Tuesday, 14 June 2011

Milling around the Auction House

My first weeks profit and report from playing the WOW economy

auctionhouseA week into my playing the auction house experiment and I can report I’m in profit!  Not just a couple of bronze either, with no more than 2 hours total effort (To quickly recap, I’m buying items on the auction house and reselling them either as they are, or using trade skills of my alts only, no questing or grinding is involved.). I’ve made a 300% return on my initial 1000g stake, and that’s without taking into account the stuff I’ve still listed on the AH and in my inventory which are still to sell.  In addition to my 3000g profit I reckon I’ve another 5000g worth of ‘stock’. 
In my week of playing the market, I’ve primarily stuck to buying Cinderbloom, converting it into ink, and relisting it.  I’ve had a little foray into prospecting ore, and whilst there's a profit to be made there, its more time consuming and I’m not quite sure I’ve fully ‘got’ the most profitable means yet.  I (just last night) had a look at buying herbs to make potions, but as yet haven’t sold any so that’ll be one for the next update, I’m also going to look at enchanting in the near future.

So, for the results; we’ll concentrate on the main trade first up, inks.  In total I bought 2598 Cinderbloom at an average price of 96s 80b, which I milled and turned into ink.  On average (ish) one stack of 20 Cinderbloom will produce materials for half an Inferno Ink and 5 Blackfallow Ink.  In total I’ve sold 33 Inferno Inks at a little over 43g each and 75 Blackfallow Inks at just over 10g each on average.  I’ll also point out that I ‘bought’ quite a lot of the Blackfallow Ink with my mage as I was dry which could be considered as artificially skewing my results – in total I purchased 300 of them at 7.5g each (I chose a value under the average selling price so as not to artificially inflate my profits.
Even when I ignore the stock of ink that is still on the AH unsold from the herbs I bought, I’ve made a healthy profit of just short of 2000g which is a mark up of 77%, a good return for a weeks work in anyone's money.  To put this into context, in the ‘real world’ an economist could reasonably expect a return of around 100% per year on an investment for a commercial venture.  I’ve pasted a breakdown of my P&L table below (note there are a couple of omissions of purchases I made before I installed Beancounter).

With the prospecting, I chose to sell some uncut gems, generally the ones that are used for dailies.  Cut some of the larger gems into various types which were going for a decent price on the AH and then create rings and necks out of the rest, selling the blue ones and disenchanting the green.  As you can see from the table below I haven’t sold that many of the glyphs which I bought, there were a couple of additional sales before the Beancounter install, but for some reason the glyph sales have been quite slow in the past week, and I’ve been careful not to compete with my glyph factory alt, as that would be silly, which has restricted my options.

Item name total number average price
Inferno Ink 1424g 70s 00c 33 43g 17s 27c
Zephyrite 89g 70s 00c 13 6g 90s 00c
Hypnotic Dust 102g 08s 00c 38 2g 68s 63c
Blackfallow Ink 778g 75s 00c 75 10g 38s 33c
Sovereign Demonseye 94g 00s 00c 1 94g 00s 00c
Brilliant Inferno Ruby 94g 60s 00c 1 94g 60s 00c
Sparkling Ocean Sapphire 38g 70s 00c 1 38g 70s 00c
Glyph of Blade Flurry 475g 00s 00c 3 158g 33s 33c
Carnelian 296g 65s 00c 17 17g 45s 00c
Glinting Demonseye 176g 50s 00c 3 58g 83s 33c
Hessonite 5g 95s 00c 1 5g 95s 00c
5826g 63s 00c
Item Name total  number  average price
Whiptail 35g 00s 00c 20 1g 75s 00c
Cinderbloom 2514g 92s 02c 2598 0g 96s 80c
Goldclover 38g 66s 00c 40 0g 96s 65c
Bladefist Sword of the Mercenary 60g 00s 00c 1 60g 00s 00c
Glyph of Death Coil 56g 96s 99c 3 18g 99s 00c
Glyph of Death Grip 18g 99s 00c 1 18g 99s 00c
Elementium Ore 578g 10s 00c 335 1g 72s 57c
Glyph of Stormstrike 17g 95s 00c 1 17g 95s 00c
Glyph of Scourge Strike 20g 00s 00c 1 20g 00s 00c
Glyph of Gouge 40g 00s 00c 4 10g 00s 00c
Glyph of Pounce 36g 60s 00c 2 18g 30s 00c
Glyph of Voidwalker 0g 85s 00c 1 0g 85s 00c
3418g 04s 01c
profit with ink purchase 2408g 58s 99c

So what have I learnt with my exploits?  Well quite a lot actually, firstly, automation is key to removing the tedium from making a profit, using the Advanced Trade Skills Window to bulk craft inks is key, unfortunately milling cannot be automated, however if you’re making one type of ink then you can set it off and go do something else.  This means buying in bulk is key I’d recommend creating 300+ Blackfallow inks in one shot and then the associated Inferno Inks.  I’ve used dead time to mill stuff, so waiting in the dungeon queue or while people are afk in dungeons where possible.

The key for me to making profit is to understand the item, its rarity, its uses and its demand.  This will vary from server to server and day to day.  I tend to list items for 48 hours, but ideally you want to aim for 24 hours, or even 12 if you log on daily to ensure you’re always the most competitive.  On the supply and demand front, don’t flood the market, if you’ve just made 300 Blackfallow Ink there's little point listing the lot, this will only serve to give the impression of high supply and you’re almost guaranteed not to sell them.  I tend to list a few stacks of 20 and then another 20 or so singles at a time.  For the Inferno Ink, because of it’s price and relative rarity I tend to only list singles in auction.  On the glyph front they’re pretty slow shifting so I only ever have one of each type listed, the gems often go in spurts, i.e. when someone gets a new item or items with multiple slots and need to gem up.  For the items used for dailies like the lesser gems, I list a few singles and the rest in triples (as you need 3 for the daily).  If the price is crap, don’t list your item, this is especially pertinent for Glyphs on my server, there seems to be a glut of people who level inscription with no idea of the glyphs worth listing them for silly money just to get rid of them; I’ve made several hundred g (pre Beancounter) buying up Glyphs for ~10g and relisting them in the 100s.

I’ve been using Auctionator to help me buy and list items, this has been invaluable in saving me time and making me the most competitively priced vendor of my items.  I can’t stress highly enough how vital the addons have been to my efficiency, without them, I simple wouldn’t bother.

My feeling is the ink is the most profitable, and my figures would back that up, even on the time front, simply due to the variation of items created from jewel crafting ink wins.  That said, I’m kind of hitting my limit for the amount of ink I can sell so if I want to make more money per week then I’m going to be forced to diversify.  I’ve had a brief foray into the gem and jewel crafting markets, but due to the variety involved it’s impossible to automate properly as each time you create a new item type it requires a manual interaction (this is a Blizzard constraint on trade skills).  I suspect Enchanting might be very profitable, however it seems to be extremely difficult to tell how much an item will sell for prior to crafting it as the tooltip addon doesn’t work with enchants (this is because you’re hovering over the enchant, however you sell vellums).

So in summary, I think a very successful week playing the market, I’ve made a few mistakes which have cost me money, but even with the mistakes I’ve made a healthy profit at a far greater rate of return than I could generally expect through grinding or questing.  I’ll aim to stick an update up on my progress as I expand my operations this week however work has gone crazymadbusy so it might be a while.

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