Small post with some info I think a lot of people brush aside.

When judging how profitable a money-making activity is, it almost always needs to be broken up into parts and viewed as separate activities. And once you’re actually doing these activities, you’re benefiting from combining as many of them as possible.

This should be easier to illustrate using an example:

• You’re buying T4 Planks with buy orders for 180 silver a piece, paying 1.8 silver per plank to set up a buy order. The average sell price for these planks over a week is 200 silver a piece.
• You’re crafting T4 Bows from the planks you’ve bought, paying 1000 silver in taxes and using 32 planks per bow. You’re selling these bows for 10000 silver, paying 300 silver in market fees.

How much money do you make per bow sold in this example? One might say it’s 9700 (what you get from the sell order) minus 181.8*32+1000, which comes out to 2882.4.

And that would be correct. But that doesn’t necessarily mean we’re making money efficiently on every step of the way. We could be losing money buying planks and then earning more crafting from them, which still nets us profit in the end. If you want to make money, you’d sooner or later have to look at every link of the chain separately, then eliminate the weak links where you’re better off just buying the product off the marketplace.

Back to our example: you could sell the planks for 200 silver (192 after tax), earning 12.2 silver per plank, so you’re earning 12.2 silver per plank bought, and 9700-(200*32+1000)= 2300 silver per bow sold. However, by combining these activities, you’re saving on market taxes as you won’t need to set up sell orders for planks and then additional buy orders for these same planks, meaning you’re making 2882.4 silver per 32 planks bought/bow sold, instead of 2690.4 silver if you separate these activities completely. This comes from saving on market fees, but you will have other reasons to combine activities. One of them is easier realization of the product: it’s often easier to sell completed items, rather than all of their separate parts.

This applies to every activity, be it transporting from other cities, refining materials yourself, growing food on your islands, using laborers instead of selling journals on the market and so on. If its a link in a chain of production, it needs to be evaluated on its own and, if it’s too weak, thrown out for you to spend more time on the strong links, earning you more money per hour in the end.

More about this in the next post.