations or is this actually legit?



Volume usually wins in T2

The more that sell, the more profit

Low volume higher priced hulls have the lowest margin and require large investments to make large runs in specialized 5% stations to realize the isk gain to make them profitable
Kaludar Toralen
KarmaFleet
Goonswarm Federation
#3 - 2016-01-14 03:50:58 UTC  |  Edited by: Kaludar Toralen
So I think this has to do with market volume. The margins may be larger on smaller ships that are faster to produce but it doesn't matter if you are making so many you're meeting the market volume and you can't move all of them. The isk/hr only matters if you can sell everything you make instantly. Did I answer my own question?

Also thanks for the input Kenneth.
Leila Meurtrier
Why Am I Not Surprised
#4 - 2016-01-14 05:15:13 UTC
In this blessed soon-to-be 13 y.o. game market heavily fluctuated by "hoarders", possessing items from long back then. Unless this stock will magically disappear, prices will be inadequate. Offcourse, stuff disappears on occasional trashing and mostly on blowing up/relocating to Doomheim corp without giving stuff away only. Cheaper things = affordable things, people buy these way more than others and inevitably blow the hell up, so they reduce the stock of item in question.
For cheapest hulls, this effect won't be that long. For example, pre-retribution banthams were worth just 100k. Retribution increased resources needed to produce it. Some cheap ones were pulled off the market to adjust the price and get back, most were bought by fw plexers since they were the cheapest option available to sit in plexes with many cases of being blown to bits.
For the expensive hulls, however...
Hochopepa
Creative Research and Production Services
#5 - 2016-01-14 19:19:03 UTC
There's an addtional overlooked culprit at play

Production time. Let's say you have T2 frig vs T2 BC, you could make the same 5 mil profit from each, however, you can build more frigs in a given time period than BC's and thus, better isk/hr.

example:
35 hours for an absolution
14 hours for malediction
Edwin Rothbard
Interstellar Arbitrage
#6 - 2016-01-14 22:43:08 UTC
Kaludar Toralen wrote:
Hey guys,

So I'm looking at possibly getting into t2 production.


  • About 90% of people who build stuff think ships have the best margins
  • You can also build T2 modules and munitions
  • Remember mining your own minerals, doing your own PI, and building your own T2 comps means they are free

Rothbard's Casino
Gilbaron
The Scope
Gallente Federation
#7 - 2016-01-15 14:33:25 UTC
t2 bpos are also surprisingly relevant
Sir SmashAlot
The League of Extraordinary Opportunists
Intergalactic Conservation Movement
#8 - 2016-01-16 01:01:54 UTC
T2 margins wildly swing, one item today, something else 2 days later.

You either small batch build and isk warrior your way on the flavour of the to maximize margins till prices normalize. Can provide nice margins, but isk/effort suffers greatly.

Or come in with volume and crush everyone's dream for some midpoint, then using the freed up working capital to quickly build the next best thing. Ideally a scalper buys you out and tries to flip for a few million more per unit.

Isk/hr only optimizes production choice, but it is very poor measure for actual returns.

If you track bid volumes you can more accurately optimize to an isk/hr method as your exit is on known orders.