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Learn How To Vend
Avogadro Offline
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#1
Learn How To Vend
Listen up, HeRO.??Today we're going to learn how to vend.

"But cranky old man", you may say to yourself, "I already know how to vend!??I can open a shop in prontera, I can charge a brazillian zeny for a stone, and I can whine unendingly that my shopping experience isn't done for me by a @whosells command.??I'm an important piece of the HeRO economy!"

To this I say BALDERDASH.??I can count the market-savvy HeRO merchants on one hand and you're not one of them.

Before we get started, a note: If you don't have the time to put into selling or want to just open one shop to offload a card or the odd rare drop, then don't bother reading this guide.??It's not going to tell you things that are blatantly obvious to everyone with less than severe head trauma.??This is a guide for people who want to build up a nice second income or increase their profitability and shop profile.

Disclaimer: A lot of this guide was developed during discussions with 7-11, who has seriously done more detailed market research than most of you realize is possible, and is reproduced with his permission.

Additional Disclaimer: This is additionally only a framework to set up your shop/chain, and a few things have been left out because there's no point putting all the hard work out there for everyone to just copy.??If you think something's missing, it's probably intentional.??If you want to do well, you need to think for yourself.
(This post was last modified: 05-18-2010, 02:11 PM by Avogadro.)
05-18-2010, 06:35 AM
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Avogadro Offline
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#2
RE: Learn How To Vend
Chapter One: So you want to make cash money but have no idea where to start.

Start by logging into your new, separate account, because we assume you're either autotrading or not trying hard enough. First, grind up a good merchant. STR, DEX, and AGI are what you want to start with.

Now that you're at the training grounds remember to grab all the bonus exp and levels you can. Put your skill points into DEX first, until you get to about 15-20. Then everything goes into STR and AGI, VIT if you really think you need it. Once you've got all the job levels you need, go do the test for merchant, obviously. No sense wasting time in the training grounds now on base levels that you can better get elsewhere. Sell off anything you don't need, keeping bwings, fwings, pots, and armour. Anything that isn't worth money can just get thrown out. This should more than cover your merchant test fees and a bit of seed money if it's your first shop.

Protip: When you get your merchant job quest code, write it down on a piece of paper. If you're at all serious, you'll be doing this a few times anyway and it's easier to skim the text and just plug in the numbers when you have to from your "I want to make another merchant" sheet.

Once you have a shiny new merchant, make tracks for Morroc*. Save your spawn point here. Now pick up a concentration potion or two and head two south, killing pickies on the way until you're level 11. Equip the axe you got during the merchant test, hotkey your noob pots, and chug a conentration potion: now you're ready to kill mukas. That DEX you picked up in the novice grounds should help you hit more frequently, the STR is going to kill them faster, and the AGI should help you die less. You are GOING to die a few times since at Lv11, since you're pretty much muka-bait. Spam noob pots to keep alive, and use your fwings to get back when you die. Do this until you start getting less than about 10%/kill, then make an executive decision to grind out the rest or head to metalings. But in all seriousness, OC and DC aren't worth it on a vend alt so you should be done by now. Go reset your stats to full STR, tart up your character with Styla, and rent your cart - it's time to vend.

*Unless you have a stapo card, obviously.
05-18-2010, 06:36 AM
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Avogadro Offline
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#3
RE: Learn How To Vend
Chapter Two: I has a shop, but I don't know what I can sell!

If you're reading this, you probably have a merchant and are looking to offload some items for quick cash. That's great. I bet you just can't wait to plonk yourself down in Prontera square and throw up a shop called "CHEEP +7 WEPZ LOL HAX" and charge a billion zennies for something that's worth ten, right next to ten other people charging similar prices for equally-random garbage.

I sympathize with your parents right about now.

Before you start selling things, consider what you want to sell and what you CAN sell. If this is at all a long-term prospect (and assuming you're reading this guide it is), you're going to want some kind of reason for people to keep coming back to check out your business, especially during those down periods when you don't have anything special to sell.

So what do you want to sell? Well, ideally you want to sell anything that makes you money, and lots of it.

What can you sell? Pretty much everything.

Protip: One of the fastest ways to make a bit of cash is selling fwings and bwings. They sell by the thousands and you can realistically OC them and sell them back for virtually full NPC rates. Seriously, the only thing you need is time to keep setting up a shop and there's a huge gap in the market for someone to do it. The profitability then comes down to location (discussed in the next chapter) and how much time you have to put into the shop.

Anything you get from anything has the potential to sell. The things you need to determine are who wants it, when do they want it, and how badly do they want it? For example: lemons are pretty useless for the most part and grinding on anubis will probably net you a few dozen of them while you cut through the minorous chaff. You could sell them, or you could hold on to them in the event that somebody makes a custom quest that requires lemons. All in, I cleared more than ten million zeny during the last birthday quest selling junk from my Kafra that wouldn't have brought in 500k if I'd just OCd it. The lesson from this is that everything has a value to someone but that value fluctuates with time. Be ready for when it goes up and don't get discouraged if that value never goes up, unless you paid cash money for that item in speculation. In that case, learn from your mistake.

As another example, consider the needs of different classes. Stems, which you'll be getting by the truckload given how much I hear people like Moscovia, are invaluable to creators. Additionally poison spores and karvo to sins. Maybe you have a creator and like shrooming? Sell off the karvo. Or take all those red bloods and make fire arrows.

So if everything sells, why not sell everything? Well it's all well and good to do that, but you want people to have a reason to check your shops beyond "I'm going shopping". In that case, it helps to give them a reason such as having a useful item that they always need, so they will be checking it even when they're not specifically shopping. If you have things people need, they'll be stopping by more often.
05-18-2010, 06:37 AM
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Avogadro Offline
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#4
RE: Learn How To Vend
Chapter Three: You're so close you can taste the money, but its sweet, sweet nectar makes you stop thinking.

The HeRO market operates on three simple rules.

1. People are going to be cheap, and they're going to do it loudly.
2. People are actually going to be lazy, and they're going to do it quietly.
3. People will generally choose lazy over cheap.

"So what does this have to do with anything?", you ask.??I know you're asking it because if you weren't asking it then you'd be doing it, and nobody's really doing it.??What it means is that people are going to whine like spoiled little children when they have to pay anything for items, but will pay it anyway when it means the difference between paying it or walking for ten seconds.??And??those two factors are inversely proportional.??The more work that goes into something, the more people will pay above and beyond what they claim they will.??True story.??Of course, there's the chance that you're going to overprice a few items, but experience will generally tell you where things sell for what.?? To expand on that, if you vend innovative things in innovative places you'll be able to make more money than you ever could by selling the same old crap in the same old place.??This is why people like Hibiki and 7-11 did so well*.

Protip: Vending in Prontera has the benefit of being where people are.??It also has the drawbacks of being in direct competition with everyone else on the server.??Weigh those carefully, depending on what you're selling.

Lets consider an example.??You're selling a hax weapon with some unpossible card combo on it.??You may want to go with your instinct and sell it in pront.??You may also want to consider who your market is and sell it in the town where that market is based.??Every guild has a base, and they're lazy.??It may result in a slower sale, but if you put up a shop in a good location in a big guild's town, your target market is much more likely to look at it.

Protip: Don't be a dick and put up your shop in the middle of where people want to be.??That's a sure-fire way to get ignored.??Do it respectfully, in the right location.??Some guilds are actually made up of adults and will show you respect if you do the same to them.??Not all, of course, but some.

The point of all of this is that we don't have a @whosells command so you need to do a tiny bit of thinking to make up the difference.??Not much, but a bit.??Imagination is going to pay off a lot more than whining about it perpetually.??Your biggest strategic advantage is how much more creative you can be than the other shops: the ones who stopped reading this guide one chapter ago.??Use locations carefully, and set up where the consumers are, not where you think they want to be.

So if you should take away anything from this chapter it's that people will pay a premium if they don't have to work.??Use the lack of @whosells to your advantage and try to locate shops in places where your items are more in demand, knowing that people are going to have to check the shops and they're going to look at the ones where they hang out more often.??Additionally, people will pay a lot more than you think if you provide a useful service in a good location.??Don't fall into the trap of being unimaginative and boring (aka, vending in Prontera only).??It reduces the chance of your shop being noticed and thus your items being sold.

*This isn't all of it, but knowing them both I can say it's a big reason.
(This post was last modified: 05-18-2010, 06:38 AM by Avogadro.)
05-18-2010, 06:38 AM
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Avogadro Offline
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#5
RE: Learn How To Vend
Chapter Four: Everybody is complaining about my prices!

Note: The following section contains a tiny bit of basic math.??It's not my problem if you don't understand it.

So you've opened up your shop in a good location, you've stocked it with items, and now you're getting hate mail.??It's pretty disheartening, right???You feel like the world is against you and you'll never make another sale again.

Well buck up.??The odds are that you've gotten under then skin of a few malcontents who would complain if you were giving the stuff away for free.??Ignore them.??The only thing that matters in this game is the numbers at the end of the day.

Keep track of your income.??Work out your average profit per day on the things you're selling frequently and watch that number.??Adjusting the price should make the number change as your throughput balances out with your profit margin.??There's no one optimal value for it, but in principle a higher price will still give you a reasonable return on investment, unless you're actually overpriced.??In theory, assume some limit to sales in any given town if the item in question is at its bare minimum sale value, let's say 100z.??For the sake of argument, let's assume that the amount of sales with respect to this initial value (a.k.a. normalized to the initial sales) is goign to decrease linearly.??Sure, this is pretty unrealistic, but it's a first-order approximation for example's sake.??Additionally, there's a linear increase in profit with increasing price.... because that's obvious.??Anyway, when you multiply the sales rate together you get your income, normalized to some base level, and that's graphed below.??Yeah, it's an approximation, but the principle is there.??Higher prices translate into more sales until a point where the reduced sales overcome the increased income.

Now that said, some things have pretty well-defined prices.??Empty Bottles spring to mind.??Getting more money for those is going to be tough, so you may want to look for something with a better margin.??I know I just said everything is sellable, but some things are significantly less profitable than others.??However, if you're looking at this as a draw to keep people checking your shops, then even standard things like bottles could be sufficient, just not terribly profitable unless you can get them in bulk yourself.

Now the point of this chapter is that the correct price is something you need to work out for yourself without listening to the whiners.??If the whiners knew what they were talking about they'd be running a shop.??To expand on that, occasionally the whiners will run a shop.??You'll notice this when a shop opens right next door that is very similar to yours but with slightly lower prices.??They're characterized by little imagination and even less market sense, but an abundance of time and dedication to cutting into your sales.??In most cases this is a one-shot thing where they'll get bored after a week or three and then leave.??In a few cases, you're going to have to put some thought into your pricing.??Now if you're selling one-off things, this is less of an issue, but if you're also selling common things it becomes a big deal.

So if you haven't been listening up to now, the only factor that you should be concerned about is your actual income.??In this respect, a price war is never good; it reduces your income rate and takes up your valuable time underpricing kids who don't understand the basis of what they're doing.??But if you want to come out of it ahead, you can't just rely on innovative marketing.??You need to keep your profits up or be able to afford a while with low income.??To do that, you need to figure out your bottom line.??This assumes that you're paying money for something, but it also is applicable when you're buying it from another vendor and reselling for a profit.??Either way, it's important.

Definitions:
Pv = Vending price
PDC = your max DC price
Pw = cost to use warper (based on a round-trip)
Pk = cost to use the kafra
Nbuy = Number of items you can buy at a single time before needing to put them in storage
Nwd = Number of items you withdraw from kafra in a single session

Vend tax exists and it's roughly 2%*.??Your break-even point is then whatever you can get as a DC price, factoring in that you're going to lose 2% to tax.??If you have an item that you can buy for 100 zeny, your not-wasting-time price is 103 zeny (1).??Selling for anything less than this means you're losing money per sale.

(1)?? Pv(1-0.02) >= PDC.

Beyond this, you need to consider what it costs you to get to where you want to be to get the stuff you need to sell.??If you're selling berzerk pots, for example, you need to pay the warper to get to Comodo, to get back to where you're selling, and any associated costs like the Kafra.??The expanded break-even equation is then:

(2)??Pv(1-0.02) - Pw - Pk/Nbuy - Pk/Nwd >= PDC

This is the price per unit that you need to have in order to not lose money.??According to 7-11, every single competitor has at one point or another gone below this price point and lost money on a sale.??Don't do that..??Know this number for every item you have, since if you have a good enough idea, you're likely going to need to protect it.??At this point, keeping track of sales is also going to serve you well, as you compete for market share.

As a secondary point, this number is not necessarily a bottom number.??Everyone may have a different PDC, but just because you have to sell for more it does not necessarily mean you're not making a difference.??Selling for less means you're making less, and if you have a razor-thin margin then you're not necessarily making money, you're just not losing it.??Look at that total profit number, sometimes just having sales isn't worth it.??Additionally, a very important factor in these cases is time**.??Dynamic pricing means you need to be checking as frequently as possible, otherwise you'll fall behind and become less relevant.

So what do you need to take away from this???Well, prices are dynamic and you want to maximize yours while also maximizing sales.??This is extremely variable between items and locations, and is affected by competition.??Don't listen to the vocal whiners, listen to your statistics.??Also: price wars are extremely time-consuming and require a lot of careful analysis, but can pay off.??If you were to start a shop to compete with a chain like pnp right now, the odds of success are high, so long as you're dedicated.

Protip: If you're competing with someone who doesn't check their shops regularly, sometimes it's more profitable to buy them out and raise your prices than reduce yours in hopes of selling more.??You have a window of opportunity there.??Use it.


* In terms of calculating price per item it's actually not exactly 2%.??The actual math is much more complicated and based on the total sale.??Just know that if you're operating in the region of 1z profits per item, you want to get out of there as fast as possible, since there's a chance you could be running a charity and not realizing it.
**As I've been authorized to say: 7-11 just didn't have the time to put into the game anymore.??Math and analysis only works when you have the time to make them work.
(This post was last modified: 05-18-2010, 08:48 AM by Avogadro.)
05-18-2010, 06:39 AM
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Avogadro Offline
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#6
RE: Learn How To Vend
Chapter Five: Conclusions

You can make a lot of money by selling things in places, and you can make a lot more money selling the right things in the right places for the right prices.??If you get it right, you can have a nice income on the side with relatively little work.??So in the spirit of collaboration that went into this article, 7-11 and I have some suggestions for marketing that should make someone a reasonable profit with reasonable work:

1. Sell fwings in every town where people congregate.??They go fast and you should realistically make about 10-15z a pop on them.??Sure that's only up to ~23,500z a cart, but for something that takes less than two minutes to set up it's a good start.??It's still 23k per shop per day for zero effort.??Plus, they're pretty much always in demand.??Bwings are also a good investment, but they sell more slowly.??Neither of us ever bothered to figure out what's more profitable between the two.
2. Blue Gemstones are also pretty good to sell, and nobody's seriously doing it.??You can buy them in Juno.??Go nuts.
3. Start up a new chain to compete with pnp.??They seem to have less time now, and that's going to be your advantage.
4. Awake pots always sell, but zerks sell for more.??It comes down to profit vs sales.??Conc pots aren't great.
5. Sell brewing mats in Aldebaran.??You need to go through there to get to the alchemist guild anyway, why not set up a few shops selling everything else so people can see them while they're heading to buy medicine bowls?
6. Sell things for quests in the room with the NPC, where possible.??That's how I made a mint on the birthday quest, before everybody else showed up and killed the profitability somewhat.
7. Sell arrow quivers.??A fairly common base price is 1500z per quiver.??Feel free to play with that, but they do sell.
8. Sell cursed water.??You should be able to get a reasonable rate on that, especially if you can do all the work yourself.

Acknowledgements:
I'd like to thank 7-11 for a lot of market research and enough data to write a book.
I'd also like to thank Hibiki for being the only merchant with a comparable level of innovation in the last three years.
And, of course, I'd like to thank the people of the server who bought from my various attempts at selling in non-traditional means.

7-11 would like to thank most of Behemoth (but not Altera) for being a positive source of feedback, and Pictish for a few creative insights that would have otherwise slipped by.

Epilogue:
This guide is intended for people who seriously want to try to make a go at vending for a secondary source of income.??I realize that a lot of people have strong feelings about this and after discussions, realize there's a lot of hate on out there for people who want to do anything differently than has been done.??Understand that I don't care, nor do I feel any sort of desire to respect your opinion.

We wrote this to try to add something to the market with some information and ideas, and if you don't like it then coming on this thread and whining is going to accomplish nothing.

tl:dr
Didn't bother to read it???Too bad.
(This post was last modified: 05-18-2010, 06:48 AM by Avogadro.)
05-18-2010, 06:41 AM
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Ultima_Pi Offline
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#7
RE: Learn How To Vend
I prefer going Str/Vit/Dex, the Agi isn't going to speed up the process significantly unless you go to 44 for Bloody Axe. Even then, you won't be that fast.

I melee Poporings off Saplings til I have about 10 under the Hit required for Mavkas, then I go Mammo said Mavkas to 44.

Reset to pure Str, Weight Limit 10, Pushcart 10, ID, and Vending 10 (forgot pre-preqs, drop ID or Weight Limit for more Vending).

Blue Gems are also sold in Geffen.

I play my own game with my pricing, but I guess I'll read the rest in class.
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05-18-2010, 07:32 AM
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Avogadro Offline
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#8
RE:??Learn How To Vend
Ultima_Pi Wrote:I melee Poporings off Saplings til I have about 10 under the Hit required for Mavkas, then I go Mammo said Mavkas to 44.
...

Reset to pure Str, Weight Limit 10, Pushcart 10, ID, and Vending 10 (forgot pre-preqs, drop ID or Weight Limit for more Vending).

For a dedicated vending merchant, that seems to be excessive. You technically only need vending 10 and pushcart... and the prereqs, but for a pure vending merchant, you don't need any more. Of course, this implies you don't plan on doing anything but vending with a character.

I've seen 7-11 roll up a new shop on nothing but a noob pack in under 15 minutes on straight mukas, and still have most of that money left at the end. It's nothing if not extremely effective.

Ultima_Pi Wrote:Blue Gems are also sold in Geffen.

But they're easier to get to in Juno.

Same as Yggs in Umbala/Aldebaran. It's faster to buy them in bulk in Umbala becasue the shop is so close to the kafra, rather than walking halfway across the map to get a few hundred.
05-18-2010, 08:36 AM
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Seth~ Offline
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#9
RE: Learn How To Vend
lol. Poor PnP. But it will be nice to see another chain open up. Make sure to open a shop in all the main towns, especially guild towns and Prontera. Prontera might need a few more shops as 7-11 and pnp has shown. For a real insight into handy items needed you can go visit Umbala, here Dragon Empire has a guild shop see what it vends and ignore their prices.

ohh, ps. Don't vend in Umbala me and DE will out price you.
05-18-2010, 01:34 PM
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Aaronock Offline
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#10
RE: Learn How To Vend
LOL I'm totally going to make a shop now in Umbala that will be hard to beat, there is only so low you can go! *Insert Q_Q, T_T, ;O;, etc faces here for the competition*
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05-18-2010, 02:30 PM
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