Buy High, Sell Low is a Dumb Economic Model

[Rechan]

I've never felt that D&D had a functioning economy, period. It just really starts to break down, especially when you consider that for the last two editions, the only thing that gold is really good for is buying magical items.

 

[anest1s]

Am I the only one who thinks 50% makes sense? I mean IRL shops buy the items they sell at 50% (or less) too.

 

[gamerprinter]

Consider that I have proposed designing a bard who specializes in 'selling', who uses Perform (sell), as a major skill use, with abilities higher up that get potential buyers to be bamboozled into buying stuff they can't afford, IOW, bilking them of their money.

I proposed the idea to the publisher I work with, and the response was "D&D isn't really a game about buying and selling, so we won't publish anything like that..."

That's not to say another publisher might think the opposite, it does put forth the idea that a D&D game about buying and selling won't be popular, thus the costs for creating content like that, just won't sell well, so is probably not worth pursuing.

And in reflection, I'd have to agree. If you're bilked of your gold pieces, what will you use to spend for buying upgraded magic items if the 'buyer beware' concept is introduced to the game. Buying and selling stuff gets in the way of good adventuring, and it's cost affects the primary game in a way that makes introducing that concept a poor choice.

While that shouldn't put you off into doing something for your own game, understand that economics doesn't work well with D&D, in fact is counter to the way the game is played. So it's really something not worth considering.

 

[Loonook]

The economic model makes sense due to the fact that you're selling things that, well, not everyone is going to want and a shop owner is going to need to hold onto an item for some time. Figure that 2k of gold + cost of a masterwork weapon. Now take that into a severely-underpriced modern framework. I have a light easily-transferable lump of steel with magic on it that could rake in $100k in open market for sale in real-world money. I have to protect my shop from a group of adventurers who hire 5-10 strong-backed commoners who come in, kill my defenses, and then grab everything that isn't bolted down. I have millions of dollars in merchandise if I have a decent trade, and need to then send some off, assign consignment costs, etc.

I always saw the guideline as just that. If you are willing to wait a season, hire a seller, bring my items to a large trademeet, getting people interested. A +3 Bane (Evil Outsider) sword may have its hilt reworked by the Priests of Whacabalor for their Guardian of the Eastern Reach. They may even pay 80% of the original cost... But you are currently 1000 miles away. Do you want to pay to Teleport over to them, do all the Diplomacy and Knowledge (Religion) checks, and then travel with your loot?

Didn't think so. But that merchant will. That merchant makes his money on it. He probably is part of a trade union that has contacts all over the world. You're paying for their agency, and they say so. Now would a merchant possibly give an offer for well-traded items? Yeah, if you work with him and offer him first-pick. He may even offer you some work on the side... But since most people treat the Magic Shop as a 7/11 with portable holes they don't do this.

Simple System (add the following percentage of your overall sale to your overall cost, Except for Pawn). :

10-15% - Pawn. You came up short on your Mage dues. You have a season to pay back a small overage of the overall loan. Not usual for adventurers, but it does allow you to save yourself from selling that Holy Avenger just yet and gives you quick cash now.

+11-20% - Take this off your hands. You need quick cash for a Raise, the merchant will give it to you almost immediately (if he has cash on hand). This would be your standard deal, willy-nilly wham-bam. If the merchant is not himself a Caster look to pay for the Identify because he's been burned by adventurers before. The merchant may take 1d4+2 hours to gather the cash, plus the time for Identify but you'll have it by end of day. A merchant should be able to get 1-2 apprentices from the local Mage guild for assistance, and will tack that cost onto his usual fee at a discounted rate to you (let us say half of the ID cost if you agree to sale).

+21-30% - Finding a buyer (local). You pay the merchant his fees for this up front (let's say a 50GP per 2000 GP item worth). The merchant will look for a buyer using that extra up-front cash to hire runners, bribe the household staff of the noble lord to present him with their information, etc. If he has Gather Information and is above 3rd level (or takes a feat to boost it) he'll take 10, find a buyer, do all the inside work for you, and then make the sale. Buyers will require that they get their own Identify cast or, if a good work relationship exists, they will take the merchant's word. Allow around 1d4 days for the most expensive item, and then +1 for every 5000 GP of sales value you're discussing.

+31-60% - Finding a buyer (national). You pay the merchant traveling fees and up-front costs for all items. The merchant will want 150/2000 GP for all items sold this way. This is going to take awhile as the merchant will go atraveling, using this cash to pay for the costs of a band of low-level adventurers, lodging, and appropriate components for wards and protection. All items will also require Identify to be paid for, and for really high-end items you're looking at Identify and Legend Lore alongside to confirm that this Holy Avenger wasn't stolen from the High Priest of Whacabalor's Eastern Champion .

You're looking at a large overhead up front, but you get more money on the backend (45-55% overall? Nice). Now this will take longer by far (1d4 Months, +1 day per 5000GP over the first item). You can reduce this by half through providing any provisioning assistance you can (Teleport back AND forth, a borrowed Bag of Holding, escorts provided from your personal retinue by Leadership, using social connections to get the group attached to a larger caravan, or an assistant to help with the bookkeeping and sale. You may also speed it up by hiring spellcasters or sellswords, but this will of course cut into your bottom line. For every benefit you give the merchant over the first you increase the return by 2% up to a maximum of 60%.

Example: The players just defeated the dreaded barbarian warrior Gimmick Bravehands. They have no need for two items, a Lion's Shield and Breastplate of Command.

Item's overall cost (combined): 34570
Normal Sale's Price: 17285

The merchant, a renowned leader in the Scrivener's Guild who practices money-changing, assurance, and sale of high-end items to various noble houses in the area, has bought items at normal rate from you and likes what he sees. offers the following:

1 Day: 18773 (19015 at +10% base, 240 GP for the identify, wait until nightfall, he keeps the extra 5 silver).
5 Days: 20520 (21260 at +23% base, 240 for the Identify, 500 GP for greasing palms).
3 Months, 5 days: 23214 (25,754 at +49% base, 1800 GP for overhead, 500 for 2 Legend's Lore, 240GP for ID, he keeps the couple of silvers and coppers). The merchant must travel to a large Tradesmeet a couple thousand miles away next season, gather together his crew, etc.

The party's mage offers a Teleport to and fro for the merchant and his items so the Merchant hires two strong oxen and takes his trade goods along. The Mage is also able to cast Identify and Legend Lore and provides his services with confirmation from the Mage.

The time is cut down by the original four months and ten days, and the party Rogue [a senior member of the Brotherhood of Shadows] provides the merchant with a symbol to draw above his tents to prevent mercantile theft. For his thanks, the Merchant waives the Identify fees and provides an additional 5% of the profit.

1 month, 20 days: 24820 (26620, - 1800 GP overhead).

Can your party wait a whole 50 days for that cash? If they can they'll make 7k more than what they would have. If they wish to accompany to the location? Heck, there's the overhead cost in pocket and the chance for more adventures .

Slainte,

-Loonook.

 

[Crothian]

The problem with gaming and economics models is that the writers of games are not economists and neither are the people running the games for the most part. I'm sure someone could include some good micro and marcro economics in a RPG but I have to think most people would care or use it.

 

[Rune]

It would take players who care more about buying/selling than exploring/slaying.

The two styles are hardly mutually exclusive. Consider a Marco-Polo-on-the-Silk-Road style of campaign. Lots of exploration, and quite a bit of potential for slaying could be found along such an adventure.

Magic-Merchant PCs are likely to spend a lot of time sitting around guarding their inventory, looking to offload it while defending against thieves and other threats.

It would probably be safest for the PCs to keep the goods with them (until they can place sufficiently powerful wards on them, at any rate). If this were so, the PCs would probably be traveling merchants, heading for wherever they think they are likely to find fortune.

One of my players recently said "We only sell at 20% of list price? Screw adventuring. I'm going to get rich by selling magic items."

Precisely. Sooner or later, an adventurer has to look at the merchant and think, "How do I get in on that action?"

My understanding of the D&D magic item economy as it stands is that it is more profitable for PCs to be out killing things and taking their stuff than it is for them to try to craft or sell magic items, so the opportunity cost is high enough that PCs soak the pawn shop economy prices as part of doing business.

One other relevant factor is the level of fun inherent in these things. I know that I went into my current Traveller game with a thief / merchant with the intent of buying and selling many things for a great profit... and while a great profit I did make, it was actually a lot of work, and kind of ceased to be fun (so now I've moved to only dealing in high-value cargoes like radioactives).

The diversity of wares that a PC peddled would, of course, be entirely up to the player. I would think that, if a DM were so inclined, it would not be too difficult to establish areas where certain goods were more or less valuable in the campaign world. Of course, this breaks down if the players have access to some form of free teleportation.

In my Ptolus campaign one of the groups of adventurers found a treasure trove of life-sized, hand crafted, very detailed trees made of precious metals. They resealed the dungeon entrance with magic until they could buy a shop in the city. They then carted the trees back to the shop by magically shrinking them. Their target audience of course were the wealthy merchants and nobles. Took them more than a month of in-game time to make it happen, but they got the job done.

Awesome. What did they do with the shop when the inventory sold out?

I've always considered the magic item market to be one of high overheads. You've got to have really secure premises, you've got to have spell casters with identify and remove curse on stand-by, and most of your stock sits idle on the off-chance that one of the few people in the area rich enough to afford it wants any of it.

So that shopkeeper is only offering you 20% because he's got a couple out the back anyway, and it's going to cost him another 20% securing and identifying the thing anyway.

That's why it makes sense to cut out the middle-men.

All that's missing to make the economics work properly is a "used gear" market model. That way, the merchants would not be selling used gear at new prices...and PCs could get used gear for less than full cost.

Of course, as used gear, it shouldn't be in as good condition, so there should be mechanical disadvantages- not as good an AC for armors, breakage rules, something.

That's one of the main problems with D&D magic items; they don't degrade in value or functionality.

I've never felt that D&D had a functioning economy, period. It just really starts to break down, especially when you consider that for the last two editions, the only thing that gold is really good for is buying magical items.

That's a good point. You've really got to be able to buy and sell real-estate to have an economy that makes sense to the majority of the world's denizens while still being relevant to high-level adventurers.

Am I the only one who thinks 50% makes sense? I mean IRL shops buy the items they sell at 50% (or less) too.

Sure. It makes lots of sense for the merchant (and 4e's 20% makes even more sense to the merchant).

While that shouldn't put you off into doing something for your own game, understand that economics doesn't work well with D&D, in fact is counter to the way the game is played. So it's really something not worth considering.

And, yet, I am considering it nonetheless.

I always saw the guideline as just that. If you are willing to wait a season, hire a seller, bring my items to a large trademeet, getting people interested. A +3 Bane (Evil Outsider) sword may have its hilt reworked by the Priests of Whacabalor for their Guardian of the Eastern Reach. They may even pay 80% of the original cost... But you are currently 1000 miles away. Do you want to pay to Teleport over to them, do all the Diplomacy and Knowledge (Religion) checks, and then travel with your loot?

For purposes of this hypothetical campaign, let's say the answer is "Yes."

Didn't think so. But that merchant will. That merchant makes his money on it. He probably is part of a trade union that has contacts all over the world. You're paying for their agency, and they say so. Now would a merchant possibly give an offer for well-traded items? Yeah, if you work with him and offer him first-pick. He may even offer you some work on the side... But since most people treat the Magic Shop as a 7/11 with portable holes they don't do this.

Simple System (add the following percentage of your overall sale to your overall cost, Except for Pawn). :

...snip...

1 month, 20 days: 24820 (26620, - 1800 GP overhead).

Can your party wait a whole 50 days for that cash? If they can they'll make 7k more than what they would have. If they wish to accompany to the location? Heck, there's the overhead cost in pocket and the chance for more adventures .

Thank you for providing a solid answer to the question asked in the original post!

 

[3catcircus]

Five words: Magical Medieval Society: Western Europe. Best economic simulator around for D&D.

 

[Loonook]

For purposes of this hypothetical campaign, let's say the answer is "Yes."



Thank you for providing a solid answer to the question asked in the original post!

A mercantile campaign works if you are going to have a group of individuals who are NOT just trading in magic items. There is an enormous amount of background in a mercantile campaign required, from hiring agents in various cities, using non-magic and magical forms of communication, willingness to travel, etc. I think that the average magical item merchant would do so as a lucrative side-venture as the instability inherent to a merchant's life should be in play. Ships go to sea never to return, caravans are ambushed, agents will be slain for that thousands of gold they carry on them. You also have to worry about the fact that most PCs are going to hoard their cash like stingy dragons.

Where do your PCs start in the supply chain? The procurement of magic items is like the raising of crops, building of homes, and running of a church. It is a business of trade, compromise, and hard work, and there will be a need for your so-called tomb raiders as much as you need strong bodies to protect your household and mages to make appraise your gains. Speculation, purchase, supply and demand, and the willingness to enter conflict will come into play, as a well-run mercantile house can become wealthy enough to sway the lives of an entire continent. You're looking to play the Medici, which would be an awesome campaign with the right kind of players .

Slainte,

-Loonook.

 

[trancejeremy]

Well, firstly, I've always thought that magic items really shouldn't be bought by players, only sold.

Especially in earlier editions, where they were not very easy to make.

But there were rules for Mercantile characters in one of the Gazetteers for Mystara, #11, Republic of Darokin. It was sort of a side class that characters could take.

 

[howandwhy99]

And I thought this thread was going to be about gaming books.