2010
01.19

Girl Scout Cookies

The Girl Scouts of America were founded on March 12, 1912 as a result of the progressive movement in the United States and as a direct counterpart to the Boy Scouts of America. Both organizations rely heavily on the Scouting principles developed by Robert Baden-Powell to build self-confidence and positive character traits. Likewise, they encourage social behaviors that are believed to be helpful to youngsters as they grow older. But the Girl Scouts aren’t famous for their contributions to the much maligned self-esteem movement, they are best known as door to door sales girls…

Getting Girls out of the Kitchen
In 1917 GSoA began a fund raising campaign, to support their local troop, girls would sell cookies door to door. Since then, the Girl Scouts have become synonymous with cookies. There is much to learn from study of the business practices of this organization, and let’s face it.

No, no Samoas but I’ve got 10 boxes of Trefoils!
Much like the guys at Robot Chicken, any girl who comes to my door with an abundance of Trefoils and no Samoas is likely to get sprayed with the water hose. Seriously, Trefoils are the bane of my existence. But let’s get back on topic: in the years since the Girl Scout’s decided to go into business (don’t kid yourselves, it’s a business) they’ve made some very solid choices, for one they do focus on one thing: cookies, but they also offer a range of options.

These include:
Thin Mints
Do-si-dos (F YEAH!)
Tagalongs (F YEAH!)
Trefoils (Who thought this was a good idea?)
Samoas (YES! PLEASE YES! F YEAH, a THOUSAND TIMES F YEAH!)
Thanks-A-Lots (More shortbread? Seriously? Least these are dipped in chocolate)
Lemon Chalet Cremes
Daisy Go Rounds (Diet Cookies, need I say more?)
Sugar-Free Chocolate Chips (See Daisy Go Rounds)
Dulce De Leche (Obviously influenced by current population trends)
Lemonades (Again with the shortbread, WTF Girls? Least they’ve got lemon icing)
Thank You Berry Munch (New cookie with Cranberries and Chocolate, not a fan of Cranberries)

Sugar, Spice, and Everything Nice
The cookies are now manufactured (obviously) unlike the early years, and manufacturers can make as many as 28 varieties of cookies (again diverse options) which means that unless someone really hates girls or cookies, or is just really broke they’re going to buy some cookies. And that’s what they’re banking on, the organization exists based on things like this. They have a website to maintain, facilities and personnel.

Girls sell these things door to door, and receive prizes for their efforts (think carnival prizes) and patches for their uniforms along with possible other accolades. In 2008 15-year-old Jennifer Sharpe from Dearborn, Michigan sold 17,328 boxes of cookies… personally I hope this chick got a pony for her trouble. For those of you keeping up at home, the average box of girl scout cookies is a reasonable $4.00, that means that this girl brought in an estimated $69,312.00. She probably got a patch and maybe a plaque for her wall or some certificate (that she’d have to frame herself).

Ok, So How Does this Relate?
There’s an obvious similarity between these cookies and the glyph market. Anybody can make glyphs with some time and effort, but it takes “too much time or effort” for most to bother. The dividends can be amazing, but it requires several key elements. First, you have to understand your cost VS profit. If you’re paying 20g per stack of Herbs, milling them and selling glyphs at 2g each… go ahead and say goodbye to your money. Much as the fool in the famous proverb, you’ll soon be parted with it.

The Girl Scout’s are aware of this: “in 2009 , several of the cookie varieties were either made smaller or had fewer cookies per box, without a corresponding drop in price. In particular, there are now fewer cookies in a box of Thin Mints, Do-si-dos, and Tagalongs, and the Lemon Chalet Creme cookies are now smaller. The Girl Scouts have suggested that this change was necessary to compensate for rising cost of ingredients.” Tin foil hat all you want, but it’s possible. If the costs go up, they’ve got to recoup somehow. Same applies to glyph markets, if the price of the millable herbs goes up, glyph prices must as well. Or you will not profit.

Of course, this speaks to fundamental principles of economics. You have to watch your cost and labor, this is what I mean when I say that gathering professions are generally not as appealing (unless you’re skilling up a corresponding crafting profession). Most of the time, the labor cost is disproportionately higher than the material cost of the finished product. These sorts of concerns become only more important in the case of competition.

Recently for example I’ve had several people undercutting me vigorously, and that’s fine because I know who they are and I know (generally) when they’re doing it. I’m fairly certain that I’m more efficient and consistent at relisting my glyphs. But, let’s say they tried to take me on and bleed me dry. How low would they have to go? Well, I’m not going to say here because that would just be stupid. But for practical example, let’s work with some numbers.

The average glyph takes 1 ink and 1 parchment to make.
Parchment cost is negligible, they’re always available and always the same price (reputation dependent).
Herbs however are the variable in the equation, there are a variety of herbs that can be milled for the appropriate pigments/inks necessary. Of course, we’re focusing specifically on Northrend Herbs since the inks created can be traded in for necessary inks to make any/all glyphs.

For arguments sake, let’s say that Deadnettle and Tiger Lily are 12g on the AH per stack.

Practical experience suggests that milling 5 of either of these herbs nets approximately 1.5 Ink of the Sea. So each stack approximates 4 glyphs rounded down.

Using this as a model, we can assume a price of roughly 3g + parchment cost per glyph to make a modest profit. Extra inks will be used to make more glyphs, and these will be nearly all profit. However, if the numbers change… say you’re paying 8g to a farmer for stacks, you’ve got a steady supply at an agreed upon amount, and you have the option of continuing to sell at or just below the “normal” price, and going lower if anyone tries to strong arm you.

In the 8g per stack example, you’d be making roughly 1g per glyph at 3g each. Of course, you’d have to actually sell them all, wherein lies the rub.

Glyphs do sell, but they don’t exactly fly off the AH. So, it’s important also to understand your quantity sold. It’s arguable that at a super low cost the things would fly out of the AH fast as you could make them, but understand it’s not likely. More likely that you sell 50 out of 1000 in a couple of hours. If you’re only making 50g with each listing cycle, then you need to change tactics. Regular undercutting and fallback prices are your friend, establish a firm threshold, if glyphs are selling under your threshold then simply go to your fallback. It’s that simple really. And of course, tend your glyphs regularly looking for any holes, restock regularly. But most importantly, keep your eyes peeled for good deals on herbs, even if you have a bank alt full of ink, you may want to consider buying that bulk of 50 stacks from the guy for 4g each. Clean him out, if you don’t your competitor will… and that’s not good for you.

The Bloodscalp Report
Things remain stable, gems seem to be hitting about 90-100g consistently, though oddly enough Dragon’s Eyes are still topping out at 150 some days. I can only assume that means that a lot of people are getting the all stats Prismatic right now to qualify for meta requirements or something. I’ve been dealing with a lot of RL issues lately that’ve kept me away consistently, so I haven’t been as strong a force in the AH as usual. Though I have been keeping tabs on what’s been going on. That said though, I haven’t been totally absent, I’m just doing the “lazy gold” for a while.

Sugar, Spice, and Everything Nice
+ Spent: 0g (No big money sinks this week)
+ Gained: 22707
+ Profit: 22707

Fell short of my goal, but in my Defense, I’ve been incredibly busy IRL.

XOXO
Khaas

Post Script
I forgot to mention something rather important, in fact I think I may have missed my original point for talking about the Girl Scouts entirely. I blame it on that lingering memory of Samoas and the distractions they cause. But to business at hand, one of the most important lessons you can take from the Girl Scouts and their campaign of
confection conquest is that sometimes you have to go to the people. Find your customers, and sell sell sell!

If you ever listen to the radio, you’ll undoubtedly hear an ad for some car dealership that’s absolutely ridiculous. However, you’ll remember it. That recognition tends to stick, for better or worse. And though you might not run out to buy a car from them upon hearing it, you will remember them when the time does come. The same applies for wow, don’t trust the AH to magically move your goods. Some people may not know of the existence of an item, as Tella pointed out on her blog (Hit The Cap!) some time ago. When selling Rituals of the New Moon Tella uses a silly little macro to spam info about the book. She goes on to note that she saw a definite increase in sales everytime she used the macro.

My AH alts have similar macros, so that when I dump a load of epic gems and dragon’s eyes in the AH people know. And before I can post anything else, I see yellow spam. The conclusion, a bit of advertising works wonders. Now obviously, you don’t care necessarily to do this with everything. For instance, if you’re in the glyph game and you’re on your main guy who makes glyphs… it might behoove you to curb your trade chat shenanigans. It’s just the kinda thing that gets you added to a competitors friend/shit list. And now, this post is for good and all finally done. Scout’s honor…

4 comments so far

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  1. Just wanted to say I’ve very much enjoyed your blog thus far. I think I discovered your page through JMTC, but I must say, your layout, style, and design of the blog is very professional and easy to read. Your writing skills are great as well.

    Keep up the great work.

    Now onto the topic at hand: Do you ever fear advertising your goods in trade chat will only tip off your sellers as to when to undercut you? That has been a fear of mine. I’ve made the majority of my gold selling the prospected gems of thorium ore, so these only sell in bulk when someone is power leveling a profession. This market has huge profit margin, but the demand is relatively slow and I deal with a couple other common sellers.

    My favorite tactic is, if you have the chance and see your auctions being purchased while you are near the AH to whisper the buyer “Don’t pay higher prices for (Item), posting more!” This way I can either get a bulk sale (with a friendly discount) or at least manage to prevent my competition from profiting.

  2. Thank you for the kind words. As I said in the post script, it’s not always advisable to go out and advertise. My general rule is that if it’s something I’m mass producing, I don’t advertise it. If it’s something in limited quantities then I do. For example, after I’ve made the rounds and got all of my freshly transmuted epic gems from my various alchemist alts I may auction Epic gems available, pic your cut Xgold each. Those are generally spoken for before I make it to the AH with my other goodies. In this case, they can snipe all they want on the AH… because I’m not selling these items there…

  3. Tagalongs are the shit

  4. SAMOAS i have 4 orders coming this year BAM