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Do you understand business?

A topic by CommanderofBlood created 235 days ago Views: 239 Replies: 3
Viewing posts 1 to 3

If i buy a copper ingot for 10$ make it into a short blade, smack a grip on there, how does the copper only get marked up to 11$? Usually, if you are doing business you want to make it up at least 100-200% profit above of the original price you bought it at (ex: copper ingot sold at 100% markup as copper short blade for 20$). Is there a way to make this into the game because there is no real way to get up into the tiers of ingots (100,000$?!).

(Edited 2 times)

I agree on the ingot price, but in what kind of companies have you been working?

200% profit? Wow, please tell me your companies name so I don't buy there :P

Edit: well comparing it to my company is unfair because we charge for work time, too, so we would add that, but that would not result in a general 200% profit, this is crazy. MAYBE for small items below 100 bucks that makes sense, i.e. account for your work time as a minimum of 100 bucks, and energy (the coal ;) ) but not for a 100,000 dollar ingot resulting in 200,000 profit, this is out of proportion

I worked at a small hardware store for 10 years and we had a similar price structure. For low cost items (under $5 cost) the markup target was about 100%, so a $3.00 cost item would sell for $5.99. In the business world you use a different formula so the percentages don't get as crazy. We calculated Gross Profit Margin which gives a percentage between 0 and 100. Formula was 1 - Cost/Retail, then multiply by 100 to change it from a decimal to a percentage. So if an item sold for 100% more than cost, it had a GPM of 50%, and 200% more than cost had a GPM of 66%.

And Ideally for Items below $20, you'd aim for 50-60% GPM. More expensive items (over $100) had worse margins (sometimes only 5-10% GPM) because people compare prices more when buying those items.

So the tldr version is: 100% markup is not uncommon for low cost items in the retail world.

Well i agree with you BUT, we don't have to pay tax, rent, food, drinks........ so the only costs we have is ingots, grips, guards. We also dont need to buy water or coal. So why should we increase the earnings of the weapons. The only thing it'll happen is that we faster get to the highest ingot aaaaand stuck there. This is the only progress we can make right now. So i would focus more on content than prices right now.