This is the most common mistake of business-noobs. I wrote about it several times, including in "middle class", mocked it in "morons of the week", referred it countless times. This time I'd like to write it so simply as I can. The purpose of this post is to be linkable to people who claim "I farmed it for free". If a guildmate, a friend or just an annoying "why do you charge 20G for a cut" person claims it, you just direct them to this page. Not the blog in general, but to this page.
At first and above all, all frost lotuses are equal! The stack in the AH for 800G is absolutely equal to the stack you farmed. You can make equal amount and quality flasks from them, no exceptions. You can gain the stack several ways:
More often they are transformed into flasks and then sold for less than their price. I mean if lichbloom and icethorn cost 1-1G on the AH and you are flask specialist, you can make 2.5 flasks from 50G worth of herbs. If you sell a flask for less than 20G, you gain less money than you would get by selling the herbs themselves. You still gain money, true.
But the steps are the following:
One good question: what if the flasks always go for 19-18G on the AH and you simply can't sell them higher or you are undercut and the auction expires? Then the flask transforming step ends with 18*2.5=45G value, that's 5G smaller than the herb price. This case don't transform. Sell the herbs themselves. If you haven't transformed for a long time, simply drop the elixir spec or the whole alchemy profession and get something profitable.
Last thing: just because you like farming or you picked herbs during questing, it's still not free. It's easy money, true, like you find a wallet on the street. But still, it worth the same and you could realize this money by selling it on the AH. Just because you got it easily, you should not waste it.
At first and above all, all frost lotuses are equal! The stack in the AH for 800G is absolutely equal to the stack you farmed. You can make equal amount and quality flasks from them, no exceptions. You can gain the stack several ways:
- buy it for gold, usually from AH, this is the most obvious case, you paid 800G for it
- get it from a friend, this case he gifted you 800G worth of herbs
- buy it for gold, on the trade chat, for 500G. This case your herbs are still 800G, and you made 300G business profit
- farm it yourself. This case you created 800G worth of product by working.
More often they are transformed into flasks and then sold for less than their price. I mean if lichbloom and icethorn cost 1-1G on the AH and you are flask specialist, you can make 2.5 flasks from 50G worth of herbs. If you sell a flask for less than 20G, you gain less money than you would get by selling the herbs themselves. You still gain money, true.
But the steps are the following:
- Farming 1 frost lotus, 5 lichbloom, 5 icethorn. This step you created 50G value by working.
- Transforming them to 2.5 flasks. Assuming that a flask go for 25G normally on the AH, they worth 25*2.5 = 62.5G. This step created 12.5G value by skilled working (not everyone can do that, only those who are elixir spec alchemists).
- Selling them for 15G each. This step you made 62.5-15*2.5 = 25G business loss.
- You have now 37.5G
One good question: what if the flasks always go for 19-18G on the AH and you simply can't sell them higher or you are undercut and the auction expires? Then the flask transforming step ends with 18*2.5=45G value, that's 5G smaller than the herb price. This case don't transform. Sell the herbs themselves. If you haven't transformed for a long time, simply drop the elixir spec or the whole alchemy profession and get something profitable.
Last thing: just because you like farming or you picked herbs during questing, it's still not free. It's easy money, true, like you find a wallet on the street. But still, it worth the same and you could realize this money by selling it on the AH. Just because you got it easily, you should not waste it.
40 comments:
While all this is true, I wish you included something about BoE epics, since there is a common agreement in my guild that the BoE stuff from Ulduar have a higher value to someone who can use it on an alt, than to me to sell on the AH.
My guild also fell that boosting lvl 78's in GunDrak makes sense, instead of waiting 2 levels and run them through on heroic, where I also gain something for it (rep, badges).
Fjols, neither of those are positive economic decisions, they're normative economic decisions. In your case, your guild's norms highly value getting alts raid-ready as fast as possible.
In that light, getting alts to 80 (where they can be dragged through Naxx, ToC5 and HToC) is of higher value than a single heroic run. Considering that the faster they hit 80, the faster they can get into heroics or PUGs, that's not a crazy idea.
Similarly, your guild's norms are such that guildies prefer to see the gear put to some use rather than extra gold in someone's pocket or in the gbank.
Gevlon's cases are flat out failures at positive economcs, while your examples deal with what value people place on things. In your cases, it's worth a suboptimal solution in terms of raw time/money if it gets people raid-ready faster. I'm not saying I or my guild would make those same choices, but they're not being made out of a failure to understand economics.
My point was that I can buy an upgrade for the same money. The, non-raiding, alts have less need for it right now in my opinion.
Boosting the same alts in instance is a waste of my time.
I see your points, but lets say I was talking about pugs then, since I consider these alts no more valuable than someone I pug with.
One line of thought that could lead to the "I farmed it for free" conclusion is that they estimate the opportunity cost of farming as much lower than you do. If they would just sit around in Dalaran and chat, then they might as well farm while chatting and gain something "extra" from being online. Farming takes so little mental effort on their part that any non-zero benefit they get from farming is a gain. The problem arises when they assume that the opportunity cost of farming is low for everyone just because they don't know how to be more productive.
The "I farmed it so it's free" brigade are generally people who do not have any concept of how to value their own time and effort.
I suspect that the vast majority of them are people (children) who have never had a job.
A lot of people don´t take the time spent into account.
On my server people sell glyphs for 20-30 silver sometimes. And yes, even on glyphs which use resilent parchments....
Its like they pay people to buy their glyphs that they worked for to create...
I blame mmo-champion and people not knowing how to use a threshold price
I believe the word you're looking for (in reference to all Frost Lotuses being equal) is "fungible" (Wiki it). It's a key principle in short selling.
The problem is that there is no comeback for people who sell short or waste money. This is why a good few servers have a messed up economy. Yes Opportunity cost is important in the real world as you wont make a living if you ignore it but in a game it isnt because many people say. I made 60g on that transaction, when they could have made 100g.
On my server Frost Lotus are in the region of 52-60g add in Lichbloom at 20+ a stack. Stoneblood flask goes for 31-33g. So the profit is next to nothing.
The other flasks are the same.
I was chatting to someone who was selling flasks for 1g on average LESS ythan the base mats. He didnt care as he was making money. He told me he had 7k gold and was happy with that... Now how do you combat that?
People set low expectations and meet them so they are happy. As I said early there is no come back in the virtual world
Very nice post indeed, I know many people who could benefit a lot from it.
@ fjols and ZacharyPruckowski :
I think the difference between you is that in fjols guild alts don't have the right to raid in normal raiding nights (maybe in guild pugs, I don't know). I've been in different guilds and sometimes raiding on alts was considered acceptable if it was needed to achieve a good raid setup and sometimes the raid would be cancelled rather than letting someone raid on an alt.
@ Gevlon :
The part with the profession crafting (why would I pay you 20g to press one button) would be really interesting. You mentioned it at the begginning, but didn't developp it at all. Of course, someone could see that similar principles apply to it, but if he was smart enough to have these conclusions from this post he probably wouldn't need someone to explain it to him. Also, in the last paragraph when you say "what if the herbs always go for 19-18G on the AH" I guess you meant to write "what if the flasks always go for 19-18G on the AH" ?
@ Everyone :
Obviously the most goblinish way when dealing with someone who doesn't understand this basic principle of opportunity cost is to get profit from him. The only case where you could give him a link to this post is when you anyway wouldn't have any benefit from his ignorance.
@Hirvox
The oppoertunity cost is no matter of opinion. If you got 800g worth of frost lotuses, you got 800g worth of frost lotuses.
"why would I pay you 20g to press one button"
the 20g isnt for pressing the button....its for saving them the time to find someone ELSE to press the button.
Its less about stupidity, rather more about the way people play the game.
Eve online, for example, has a ruthless market. You can litterly bankrupt "guilds" in that game. However people keep building spaceships below the mineral cost.
The reason why?
Because people think thats the game. Some guy making flasks for less than mat cost thinks that is "fun", so thats what he does. He does not care about cost - all he cares is that he "sold 20 flasks woo hoo"
Its not just WOW, but pretty much any MMO is being hit by people who are think something boring is fun and are happy to sell.
I spoke to one guy, who is part of a farming guild. His reaction was "I get stupid new lvl80 folks to farm mats for guild bank and half of it stays in the guild and the other half I steal."
He went on to say "Nobody is any wiser and I make 10k/day easaly. I do not have time to check auctions so I sell below mat cost just to guarentee a hassle free sale and to piss off existing undercuters for shits and giggles".
Its not always about making money, eve online suicide gankers are another example of people trashing money for greifing/fun. Or some guy who fills all manufacturing slots in a station with cheap crap so regular builders get massive queues. He does not care for money - its about "shit and giggles"
I have to disagree....i for myself like to fly from time to time just through the areas and collect herbs...for this moments i PLAY the game too, i really enjoy it when no one is around listening to music and drink my coffee....and in that case everything i collect during my chilltime is FREE got nothing to do with WORK......on the other hand if i need 100 frostlotusse and i know i have to farm them then its work....but thats 2 different pairs of shoes. There are fun parts which people like me really enjoy and just because your definition of work dont makes it as such.
and also your philosophy by undercutting makes then no sense at all....u undercut by a hugh amount of percent but the market prices are that high for your products.....so the I farmed for free idea is kinda the same as the undercutting one....you got stuff and sell it way under market price others have made once...dont matter of which reasons...
Anon, as far as the "but I enjoy farming" argument goes - then just sell the raw mats as is. Even taking that farm time as free, you lose money once you have the big stack of raws by faffing around with it. Just sell it at market price.
Raw mats have an almost ironclad value controlled by how long it takes to farm them. The only way to increase supply is to farm more and there is usually greater demand than supply. In other words, you get a solid price on them (gold farmers aside) unless environmental factors change (ToC for example wrecking the Abyss Crystal price).
As far as the glyph undercuts go - I'm afraid you're comparing apples and oranges.
Glyphs have a subjective value above and beyond the "time cost" to create them (marginal - 10 seconds a glyph all in) and of the raw mats they require due to the requirement of the correct glyphs of the moment for each class. You can safely toss away this subjective value without losing money because it didn't cost you anything to create and the cost to scale up your production to keep your gold income steady is marginal.
In other words, you can make 10 glyphs @2g above cost about as easily as you can make 5 glyphs @4g above cost.
In addition, the 10 "cheap" glyphs will sell faster and have less competition. Look up Henry Ford for a RL example.
The oppoertunity cost is no matter of opinion. If you got 800g worth of frost lotuses, you got 800g worth of frost lotuses.
I agree, it isn't. I didn't say that they were right. I was saying that they estimated their opportunity cost to much, much lower than a goblin would, because a goblin knows better ways to make money. The opportunity cost is the cost of the next-best option, and if to your knowledge the next-best option is to sit in Dalaran and chat, then you naturally estimate the opportunity cost to be low. You would be wrong, but that's what you get when you base your decision on incomplete or incorrect information.
@criven:
yes, when you talk about 5 vs 10 glyphs you are right. But I have 1.5k glyphs on the ah at any given time. And that makes a difference. When you cancel outbid glyphs and you have to retrieve 700 glyphs that takes you 15 Minutes at the least because of the way the mailbox works.
But tbh, if people would sell them for 2g + mat cost (and for me inks = 0 cost) I would be fine, but selling them under the parchment price is what people do on my server these days! That is just beyond stupid. And no they don´t try to take the market, its always some glyphs that go that low and some other the next day. I still sell glyphs for up to 40g.
So I just settled with selling a bit less but with a lot less time required.
I still sell at least 100-150 glyphs a day for 20g each. With about 5 to 10 minutes "working". Sure I could sell 1000 glyphs a day for 2g. I would have another 2k gold, but I would have to spend at least an hour each day more to make that happen (posting cancelling creating and so on...).
So I´d rather get 2k in 5 Minutes than 4k in 1h and 5 Minutes.
I rather have 400g/minute than 60g/Minute.
I don´t need the gold that desperately.
anon: "for this moments i PLAY the game too, i really enjoy it when no one is around listening to music and drink my coffee....and in that case everything i collect during my chilltime is FREE got nothing to do with WORK......on the other hand if i need 100 frostlotusse and i know i have to farm them then its work....but thats 2 different pairs of shoes."
No it isn't. Not unless you never do each thing on the same character.
If farming incidentally on your own schedule without need for items is fun for you, then great, you do something that doesn't feel like work, and it makes you gold.
Then you sell it cheap or give it away and you lose gold. and *that* leads to situations where you need 100 frost lotus (or whatever) for something you care about, and now you have to farm it in a way you don't like (feels like work).
If you instead kept the stuff you would probably need in a bank, you wouldn't have to farm it when you need it. Or alternately, if you sold it for what it's worth, you would have enough gold, that when you need a lot of something and don't feel like farming it, you can afford to just buy it.
This is the gnome/goblin way -- don't let the circumstances of getting something blind you to it's value. Just because it was fun to farm, doesn't mean that stack of frost lotus is not worth the same 800g (or whatever price your ah supports decent sales volume at) as the stack you sweated bullets to farm under the gun because you needed a stack of flasks for your raid week. That's the whole point of this post.
sorry but in my econ class that would be a 25g opportunity loss not business loss.
For northrend herbs I agree but not all ingredients that you can farm sell quickly and some have a high cost to list. Sometimes you are better off to make something rather than sell it raw.
All of this is opportunity cost. Like if you could have done dailies and got 150g and instead you got 5 lichbloom and 5 icethorn 1 frost lotus you lost 100g opportunity if you sold them raw.
Yes, it's opportunity cost. No, it's not the same as an accounting loss. It is however necessary for accurate estimation of the true cost of one option over another. Businesses which completely disregard opportunity costs are not well run.
I'm afraid those two examples you give are weak arguments.
There are exceptional materials which are not going to sell as raws. Most of the more ridiculous of these have been removed from the game already. Most lower craft recipes do not add value to raw materials. For the few that do, are you making money on the raw mats or on the activity of crafting?
If crafting, why are you farming those raw mats rather than buying them?
Similarly, either some utility of farming to you is enough to justify the loss of daily time/buying raw mats to craft, or you do not farm the mats.
If your choice to farm the mats has little to do with the value of the mats, the choice you are assessing is incorrect. It is either sell the raws, or transform the raws. Whichever one has the lower opportunity cost is the correct call.
@War-a-tron "any MMO is being hit by people who are think something boring is fun "
This is because 'boring' and 'fun' are subjective judgments. What one person finds 'boring' another may find 'fun'. Some people find dailies to be 'boring', others, like myself, find them 'fun'.
I think some of the 'farmed it free' thinking comes from the fact that you get your raw materials as a by product of another activity. Allow me to give you an example. When I was farming my Sons of Hodir rep to be able to properly enchant my shoulders, I would often wind up with a stacks of Crystalized Earth, and Saronite. I didn't go out to farm them, I got them as a by product of doing my Hodir dailies.
Saronite goes for about 20g per stack on my server. If I sell it for 15g, I'm now have 15g more than when I went out to do my dailies.
I lost a potential 5g, but sometimes 'one in the hand, is worth two in the bush'.
I agree with the assessment of oppertunity cost. However, as noted many people can have a skewed assessment of them. Though Hirvox does make a fair point, even if you know some goods are worth more when processed you may opt to sell them raw anyways. This makes sense especially if you believe that the raw materials are a more stable market. Basically you're trading potential profit for risk mitigation. (remember 800g of frost lotuses isn't really 800g until you sell it. If you hold onto it too long (e.g. next expansion) you may find them worthless). Also listing most things on the AH is not free, so if it doesn't sell, you've not only not made money, but lost some as well
There are actually three opportunity cost at work here: gold, time and 'fun'.
Ultimately it is how we value them against each other that determines how we play the game.
Gevlon's AH strategy tries to maximize gold/time. That is because he values both gold and his time pretty high. He could be making a lot more gold but it would take him a lot more time. Since his time is valueable he will optimize for two or the variables rather than just for one (assuming that the 'fun' stays contant).
The 'farmed it for free' crowd has the problem that their time and 'fun' values remain pretty much constant no matter if they sell the mats or the crafted good. So for them it is a mistake not to maximize gold earned since there is no tradeoff with time or 'fun'.
The situation changes when there are tradeoffs in the variables. If you know that the finished good will sell really quickly but the mats might not sell (not much of a problem in WoW but happens in other games) then selling the finished product for less gold might bring you more overall value in time or 'fun'.
Personally I have the problem where I understand the opportunity costs of the mats I farm but I do not like using the AH so I just store them away for later.
There are combinations of time and people for which farming is fun. That fun has some gold value, possibly enough that the resulting herbs are effectively free; any time-gold lost is made up for with the gain of fun. We all know that people place less value on that which is free.
Great post, very informative to those who can't figure it out for themselves. I expect I'll be linking this more than a few times.
Tom the Guild Theif has a farming guild. "We farm mats for the Guild" he tells him members "so we get free flasks etc".
Tom steals half the mats that the guild members farm and put in the guild bank. He uses the other half to acutally give out free flasks, so as to prevent a 'slave revolt'.
Over a couple of months, Tom will have hit gold cap and have full stacks of flasks in every bank slot, resulting in using alts for extra bank slots.
Tom wants his alt to hit gold cap. Tom does not care less about mat prices, since he has a free slave production chain. So he dumps his flasks below mat price so guarentee a sale and hit gold cap on his alt(s).
Of course, tom is in the minority. The biggist bunch of loosers selling crafted goods less than mat cost are the people who play only to craft. That is their game - the gold is a side effect.
@Everyone with "he likes farming" and "optimize for fun".
If he likes farming (or herbs during questing), then farming/questing is a very profitable work for him.
This is a good reason for him to farm more.
But it's NOT a good reason to waste the farmed materials. The herb still worth the same.
The only good reason I can imagine to sell low is someone really hating the AH so selling fast is better than selling high at the cost of several reposts.
Klepsacovic: "There are combinations of time and people for which farming is fun. That fun has some gold value, possibly enough that the resulting herbs are effectively free."
They are only free when it comes to the decision of whether or not to farm them.
The fact that anon finds it fun to farm herbs while I find it about as interesting as watching paint dry, is why anon farms herbs, and I instead have a little macro that I hit when I'm in cities doing afk-work that says "Buying all Frost lotus 25g, Icethorn, lichbloom, adders tongue 14g/stack"
Once the herbs are farmed, they are worth gold, and randomly giving them away because they are "free" only makes sense if you really get 30g (or whatever) worth of value out of the good feelings of being nice to some random stranger. Giving shit away is incompatible with later complaining that things cost too much.
For those who say sell cheap and get a quick firm sale, that makes sense on some items, but not on something like frost lotus or icethorn for which on 99% of servers (all but the practically dead ones) there will be a lively market. By the market price, we mean the price at which the market clears and *total* profit is maximized for sellers -- a price at which most people will buy if they need it, rather than go through tribulation to get it cheaper or go without, so that you can sell plenty of it whenever you are lowest, and even if you get undercut, your competition probably sells out and then they buy yours again.
In any case, on something like frost lotus or icethorn, if you want to sell absolutely for *certain*, all you have to do is post (or offer in trade) at 80% of the market price, and you can bet that the gnome of zurich, or someone else like him will be *happy* to accept your offer of letting us skim the other 15% (after fees) in return for accepting a very little bit of risk, and doing very little, add-on automated work.
In general, in a functioning WoW economy, any popular item offered at a 20-30% discount to the standard ah price (assuming nobody has just monopoly reset to a non-market clearing price) will sell *very* quickly. Going lower than that is just stupid, although I thank those who do it every day.
Similarly, equipping BoE items that you would not buy to equip for 80-90% of market price is stupid. Because at 80-90% of market price, you *will* sell it. Again, assuming it is the real market price that clears the market (i.e. sells about as fast as it drops/is farmed), and not just what some random idiot put it up for.
Well said. Economists even have a name for this: "Opportunity Cost"
what i do ingame comes pretty close to someone that travels around buy antique furniture for low and resell in a noble shop much high.....
so if this person is on a holyday and find a very special piece of furniture he will resell it lower then the market price.......because he dont want to destroy the feeling and atmoshare of his holyday with the label of work....its like finding 20bucks on the street i would spend it right away on a present for my wife instead of putting it on the bank;)
Hivrox,
I do not think opportunity cost of time spent gathering has anything to do with the value of the herbs once you have them. The herbs could have fallen out of the sky and dropped into your bags.
The point is that if you have 800g worth of herbs, don't convert them into 600g worth of flasks on the argument that hey, they were free anyway. Just sell the herbs.
And mister Anonymous two posts above me trolls on. Luckily we have wikipedia to counter with: http://en.wikipedia.org/wiki/Style_over_substance_fallacy
On another note. On the one hand I'm trying to be a bit of a goblin, but my interest isn't in the glyph market. I sell armor kits. But now I rolled an alt, had herbs stocked on another and powerleveled inscription.
Not being on the glyph market (and my brother is), I just gave them away to see if he could make a profit. Because at the time, the glyphs I created for leveling were taking up a lot of bagspace. I can imagine a lot of the "below material" price glyphs you see on AH are made in this fashion. When I level a profession, more often then not the things crafted are next to useless.
Does this also fall under opportunity cost lost?
On another note: there are things you can do when you reach the goldcap as a big goblin on our server proved: http://forums.wow-europe.com/thread.html?topicId=10543786550&sid=1
I think people mix here two things, let's name it "cost" and "value", because I'm not good in economy terminology.
"Cost" is what you "paid" to get something. It cost you 1 hour of time to farm herbs. Things can "cost" you time, gold, stress, losing fun, etc.
"Value" is how much people want to pay.
There are things that "cost" a lot but are worthless, because people simply will not pay for it.
A "smart" person will simply not craft those items and not get involved in such activities. Those include crafting Gnomish Army Knives to get "450 Engineering" or boosting people in DM for 5g, which is never worth the gold/time rate.
About 30s glyphs: let's say we weren't "smart", we crafted a bad glyph which is worthless, because no matter do people utilize levelling, raiding or pvp specs at the moment, they have better glyphs to buy for that purpose. So we lost, because we made wrong decision. We can sell it to the vendor for next to nothing. Or try to get back at least some of our lost money, trying to lure "noobs" by low price, or people who "cba" to buy the best glyphs for their spec and rather buy a slightly worse one but for much lower price. Min-maxers will buy the best ones anyway.
Some items have non-zero "cost" but almost zero value, yet they have a "gain" - the skill point. That's why some people started that dreaded tradition of "will pay if I skill up" - they just can't find any way to get gains instead of losses. If the item he crafts for "skill up" is worth less than "material cost -10g", he might just start giving away those 10g for skill points.
About people who moan 20g for and epic cut is "rip off": when I need a gem, I can buy cut one or get uncut one (for gold, honor, badges) and get it cut, but as long as the JC fee is below "AH cut gem price minus AH uncut gem price" it's fair. For people who say "you charge 20g for nothing" - if it's nothing, go make it yourself. They charge not for labor, but for the knowledge (of the particular pattern).
If someone doesn't pay, why would the crafter bother to arrange the meeting and make the item, he could have continued whatever he was doing instead.
Ignoring the english language grammar nazis
< sarcasm> shame on you Gevlon for not having perfect english < /sarcasm>
can I extend the line of reasoning from this post GG?
I agree that there is no such thing as free farming - and using herbs as an example - say you purchase 2 stacks of Tiger Lily for 10g each off the AH.
Clicking these stacks 8 times will give you 20 azure pigment and 2 icy pigment. We open our inscription, and a few clicks later we have one Snowfall and 10 IotS in our bags.
From two stacks to 11 inks in approximately 12-15 clicks (dependent on set up).
To buy the same inks from the AH will cost significantly more than our original investment of 20g but will save us the 12-15 clicks in between.
Where do you draw the line? When is clicking worth the effort?
Likewise - with a tab full of herbs (as we often see on KevMar's blog) - 98 stacks - 392 clicks to make pigments. Plus the time to convert in almost 500 IotS. When does it stop being 'free' - when does it become worth sending inks off to a trusted worker to do all the monotony?
We know glyphing is profitable - but its still fairly labour intensive - even if you purchase your herbs from a supplier. If time is money (which we all agree it is) what are your cut offs to ensuring you are happy with your time:gold ratio?
Nice post, Gevlon.
I have one question about a detail that plays an important role in your explanation: where did that factor of 2.5 for elixir mastery come from?
Crafting flasks by non-masters will produce 2 flasks for the mats, so listing 2.5 suggests that elixir mastery gives a net bonus of (2.5/2) = 1.25 = 25% extra. In my experience that is a rather gross overestimation of the mastery effect; I have the feeling it is closer to 10% (making your 2.5 factor 2.2). Can you please enlighten us with your source of that 2.5 factor? Was it your own testing, or was it just a value inserted for educational purposes?
This is something which has been a constant, stinging thorn in my figurative side. It is a personal pet peeve of mine that people are unable to properly grasp the concept of opportunity costs.
I am constantly running into people who volunteer their time and effort for the purpose of helping the needy, and this causes me some amount of emotional distress. To watch educated adults performing work which could easily be done by teenagers at a fraction of the hypothetical cost is painful.
This in itself is not what bothers me; perhaps there is some value created in the form of emotional fulfilment when the adults perform such menial labour. What irks me is when said adults claim that they are doing such work entirely for the benefit of the needy. That just doesn't work out! Stop it!
Especially with glyphs, I find that prices drop sharply (like 20, 30 silver a glyph, even below parchment cost) when an unpopular glyph (Glyph of Possessed Strength, anyone?) still needs to be made to LEVEL the skill. The market is flooded with glyphs no one wants but everyone has to make.
In this case the glyph is already made, the desired reward already received by the crafter (the skill point), and at that point even a 20 silver sale is preferable to vendoring the glyph for 1 silver each.
You have the same issue with alchemy. Very few people actually *buy* potions and elixirs to level their characters anymore. They just aren't necessary. So up until you can start making decent flasks, almost every potion or elixir you make to level your skill will end up being sold at a loss.
And like Ry pointed out, you can't ignore the emotional strokes some people get from charity. It's a payoff.
Why is there always someone begging in SW for gold handouts? Because it *works*. There will always be morons around who just want the payoff of being the kind, generous benefactor to the poor, downtrodden newbie.
The fact that such "generosity" actually hinders the newbie from learning to be self sufficient and actually hurts his independance doesn't matter at all to the "benefactor." He'll accuse YOU of taking advantage of the newbie when you sell items at a fair price on the AH, but completely ignore how *he's* taking advantage of the newbie for his own emotional payoff.
@Ry........lol confusing isn't it. There are people just like that and there are more of them than you we may even know. Amazing that people have caring hearts even in something as silly as moving around online pixels. Where would the world be without volunteers.....where would the world (of warcraft) be without them? >:}
I don't see why this is a hard concept. Check the AH for both your product and your materials before you craft. I'm a herb/alc. I farm herb for about 2 hours per day. I check the AH lowest price of the flasks and the frost lotus. I tend to not check the herb prices as they are very stable and I have so many herbs I don't care.
Now after checking the prices I decide to either make flasks, or sell the frost lotuses I farmed. Sometimes I'll even buy frost lotuses and make additional flasks if they are cheep. Every server is different, but the basic rule of thumb still applies, can you make more money from the mats then you could the finished items? Post which ever makes more profit considering an undercut to make sure your item sells fast.
For example the flasks on my server are very stable, 30-34g. I always post mine for 27.5g and I never have a problem getting rid of all of them with in hours. I sell about 30-40 flasks per day like this. Afterwards I sell most of my extra herbs, and an epic trasmute and a dragon's eye from my alt running the JC daily. I'm sure I don't make the most amount of money possible for my two hours per day, but I'm happy with the 1-1.5k I make. Epic flyers for all my toons finally!
The only problem that I can see with the OP is that - unless I'm misunderstanding what I'm reading - it assumes you WILL make the sale.
Putting the herbs on AH isn't always a guaranteed sale. Even when you undercut heavily you might just cause the whole market to take a plunge, however unlikely that is. If you're forced to undercut, well, you're not getting the full value of the herbs.
The general mentality I heartily agree with though.
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