Magic Shops

Lots I should be writing: a follow-up to the "Rules Are Meant to Be Broken" post, some stuff about classes. But I thought I'd write something about magic shops, since I did some calculations a while ago. I don't like magic shops in my game, but if I had them, what does the book say about magic item pricing?

First, the assumptions: we're talking about a magic-user making and selling items in town. Assume there's no actual "shop", it's all being done out of the M-U's home, so no separate charges for rent; all that matters is the cost of the item and the usual living expenses of the M-U, since the M-U won't be able to gain money through some other means.

First, the expenses.

Player/Characters must pay Gold Pieces equal to 1 % of their experience points for support and upkeep, until such time as they build a stronghold. If the stronghold is in a wilderness area all support and upkeep costs then cease, but if it is in a village or town not controlled by the player/character then support and upkeep payments must continue.
Underworld & Wilderness Adventures, p. 24

Since only Wizards can make magic items by default (per Men & Magic, the monthly expenses of an M-U making and selling magic items is 3,000 gp per month.

The cost of supplies for making a 1st level scroll is 100 gp. It takes one week. If the wizard does nothing but make scrolls and direct staff to sell the scrolls, he could make four scrolls a month  and would have to sell all four at 850 gp each just to break even. The scrolls would more likely be priced at double that, or 1,700 gp, so that the wizard only needs to sell 50% of stock each month to survive.

If you follow the Holmes rule and allow M-Us of any level to make scrolls, scrolls may be cheaper. Wholesale might be as low as 115 to 120 gp for 1st level scrolls, and presumably there are more 1st level M-Us than wizards, so the mark-up might not be so high: 150 to 200 gp per scroll, with a good supply available.

A potion of healing costs 250 gp and also takes one week, so the wholesale price for a potion of healing would be 1,000 gp, and retail would be 2,000 gp. However, hiring an alchemist (1,000/month) reduces the costs to 125 gp per potion... and adds 250 for the cost of having an alchemist. The main benefit of hiring alchemists is it allows more potions to be made, since there are no other rules about low-level M-Us helping the process.

Magic armor +1 costs 2,000 gp in supplies and takes two months, and there are no provisions for using assistants, so wholesale price would be 8,000 gp, and retail would be double or triple that. That is probably a custom order, not a stock item.