Wednesday, December 8, 2010

The Cost Of Doing Business

So far I have managed to log an incredible 2 hours of cataclysm (thanks work). My computer is up and running however, and I am trudging forward into the new content. Anyway, I figured now would be a good time to talk about a very real cost of doing business.
 As cataclysm progresses and you start placing more and more new content items up on the auction house, You need to start paying  more attention to one of the numbers that a lot of people simply don’t factor in while making their calculations, The Deposit cost.
A small hole can sink a ship. So when you are judging what to price an item for seriously consider if you are better off Pricing it a little lower to give you a better chance of selling, or if you want to post it 2 or 3 times to maximize your profits. As the cataclysm Items are posted, As with any item with an Increased level.  It’s deposit cost is going to Higher as well. This is all fine and dandy if you manage to sell the item within a 48 hour period as you will get the deposit back. However if it takes 3-4 posts to sell, you may already be in the red. 
This is especially important if you are a person who makes the majority of their gold Flipping items.  Before you buy out those stacks of Herbs at 60% value…. Take a look at how much a 48 hour deposit is. You may find that after a single posting, You’re breaking even.
This is something I am guilty of myself…. In truth I probably lose a few hundred gold a day because of deposits.  It’s easy to do, If you’re not the spreadsheet type and you simply watch your gold keep going up, It’s easy to think you’ve got the market all figured out.  However if you take a quick look at the number of returned auctions , you should be able to see just how much Money  you are really losing.
Now I am not going to say you should be selling 100% of your auctions, which is of course a unreasonable expectation. But stepping back and taking a look at where the holes in your boat might be is an important thing…. The gold you will save is going to be substantial.


  1. Acadia, I think you forgot about AH cut on top of the deposit fee.

    Please add me to your blogroll if you like what you read!

  2. yea I didn't exactly include it in the post... was just concentrating on the deposit. But you are correct.You just can't forget the AH cut :)

  3. You have to look at the AH durations as well. If your competitors are using a 12-hour duration, it is usually not worth your paying for 48 hours, because after at most 12 hours, your item will be buried in the stack.

  4. Silverthorn makes a good point - for markets with heavy competition, 12-hours may be all you get before you're undercut by multiple auctioneers. I usually stick with a 24-hour post for consumable goods and 48-hours for gear.

    I'd do 12 hours for glyphs, but the deposit is so small, and there's often times when I can't get back to repost items that expire in 12-hours. That, and there a small handful of glyphs that only I list.

  5. I agree with the last 2 posters. There's many factors that go into auctioning an item. If there's no competition at all for an item in high demand, you could put the item up for a short period of time and it would sell quickly. If it's not in demand, I would make the auction 48 hours and just hope it sells.

    Looking at competition is not only important in deciding on your price, but also from an auction time perspective.