In the first part of trading guide we taught you the basics of Trading in secure 'empire' space. If you followed the advice, you should by now have a decent amount of skillpoints, a capable industrial ship and a wallet bursting with cash. Now it's time to join the big league, where fortunes can be acquired without ever leaving the safety of your home station.
While our focus so far has been towards the NPC trade goods market, it's time to put the skills you've been learning and the experience you've acquired to good use. We'll start by looking at trading in items more directly useful to the common pod pilot.
As pilots delve deeper into uncharted or unsafe areas, wars are fought and ships and modules are lost, there is a huge market for modules as players strive to replace them. Fighters with more ISK than time will pay large sums of money to have spare items and ships available near their base of operations. This gives them more time to do what they do - fight for a living - while you, as the wise trader, provide the logistics for their operations abroad. Remember, though, the further you go out from the core, the more dangerous (and profitable) these trades become.
Of course, you should not overlook other commodities that are driven by player-demand; like the NPC trade goods market, the POS (player-owned structure) fuel supply market has a high volume turnover with static purchase and sell locations that the seasoned trader can capitalize on. The POS fuel market consists of a form of ice, containing heavy water, liquid ozone, strontium clathrates with the additional NPC items; enriched uranium robotics, mechanical parts, coolant, and oxygen. All POS towers use these items. The only difference between the racial towers is that they use one of the four types of isotopes.
Red moon has risen
There are more than a few small POS operations out there running a skeleton crew in 0.3 sec border systems, sometimes under the care of a single POS manager - operations which tend to buy rather than supply their own fuel. As they were prior to Red Moon's release, moon mining remains limited to 0.3 systems and below, but the re-working of the manufacturing process means that factory and research starbase structures can be built in up to 0.7 security status systems. The upshot of this is that not only will demand for base minerals increase thanks to the insane resource requirements demanded by Capital Ship manufacture, but the number of deep space POS operations will increase alongside it. In short, greater demand for ice products and the trade goods mentioned, to the glee of the watchful trader.
Some systems have very established production facilities, which depend on having huge quantities of minerals present for day-to-day operations. Buying low-end materials from systems with large numbers of sell orders indicates a lot of competition from players mining and selling these products and can consequently provide a trader with a good source of cheap(er) minerals. From here you can haul these into established manufacturing systems, ones with large corps producing ships, modules and ammunition, for a tidy profit margin. These areas generally have specific points in the universe. And again, with manufacturing POS operations springing up, the demand for ore can only increase.
Black market trading
There are unquestionably huge sums of money to be made at trading in black market goods. The downside is the inherent risk tied to such activity. The skills needed for this type of trading are varied, with a single skill (Black Market Trading - each level of which reduces the chance of contraband detection by 10 per cent), only being available at character creation. However Black Market Trading has not been available at character creation since the Revelations patch, and is still not available on the market or as a drop.
So, while you may be successful if the trip spans just a couple of systems, without a character specifically made for smuggling you will be hard pressed to survive. Most regions have NPC customs officers watching the gates; they will scan your cargo more often than not. Depending on your standings, skills and cargo, you may be stopped, searched, fined and your illicit substances confiscated. Worse, if you don't haul ass, your ship may be destroyed by Concord and customs.
There are a few myths that need to be dispelled here. First, that you can put a password protected secure container in your hold with the contraband inside and jump free and clear; this is false. Second, insta-jumps or warp to 0 will not save you. Anyone who has ever been targeted by Concord knows that the lock times these guys have are just short of incredible, so while you may succeed once or twice, it's luck not skill that'll save you. Sooner or later you are going to get caught and the added consequences are that you can loose faction standings, making your presence in high-security empire space less than secure.
For this reason, I personally choose not to trade black market items. I know of many people that do, and make a tidy sum by avoiding systems where cargo is deemed illegal (check your Autopilot settings via the F10 Map Screen). If you have the financial resources to soak up the fines you'll earn in the early stages, knock yourselves out.
Whether or not the Black Market Trading skill ever worked is a debate that will be put to rest only by an individual with insider knowledge.
The Contract System can be a gainful tool for the clever trader. Basically, contract is putting something up for sale without using the standard market option.
In the beginning, contract system was supposed to be used for items that could not be sold on the market because they were not included in the market database, such as 'named' modules and specialty equipment. Then people figured out that it offered a way to avoid paying taxes to some extent, hence a huge number of 'market items' are appearing on contracts for sale.
The word escrow is used extensively in EVE, but it has two very distinct meanings, each with important differences. There used to be the Escrow Screen (replaced by Contract System), meaning a tool for entering an item (or items) for sale or transfer to someone specific (or not). But the term 'escrow' also denotes an amount of ISK pledged when putting up a buy order on the Market Screen. When you place an order that is not an instant buy, you need to secure the transaction by pledging the total amount of the purchase, plus the fees associated with the transaction (escrow tax, transaction tax) from your wallet. This amount is deducted immediately when you enter the buy order. It's an 'I want to buy 50,000 widgets from someone at this price, here's the money for it in advance' order.
When your buy order is fulfilled it is purchased with these escrowed funds. Note, however, that if you enter a buy order like this and you either don't get the items you wanted at the price you wanted or you cancel the order, you will get these funds transferred back into your wallet minus the escrow fee. This is a very important point.
The Market Screen charges you to use its service regardless of whether your buy goes though or not. The Margin Trading skill will reduce the amount you have to pay, but you may have to wait some time for this escrow amount to show up back in your wallet.
Pretty soon you will realize that flying back and forth in a slow industrial is... well, sometimes boring. But the money is good, right? Well there are ways and means of keeping profits high that are a little more taxing in the gray matter than watching stars scoot by. To reach this stage of your trading career, you need to think of yourself as more of a trade manager running a large depot, than just being simple truck driver.
Assuming you have done your homework and prospected with some success, you should have found a few profitable spots. You should have taken note, too, of the volume of the commodity per unit. You know the lowest sell and highest buy of the NPC stations in the region. Additionally, you'll have trained up your Wholesale skill, raising your limit of active orders, and your Marketing and Margin Trading skills for remote selling and reducing market escrow amounts (see above), along with any other number of useful skills, like Procurement and Broker Relations.
The trick with ship-less, or remote, trading is to set the quantity of your buy orders into manageable amounts. This has repercussions when it comes to keeping your profile low (which we'll explain in a part 3), but the main reason for this is that you are going to hire people to make you money. In effect, they will do all the donkey work. Your target pilots are the up and coming couriers and haulers, who you must assume will not always have the largest capacity ships. You want to be aware of this when setting the quantity to be transported. Figure out manageable amounts of items according to their volume. Make them small and you will increase your chances of a timely delivery.
Spread your bets
If you're in tune with the markets and know what the rock bottom and ceiling prices are, you'll also know that the market fluctuates between these prices and rarely ever reach rock bottom or sky high. By layering your buy orders at the right prices, you ensure that you can capitalize at just the right level. The point is that, rather than sitting and waiting for the absolute best price, at least your money is working for you rather than sitting idle. And the better you know your market area, the better you will be at maximizing your profit to cover the fluctuations in the marketplace.
The way to do this is to enter your station, system or regional buy orders for the items you are planning to make a killing on. The first order should be for the rock bottom price on the buy. Now, do it again with a 5-10 per cent increase, and again for another 5-10 per cent. What you are doing is layering the buy orders. As the market swings, your buy orders fire and you start to fill your hangar with stacks of items. Each stack is a transaction so make a note of what it was bought at in your wallet. When the market moves, the orders fire on 'arrival' of the new price, not in 'passing' prices. For example, if you have buy orders for something at, say, 5 10 and 15 ISK and the market is currently at 22 ISK, when the market swings low, lets say to 9.5, all your orders above 9.5 will fire, but the order for 5 ISK will remain in place. The downside of layered buy orders is that by increasing the number this will cut away at the profit margin, since prices rise with each order fulfiled, but you should be able to easily absorb some of the loss if the items in question offer a high profit return.
Hire some truckers
Since you've invested your time (and skillpoints) in studying the marketplace and being able to interact remotely with it, you'd be wise to pay others to get your goods to their destination. This is where the Contract System with Courier Missions comes in useful. Figure out a reward that is acceptable to your profit margin and don't forget to make the collateral setting both to cover your purchase and make it affordable to the courier.
Setting these up is pretty straight - forward; Open Contracts, find the stack you want to ship, set your collateral and reward, and the destination. It may take some time to build up stock at the target (buyer) station, so you must be prepared to tie up these funds for a bit, sometimes a while. Once you start to accumulate stock at the station, you can set sell orders, again using the tiered-layering system described above for the buys, the reasoning being that if the market spikes just a little, you don't want to dump a huge sell at the lower-tier sell price, but rather at the top of the buy. There's more profit the more you sell at the high price, obviously. If you have 'purchasing power' you can do this all day long; refreshing buys, setting couriers and tweaking sells. To stay on top of things you should do all three. With practice you can get the time spent doing this down, leaving time for more prospecting, or something entirely different.
Reversal of fortune
Chances are, by following the advice above you will enjoy great periods of wealth. This will depend primarily on your knowledge of the markets. I stress this again because it cannot be stressed enough; to join the exclusive billionaires' club (there are a few who can rake in this much in a single day), you have to study the markets constantly. It's an aspect of trading that cannot be taught, you simply have to make the effort. Do so and the rewards will be immense.
However, your ability to turn over a sustained profit also depends on other players. The profit they make is usually acquired at your (or others') expense, so what can you do to make sure your routes stay yours? And what can you do if you find another trader poaching your routes? The short answer is that there are many methods at your disposal to remain hidden on others' territory, to seek out trade poachers and to make sure that they never bother you again. If you thought trading was a 'carebear' activity, think again. In EVE, money talks and, in a heated exchange between traders, only the common tongue of heavy ordinance flying across the heavens hastens resolution. Trading can get very messy, but we'll have to go into the cleansing process another day.
The trader who relies solely on the in-game Market Screen will always be at a disadvantage as it's limited to regional market data. You can be on the boundary system in a region and one jump away could be a seller with hundreds of items you want - the Market Screen will not show this. There are traders who make millions working regional border zones with little or no effort at all. Locating your base of operations at the apex of several border regions can be a lucrative and effortless way of amassing capital.
Trafficking common NPC trade goods across the core systems in empire space is one of the most competitive, demanding and frustrating ways to earn a wage. A huge percentage of the general population live in or around the main Empire trade hubs, and because of this, competition is intense. The common trader realizes this and moves into the less populated systems, hoping to capitalize on the lack of traffic. But the wise trader will quickly know exactly where to go... and why.
One of the first things a smart trader does is research (yes, we covered this in Part 1, but it's an important point that can't be stressed enough). So where does one find the information? Well, the EVE Online website has a little-known but priceless source of information called the Item Database. This is your new best friend!
Within you will find the pertinent statistics on all the in-game tradegoods, all neatly sub-divided into categories. Let's look at consumer electronics (predictably enough, found among Consumer Products). Notice that there are two tabs at the top there - one for the general statistic info, and the other, 'NPC market', which shows which NPC corporations buy and sell this commodity.
The first on the Buying list for Consumer Electronics is Amarr Trade Registry. Clicking on the familiar blue info icon next to the name will link you to the entire corporation infrastructure, to the left of which you should see the 'Station Map' icon, which will show you the general location of every station owned by the corporation.
You can go in-game to find the precise locations of these stations by using the People & Places search function on your Neocon (show info then show on map) which gives you green dots in every system in which the corporation has a presence.
To find a supplier, the procedure is the same; go back to Consumer Electronics, click the 'NPC Market' and you'll see which corporations produce these items. At the top of the list we find Noble Appliances, also an Amarr corp. Simply by bouncing between Amarr Trade Registry, and Noble Appliances on your map you can get a pretty good visual indication of how far apart the market is, and can judge if the route is a worthwhile one.
Now it's time to jump in a shuttle and scout the area more thoroughly. Make at note of the general market throughout all the regions you pass through. What you want to especially look for are regions that sell a lot of some type of commodity (from multiple stations) and have no NPC buy orders. You can tell an NPC buy as the volume stays constant, only the prices change.
Trade skills explained
The various Trade skills can be neatly subdivided into three types. The simplest are the four 'Market Order' skills that increase the number of active buy/sell orders you can create (Trade, Retail, Wholesale and Tycoon).
The 'Money' skills effectively decrease the costs of trading; Accounting reduces transaction tax; Broker Relations basically reduces the broker's fee, which is based on the value of the sale goods; Margin Trading reduces the escrow amount - essentially meaning you pay less up front, thereby freeing up cash until the buy is fulfiled; finally, Day Trading allows you to modify market orders, meaning you don't have to cancel and then create new orders and incur another hit of transaction tax charge (since tax is non-refundable if a market order is cancelled).
Finally we have four 'Order Manipulation' skills. These include: Marketing, which allows you to sell goods you have in remote stations in the same region; Day Trading, which allows you to modify standing orders in the same region; Procurement, which allows you to place remote buy orders in remote stations in the same region; and Visibility, which allows you to set the range of a remote buy order. The basic function of these four skills is set out in this Diagram of EVE Trading Skills for Remote Orders.
If you were to max out all the 'Market Order' skills, you could place 305 buy or sell orders (300 from skills and 5 you have by default). In conjunction with high levels attained in the 'Order Manipulation' skills, you could buy and sell goods all day without ever having to leave a station, so long as you can hire enough couriers to ferry the goods to where they need to go.
In the first part of trading guide we covered the basics of trade good trafficking. In second part things got a bit more advanced with POS fuel running and remote trading. Now it's time to look at the competition and how to deal with it, or even muscle in on the trade routes of others...
You've all seen it; the 'perfect' trade route dries up, gets bought up and leaves you (and your ISKs) stagnating while you scramble to recover. It's what you do when this happens that tempers your mettle as a trader. Assuming you've followed the strategies outlined in previous instalments in this fine guide, you should be able to do something about the situation.
Let's say you set a region with a series of buy and sell orders, in addition to a few other routes you regularly maintain. And in your downtime you make a few choice hauls for something to do. Then you notice your buys aren't firing for a few stations. Checking the market screen under the market history, table or graph setting, you observe that the quantities are still moving in or about the regular frequency. Chances are you have encountered some competition for the route.
The first thing you need to do is decide if the transgressor is just a one-time opportunist, or someone moving in on your territory. Check the market screen and look for sell orders in place at the buy stations that are not taking your sell orders. Should you find some suspicious looking orders, go ahead and buy one of the items in question. You can then check your wallet for that sale and get their name, and from that, their corporation info, member count and headquarters. Now make notes of this information and watch the market there. It may have been a passing trader, just disrupting your operation momentarily, which should go back to normal in a market cycle or two. But if it is a repeat offender muscling in on your patch you have a few options.
You can add this offender to your friends list, noticing when they log on and off. And watch the market when they come on. Keep an eye on the volume traded for the first few minutes they are on. They may not have the ability to issue many orders, and be forced to use instant buys instead. You are watching for this.
Scout the competition
You can convo or mail them, explaining your intent to keep the route they are running for yourself. Depending on your gift of the gab (or intimidating nature) you may be able to convince them to move on.
Or, you can just buy his sell order at the buy station. This only makes sense if his sell order is lower then the ceiling buy for that station, of course. You won't be making much at all, but you will be making some profit. Its akin to having had them buy the goods for you and move them to your station for a higher then normal fee. Younger traders will put up sell orders somewhere between middle and top buy triggers because, a) they can't afford to have that much capital inactive, or b) they just don't know what the ceiling price is. Either way, you can make a fair profit by just 'brokering' his material.
But what if they do know the ceiling price? Then attack their supply. They have to be buying from somewhere, just as you do, maybe close by. Move your 'low buy percent' higher, or add a few more tiers to your buys. Make it unprofitable for them to run that route. By controlling the higher and lower ends of the market you force your competition into a narrower profit margin, squeezing them out of the route.
If they are still persistent then its time to do some maths. Figure out how much the route is worth. Run the numbers for the low and high end buy and sell numbers to put a price tag on the route. Then ask yourself, is this route worth vigorously defending? Because if it is, you should think about stronger measures. Be warned though, it will cost you both time and money. So, make sure and factor all costs into your defence or you may cripple yourself as well.
So now you have been dealing with some trader usurping your route(s). You have a pretty good idea of what they are trading, and when they are around. Having an agent do regular checks on their location is a good idea. You should also have an idea of the types and maybe quantity of ships they have, again by doing your homework and scouting their base(s) for a first-hand look. This information will be needed by whoever you hire to deal with them. Yes, that's right, I said hire.
Protecting ones time and investments is omnipresent in EVE. Should you choose to aggressively defend a trade route I would recommend hiring a mercenary corporation to do your dirty work. For me, not being much of a combat pod pilot, I would rather pay someone to fight while I continue to do what I do best with the skill set I do have. There are many fine mercenary corps out there that can, and do, take this kind of work seriously and typically, it is a bit easier for them too. When hiring a corp to do this, have clear goals in mind, of what you want to have them do for you, as well as a time line for completion. There's nothing wrong with having an open-ended contract, but I personally prefer short bursts of intense disruption. If you are combat-oriented yourself, then maybe you would prefer a little action, but you may find yourself on the receiving end of the dispute as well. That's why I pay someone. But make sure the corp you hire is discreet with their employers name - that is very important. Nothing sends a clearer message better then a good, heavy dose of anonymous subterfuge. Think about that.
The types of operations you can purchase run from simple intimidation (having the mercenary corporation 'contact' the offending party with a threat of military action) to a full scale war declaration with open hostilities on everything they fly. The main thing to consider is the result you want and to keep the costs down doing it. Hiring a 30-man corp to obliterate everything your foe has may be over the top for what you are trying to accomplish. You don't have to beat them bad, just beat them.
Masking your identity
Of course the nature of trading means that unless you are obscenely industrious or fortunate, when you aren't being screwed over by other traders you will be the one doing all the screwing. Rather obviously then, your aim opposite to reconnoitre trade bullies is to hide your tracks as if you are the competition; remaining incognito is paramount to avoiding repercussions.
Some methods of avoiding detection are common sense, others less obvious. Keeping your name off someone's note pad will go a long way to your trading survivability, should you be the sharp eyed trader moving in. You can do this in a few ways - one of which is to make your buys with another character. Yes, the old alt-character trick. I hate them, so do a lot of other folks for more reasons than this, but they are in the game so use them. By having them purchase your buy orders you are masking yourself to those that would seek you out. The down side of this is that to be cost effective you need to have trained up some hefty skills to keep the market purchase costs down. Coupled with the logistics of trading cash and items back and forth makes for cumbersome times too. Before you think, 'hey I can do this with sells as well' I say, yes, but then it really isn't an alt anymore is it?
Masking your sell orders is a little trickier. One technique is to set your sells to the station buy volume amount. For example, a station buys 39372 of something; don't make a 200k sell order. Make five 39372 sell orders instead. At first glance it can look just like a regular NPC station buy order. This, too, has the added effect of discouraging 'phishing' for your name by your competition buying just one of the items you sell in order to get your name. Remember, earlier we set our buys in smaller increments for our couriers to work with, so this helps as well. It forces them to 'pay' for your name, buying the maximum quantity you set on your sell orders.
In short, however, there's no absolute way to completely hide your market transactions. Sooner or later, if someone needs the information on you, they can find it. Just remember undetected is unaffected and if searching for the next large trade route is more important that holding on to one, you'd be advised to move along. Trade is like combat in many ways; some prefer to battle against others, some prefer to battle the system.
Freighters - Trade ships or haulers?
Contrary to the whines and moans of a few naysayers at the time, the introduction of freighters prior to Red Moon's release did not kill trading. It redefined it. There are more than enough trading routes and money to be made in Empire and beyond with just a little bit of forethought. Freighters are, well, gigantic, and can hold tons and tons of items; on the surface you may think that routes are sucked dry the second one jumps into the system, but lets look at this a minute. First thing; a freighter costs quite a tidy sum, so they are not for the casual trader. To fill one with trade goods requires a huge amount of money, and this is not something to be taken lightly. Initially when these beasts came out, traders would buy and haul 5-10 runs worth of materials (in a Mark V) in just one run. But using these for antibiotics say, is just a waste. No station comes close to buying all that they could carry. Even stockpiling, like I outlined before, ties up more cash than most, if not all, traders are willing to do. While they are sitting in a station that holds five million antibiotics, buying them at 33,000 per order (remember they have to wait for the market to swing too) you in your trusty Mark V can flit about the systems picking and choosing the best deals. The freighters are slow as well, so a pilot trying to do this in a freighter will spend the better part of their life waiting to align for a jump, not to mention warp, or docking. All this is time you can use to move smaller loads (by comparison) for maximum effect. Using the freighters for the really large objects is what these things really shine at. And if you find yourself being shorted by someone you think is a freighter pilot, running your route, well then you know what to do.
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