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CyberChick
The Ghost Riders The Makhai
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Posted - 2007.09.10 23:45:00 -
[1]
As an investor in a capital ship production corp, I have seen a disturbing trend of capital ship price plummeting, six months ago the cost of a chimera was 1.1 billion, but the increase of producers wanting to cashing in, however more and more producers of single vessels using theforges excellent component sales has caused as I call it a charity shop mentality, the market is now flooded, and at one point two weeks ago a total of 21 Archon's where on sale on the contract system. This prompted the sale of my alt corps Archon me1 bpo at the npc price.
Why I am i concerned, the dwindling profits obviously, but also I hope that the declining profits don't become close too build cost, leading to Capital-Ships-Online, where they can be thrown away for insurance cost and every alliance out there starts having large scale capital blobs.
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Sarah McTeef
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Posted - 2007.09.11 00:30:00 -
[2]
You hit the nail on the head. Competition is good for the consumer, not so much the producer.
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Archbishop
Amarr PIE Inc.
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Posted - 2007.09.11 00:39:00 -
[3]
When you factor in the "I mined it it's free" crowd building it's even worse. I know two seperate Gallente folks who are building capitals and who strip mine with a fleet of barges. They basically sell at a "profit" but view only bought minerals as "build cost" totally ignoring their mined minerals. They enjoy mining so it's "fun" for them but it's hard to compete against stuff like that.
I'd recommend making a nice recycling spreadsheet and start watching for bargins. I've yet to recycle anything larger than a BS but I am keeping my eyes open.
Archie
PIE WEBSITE & FORUMS |
Kenneth Brackhaven
Gallente Brackhaven Investments
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Posted - 2007.09.11 02:36:00 -
[4]
Edited by: Kenneth Brackhaven on 11/09/2007 02:35:52 The biggest difference I have noticed is that producers in Eve will never behave like producers in real life. Why? Because they can ignore that extra 15% of profit to make a quick sale. In eve it seems like any profit is reasonable profit. Whereas in real life, you do everything you can to squeeze a quarter out of a nickel.
With the miner crowd, this gets even more dilluted because their margins are so much lower than everyone elses. Jacking up the prices on your ships to keep your profit line consistent isn't a possibility because there's always some jackass that will undercut you.
The ship channel is a perfect example. You have your regular builders who sell their items at a fixed cost and advertise as such with predictable regularity, and you have those that will undercut them the second they spam their sale.
I have survived on repeat business. I have a regular line of customers that keep my manufacturing lines completely locked out. I'm in the minority and that really sucks. I'd love to see an Eve economy that supported the manufacturers, not the resellers.
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Shadarle
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Posted - 2007.09.11 05:14:00 -
[5]
Originally by: CyberChick As an investor in a capital ship production corp, I have seen a disturbing trend of capital ship price plummeting, six months ago the cost of a chimera was 1.1 billion, but the increase of producers wanting to cashing in, however more and more producers of single vessels using theforges excellent component sales has caused as I call it a charity shop mentality, the market is now flooded, and at one point two weeks ago a total of 21 Archon's where on sale on the contract system. This prompted the sale of my alt corps Archon me1 bpo at the npc price.
Why I am i concerned, the dwindling profits obviously, but also I hope that the declining profits don't become close too build cost, leading to Capital-Ships-Online, where they can be thrown away for insurance cost and every alliance out there starts having large scale capital blobs.
I don't see the point of this post. It seems like you're just wanting to whine to an entire forum of people. What do you expect to happen to capital ship margins? Do you expect them to go up? The longer the game goes the more people will produce capital ships. The more people who produce them the lower the margins go. It's simple. If you can't handle it get out of the market. Whining about your lost profits is not more useful than people who whine about people who don't use .01 or those who whine about those who do use .01. Whining serves no purpose. Either change the way you do business to compensate for a new market situation or change markets... or stay where you are and make less money. Either way, I'm making more money than ever the way the market is shaping up. Far more than I did when I actually wasted time producing capital ships myself.
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LaVista Vista
Corporate Research And Production Pty Ltd Zzz
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Posted - 2007.09.11 07:37:00 -
[6]
Once CCP does whats needed, the prices will keep falling.
But i think CCP will make more capital level 5 missions, but i have had terrible nightmares that CCP wont make a much bigger demand, thus increasing profit.
But i doubt people wanna actually sell their ships for less than the current going price. That would be stupid, considering the high investment needed, and the troubles with low-sec.
But then again, theres so many stupid people in eve.
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Akita T
Caldari Navy Volunteer Task Force
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Posted - 2007.09.11 08:51:00 -
[7]
When the market is cornered by moronic manufacturers ("these minerals I mined are free", "time spent building means nothing", "sales price equals profit"), all that's left to do is stop manufacturing... and start trading. _
EVE GOLDEN RULES | Char creation guide | Stack-nerfing explained |
LaVista Vista
Corporate Research And Production Pty Ltd Zzz
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Posted - 2007.09.11 09:06:00 -
[8]
Originally by: Akita T When the market is cornered by moronic manufacturers ("these minerals I mined are free", "time spent building means nothing", "sales price equals profit"), all that's left to do is stop manufacturing... and start trading.
I have had little success with that. At least compared to how much i have made in production. Wanna learn me how? .
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Akita T
Caldari Navy Volunteer Task Force
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Posted - 2007.09.11 09:32:00 -
[9]
Well, if you were a manufacturer, I can only assume you have near-perfect or perfect skills, and you know how to calculate both your actual cost of manufacture and the opportunity cost of all components involved. If you see anything for sale close to (or even under) opportunity cost, buy it instantly (then either recycle and sell parts if market it way too "full", or put back on the market at your regular sales price)... same if it's close to (or under) your projected "cost of manufacture", it's time to buy it and put it up for sale at a higher price (no recycling option here).
You do have to have a huge starting capital (think at least 15-20 bil or around that), so you'll be able to "absorb" all other "silly manufacturer" products on sale to build up your "product buffer". Same as with any other T1 product, really... it's just a higher value per unit. All other "normal rules" of manufacture vs trading still apply. _
EVE GOLDEN RULES | Char creation guide | Stack-nerfing explained |
LaVista Vista
Corporate Research And Production Pty Ltd Zzz
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Posted - 2007.09.11 09:40:00 -
[10]
Originally by: Akita T Well, if you were a manufacturer, I can only assume you have near-perfect or perfect skills, and you know how to calculate both your actual cost of manufacture and the opportunity cost of all components involved. If you see anything for sale close to (or even under) opportunity cost, buy it instantly (then either recycle and sell parts if market it way too "full", or put back on the market at your regular sales price)... same if it's close to (or under) your projected "cost of manufacture", it's time to buy it and put it up for sale at a higher price (no recycling option here).
You do have to have a huge starting capital (think at least 15-20 bil or around that), so you'll be able to "absorb" all other "silly manufacturer" products on sale to build up your "product buffer". Same as with any other T1 product, really... it's just a higher value per unit. All other "normal rules" of manufacture vs trading still apply.
Sure, i have perfect skills, and i can calculate the cost.
But with capitals its a dangerous market. If you buy up the cheap carriers and resell them, you will make it look like theres a demand. More people will build them, and all of a sudden theres more carriers for sale than theres demand, worse than before even.
But im mostlikely wrong
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Akita T
Caldari Navy Volunteer Task Force
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Posted - 2007.09.11 09:46:00 -
[11]
Considering the build time on carriers, it will take some sweet time before market trends shift so dramatically you can't make a living out of reselling them. A good trader knows when to get into and out of a certain market _
EVE GOLDEN RULES | Char creation guide | Stack-nerfing explained |
CyberChick
The Ghost Riders The Makhai
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Posted - 2007.09.11 15:24:00 -
[12]
Originally by: Shadarle
Originally by: CyberChick As an investor in a capital ship production corp, I have seen a disturbing trend of capital ship price plummeting, six months ago the cost of a chimera was 1.1 billion, but the increase of producers wanting to cashing in, however more and more producers of single vessels using theforges excellent component sales has caused as I call it a charity shop mentality, the market is now flooded, and at one point two weeks ago a total of 21 Archon's where on sale on the contract system. This prompted the sale of my alt corps Archon me1 bpo at the npc price.
Why I am i concerned, the dwindling profits obviously, but also I hope that the declining profits don't become close too build cost, leading to Capital-Ships-Online, where they can be thrown away for insurance cost and every alliance out there starts having large scale capital blobs.
I don't see the point of this post. It seems like you're just wanting to whine to an entire forum of people. What do you expect to happen to capital ship margins? Do you expect them to go up? The longer the game goes the more people will produce capital ships. The more people who produce them the lower the margins go. It's simple. If you can't handle it get out of the market. Whining about your lost profits is not more useful than people who whine about people who don't use .01 or those who whine about those who do use .01. Whining serves no purpose. Either change the way you do business to compensate for a new market situation or change markets... or stay where you are and make less money. Either way, I'm making more money than ever the way the market is shaping up. Far more than I did when I actually wasted time producing capital ships myself.
Actually I am hoping to bring up a discussion about capital production vs profits, of the 9 replies so far, 8 have achieved this.
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M4ria
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Posted - 2007.09.11 18:45:00 -
[13]
The profite going out of the window was exactly the reason why my corp sold all Capital BPOs we had (and that have been all except the super capitals)
Some PPL just don't include things to the building cost that others do.
For me it was always a pain in the a** to haul all the mins needed to build so i would include that to the price for other guys this is just fun. Some ppl don't include the money you need to get the buy orders up (for mins) or whatever.
Some ppl are just stupid. i have seen a revelation go for 1.2 b 1 week ago, what are you expecting ?
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Shadarle
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Posted - 2007.09.11 22:24:00 -
[14]
Originally by: CyberChick
Originally by: Shadarle
Originally by: CyberChick As an investor in a capital ship production corp, I have seen a disturbing trend of capital ship price plummeting, six months ago the cost of a chimera was 1.1 billion, but the increase of producers wanting to cashing in, however more and more producers of single vessels using theforges excellent component sales has caused as I call it a charity shop mentality, the market is now flooded, and at one point two weeks ago a total of 21 Archon's where on sale on the contract system. This prompted the sale of my alt corps Archon me1 bpo at the npc price.
Why I am i concerned, the dwindling profits obviously, but also I hope that the declining profits don't become close too build cost, leading to Capital-Ships-Online, where they can be thrown away for insurance cost and every alliance out there starts having large scale capital blobs.
I don't see the point of this post. It seems like you're just wanting to whine to an entire forum of people. What do you expect to happen to capital ship margins? Do you expect them to go up? The longer the game goes the more people will produce capital ships. The more people who produce them the lower the margins go. It's simple. If you can't handle it get out of the market. Whining about your lost profits is not more useful than people who whine about people who don't use .01 or those who whine about those who do use .01. Whining serves no purpose. Either change the way you do business to compensate for a new market situation or change markets... or stay where you are and make less money. Either way, I'm making more money than ever the way the market is shaping up. Far more than I did when I actually wasted time producing capital ships myself.
Actually I am hoping to bring up a discussion about capital production vs profits, of the 9 replies so far, 8 have achieved this.
Nice attempt to dig back at me... but there has already been a lot of discussion on this topic and the answer has been quite clear for a while. Capital production is not really profitable anymore. It used to be, it isn't now. There, your discussion is over. The people that knew what they were doing either got out of the capital market or figured out new markets to sell for decent profits still. The rest who just started up decided to build ships cause it was gonna make them uber money... and now they are selling them for a loss or almost no profit on contracts.
And I'm loving it. I am making a lot of money off this current craze to build capital ships and sell them for a loss.
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Shadarle
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Posted - 2007.09.11 22:26:00 -
[15]
Originally by: Akita T Considering the build time on carriers, it will take some sweet time before market trends shift so dramatically you can't make a living out of reselling them. A good trader knows when to get into and out of a certain market
Indeed. If you're noticing that markets you're in are not profitable or you're losing money then you need to re-evaluate your trading strategies and determine if you adapt fast enough to changes.
There is nothing wrong with screwing with a market, making a good chunk of money off of it, then getting the hell out of dodge before the market crashes hard because of your interference. Who cares if the market is dead and everyone else loses a lot of money, as long as you made a profit it's all good.
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Daeva Vios
Ardent Adversary Anvil.
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Posted - 2007.09.11 23:04:00 -
[16]
In fact, a good market PvPer will note that it's very good when the competition is losing money, especially when they're losing lots and lots of money.
Complaining about this shows lack of foresight.
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Dueck
Setenta Corp Combined Planetary Union
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Posted - 2007.09.12 07:12:00 -
[17]
Originally by: Daeva Vios In fact, a good market PvPer will note that it's very good when the competition is losing money, especially when they're losing lots and lots of money.
Complaining about this shows lack of foresight.
The problem here, which has already been alluded to in this thread, is that the competition is not losing isk when they undervalue their mining/hauling time. From their perspective, they're still making a profit, and this is true in the sense that their wallet balance will continue to go up over time.
As long as producers are willing to discount their time in such a manner, it will be impossible to take them out of the market by watching them "lose lots of money."
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Shadarle
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Posted - 2007.09.12 08:05:00 -
[18]
Originally by: Dueck As long as producers are willing to discount their time in such a manner, it will be impossible to take them out of the market by watching them "lose lots of money."
You're right, there is absolutely no money to be made due to their stupidity. Just go about your normal business... these are not the droids you're looking for.
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Chainsaw Plankton
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Posted - 2007.09.12 20:06:00 -
[19]
Originally by: M4ria
Some ppl are just stupid. i have seen a revelation go for 1.2 b 1 week ago, what are you expecting ?
so where can i buy that
and i didn't buy it on the market therefore it is free
although selling for 1.2 bil and mining all the minerals yourself is profit... well once you have sold enough to cover all the bpos involved, pos fuel used (if a pos is used), all mining barges. its a stupid low profit, but still a profit...
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Angela Toren
Amarr Toren Shipyards
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Posted - 2007.09.12 22:20:00 -
[20]
Edited by: Angela Toren on 12/09/2007 22:27:01 It's because some capital builders are naive.
Trit has gone up, pyerite has gone up, mexallon has skyrocketed and capital builders are still screwing themselves when it comes to sale time. Instead of selling at a fair and decent mark up they offload them like mouldy fruit for any price going.
They don't factor in time or effort in their building. I'm pretty damn sure no one actually calculates to the last isk the cost of what they making either. In actual fact you could probably make more net profit rolling battleships off the production line in those 13 or so days it takes to build a carrier.
Oh and one more thing, just because you mine the minerals yourself it doesn't mean it costs you nothing! Your mining time should be factored in, your mineral price should at least be based around market average, all your stations manufacturing costs and the endless running around and hauling should be factored in.
How do you calculate what your time is worth? Simple, any other activity that you could do to make isk other than mining. For instance if it took you 14 hours of mining to get the minerals needed the calculate how much isk you would have made doing 14 hours of missions or ratting.
Your minerals will always have a value and that should never be less than the market average, if you are selling your mined minerals for less than the market is paying for them then you are wating your time and efforts.
I refrain from pricing my ships the same as everybody else because to be honest i think most people don't know what the hell they are doing.
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LordBrutor
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Posted - 2007.09.17 22:26:00 -
[21]
What i dont understand is why people havent formed a syndicate and created a monopoly on the market. If 10 or 12 of the Big Producers got together and created a ship yard with say 10 BPO of each ship you could devote time to build 5 reseach 5 and bring down the ME of each BPO. With Theforges capital components shop and the way people panic if they hold on to the ships for a day or 2 they are pricing us out of the market. Lets get together and form a big ship yard with outputs well beyond the little guy who buys a BPC and makes one the sells off the ridicules prices because he is afraid he has made a mistake or needs the cash back so quick he wont wait for more then a day before he panics and throws up a Dread for 1.3bil.
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Shadarle
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Posted - 2007.09.18 00:28:00 -
[22]
Originally by: LordBrutor What i dont understand is why people havent formed a syndicate and created a monopoly on the market. If 10 or 12 of the Big Producers got together and created a ship yard with say 10 BPO of each ship you could devote time to build 5 reseach 5 and bring down the ME of each BPO. With Theforges capital components shop and the way people panic if they hold on to the ships for a day or 2 they are pricing us out of the market. Lets get together and form a big ship yard with outputs well beyond the little guy who buys a BPC and makes one the sells off the ridicules prices because he is afraid he has made a mistake or needs the cash back so quick he wont wait for more then a day before he panics and throws up a Dread for 1.3bil.
Yeah, why don't you do that... I'll not join it and I'll start producing capital ships again sell them just below yours, so you can buy mine up and give me instant profit.
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LordBrutor
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Posted - 2007.09.18 01:10:00 -
[23]
Well unless you own all the Cap Ship Components and can supply your own mins then you would never be able to able to compete with our purchasing power. If we produced 8 Dreadnoughts and 8 Carriers per week we would purchase 2904 Cap Ship Components per week and have 1 of each BPO in research at all times driving down the cost of each build. I never said we should buy up the ships sold at a lower cost but that we could make the components to rare and expensive for you to compete.Here is a few things i worked out, the amounts needed for 2 of each dreads and carriers per build run. We would buy at a cost of 17 billion per build run but sell at market price (1650per dread and 900 per carrier) we would make 20.4billion. I have used the prices from theForges website not calculating any discounts for bulk.
Need Capital Propulsion Engine148 Capital Turret Hardpoint160 Capital Sensor Cluster252 Capital Armor Plates168 Capital Power Generator 140 Capital Capacitor Battery196 Capital Shield Emitter224 Capital Jump Drive160 Capital Drone Bay 480 Capital Computer System252 Capital Construction Parts224 Capital Ship Siege Array280 Capital Launcher Hardpoint60 Capital Ship Maintenance Bay 80 Capital Corporate Hangar Bay 80 2904
Cost Cost per mil Capital Propulsion Engine5.8 Capital Turret Hardpoint6.8 Capital Sensor Cluster5.8 Capital Armor Plates6 Capital Power Generator 6.3 Capital Capacitor Battery5.3 Capital Shield Emitter6.1 Capital Jump Drive7.8 Capital Drone Bay 4.3 Capital Computer System5.8 Capital Construction Parts4.8 Capital Ship Siege Array7.1 Capital Launcher Hardpoint6.1 Capital Ship Maintenance Bay 7.9 Capital Corporate Hangar Bay 7.7
Capital Propulsion Engine858.4 Capital Turret Hardpoint1088 Capital Sensor Cluster1461.6 Capital Armor Plates1008 Capital Power Generator 882 Capital Capacitor Battery1038.8 Capital Shield Emitter1366.4 Capital Jump Drive1248 Capital Drone Bay 2064 Capital Computer System1461.6 Capital Construction Parts1075.2 Capital Ship Siege Array1988 Capital Launcher Hardpoint366 Capital Ship Maintenance Bay 632 Capital Corporate Hangar Bay 616
Total Price 17154
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Shadarle
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Posted - 2007.09.18 01:15:00 -
[24]
Originally by: LordBrutor Well unless you own all the Cap Ship Components and can supply your own mins then you would never be able to able to compete with our purchasing power. If we produced 8 Dreadnoughts and 8 Carriers per week we would purchase 2904 Cap Ship Components per week and have 1 of each BPO in research at all times driving down the cost of each build. I never said we should buy up the ships sold at a lower cost but that we could make the components to rare and expensive for you to compete.Here is a few things i worked out, the amounts needed for 2 of each dreads and carriers per build run. We would buy at a cost of 17 billion per build run but sell at market price (1650per dread and 900 per carrier) we would make 20.4billion. I have used the prices from theForges website not calculating any discounts for bulk.
Need Capital Propulsion Engine148 Capital Turret Hardpoint160 Capital Sensor Cluster252 Capital Armor Plates168 Capital Power Generator 140 Capital Capacitor Battery196 Capital Shield Emitter224 Capital Jump Drive160 Capital Drone Bay 480 Capital Computer System252 Capital Construction Parts224 Capital Ship Siege Array280 Capital Launcher Hardpoint60 Capital Ship Maintenance Bay 80 Capital Corporate Hangar Bay 80 2904
Cost Cost per mil Capital Propulsion Engine5.8 Capital Turret Hardpoint6.8 Capital Sensor Cluster5.8 Capital Armor Plates6 Capital Power Generator 6.3 Capital Capacitor Battery5.3 Capital Shield Emitter6.1 Capital Jump Drive7.8 Capital Drone Bay 4.3 Capital Computer System5.8 Capital Construction Parts4.8 Capital Ship Siege Array7.1 Capital Launcher Hardpoint6.1 Capital Ship Maintenance Bay 7.9 Capital Corporate Hangar Bay 7.7
Capital Propulsion Engine858.4 Capital Turret Hardpoint1088 Capital Sensor Cluster1461.6 Capital Armor Plates1008 Capital Power Generator 882 Capital Capacitor Battery1038.8 Capital Shield Emitter1366.4 Capital Jump Drive1248 Capital Drone Bay 2064 Capital Computer System1461.6 Capital Construction Parts1075.2 Capital Ship Siege Array1988 Capital Launcher Hardpoint366 Capital Ship Maintenance Bay 632 Capital Corporate Hangar Bay 616
Total Price 17154
It sounds like I have more purchasing power than you would have with this "plan" of yours. Don't expect people here all have the same spending power, some have very little and others have quite a bit. I left the capital production business a while back because I was quite bored with it... the margins dropped too much. I made higher margins in other ways. But if someone were to try to corner the market and drive prices up I'd be more than happy to jump back into the market in order to take advantage of them.
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