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Trading 204: Cross-Selling

Modular Possibilities

A Tech 3 ship is a great example of an item that has high cross-selling opportunities. A Tech 3 hull by itself it useless; a person must assemble it by combining it with five Subsystem components –defensive, electronic, engineering, offensive, and propulsion. This requirement for flying the ship gives a trader the ability to also stock the necessary Subsystems and increase potential profits.

Tengu Hull Performance

I have found the Tengu hull to have the most volume out of the four racial Tech 3 hulls due to it’s PVP and PVE applications. The Loki hull is a close second, but it out-shined by the demand of the Tengu.

Over 473 days of trading I’ve sold 56 Tengu hulls. Moving 14.7 B ISK, I was able to achieve a 2.29 B total profit with the average profit per hull coming in at 41.65 M.

2013-08-19_tengu

Tengu Subsystem Performance

The real trading power comes from using some intelligence and trending to find the most popular Subsystems. My analysis shows that the Amplification Node was the most profitable and also had the highest average profit. The Fuel Catalyst is also a strong performer as it had the second highest average profit. At the bottom of the list was the Covert Reconfiguration as I accredit the cloakey role to be a very niche role.

2013-08-30_tengu_subsystems

Cross-selling Performance

25 of the Tengu hull sales included the same client buying one or more Subsystems at or around the same time. On average a person bought 2.6 Subsystems with an average total of 52.4 M profit.

Further analysis shows that the best performance comes from also selling a person 3-4 Subsystems when they are also buying the Tengu hull as the average profit per Subsystem for these transactions types comes in at 21.7-22 M.

2013-08-19_subsystem_profit

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HAC Price Volatility

Lockefox got me thinking about my instincts for trading HACs a few days ago. I have always felt the Ishtar’s price to be historically less volatile than then Zealot so I went out to run the numbers and prove my theory.

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Annualized Volatility

8d20ec0ca96fd6e58ccf8b99e496a9ba

P = time period

Results

The numbers show that I was correct. If you want something stable to trade, go with the Vagabond. Higher risk items include the Ishtar and Zealot hulls.

2013-08-20_hac_volatility_results

Here is a snapshot of the historical buy prices for reference.

2013-08-20_hac_prices


New Chapter

No, I am not leaving Eve. I have accepted an Engineering job in the San Francisco Bay Area and will be moving at the end of the summer. This is a major career advancement where I am going from a generalist to an Engineering specialist. My posting will become erratic, but I will return after I get the family settled from the cross-country move.

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Wallet Manager Code Update

It is with great pain that I have to announce that my wallet manager code was compromised at an unknown time in the past. I haven’t spent too much time doing computer forensics because I believe that I was compromised on a previous VM that hosted my site in 2011, which has since been deleted in favor of a OS refresh.

Details about the compromise can be found on this stackoverflow.com post. If you have downloaded and are running a copy of my Wallet Manager, you will want to look at files in the /protected/models/ directory for the exploit code.

Going forward I am going to publish the Wallet Manager code to a public GitHub repository. My goal will be to secure the code, make it open source, and enable community contributions.


100M Skill Points

My main has passed the 100M skill point mark, greatly validating my bitter vet status.

2013-08-07_blake_armitage

I have also almost achieved some nice V’s over the past few years.

Gallente Carrier V
Fighters V
Sentry Drone Interfacing V
Heavy Drone Operation V
Logistics V
Heavy Assault Cruisers V

2013-08-07_battleship

2013-08-07_navigation

 

2013-08-07_bc

What’s the next bitter vet milestone? 150 M skill points?


Outsourcing with Black Frog Logistics

Overview

When my trading and production operations are in a refined and focused state, Eve Online becomes Logistics Simulator Online(tm). The singular focus is to take goods from one area and get them to another place where they are worth more due to conflict or different styles of gameplay.

To minimize risk, I do a lot of the freighting and capital jumping on my own. The less people that know about your movements the better. Even with a perfected station-to-station jump technique, I needed more manpower, and hence started to look for a partner.

Outsourcing

When I was supplying for the now former TEST capital system of 6VDT-H in Fountain, I ran into a scenario where the amount of m3 I was moving per week could not keep up with demand. I was performing around eight to ten round trips per week which equates to around 2,500,000-3,200,000 m3 of goods, and there was still more work to be done if I had more game time.

I was entering a scenario where I was pushing way beyond the 200 M/hour income rate. At this level, you need to pick your battles carefully and choose where to spend your time. I was now getting to the point where I needed more manpower.

Having worked with the Highsec division of Red Frog many times, I have grown to rely on their service for large moves. They have another division called Black Frog Logistics that deals on moving goods around is the Low and NPC Nullsec.

After performing some due-diligence, the risks were acceptable and I partnered with Black Frog for my operations. After contacting Black Frog (The Black Rook) and seeing if they could make an exception beyond the published 5B/contract mark for me since I was going to be providing them with a lot of business, they agreed to work with me. I assumed higher risk, paid a little more in contract prices, but it got the job done for an acceptable price.

The Route

My shipping route was from Placid into Fountain with a quiet lowsec midpoint in Solitude. I needed assistance getting goods from Highsec into the Lowsec station as moving items from Highsec into Lowsec, jumping back to a Lowsec next to a Highsec, using the gate, docking, and jumping out again was the most time consuming operation in my logistics chain.

The Babirmoult Lowsec system has a Gallente station with a nice docking range. After the route and station was picked on paper, I spent a few days scouting the area. I looked at killboards for anything out of the ordinary and I found that there was only the occasional cyno frigate kill.

2013-08-04_placid_fountain_route

Spreadsheet Calculations

Running an analysis with a set of high volume items, I found that an outlay of 12.982 B would net around 4.127 B of profit even considering the cost of outsourcing to Black Frog. Here is a small sample of some of my worksheets for this outsourcing operation.

2013-08-04_black_frog_calcs

Daily Routine

My routine at the time consisted of scanning markets, reading up on fleet doctrines, and looking at killboard loss summaries in order to predict future needs. I then contracted out items from Jita and Amarr to Black Frog and often later that day my items were delivered to Babirmoult.

The station-to-station jump (I will make a video on how to do this) between Babirmoult and 6VDT is almost no risk if done properly so my goods arrived in the TEST capital usually within under 24 hours of seeing market potential.

Quick, low-risk logistics. That is the name of the game if you want to compete.


Naglfar Bubble

In the Odyssey patch the split weapon system was removed from the Naglfar hull bringing with it increased demand for the Dreadnought hull. Having just come into possession of a ME8 BPO, we quickly put it into production as I knew the demand was going to grow.

2013-08-01_naglfar_sales

What we’ve seen over the past 5 months due to the increased demand was a large increase in the price. Sales have been quick showing that there is a strong demand.

The capital market is quite different than any other market I have worked with. The barrier to entry is high due to the core profits coming from owning a complete set of BPOs, the timescale is measured in weeks due to the building of parts that go into hull construction, and the demand can shift due to a change in popularity.

In contrast to the Cruiser market where a single BPO can make the hull, a unit can be delivered in 2 hours, and almost all of the hulls are in demand, the differentiators set capital production in a league of its own.