War record: Trade Log

So yeah, I get to do one of these things.

I was running a not inconsiderable amount of stuff from Amarr to Hek two days ago in my Wreathe. Now, to be fair, I really wasn't paying attention. I know I should take more care with hauling, but, well... read on. And besides, I really wanted to find out what happened to Vinneti. Those long hauls are good reading time, and I'm a sucker for Gallente crime stories.

I jumped into a system, and span up the warp coils for a jump. Suddenly, alarms go off, I get little red warning lights flashing in my eyes along with a big red warning light flooding the pod with crimson. I also spilled my pod-kaf.

I looked up from my reader and saw that someone had taken a good chunk out of my shields. Out of reflex, I hammered on the defenses (read: Damage Control Unit), and prepared for combat! (read: to die horribly)

Or at least I would have if I wasn't already halfway across the system and slowing down for the next gate jump.

Huh.

So, yeah, that was my first time being the target of a gank. It... did not go so well for the ganker. Now, don't get me wrong, he took a big chunk out of my shields. But he lost a ship for his troubles, and judging by the chunk taken out of my shields, it was a big ship.

I've heard of this Burn Jita thing. I did the run that night to avoid having to deal with it. Honestly, I'm not sure it was worth the extra effort. Seems like gankers these days haven't quite worked out that T1 industrial ships are tougher than they used to be.

Ah well.

If I were the boss I'd go into a full-blown discourse on warp-mechanics and gank avoidance strategies. I don't have time for that, and know the exact reason I got caught: my ship wasn't named, therefore was unlucky.

Fixed that problem. Debt Dodger will again make the trip out to Amarr in a couple of weeks.

Why Debt Dodger? Well, that refers to this time in Dodixie, when I needed to make a quick get away after a not-quite-on-the-books deal. Let's just say electro-magnets were involved. See why I like those Gallente crime novels? Reminds me of my well-spent youth.

Trade Log: Back to business and a few quick tips

I do so enjoy fixing other people's mistakes. My former-master now-boss fluffed up his finances. Needless to say, it took me a whole 2 days to fix it.

For those of you who don't know me, I'm Benh Thanh, Behnid's former market slave.

So, as soon as Behnid joined the Tribal Liberation Force, I became a free man. With all the rights, privileges, and taxes that come with it. Apparently even mercs for the Matai forces can't own slaves, and his conscience was giving him the usual unprofitable pangs.

Which means that we no longer enjoyed those lovely tax exemptions on our trades. Ugh. Nothing worse than giving governments money. They rarely know how to invest it.

Slaves aren't taxable in the Empire. Any customs taxes that get put on my shipments need to be sent off to my master. As my Master was very difficult to track down (piracy and all that), the invoices got lost bouncing around the legendary Imperial Bureaucratic machine. The Republic also doesn't tax slaves. Anything you bring out of the Empire is considered liberated goods, and basically what you use to make a new life in the Republic. They also strongly hint it's a good idea to go back to the Empire and liberate more stuff.

These new taxes would seriously cut into my bottom line. So, I put my plan into effect.

My first step was to free my wife, posted in Amarr. Behnid managed to sneak her papers under the local authorities, and bam, free lady. With all the rights and privileges of an Amarrian subject to the crown. One of those rights being the right to own slaves.

Holder status is surprisingly cheap to obtain these days.

After that, I sold myself to my wife for the incredible price of 1 ISK. Well, at least that was the starting offer. She haggled me down to 0.01 ISK. God, I love that woman. So now, like all husbands, I'm a slave to my wife... just more literally so. And blissfully free of taxes on moving goods between the Empire and Republic.

I guess I shouldn't mention what category of slave I am. Let's just say I get to share the exotic dancer lounges in stations.

Anyway... fixing problems.

It took three runs from Amarr to Hek. Starting with 100mil liquid ISK, I bought a dozen or so stacks of, well, crap that no one wanted in Amarr, but was highly valued in Hek. Two days later, and we're looking at a PLEX within a week, with enough licenses to keep the Sir Chief Behnid, myself, and my wife in space.

Seriously, if you need a lot of cash in a hurry, and you're not afraid of travel, Region Trading is the way to go. It's even a little easier than when I first started. Frigates warp faster these days, and Industrials don't take forever to get going. I did the last 2 runs in a Wreathe. Never felt more secure carrying 100mil worth of stuff.

But I just want to share a quick tip I discovered. Made my life a whole lot easier.

Before, I would use spreadsheets and market browsers to keep track of everything. It was fantastic, and kept track of everything well, and I could get all kinds of data.

It did add a lot of time to my trading though.

But did you know the market browser had a quick bar?

Using folders to organize what you region trade and what you station trade, you spend a lot less clicks going through your orders. Before, I'd go to my order page, get the menu open, wait for it to load, check back on my spreadsheets etc.

Now, I open up the market quick bar, and just scroll down to update my orders. Many of you are thinking, 'Duh, why didn't you do that before?' No one told me how, that's why.

But something I did discover though, which was pretty nifty. You know you can add your own text notes to items in the browser?

I use this now instead of referring to my spreadsheets. If I find an item worth trading (which croda does so well in explaining how.. and which I tried to explain a while back), I just add it to quick bar, put it in the right folder, and note 'Buy". If I have the item already, I note 'Selling'.

(Actual items censored to protect my investments. Do you own research you lazy bums)

How does this help? My wife in Amarr shares the same market browser as me. I don't have to keep referring to spreadsheets to see what I want to buy, or what I don't need to get more of. More time spent actually buying/selling, and less spent on fixing my terrible spreadsheet equations, is more potential profit.

Just a quick tip for your market noobies out there, and those who don't want to spend too much time crafting spreadsheets. Nothing better than good accounting though, so if you're serious about things, still make that spreadsheet. Some mercantile royalty types do seem to get along fine without though.

Now I need to go find the Boss. last I saw he was babbling something about wormholes and the profits there in, and trying to find his Astero keys.

Trade Log: Planetary Interaction Part 2: The Factory Planet

So, when I took over management of the planets I decommissioned two of his Hek based colonies. They were a flawed idea, but one of them is salvageable.

The reason I chose this planet, is simply because of the tax offered by the owning corporation. Really, if you have a planet in a hub system, keep the tax low. People will flock to your planet for factory purposes, and your profit will be huge: factory planets can host many capsuleers, since they don't compete for extraction.

It's a pretty much standard factory planet. P2 materials go in, P3 comes out. Have  look below. I've annotated the factories so it's easy to see how it's set up. Not that it's complicated...

Looks pretty right? It's current set up is wildly optimistic though.

It requires 120 Mechanical Parts, and 120 Consumer Electronics per hour to run full time. From this it can produce Robotics at a rate of 36 units/hour.

At conservative market values off 55,000 ISK, that would net about 1,980,000 ISK per hour in sales. This leads to 47 million/day, and  total of 1,425,600,000 ISK/month.

Not bad, huh?

Of course that's not the reality of the situation. Import and export taxes cut heavily into this, and if you're buying raw materials from the market, you'll be working with market forces... which usually are as fickle as the sea. Or so I've heard. The sea's the big open air water tank on planets right?

So you're probably wondering, why are we starting with the final product? Surely it'd be easier just to work out what we can harvest and produce from that right?

Well, if you're a miner, then yeah, you can do that. Life is simple. Go out, get rocks, sell rocks, and money is as good as the number of rocks you get.

Planetary interaction is a bit trickier than that. You could follow that plan with raw materials, buuut, you'll be better off hunting the low grade hoodlums in Hi-sec. Hek, you'd be better of mining.

Factories are the limiting factor in P.I. You can extract all the raw material in the world, but you'll only end up with warehouses full of junk whilst your factories chew through the material. Hence, we start with the final product, and work our way back.

In this case, the final product is Robotics. Why Robotics? Because everybody uses them, from POS fuel manufacturers to those dedicated Tech 2 production guys. Markets good, volume traded is high, and high volume usually means steady price... exactly what you need when you don't want to spend to much time messing with your mud ball.

We'll start by filling up this factory planet. Is that possible? Well, I don't know yet. We need to hit the spreadsheets.

Next time we'll look at the spreadsheet I created to wrap my head around the production line, and explain the step I went through. Then you can copy it and compete with me.

Why am I doing this again?

Trade Log: Planetary Interaction Part 1: Past experience

Planets...

Damn the things. Sometimes too hot, sometimes too cold. Dust and mud everywhere. Water leaking from the sky, that can carry acid. Earthquakes knocking down buildings. Bugs.

We work so hard to make ourselves capsuleers to get away from those dirty, insect infested balls of rock, and here's my Master telling me to start 'interacting' with them.

Two things before I continue:

• The experiment went 'okay'. I managed to get a decent return on my investment, but once volume went up on an item, competition swooped in. As much as I'd like to trade this way, I don't have time to keep tabs on the price fluctuations.

If you're a full time trader, I do recommend it. If you have a boss demanding you waste time with environmentally unregulated balls, it might not be for you. Personally, I'll do it in a limited sense, but only on one or two items. As long as I make enough for 10 assault frigates a month, I'll be happy.

• I'm still a slave. 

Behnid threatened me with freedom, but he was completely unaware of the tax benefits for being a slave in the Republic and Empire. I won't bore you with the details, but lets just say slaves aren't considered taxable in the Empire, and the Republic literally throws subsidies at you to get you to revolt. Good times.

Still, it can't be long before he's officially branded a traitor to the Empire. I may find myself in the hands of another owner, or even worse, in the heavily taxed bosom of Freedom. Don't worry, I have a plan.

Back to the mud balls though.

Before, my master engaged in Hi-sec Dirt-ball Interaction (P.I.). The profit wasn't amazing, but it was steady, and really, really, really easy money. Set up the planets, wait a week, empty what his colonial slaves had dug out of the ground, put it on market, and money happens.

The money was pretty low, and he eventually abandoned it in favour of... well, not doing it. Honestly there's not much point in maintaining harvesting planets once they're set up. They might not be the most efficient producers, but it takes about 30 mins/week to maintain, and one lazy afternoon of hauling.

He did this in Molden Heath, "modernising" production on planets there. Later, he created some factory planets in Hek, turning other peoples P.I. products into higher tier commodities. Doing this in the trade hub itself meant that finding materials was easy, and travel time between planets was very low.

On the downside, he was at the mercy of market forces, in the end, lost money on his investment. The factories went silent after a month, unused.

Well, until now...

Trade Log: Depreciation

No, I don't mean I don't like my customers!

Depreciation is when the value of an item decreases over time. Take an obvious example: the humble Gallente potato.

The Galpo is worth s most when it's freshly dug from the soil. Obviously there are price differences between planet side and station vat grown samples, but nevertheless, it's the freshest and most expensive as soon as you get it out of the ground.

Then, it starts to get older. Day by day it gets less fresh. It goes wrinkly. It develops buds. The flavour goes, it starts to dry out. It can take a while, but eventually, your potato will rot. Have you ever tried to sell a rotten potato? It's value plummets.

The same is true of any item you buy in New Eden.

When you buy an item, with the intent of selling it, it's value to you is the profit you can make from it. Generally speaking, it's at it's peak value the moment you buy it... then the clock starts ticking.

Let's start with what I call Market Depreciation.

As any trader can tell you, the markets of New Eden are fiercely competitive. Prices are undercut, buy orders over bid. Once you set an item to sale, it will inevitably fall in price. I can't think of a logical time when prices will increase, except for a sudden and drastic surge in demand, or a catastrophic drop in supply.

This is your items depreciation. Most traders hedge their bets, taking a 20% hit n their projected profits to represent this. I'm one of them, introducing as many worst case scenarios into my calculations as I can.

You should to. My own calculations (since I have occasional obsessions with arithmetic), take into account standings, taxation, travel time etc. However, it's not really necessary. Just do as most others do: 20% off projected profit. It'll keep you smiling when your wallet balance is better than expected.

But that's not the only other form of depreciation. Let's look at Profit Depreciation.

If you're a serious trader, or looking to supply a soldier whose skills aren't stellar with a frigate every day, then you should really start calculating in terms of Profit/day.

The calculation is easy enough:

Profit per day= Profit ÷ days to sale

Calculating this way actually gives you a much better idea of what an item is worth... or at least, worth to you as a trader.

Say you have a very expensive implant. You got it cheaply, and you can make 100,000,000 ISK from flipping it to someone else. Sounds great right? But it takes 10 days to sale.

Profit/day = 10,000,000 ISK

Not too shabby. But, say you have a cheaper implant, that you can only sell for 50,000,000 profit. No brainer right? Go for the better profit margin. But lets check Profit/day. How long does it take to sell. 2 days.

Profit/day = 25,000,000ISK

Better than double! And you get your money back quicker, which means you aren't subject to Market Depreciation for so long!

The point is this: Big wide profit margins look good, but can be misleading. Estimate how many items you can sell in 10 days, and see if that super-shiny implant is worth the trouble of buying, when you could get two cheaper ones for better Profit/day.

Happily, every Region in New Eden keeps a record of market fluctuations. It's that funny graph on the market window. Very handy.

So why is this on my mind right now?

Well, to do with my experiment. Profit margins in Hek are very wide, but volume of items sold is pretty poor. Right now I can expect to have an item sitting on the shelf for a week, if not longer. And yes, the profit off each will pay for a fully fitted frigate, but I think the same items can do better.

Just to be clear, I'm not manipulating the market. I'm working with market forces... whether it's sustainable or not is up those same market forces. 

Trade Log: Market Experiments

Every now and then, I like to experiment with the market.

Now, don't get me wrong, I understand my master's orders... I still maintain my other business. But when those a stable, such as now, even the clink of coin flowing into the bank can become dull.

When this happens I like to fiddle with market forces and see what the results are. My goals with trading are to keep my master happily supplied with ships to blow himself up in, but since that Slicer of his hasn't gone boom yet, we have a bit of a breather.

Today's experiment: Volume increases in Hek.

Traditionally, Hek is good for it's low volume, but wide margins. There's money to be made if you're patient, and don't expect ISK to pour like a waterfall, but more like periodic geyser.

The downside to high margins is that volume of sales are low. So, the idea is simple: lower sell prices, and raise buy prices, to see if we get more product mobility. I'm going to invest a relatively small sum, and see what the results are. I'll track the progress, and see if I can update you guys on how it goes.

Theory: Decreasing the gap between Buy and Sell orders will make items sell faster.

Counter argument: Market is already balanced due to laws of supply and demand. Basically, the amount of items flowing already satisfy the people living in Metropolis... in which case, we'll see no change.

Why?: I have a soft spot for Hek. I've pretty much made all of money here, and, well, my family came from here.

End Date: 03/12/2013 (Subject to my Master's needs)

Trade Log: Hauling (Regional Trading)

The graceful art of moving stuff.

Here's the secret. Look at your stuff. Put stuff in ship. Undock. Fly to destination. Dock. Take stuff out of your ship.

And that's it.

There are some tips though.

I rarely use industrial ships for this. Now that there are speedy industrials, it's not a terrible idea to use them, and can give you a good deal of tank.

What you deal in is usually quite mall, so the cargo capacity of a hauler isn't necessary. Gankers, pirates who prey on the humble hauler, used to be able to pop open most industrial ships without breaking a sweat. Not quite so true now, but gankers will still target you, since you're most likely to have cargo.

A fast frigate requires someone to have a ship designed for speedy locking, since they warp quite quickly, and they will also have to cargo scan you. No sense in wasting a destroyer or battle cruiser on a rookie's mission ship.

A Vigil, the Minmatar E-War ship, is usually the hauler of choice. However, gankers know this too, and will target those first. Any frigate will do though. I know of some traders that used to haul in destroyers too... no one ganks destroyers.

The speediest ship for moving around valuables is an interceptor. With this ship you'll zip across the space lanes, and outrun all but the most determined ganker.

It goes without saying that you shouldn't be asleep at the pod when you haul something valuable. Auto-piloting gives gankers an awful lot of time to peruse your ship. They'll scan you to see if you have cargo, and then blast you at their leisure. Manual piloting limits this time, and makes it less likely for you to be a target.

Also, avoid low and null security space. CONCORD won't help you out there. If you absolutely must, get a cloaked ship. Covert Ops vessels are good for this.

If, on the other hand, you find hauling too stressful (and boring), I recommend using either Push X or Red Frog on Courier contracts. I mostly deal with Push X. They are reliable, and have have a good insurance network.

When setting collateral for the contract, you might want to consider putting a small mark-up on your goods being hauled. Certainly do this for public contracts. I'm disinclined to do it for Push X though, as they're very professional about what they do. Good relationships are the foundation of any business.

The reason for the small mark up is lessening the damage to your business cycle. If you lose your valuables to a pirate, then you will have lost all that time spent buying and setting up the Courier contract. The small mark-up gives you a little bit of profit, to make up for the lost time. Don't be greedy, though. Just a little bit to pay for your time. Too much is simply unfair for your courier, and will damage your reputation.

So there you go. Get moving stuff. I've got things to do... 

Trade Log: Buying (Regional Trading)

Hi again. I'm here to tell you about Buying.

So, this is actually the hardest part of the whole trading business, and how well you do as a trader is a direct product of what you choose to buy.

That said, don't feel too pressured. So long as you set your sell order higher than what you bought the item for, you will make a profit. Of course, when you make that profit is a completely different question. It depends on your patience, and how active you want to be in trading.

Before you do anything, choose your hubs. Here is an excellent description buy a far wiser trader than I am, which highlights the regional hubs by size. The idea is buying from a bigger hub, and selling to a smaller. The hubs I work are Amarr and Hek... the reason being I was born in Hek, and Master Arcani operates from Amarr.

On a side note, flooding the Republic's markets with cheaper Amarr goods also sucks wealth from the regions economy. This is the one reason my Master didn't kill me on site for selling guns to his enemies. An added bonus is the intelligence my Master picks up from his patrols. Every ship he blows up gives us an idea of what the Liberation Force is buying, and thus what I should be selling.

A better idea is to work from Jita, that giant ISK blackhole in Caladri space. Prices tend to be the best there, and you'll never want for supply. If you are a serious trader, not working a Jita store is dumb. Really dumb.

Anyway, the easiest way to find things to buy is to use appropriate intelligence channels. This trade tool will give you a distinct advantage in choosing items. Essentially, set your budget, fill in your hubs, and you can just select the items you want to trade.

Sound simple? That's because it is! Using this site, you are nearly guaranteed to make profit.

Nearly.

This is where your experience and knowledge will come into play. Some items sell faster than others. As a rule of thumb, the fastest sellers are:

• Skill books
• Implants
• Modules
• Rigs

... and in that order too. Avoid things that are manufactured, since you'll put yourself in competition with the industrial capsuleers. Use your common sense too. If you can pick something up for a million and sell it for a billion, chances are it's too good to be true.

Feel free to take risks and gamble on unfamiliar items. The only thing that can hurt is a slow down in profit, provided you don't go all in on one item.

The actual buying can be done in two ways. Ideally you'd set up 'Buy Orders' at the bigger hub, so you can get something for the cheapest possible price. The problem with that is that you'd have to manage the buy order, which is added hassle.

The lazy way to do is simply to buy from the cheapest 'Sell order'. Not the most ISK efficient, but it depends on your chosen vocation. A pure trader can spend his time managing the buy orders along with what they station trade. If you'd like to do other things with your time, just pick up a sell order. It all comes down to what's important to you.

That's all for now. Stay tuned for the next post which tells you how to haul. 

Trade Log: Starting off in Regional Trading

...amn pie.. of Min..tar junk! Why does anything made in Rens break the second you leave system?! Wait, is it on now?

Oh. Well... good.

My name is Benh Thanh. I am Vehrokior. I am a slave.

Lets clear away the obvious question. Do I like being a slave? To be honest, I never really think about it. What would I do with freedom? Probably the same thing as now, but I'd worry more about a steady pay check. As a slave, my family is taken care of by the Arcani, and as long as we work, we won't starve.

The Arcanis are good people, as most Holder families go. They treat us fairly, and show us trust. They don't have to. The Khanid aren't exactly known for the good treatment of slaves. If you want to know more, ask my Master. he loves to ramble on about crap like that..

Anyway, he asked me to talk about Region Trading. I guess he wants to give away all my secrets, but slave does as slave is told.

Region trading is this:

• Buy stuff in one hub
• Move it to another
• Sell
• Repeat

Got it? Good. That's all. I've got some business to get back- What? Oh. The whole story? Do you want us to lose all our profits?! 

<static>

Ahem. My master informs me, that this is not clear enough. I apologize for my rude outburst.

Anyway.

The above is entirely true. Region trading is simply the process of moving some cheap things in one trade hub to another one where the locals will pay more for it. 

There's all sorts of complicated reasons why there is a price difference. Certain things are in more demand in some places, some things are only produced in other places. Throw hauling time for that with a bunch of other factors, and you have a five hundred page essay, which will amount to a lot of time wasted when you could have been trading for profit.

That said, there are some things you can do to make trading an easy source of income. It takes a bit of effort to set up, but after the intial set up, you can do just a little bit every day to keep a steady profit.

Obviously the more active you are, the more you'll make.

Over the next few weeks I'll be describing each of the above stages in more detail. There are other more trade centered blogs out there, but I want to give you a lazy man's guide to 'enough riches', rather than boast of my riches.

After all... it's not my money. I just spend it.