At the end of my tenth full month, my wealth is 89.2bn ISK after paying 1.3bn to upgrade Omega for another 30 days. My wealth increased by 5.3bn in June.
Another poor month and, to be honest, i dont see any improvement in July so far. June stayed weak pretty much all the way through.
Work is getting busier so perhaps the low profits reflect the low amount of time in the game - the main takeaway from all this is that i need to find new items to sell.
Bottom line remains that i need to make 2.5bn sales per day to achieve 10bn profits in a month after paying for plex. In June i was only doing 1.8bn sales per day.
One day, the goal will be for 1bn profits per day but that will need c7.5bn sales per day.
Review of the June aims
1) Plex the account - aim number one all the time - done
2) Increase sales in Dodixie - missed
3) Increase sales in Amarr - mised
4) Review the Trading character in Rens to determine what best to sell - ongoing
5) Review the Trading character in Hekto determine what best to sell - ongoing
Reminder of my Current Business.
I operate with one omega account (paid for with plex) with three alts and now another (alpha) account with two alts. This latter account with two alts is doing not much right now.
The main alt is a seller in Dodixie and the other alt is a seller in Amarr, two of the main trade hubs in Eve Online.
The third alt sits in Jita and buys from Sell Orders, has these items couriered to the alts in Dodixie and Amarr who then put them onto these markets for sale.
I focus on slow moving but high margin items.
For this side of my business, lets call it Merchanting or inter-regional trading, i want to generate income of 10bn isk per month after paying to Plex my account.
My business model evolves over time. As my wealth increases i focus on higher value items. Currently, i only buy items in Jita for over 100m isk. In time that will move up. I don't want to be buying items from Jita for 30m and selling in Dodixie for 45m - that may be great margins but does not move the dials anymore.
Analysis of Trading Profits
In total i made 53.9bn of sales in June which made me item profits of 14.4bn isk.
Overall, sales declined 24% in June having declined 7% in May and 16% in April. This is a poor run and sales peaked at 91bn in March it seems.
Dodixie sales were down 44% to 17bn vs May and Amarr sales were down 14% to 35bn. Amarr is clearly now my main income generator.
When i say "item profit" i mean the pure profits of buying from Sell Orders in Jita and putting up for Sale in Dodixie and Amarr. So before all fees / taxes etc.
The character in Rens made small sales of 2.0bn, up from the 1.0bn in May.
This therefore was an item margin of 26.7% (14.4/53.9) vs my target of 25%. So, at least my margins are on track
Since September 2020 the item margin range has been 28% to 32% with one low outlier of 26.6% in October 2020 and now a near low of 26.7%. It is still good news, i am comfortably beating the 25% i really need to make this all work (see below).
From this I then need to take a whole series of costs off before i get to my Business profits:
Courier Fees: i aim to pay 2% of sales value to the Courier = 2% x 53.1 = 1.1bn
Sales tax cost me 1.3bn ISk (=2.4% of sales) - both main characters are level 5 in Accounting, the Rens character is an alpha account so may start to dilute the sales tax rate upwards if its sales rise.
Broker Fees costs me 5.4bn (=10.0% of sales). Now, i can break this down into the initial listing fee of 3.50% (because i am Level 5 Broker Relations on both main characters) and therefore the rest is the cost of changing the price which is 1.14% a shot.
So, i know the listing fee = 3.50% x 53.1 = 1.9bn and therefore the price change fee is 3.5bn (5.4 - 1.9). This 3.5bn is 6.5% of sales which reflects a steep increase in competition in Amarr and also Dodixie for the items i sell. i.e. i had to change the price on my Amarr / Dodixie items more often to keep them priced competitively.
This takes my 'Business Profits' to 6.6bn isk for June vs 9.9bn in May. This is what 20-30 minutes a day in June gave me.
So, the post-tax margin is 26.7% - 2.0% - 2.4% - 3.5% - 6.5% = 12.3% (=6.6/53.1 = business profits / sales).
Fees and Taxes take 14.4% off my margins (2.0+2.4+3.5+6.5). That is a big hit. I can take action to reduce this which i may investigate in the medium term.
12.3% is poor, i would normally aim to get a respectable 13 to 15%. However, 12.3% is the lowest margin i have ever had and reflects the higher competition in Amarr and Dodixie and my lower sales.
And then from those 'Business Profits' i buy Plex for 1.3bn isk to extend the Omega by 30 days.
That, therefore, is the roadmap from making 53.1bn of sales and seeing my wealth increase by 5.3bn as a result.
Items i am selling in Dodixie and Amarr
I sell blueprints, skill books, implants, ship equipment and structure modifications.
Blueprints are on hold - i don't think i have sold a blueprint in many a week. At the level i am now focusing on, the c1bn isk level, there to appear to be a dedicated few players doing the same thing. The the market is exceptionally slow moving, even for my liking.
Implants are doing ok - i am expanding into more types and moving up the isk value curve. I now only focus on implants to sell for at least 150m isk. This is a slow but nice market for me.
Ship Equipment has slowed down recently, supply has really dried up in Jita. Something to re-examine but until i am more certain as to why supply has dried up and therefore why prices in Jita are up so much i intend to tread carefully.
Structure modifications are doing ok - i focus on the 500m and above level in this item type. I am still broadening out my sales items in this area and i suspect it will take me a few months to fully cover this item type.
For now, Amarr is doing much better than Dodixie. I am not sure if the Dodixie is getting slower or if i am merely focusing on the wrong items.
Rigidly sticking to the 25% margin target. Courier fees and taxes can take a whopping 12% of that to leave me with 13%. This is the one line i can't really cross. If i took the margin down to 20% then after costs i am looking at 8% profits which leaves no room to change prices too often!
Dodixie Seller character
This remains my main character and was my biggest seller - Amarr just over took Dodixie this month.
I have now trained all the relevant skills to Level 5.
The skills relevant to Trading that i have are:
Accounting: Level 5; means i am charged 2.25% of the sales price on completed sale vs the normal 5%
Broker Relations: Level 5; means i am charged 3.49% to list an item for sale
Advanced Broker Relations: Level 5; means i can reduce the cost of changing the price of items i already have for sale. I decided by train this rather than go all for Plex. With no skill i would be charged 1.89% to change every price. Level 5 has brought this down to 0.94%.
Trade: Level 5; increases the number of items i can list for sale by 4 per level.
Retail: Level 5; increases the number of items i can list for sale by 8 per level
Wholesale: Level 5 (increased by two levels in January); increases the number of items i can list by 16 per level
Marketing: Level 3 (increased by one level in January); this allows me to set up Sell Orders in stations other than the one i am in; it also allowed me to look to increase my Contracting skills which i will need to sell my BPO copies from invention
Given the level 5 Trade, level 5 Retail and level 5 wholesale, i am able to post 145 items for sale (5 + (5x4) + (5x8) + (5x16)). With no Trading skills you can post up to 5 sell orders
I may have to train Tycoon which will give me an additional 32 slots per level.
Amarr Seller character
Started in November and has grown very quickly - has just become the biggest seller. I gave my initial views in a prior post.
I have now trained all the relevant skills to Level 5.
The skills relevant to Trading that i have are:
Accounting: Level 5; means i am charged 2.25% of the sales price on completed sale vs the normal 5%
Broker Relations: Level 5; means i am charged 3.49% to list an item for sale
Advanced Broker Relations: Level 5; means i can reduce the cost of changing the price of items i already have for sale. I decided by train this rather than go all for Plex. With no skill i would be charged 1.89% to change every price. Level 5 has brought this down to 0.94%.
Trade: Level 4; increases the number of items i can list for sale by 4 per level.
Retail: Level 5; increases the number of items i can list for sale by 8 per level
Wholesale: Level 2; increases the number of items i can list by 16 per level
Marketing: Level 2; this allows me to set up Sell Orders in stations other than the one i am in; i don't use this really
Given the level 4 Trade, level 5 Retail and Wholesale Level 2, i am able to post 93 items for sale (5 + (4x4) + (5x8) + (2x16).
This market is much more competitive so it is harder to find items to make a good sale - but is still very profitable.
Rens and Hek characters
I want to see if i can take into some sales in these trade hubs. I don't want to target much but if i could get to post plex profits of say 3bn isk per month for minimal work then that would be ideal.
I have restarted these two characters. My wild ideas of what would sell in Rens and Hek have proved to be just that. Wild.
So i now need to relook at what works and go from there.
Courier Contracts
Each night, i get home from work and determine what i need to sell in Dodixie and Amarr. I tend to focus on one location per night unless i need to courier over 1.5bn isk of items to both locations. So Dodixie one night, Amarr the next. Keeps my time on Eve to a manageable 45 minutes which includes looking for potential new items to sell.
To look up prices in Eve I am using Eve Tycoon which seems to have more of the latest items in its market browser. I used to use evemarketer but i just got used to Eve Tycoon.
Each night i courier about 2 to 8bn isk of items from Jita. The total cargo volume is 10-250m3 per shipment. So small but valuable items. But this allows the couriers to use small, fast ships with much less chance of being ganked. So there is always someone willing to pick up the contract quickly.
I pay a generous 1.5 to 2.0% of collateral as fees. I am more interested in getting my items onto the market quickly than penny pinching on distribution costs.
Nothing, yet, todo with my Eve Business ventures but just noting that in December i set up a website site eveeconomy.com which takes the monthly economic data provided by CCP and visualises it in chart form.
Loads of charts and more i can add.
I need to work out how to render the charts faster - right now they are accessed from a google drive given that is the way i have worked out how to update multiple charts at once quickly.
Let me know what you think and what else i should add.
Outlook
July will have five aims to it and be the same as the aim were for June:
1) Plex the account - aim number one all the time
2) Increase sales in Dodixie
3) Increase sales in Amarr
4) Review the Trading character in Rens to determine what best to sell
5) Review the Trading character in Hekto determine what best to sell
The daily sales in June averaged 1.8bn.
If i assume i need to make 10bn + 1.4bn income per month (=11.4bn) and i assume i can achieve 15.0% margin then i need to make monthly sales of 76bn and so daily sales of 2.5bn.
So far i have achieved this in December, January, March and April. For now, July is also looking like a slow month.
Current wealth is 89.2bn ISK made up from:
- items in hanger for sale 3.4bn ISK
- Buy orders on the market 0.0bn ISK
- items for sale 98.8bn ISK
- less a 20% provision 19.8bn ISK*
- ISK in wallet 6.3bn ISK
* I take a 20% provision against the items I am selling. Eve calculates wealth by adding up the value of the sell orders hence it is possible to increase your wealth by buying an item for 100m ISK and putting a sell order for 120m ISK (in this case your wealth would increase by 20m ISK). For me, I want my wealth to be calculated at cost. I know that the value of my sell orders will likely fall over time as I update my orders downwards as competition reduces their prices before my items are sold. Hence the 20% provision is my best guess as to what the maximum reduction I would need to make to my sell orders as a whole before they are sold. In an ideal world I would value my sell orders at the value which I bought the items for.
