Thursday, 27 September 2012

Fuel blocks - my introduction to manufacture

Fuel blocks are relatively large, uninspiring, and needed by owners of towers everywhere.  You can't put up a player owned station in the highest of highsec, it needs to be in a system 0.7 or lower.

Many tower owners make their own; some haul from a trade center; and some are sufficiently busy that they want to buy local.  To keep the lights on (or the shield up), every small player owned structure (POS) you see need 10 blocks per hour; every medium 20, every large lower 40.  So every large tower is (in round numbers) 30,000 / month (assuming I have done my maths right).

They are a great introduction to manufacturing.  A low entry cost, I have found perfect material efficiency blueprints available via contract for 20M (or find someone to research one for you - it should be cheaper).  They are profitable to make.

I have been making ISK not just from selling expensive product, but also from buying cheap.

I use to work out where to both buy and sell items.

First of all you need:
  • A blueprint.  Ideally these will be researched to 40 Material Efficiency.  You can buy both researched Blueprint originals and blueprint copies.  Alternatively if you have access to a material efficiency research slot (most likely a Player owned station), NPC Thukker Mix stations sell the original blueprints.  I like my BPO's (blue print originals) in highsec for the larger run sizes, but copies into our wormhole.
  • Some production skills and production efficiency skills.  I don't like learning level 5 skills unless they unlock later skills, but have just finished production efficiency 5 just for these blueprints.
  • A place to build your product.  I chose an NPC station, close to low security systems, and a null security pipeline and out of the major trade hubs regions.
  • A big transport ship.  I get by on my Iteron Mark V with cargo extension rigs and extended cargo holds, full of giant secure containers (about 49k m3); but it is a compromise.  I see a freighter in my future, and sometimes hire them for haulage.  The cargo is bulky, but the Iteron Mark V's walls are thin (nothing to see here, move along, don't target me, arrgh quick run away, dock, rename ship and swap alts for an hour or 2).  I have not lost a single ship for this, but have often been targeted, generally on my way into Niarja.
 Rather than list all the components (which you can see on your blueprint), I have categorised them as:
  • A 'racial isotope' (eg hydrogen isotope), farmed from mining ice products in the correct regions of space then refining.  Roughly 40% of your costs.  Look at prices around the faction's region, including major trade hubs.
  • Other ice products farmed from ice anywhere then refined; (except wormholes.  No ice in wormholes.  Nerf ice mining in known space!). Roughly 15% of your costs.  No real pattern about where I buy these; but hardly ever in Jita.
  • Planetary Interaction components.  I buy these away from the major trade hubs. Roughly 45% in costs.  I buy these away from the major trade hub districts (though often Rens has good prices).
I mentioned it before; but I will again.  Use an out of game tool like Eve Central (there are others) to work out what where you are buying.  Limit your search to regions you are prepared to buy from (empire regions for me), and you can exclude order sizes below what you are prepared to look at.  If I need 200,000 units of a racial isotope, then I will not bother with a 100 unit sell order even if it is really cheap.

Each of the racial towers have their advantages, and to be honest, I am not really sure what they are.  That's OK, what I do know is that there is demand for out of region fuel blocks, and buyers are willing to pay a premium for that fuel.  In Jita for Caldari fuel blocks, margins might be paper thin, but margins of the other fuel blocks are often much more.  In Hek, margins for Ammar fuel blocks were about 25%.  Off the beaten tracks, my margins are about 40% (with admittedly slower sales).

An obvious alternative to manufacturing the fuel blocks is simply to transport input materials and/or finished fuel blocks.  As a number pulled out of the air, my current profit is 70% of the profit is transportation of either material or fuel blocks from high supply stations to low supply regions; with the remaining 30% coming from manufacture.

Stockpiling mats for a few runs would also be a good idea that I am currently failing at. I have another distraction that is costing me ISK; Interbus 3, Foo Holdings 3.  It appears that some some gangs are grinding Interbus standing (what else could it possibly be?)

As an introduction to manufacture, or even for a haulage business; fuel blocks are a great start.

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