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So I got bored and made this Excel spreadsheet that tells you how much gold you can make by crafting any given gem above flawless square quality based on GAH prices. Instructions are provided, but it's simple. Just update the AH prices for the gems and tomes, then read the profit tables. Here's the link:
Click "File-->Download" and you should be able to save it as an Excel file and edit as you please.
If there are any mistakes, please let me know. But I'm 99% sure I've ironed out all the kinks.
So this is assuming you buy your flawless squares from the AH. Is it also assuming you buy the tomes? I wouldn't expect there to be any significant profit at all if that's what people plan on doing; I mean, who would bother paying someone more than it would cost themselves to go ahead and buy the flawless squares and craft up themselves? It's basically paying someone for their [small amount of] time (and cost of jewelcrafter upgrades, but that's negligible in the long run). That's not even accounting for the AH cut which would kill you on the higher tier gems.
Which brings the next question: How is the profit calculated? Is it:
AH price of desired gem - AH cut - transmute cost - cost of mats ?
People looking to make a better profit, but slower (at least you don't lose money) would be using their own mats and not posting their gems on the AH. So the profit would be more like:
Selling price (~5-10% less than AH) - transmute cost
It's also notable that in this way the seller can ensure that the selling price is greater than the transmute cost, which guarantees a profit of some sort.
A more interesting spreadsheet would be to look at the revenue you'd get from selling all your flawless square gems and tomes, then compare that to the profit you'd get from selling gems that you've crafted up with your own mats. To complicate it more, perhaps there's an ideal gem tier at which the profit is the highest; selling higher ones with your own mats or selling lower ones with your own mats would net less profit.
I'm assuming the final thought is the case and that it would be around flawless stars or perfect stars, since the market would be flooded with flawless squares (from people who don't craft), stars (from people who don't have upgraded crafters), and radiants (people who mindlessly put their top gems on the AH).
The profit margin of selling gems is really low since all the mats drop frequently, all you need to invest is time. Thus, getting a guaranteed profit involves using your own mats, not buying them from, and then selling on, the AH.
Yes, this does assume that you buy the mats on the AH. This is for people who want to make gold by crafting gems regularly. And you are also correct that, for the most part, there is not much profit to be made. Most gems will net you a loss. In the case of the radiant star amythyst, you would lose nearly 6 mil by crafting it and selling on the AH. However, when I last updated the AH prices you could make about 45k gold for each flawless star emerald you crafted. You could also make a small profit on star emeralds and topazes.
Yes, you can make more of a profit by using your own mats. That also takes a LOT more time, and time is money. You can craft up 50 flawless star emeralds per day and make 2,250,000 gold, or you can craft them using your own mats and make ~250k each, but you'd be lucky to crank one out every week, considering it takes 81 flawless square emeralds and 159 tomes. Also, if you try to buy or sell anything outside the auction house right now, you run a high chance of being scammed, so there is a great deal more risk involved.
As for how the profit is calculated, here is the formula for crafting with flawless square gems:
Profit = (AH Price of Crafted Gem) x 0.85 - (Total Crafting Cost)
(Total Crafting Cost) = (Cost of Fl. Sq. Gem) x (# Fl. Sq. Gems Required) + (Cost of Tome) x (# of Tomes Required) + (Total Jewelcrafting Fee)
The main reason I created the spreadsheet is because markets change and prices fluctuate, but as long as you update them in the spreadsheet before you craft something, you will always know whether or not you can make a profit (unless, of course, they significantly change jewelcrafting in a future patch).
Edited by vertX29#1810 on 9/26/2012 10:45 PM PDT
the market changes way too much ... not sure how you have live updates on your excel sheet..
I don't have live updates in my excel sheet. That's why I said in the OP that you had to update the prices... :/
And the prices of most gems are steadily going down, not up. The supply of gems keeps rising, since they are never destroyed and the demand stays (roughly) the same, so the price drops. Buying gems and sitting on them is not a good idea. The price of all of the top tier gems has dropped about 3-4 million in the past few days.
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