Wednesday, March 31, 2010

Cost effective 2

Following up yesterdays post we continue with the example of epic gems and trying to get the most out of them with the various ways they can be acquired. Yesterday was alchemy transmutes and today will be about honor bought gems and emblem of triumph gem exchanges. One note to keep in mind when reading this post though. As I mentioned yesterday in a few points, you need to consider more than just buy/sell prices. You have to take into account competition, availability, total stock, etc etc. All of those things should greatly influence your decisions so keep that in mind while doing your AH business.

When everything has the same "material cost" the opportunity cost (talk to X NPC) becomes exactly the same across the board. The only thing that changes the profit margins in this case are the resulting sales. Every American dollar is just as valuable as the next and many people have found ways to turn their small amount into massive fortunes. You can do the same with WoW. With 10k honor you can get any color of uncut epic gem. Since the price tag is equal for all of them, you should go for the most expensive thing you can get. I refer of course to cardinal rubies.

Why would I buy a yellow gem with honor when that same 10k honor gets me a red gem which sells for more? Again this is because the cost to get the gem is the same for every color, which is not the case with xmutes as they have different material costs. Buy the red gem, cut and sell, then use that gold to buy which ever colored gem you need. Doing anything else is an obvious waste.

Now lets translate this same scenario into exchanging emblems for epic gems. In case you forgot, the price is 20 emblems for red, blue, or yellow gems and only 10 emblems for orange, green, purple. Using the numbers I quoted yesterday, that equates into the following:

20 emblems = 200g or 180g or 190g depending on color chosen
10 emblems = 160g or 140g depending on color chosen

Using those numbers, buying 2x dreadstones to sell for 160g each turns into 320g in sales, while a singular cardinal sells for only 200g.

Based on that you can easily see (I hope at least) that spending 20 emblems on 2x purple or orange gems will get you 120g MORE than if you just bought a single red gem. Myself, I always buy purple gems with emblems because I always sell out of them and even if I had 500 emblems, I'd still get more from that than just buying any of the solid colors. Even if you need a strength gem or a stamina or a haste gem for your new "epic" gear you're still wasting potential profits. Stop that!

Thanks for stopping by!

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