With the AH merger, surely many have noticed the cost of certain crafted items tanking far below the crafting cost.
For example, I’ve always been able to make a bit of extra gold selling bags. I’ve been saving up Shrouded Cloth and the base crafting cost for Shrouded Cloth bags is 132g, but people are listing bags, in bulk, for approximately 120-125g. Now, I understand the mats (cloth) used to make the bags have tanked, but they still cost 132g each to craft.
Can somebody please explain to me the logic in this? You are literally losing gold by doing this. So why do it?
Perhaps my first error is thinking there is some “logic” to it?
To be honest, it has always been this way. Most people who do their own gathering consider the materials to be free. So they don’t feel they have a cost and will undercut their items. Then others undercut to try and reduce their own loss. It becomes a vicious cycle just to sell.
Your assumption is based on “it costs 132g to buy the materials from the AH (and a vendor for any relevant recipes) and then craft it so bags should cost 132g”.
You’re not taking into account that a lot of people don’t pay attention to material cost because they farm the materials, or they just don’t care.
I’m not sure how I feel about it yet as its still fairly new and would like to reserve my judgement until the economy gets a new item cycle.
It is the end of an expansion with another announced expansion around the corner, so people have stuff they have been sitting on for years they are trying to push out. Even if the AH was not merged you would see this trend.
If we’re taking the economy and market super serious then time is money. In the time they farmed up the resources and made those bags what was the opportunity cost?
If they earned those materials while doing missions with an army of alts and did essentially get them passively while doing a circuit of other activities yielding a decent gold per hour strategy then it isn’t so bad.
If someone does the cancel and repost thing every time I post a new item they get the price reduced until they are selling for little better than cost. If you want to be first you get to be first but I will do my best to make sure you make nothing.
This is what I ended up doing. I had a ridiculous amount of cloth in my bank I wanted to get rid of so I made a slew of bags and sold them at a lower cost to free up the room.
If you are getting the cloth via farming yourself then I can see this happening. Or other ways. It is crafting at a loss if you do it soley from buying cloth.
Someone also can put these low to buy from people who post at the same price (since you can’t buy your own auctions.
That’s the price I paid for each of four a few days ago. I looked up what the cloth is selling for (1g72s each), and the cost of the thread needed, and a Shrouded Cloth Bag costs about 169g each to make right now…IF you buy the cloth from the AH. Not much of a profit margin, for sure.
You need to buy penumbra thread from a vendor. At exalted, that thread costs 8.8 gold and you need 15 of them, so 132 gold. It costs 132 gold to make the bag, even if the cloth is 100% free. It is possible the bags were crafted and sitting in a bamk from back before blizz increased the price of penumbra thread from 7.2 gold (and cheaper earlier, I think).
The bags don’t vendor for anywhere near that. The mats you need to BUY from a vendor to MAKE the bags costs more than what the bags are being sold on the AH for.