July 2, 2015

Making a Market: Lessons so far

I've been working on getting a market going in our home system of Fliet.  Now I'm no Sugar Kyle, so it's been interesting to get this going with essentially one character with limited capital and trade skills.  Some of the things I thought might be real advantages are actually disadvantages and I've had one possible market sector pop up that's been fun to try out too. So Psst, hey buddy, need some boosters? But let's step back and ask some questions.

What is the local geography?
Fliet is in the southeast of the busy Gallente-Caldari Faction War zone in the Essence region.  Fliet is home to Aideron Robotics as well as some small pirate groups that tend to come and go over the months.  There is a lot of fighting to be found in the area, though much of it crosses over into the neighboring region of The Citadel (and Sugar's old home market of Sujarento).

There's only a bit of Essence that comes into the warzone (8 systems) so that puts a limit on the number of people looking in their market browsers that will see my stuff.  On the plus side, if I was in Placid I'd be competing with a lot more people including the decent-sized markets in Stacmon and Orvolle.  The smaller market area may be a better match for my smaller capital and skills.  The original point was to supply Aideron, so that's not really part of the choice equation anyway.  But I need to keep in mind that there is going to be a natural limit to the size of this market.

What are the limits of my Skills and Capital?
My market alt can run some 53 market slots, and with PLEX/MCT prices back up close to a billion I probably won't be changing that for a while.  I've also only been able to spare around 2B ISK in capital to stock things up, since I'm not particularly space rich, and that pretty much wipes my alt's liquid resources.  This makes me think about how much profit I can make on each of these slots.  If I hope to make 250M a month, I need each of those slots to turn over 4M in profit after all costs.  That means that where the difference between Jita price and the local market prices is narrow I'll have to really consider if I can get enough volume to make it worthwhile.

As an example, I know people need 400mm Rolled Tungsten (old name, I know) plates, but they are cheap.  If I can get them for 120k ISK in Jita and resell them for 180K that looks great on paper at 50% profit - but it's also only a raw profit of 60,000 ISK each.  So I'd need to sell 60-70 of them a month to hit that 4M per slot target.  Similar patterns come in for ammo and T1 rigs as well.

I know I need to expand those market slots, so if things are successful I'll be looking for another Multiple Pilot Training Cert. However prices on PLEX and Certs are very high right now. Amazingly the MPTC is more expensive than a PLEX, which I don't see any reason for, but it has been sustained for several days at least now.

Who are my customers?
Aideron has a great freighter service for members to bring in supplies cheap from Jita.  This is great for me in being able to stock Fliet, since I don't own a Jump Freighter.  However, this also means that any member who is willing to plan ahead and have an alt in The Forge has no need for my services.  We also keep a lot of the doctrine ships up on corp contracts, so it's easy to grab a ship and go when the fleet is forming.  This is not something I considered when I started doing this, and that was a big miss in my thought process.

So what I can provide is a convenience factor for AIDER pilots outside of doctrine fleets - ships that do solo, combat sites, and WH dives.  It also means that I end up selling to local pilots who aren't in AIDER.  If I look through the names of people who have bought from me, I actually seen relatively few AIDER names.  So my real customers range from pirates passing through (or trying to camp us on the undock) to other GalMil folks who aren't in AIDER but might end up reshipping here. That's something else I didn't think about, which encourages me to reach into saleable items that aren't only in the Gallente-focused AIDER doctrine set.

Is there a niche I can provide?
In talking to corpmates I found there was a need for truckloads of drugs. Based on that I've reached out and gotten supplies brought in for Standard Exile, Blue Pill, and Drop. After that was successful I've expanded that to include Strong and Improved versions as well. This was very expensive - most of my market orders by value are now in the combat booster sector - and we'll see how that turns out. If so, I'd love for Fliet to be a place where people in the area come to know they can get some boosters for the edge in that next fight. As things grow, maybe there is another niche I can fill as well.

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