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2012 Trading and Industry Report

Overview

Another year of growth and transitions into larger projects.

Module, gun, ship construction and trading proceeded as it did the previous year. With reliable income from trading, we expanded our operation into heavy construction by adding a Carrier construction wing to our operation.

2012-12-21_2011_vs_2012_overview1

From these numbers we can see that our operation is facing more competition as margins were slightly lower than the previous year. To overcome this, we migrated our inventory to higher per-sale profit items. The drastic change in quantity can be explained by dropping Ammo as a common trade item.

This overview shows the benefits of spreading your trade load between high ticket, low volume items and more volume centered low price items.

Quick Numbers

Q1 and Q2 saw renewed vigor into trading as I started to invest more time into logistics and product research.

Q3, July especially, was a record breaking time as I took any liquidity and moved it back into assets. This also marked our shift into high ticket items. Additionally, at this point in the year my trading partner and I had a lot of time to devote to our operation.

September into October is a busy time for me personally. I took a long vacation October and was away from Eve for a few weeks. Everyone needs a break and our performance numbers directly show this.

2012-12-21_gross_sales_and_profit

Highlights

Procurer speculation with the Inferno Patch.

Outsourcing some Highsec logistics with Red Frog Freight during busy periods.

Expanded trading into High Meta items.

Expanded construction and sales into Carrier hulls.

Invested 133 days of training into Racial Cruiser Construction V and Jury Rigging V to enable Tech 3 hull and subsystem production in the coming year.

Invention

Though there are profits in invention, I found the process of gathering materials, inventing a BPC, putting the component parts together to be uninspired; I had no real focus this year with invention. Most of the time I spent in this area was spent making Drones and increasing my stock of -1/-1 Anshar prints for a rainy day.

My two invention characters have 4-4-4 skills. I have found the training return of getting 5-4-4 or even 5-5-5 skills to marginally increase profits. Since the train time to get a Science skill to 5 is around 20 days, I have not felt the need to sink time into polishing off the skills.

I did keep a database record in order to produced the below summary of my invention statistics  The overall success average came out to be 48.2%, which falls in line with any invention guide.

2012-12-19_invention_stats

High Meta

With the addition of Faction, Deadspace, and Officer modules to the market, I saw several trading opportunities throughout the year to work with these items. I had little to no interest in using the tedious contract system to trade these items so when they were added to the general market, I rejoiced.

Here is a summary of the performance of items by Meta levels. Faction and Deadspace items traded well and brought consistent high profits.

2012-12-19_meta_stats

Escalation Barge Teiricide

With the changes to mining barges in the Escalation patch, my partner and I mainly targeted the Procurer hull as its build requirements changed the most with the patch. We speculated that the new  barges would cost more post-patch so we build a large stock before patch day.

We ended up selling 288 units for a profit of 2.48 B. We put a smaller amount of effort into Retriever hulls and managed to build and sell 44 for a profit of 431 M.

2012-12-19_tech1_industrial

Fear the Sabre

I had limited success with trading other racial Interdictors. The Sabre is the champion of them  all and hopefully we see some further balancing to these hulls in upcoming patches.

2012-12-19_interdictors

Alpha Maelstrom to Rail Rokh

This year we saw the popularity of the Alpha Maelstrom as a viable Nullsec fleet composition fade away in favor of the Rail Rokh. I was slow to react to this change and by the time I got my Rohk BPO researched to an acceptable level, the switch to the new doctrine was already underway.

2012-12-19_battleships

Rigs and Guns

The core rig types (Trimark, CCC, and Field Extender) continued to be a solid performer. If you sell a ship in an area, you should also sell related rigs to popular fits. Let this be a lesson in item cross-selling for anyone building, stocking, and selling ship hulls.

2012-12-19_rigs

The core gun types seen below also provided some income over the year.

2012-12-19_guns

GoonSwarm Shrugged, I Smiled

During the GoonSwarm Ice Interdiction, I speculated on POS fuel and turned a profit. I made 648 M doing some passive trading in Jita on Oxygen Isotopes. In addition, people started to panic and predict that other Isotopes were going to be affected also. I made some early buys on Nitrogen and then sold them off at the height of their price level.

2012-12-19_fuel

High Meta

I have focused on and found a number of High Meta items that have proven to be very profitable. I’ve blanked out the names of them because I don’t yet want to disclose the item types at this point in time.

2012-12-19_highmeta

Implants

As expected implants were a high performer.

2012-12-19_implants

Standard Modules

High volume modules provide a small source of income as working with these items means you are in a competitive and often saturated market.

The new Drone Damage Amplifier modules sold very well, but I had poor success with the Reactive Armor Hardener.

2012-12-20_modules

Batch Ammo

I have continued to have limited success with ammo. I have found the velocity of trading to be very slow which I think is due to the nature of ammo production and consumption.

Since ammo jobs are batch based (meaning that when someone runs a production job they are producing a large bath of ammo rather than a single unit), production has periods of high volume. Additionally when someone buys ammo, that person tends to buy a large stock and slowly work though the pile.

I keep stocking ammo with the intention that it will move, but I always am unimpressed by the numbers.

2012-12-20_ammo

Tier 3 Battlecruisers

The popularity of the Tier 3 BCs remains high as I was able to make a profit on every racial type of them. Surprisingly the Oracle and Talos have been outselling the Tornado.

2012-12-20_tier3_bc

HAC Favoritism

The Cerberus has remained a poor performer with no production or trading opportunities arsing this year. The Ishtar remains a strong seller as a preferred AFK mission ship while the Vagabond holds up the PVP end of the HAC spectrum. I fully agree with Kirith Kodachi’s recent comments on the upcoming rebalance initiative that will eventually hit HACs.

2012-12-20_hac

Tech 2 Logistics Falling From Grace

With the recent rebalance of Tech 1 logistics, I expect my production and trade of Tech 2 logistics ships to decline. As Jester pointed out, the proficiency of the Tech 1 variant can cheaply replicate the Tech 2 variant.

2012-12-20_logistics

Future Ventures

Champion CREST API changes and development with the community to enable 3rd party tools to flourish.

Pressure the CSM for industry and mining changes.

Though the Carrier project is new, it is proving to be profitable so we expect the expand the operation. We are going to look into Dreadnought production in addition to carriers.

Build from stockpile of Tech 3 hulls and subsystem BPCs.

Build backlog of invented Anashar BPCs.

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Solitude Highsec Island Research

Contiguous Highsec may have a large number of stations for research, but they are almost always busy with long wait queues. If you have the mettle to speed around Lowsec or have access to jump capable ships, you might want to consider other areas for your research.

When I could not find an open or low wait slot in Highsec, I usually took a shuttle into a neighboring Lowsec region to find open research slots. Thankfully I never encountered a boosted locking ship or smartbomb camp. After a few months of easy access to ME research slots, my Lowsec area started to get overrun so I started to look elsewhere for my needs.

After looking at Eve maps a few areas stood out to me. The Solitude region in particular contains a Highsec island (non contiguous to normal Highsec) that I have found to be perfectly isolated in terms of researchers.

There are several Highsec stations with (at the time) open or extremely low wait ME slots: Stoure, Vecodie, Octanneve, Maire, Oerse, Gererique, and Niballe.

I flew around between these systems with Capital Part and Ship BPOs with no trouble at all. Every gate between the Highsec island systems was never manned with campers.

2012-11-29_solitude_dotlanWhen looking for open slots, I often noticed a few extremely long research jobs. I infereed based on the time that these might be Titan/Supercarrier jobs.

I imagine that this type of Highsec island is perfect place to get additional ME/PE levels or copy your Titan/Supercarrier BPO. No POS to get reinforced means no risk from external factors. If I were vested in these type of large research projects, I would home here.


Dreadnought Presents

As an early Holiday present to my industry partner Raath, I decided to surprise him and buy two perfect ME Dreadnought BPOs. Each of these Dreadnought BPOs comes with over a year of research and no loss.

2012.12.20.15.01.30-1

I also thought that since we are going to start Dreadnought production, I might as well get a set of guns to go with the additional capital parts needed to build Dreadnought hulls. The additional part and gun BPOs are unresearched, meaning that I will have to get their ME levels up before we start to produce with them. The calculations on the capital guns show a sweet spot of ME 5-7, so I will have to spend under 20 days to get them production ready; the numbers on the new Capital Component prints show that a ME of 4 enables them to be production worthy.

2012.12.20.17.06.36-1

I was not able to find a perfect ME Moros or Phoenix print on the market. I doubt that I will produce the Phoenix class hull as it has poor volume and margins per the research that Eve-Fail has conducted. The Moros as far as I know remains a preferred DPS hull for structure bashing so I will need to locate a nicely researched print soon.


Trading 202: Challenges of Asset Tracking

Overview

You buy something and then sell it somewhere else at a higher price. This process is easy enough to do, but for accurate profit records it turns out to be rather troublesome due to how asset identification is implemented in Eve at the database level.

If you want to preserve a chain of custody for bookkeeping reasons, you need some additional tools for asset tracking.

Stacks and itemIDs

A single item or a stack of items is stored in the database as a single row with a unique itemID. Below is an exmaple of a Medium Shield Drone that I have in a Dodixie station.

2012-12-16_asset_example-1

Every item in the game as a unique itemID that is created and destroyed when it is stacked or split.  Here is an example of what happens when you take a stack of ore, split it, and then combine it again.

assets_combined

This is a very simple example, but imagine a larger trading operation. You are buying 200 implants and 3 are for your personal characters, 100 are going to your primary trade hub, and the other 97 to your secondary trade hub. As you split up the stacks, your itemIDs change. The chain of ownership gets lost along the way.

While your current orders are selling, you are going to buy more of the same implants so you can replenish stock in the trade hub. This new purchase is at a slightly higher cost, but well within good profit margins.

So how do you calculate profit? You have items at a certain price currently selling and then a new price to work with for the next batch. Do you use the last price that you bought it at? A global price from a source like Eve-Central? An average?

The ideal solution involves working with a record of quantity and price at a point in time. Once you have this information, you can keep better track of profits as you continuously sell and buy items.

Solutions

1. First In, First Out

This system can be explained by James, my coding right hand man. Here is a quote when we introduced a ‘inventory’ table to our Wallet Manager.

“As far as getting profit and costing, that’s pretty simple. We get costs in a FIFO basis (first in, first out). As purchases come in through the API, they go to the ‘inventory’ table. As things are sold, the quantities are deducted from the items in that table and the profit calculated on the original purchase cost. This allows for a pretty accurate profit calculation.

The caveat is that method is pretty prone to drift. You might buy 1,000 heavy missiles you don’t plan on selling, but they’ll end up in the table. However, we have a way of combating that.

One is that the tool works best when the characters being tracked do nothing but trade or produce. Because the Eve API doesn’t allow you to track specific instances of items well enough, that’s really the first line of defense. You can always spin an alt to buy your toys and keep them off the tool’s books.”

2. Assign Assets to a Project

Raath, my production partner that heads up development at industry.darkshadowindustries.com, uses Projects.

A asset or resource that enters the system can be assigned to a project. That item and the price can then be tracked and rolled into the final profit calculation of the job when it is completed.


Trading 203: Mission Hub Stocking

Overview

This guide is indented to use a Highsec mission hub as a trading example.

I wanted to use a concrete example and disclose methods that I have developed over the past few years on how to seek out items to trade. Every trader has a technique, and I am no different. The following process is meant to guide you through the technique of selecting an item and gauging its profit potential.

Example

Product Source: Jita
Product Destination: Mission Hub of Dodixie
Weekday 02:00 Eve Time population: 349 Pilots
Item: Cybernetic Subprocessor – Basic

Item Selection

Every market is different so you need to due your due diligence.

For mission runners you might want to look at common mission ships such as the Raven or Dominix. Think about the entire package beyond the ship. Mission runners will need ammo, rigs, drones, and salvage equipment. In a PVP market, you will want to take a look at High Volume PVP Items.

For this trading example I picked a very common item. Almost all pilots have, at any given time, a Cybernetic Subprocessor of any grade in their head to improve training time.

The Market Window

The purpose of scanning the market window is to give you a ‘feel’ for the item.

Is obvious manipulation attempt obvious? Is the volume so low that you should not bother trading the item? Using this tool will help you weed out the error prone trades and focus your efforts.

I have a long list of items to browse through ranging from modules, ships, ammo, to even special high meta items. When you have 200 items to review, you should only be spending 5-10 seconds on each item to get a feel for the market. Quickly work down through your Quickbar in both regions, comparing results.

Market Window Using the Example

2012.12.13.02.32.15-combined

1. Price Trend

The Jita price has been rather stable over the past few months. Yes, there was a price increase from ~6.5 to around 8 M but remember that LP payouts were adjusted in a previous patch so I would not worry about the price raise to 8. Consider it a patch market blip.

The market in Dodixie is more volatile, as expected; a smaller group of traders is stocking the market and trying to make a profit. The range and period of the price waves don’t seem to bother me.

2. Volume

Rough guesstimation shows that around 50 move a day in Dodixie with larger spikes when traders are buying out the market to raise prices.

You can clearly see two major spikes in the Dodixie market where the price was ‘reset’ as I call it. This is normal behavior and I see it across the board in Highsec, Lowsec, and Nullsec. A larger trader will buyout all the items to a certain price threshold and then attempt to sell off stock at that newly established price. If your items were bought out at a profit, then you can ride the wave and restock at the new price hoping that it doesn’t crash back down (I’ll detail this process later).

3. Market Window Conclusion

Both the trends and volume pass the sanity check for me on this item. At this point I would look to use further tools to gauge profit potential.

Spreadsheet Time

Since our implant passes a sanity check, you can move on into more number work to see the item’s true potential.

1. Cut and paste a month worth of history from Eve into Excel. Ignore the most recent trading day as the numbers are not final and will throw off your calculations.

2. Do a find and replace on “ISK” to “” to get that extraneous text out of your sheet.

3. Adjust column size and add column headers. You should have something that looks like this.

2012-12-12_cybernetic_basic-1

Getting Useful Data

1. If you SUM the Quantity column, you can get a view into how many move in the region in a month.

For this implant we are are looking at 1,702 items/month. This figure will help you estimate how much you should buy at your source system. Based on your scale, you can buy a full month of items or small increments as liquidity allows.

Since a full month of implants to stock this region would come out to 13.694 B at Jita sell prices, you will opt for small portions.

2. Gauging profit potential is rather easy. Take the current Jita price and the last average price you have in Dodixie. Use the movement of the region of the month

(Jita Price – Dodixie Price) * Movement/Month = Region Movement/Month

2012-12-12_cybernetic_basic-2

3. The region potential doesn’t show you the volume in the system that will be your focus. For this you look at the Market Data tab to see where the orders are located.

2012.12.13.02.33.29-1

We can see that the majority are concentrated in Dodixie with a smaller concentration located in Bourynes. This informs me that the majority of trades are going to be concentrated in the Dodixie IX – Moon 20 station. This is where you should setup shop.

Closing Notes

Hopefully my method will help you see how to operate and fine tune your operation. I haven’t touched on logistics or item diversification — I have to save topics for other posts.


Racial Starship Engineering V

After 133 days of training, I have completed a training plan on one of my production characters that now allows me to construct every Tech 3 Hull and Subsystem.

Amarrian Starship Engineering V (25 D)
Caldari Starship Engineering V (25 D)
Gallentean Starship Engineering V (25 D)
Minmatar Starship Engineering V (25 D)
Cruiser Construction V (25 D)
Jury Rigging V (8 D)

2012.12.10.04.12.13-1

2012.12.10.15.17.50-1

Up next is Advanced Laboratory Operation V and Advanced Mass Production V to polish off the industry skills.

I’ve run the profit potential numbers on both the Hulls and Subsystems and they are both a good time investment. I just need to either wait for a POS rework or grind standings for a highsec POS.

I have little to no interest in setting up a production POS in lowsec due to the ability of any entity coming along and reinforcing the POS. I would rather operate under the umbrella of a 24 hour wardec timer that would allow me to bring up defenses and recover industry items before the war goes live.

2012.12.10.15.28.25-1

2012.12.10.15.28.39-1


November Financial Report

Overview

My trading and industry focus tends to ebb and flow over time. Station trading, ship building, reactions, tech2/tech3 construction, and other types — one venture may not be the most appropriate  path to success at the given time. Focus on daily ‘0.01 ISK’ trading has fallen off as we’ve moved our focus to Carrier production.

Our mineral compression location has been fully stocked with compression appropriate blueprints, logistic supply lines to our production system have been sorted out, and the initial ISK investment in Capital blueprints has taken place.

Sales from our first Carrier batch have proven profitable, so my partner and I are pleased with the initial results.

Heavy Industry

Current industry jobs contain guns for mineral compression, Carrier hulls, and getting more ME/PE work done on idle ship blueprints and Capital related blueprints.

My two industrial characters are polishing off Advanced Laboratory Operation and Advanced Mass Production to V, which is around a 27 day train each, to maximize their production abilities.

2012-12-03_industry_jobs-1

Procurer Blueprints

In an attempt to sell off the stockpile of blueprints that I acquired from price speculation in the Inferno expansion, I have started to become more aggressive with their pricing.

Profits per blueprint have come down into the 250-350 M range. Though they are now worth much more when sourced from NPC suppliers, the market is glutted with people that made the same move as me. My preference is to sell off the stock of 20 prints that I have and to move the ISK into minerals or Capital prints.

2012-12-03_procurer_bpo_sales-1

Charts

I’m seeing a slow, profitable burn the past few months despite spending money on a Capital Ships and Racial Carrier skillbook in addition to a PLEX for a friend to keep his account active.

We’re still turning a profit and I expect the pace to accelerate as our Capital ship production line grows into a full-fledged, efficient operation.

2012-12-03_net

2012-12-03_net_chart

Retribution

I did not make any moves on the market for Retribution as I did not see any major profit potentials with this patch. The scan changes to Blockade Runners did drive prices up, but I was online far too late to purchase stock.

I did have a plan to place a Jump Freighter in one of the NPC ORE stations that sell blueprints and buy as many BPOs of the new frigate as possible, but the move of liquid ISK into capital prints took precedence.

The rush to build the new Destroyer hulls also did not interest me as I expect their profit potential to rapidly vanish over the next two weeks.