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I am thinking of setting up a "craft based" character is Skyrim - with the challenge to use Smithing/ Enchanting/ Alchemy and Speech to build up wealth while avoiding the normal kill, loot and sell approach.

From experience it's hard to make/ sell things without losing a lot of money in the process. For example a leather strip (3 gold) and an iron ingot (7 gold) can be smithed into an iron dagger (10 gold) - which is a grand profit of no gold.

Even using enchanting/ soul gems and "high value" enchantments like "Fortify Sneak" don't deliver a good return. Although because previous characters have been combat/ magic/ sneak focussed I haven't put a lot into "Speech" perks.

Is there an effective/ profitable approach to a "crafting" style of gameplay or do the in-game economics make it pretty much impossible?

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its really easy to make a profit doing alchemy. –  z ' May 10 '13 at 21:50
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up vote 6 down vote accepted

If your speech skill is low, you can get your own resources by mining (good places to mine), hunting, chopping wood, gathering flowers, et cetera; although leveling up your speechcraft will make buying resources and selling products profitable, and it's fairly easy to do.

Buying cheaper alchemy ingredients can also be a good way to turn a profit.

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After a bit of experimentation with an existing character I think the Speech skill is key (and I've been a bit dense). There's a number of ways of increasing Speech which my craft based character should invest in early on. Including an amulet of Dibella, the Masque of Clavicus Vile or Volsung: elderscrolls.wikia.com/wiki/Speech –  Tama May 12 '13 at 20:33

Start by creating 4 items (bracers, helmet, necklace, ring) that can be enchanted with "fortify alchemy". Go and create two or three "fortify enchanting" potions. Use the potion at the enchanting table and put "fortify alchemy" on the 4 items. Put on the 4 itmes. Then go back to the alchemy table and re-make the enchanting potion. The potion should be more powerful now. Repeat the process until you are at high levels of percentages (22-25%) on the enchanted items. Once the items are high enough, create potions like fortify health, invisibility, etc... Basically anything with wheat and a Giant's toe.

The only cost is a few leather strips and iron ingots for the equipment (silver ingots for the necklace/ring), and soul gems (which can be farmed in Blackreach or dwemer dungeons), and the wheat (which is rather abundant) and giant's toes are on giants (naturally). It takes time, but it is really not very expensive.

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grab everything, enchant it using a petty soul gem and sell only problem is soul trapping and enchantments

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