If you played Eco by Strange loop games few times, you probably noticed the economy has several differences to the one in real life. Therefore, trading and building an economy must be seen with a fresh vision and ideas tailored to the specific context of Eco. This is especially the case for profit margins.
For example, the process of crafting items has a big value in real life and in many cases, more skills means higher fees. In Eco it's the opposite: the cost of work lower as skill level increases. In fact, crafting (calories, fuel and click) often account for 1 to 5 % (average of 3%) of items' cost and this percentage lowers as you reach level 7. Exceptions of 15% to 22% are for charred food, tallow candles and other low level items that an efficient community will avoid anyway.
Fact of the day: highly skilled specialists in Eco cost less.
The previous example was not chosen randomly. It supports the idea that almost all the worth of an item in Eco comes from the time and effort needed to gather and transport raw resources like wood and stones to the crafting tables. The good thing about these basic resources is any player can get them. So any player can also appreciate the time and energy required to gather and transport them. In fact, if you travel to random public servers for a while, you'll see that servers with experience are reaching a more and more similar price balance between basic resources.
In other words, if running an economy in Eco is like driving a car, raw resources are right in front and easy to see for everyone.
However, a curious thing happen when items are crafted with basic resources : there is an arbitrary extra cost added to them. We are still in a cooperative game with a limited number of people and where the well-being of a player and the server depends on others. But many players are conditioned for profits, especially if they hold a monopoly.
Speaking of monopoly, there are many professions to cover on a server compared to the amount of active people after a few days. When players in a region or on a server are too few, when a player doesn't do his part and leaves the other specialists to care for the server, when a player simply has too little time to play compared to the pace of the server....all these situations explain why you see so many regional or server-wide monopoly in Eco. Limited access to skills and means of production lay the ground for greed...despite the cooperative setting and goal.
For example, a mason buys raw resources (ex.: limestone =1 credit) and sell crafted items (ex.: statues). If a limestone wolf statue requires 60 limestone when a basic upgrade module 2 is plugged in, we can expect the basic cost of a wolf statue to be around 62 credits depending on the cost of food. There is still plenty of "money" to make if the mason harvest part of this limestone too. However, I am currently looking at a store right now and it is listed at 150 credits. Basically, there is a 57% profit margin for these statues and if I bring 150 credits worth of limestone to this player, he will only give me back something worth 62 credits in exchange. The extra resources that I just gave up freely are enough to craft a free statue for the owner. This doesn't feel like cooperation.
When you feel exploited, you are not in a good community. Ask for another deal and begin looking for other servers.
While we can all relate to recipes to calculate basic costs, the crafting step seems to bring various and strange reasons to increase the price. When seemingly greedy players are challenged to explain why they have such a high profit margin, the answers are:
To illustrate this further, there is a popular and respected youtuber, Oearth, who described an original way to mint money in Eco using seeds (https://youtu.be/WsI4NKe6k6U). From what I understand, the system is made in the hope that gatherers and farmers share the wealth from minting equally. However, I suggest you try the farmer profession. Notice the relative effort you put into gathering crops compared to producing seeds. The first skill relies on moving across the map, plowing fields and routinely pickup and replant, not to mention deal with fertilizers. The other requires a 25m3 wood hut and the click of a button to obtain thousands of items. Why should the skills bring the same money if they require so different time/effort ?
So, do I really have to pay for your stupid infrastructure of 5 sawmills acquired for a high price? After all this infrastructure will also be useful for your own project, so why do I have to pay for it entirely ? There won't be a shortage if you drag your lazy person in the wild and get resources too. Why are you the one getting the extra money to spend at others' stores: I can do this very well too. I routinely read and heard players complains that profits are not enough to eat, while the absolute value of the profit margin alone was several dozen times higher than the cost of calories needed to craft the item and gather all the raw material for it.
What I want to stress here is the sheer diversity of reasons given to add profit margins in Eco and how they miserably fail the challenge of reason when you stop to think about the time and efforts required to craft most of the items. Even in the case of profits to pay for infrastructures, people are unable to say how much their infrastructure really cost or say when the price will return to normal.
We can also see infrastructures and stockpile management as a challenge and first look for solutions (ex.: joint buildings, community workshop, clever stockpile design) before putting all the cost of our lack of planning and cooperation on others.
While it is already hard to find proper justification for profits margins in Eco, there is also a huge variability when discussing what is an acceptable margin. I heard comments like "30% is a minimum for me". Okay, why? Why 30% and not 28%. How do you reach this number ?
Huge profits in Eco are like the dead angle of a car when you drive: something suddenly appears next to you and you have no idea where it came from.
I agree that some skills require an extra investment in infrastructure compared to others (ex.: cooking vs glassworking, mechanics vs advanced smelting) and that managing stockpiles and planning takes a bit of time. Perhaps it means some additional cost for crafting if we want to be fair. For example, I can start a job of 500 mortared stone and calculate that I spent 10 seconds handling stockpiles. I can define a base price per minute of management from the value of rocks or wood I could get in this same amount of time and divide it by 500 to obtain the extra fee. I am playing as a mason right now and this management fee gives a profit margin of about 1.4%, roughly half the contribution of calories and fuel on most items.
I don't know if this percentage is a good or bad one. What I know, however, is I can justify it... which is more than those you will play with.
Moreover, some servers propose minimum prices for raw resources as a way to guide their small-scale economy and ensure some fairness between players. But all these efforts to negotiate and compromise the balance are null if smelters agree to sell iron at 30% profit margin while carpenters are in the 10% range. In practice, this means the price of iron ore becomes higher than what it was meant to be since these players are likely to mine ore as well. Your fellow citizens will first fight this unbalance by finding alternate strategies or absorb the grinding for a few days. Eventually, they won't anymore, as we can see in many failed worlds.
In conclusion, playing Eco like an expert means to avoid readily applying popular economic models to the context of Eco, which is unique and different. It also means you aim to collaborate with others, not try to rob them because your skill is unique. Like the blind spot in a car, profit margins in Eco is a poorly visible thing but it can come at your society and have detrimental impacts on fairness and motivation. This is why it needs to be regularly checked and challenged.
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