Friday, November 11, 2011

The Price is Right

In our continuing series on exploring the little known features of MTGO Library, I'm going to delve into the prevailing task of management today: Maximizing Profits and Minimizing Expenses.

A good part of Senior Management's job is to look for ways to increase revenue and decrease costs. How this is done is a very tricky proposition; which the Occupy Wall Street movement is highlighting. While global politics is not the scope of this forum, there are lessons which can be found by looking at other examples.

There are the obvious methods of doing so: The first one is to simply raise prices.

Assume you sell ten (10) rares a day for 1 ticket each. This nets you ten (10) tickets each day. Increase your prices by 10%, or 1.1 tickets each and assuming you keep selling ten (10) rares a day, you have increased your revenue by one (1) ticket.

This method has its drawbacks as Bank of America recently discovered when it announced it was raising some of its fees. If your customers balk at paying the increased price, they may be motivated to look elsewhere. There are economic theories based on finding optimum pricing for maximum profit.

The other obvious method is to decrease expenses. In traditional businesses, many times this takes the form of cutting employee pay, which the Occupy Wall Street crowd highlights. In our MTGO business, this takes the place of paying less for incoming cards.

Again, while this method will not be detected by those who buy from us, it may be detected by those who supply cards to our bots. Again, they may be motivated to find another bot to sell their cards to.

But there is yet another method which can decrease our costs with no other drawback: Wikiprice.

What is Wikiprice? It is a tool used by buyers to find which bots carry a specific card at the lowest possible price.

But more importantly to use bot owners, ticking that checkbox instantly reduces our leasing fee by 1%. This may sound like an insignificant number but in the “real world”, such a savings would get the person finding this a large bonus.

Imagine buying a chase rare for 40 tickets and selling it immediately for 60 tickets. Normally, the fee for this transaction would cost us 3½ tickets. Having that checkbox checked reduces the fee to 2½ tickets. One ticket may not sound like much, but how much business does your bot do over the course of a year? Does a simple checkbox tick save you 50 tickets? 100 tickets? More?

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