I hope it goes without saying that after you have killed the enemy, their mangled corpses should be subjected to the indignity of a strip-search while their blood still gushes hotly, and that you should loot everything you can carry.
What have you been doing with all that linen and woollen cloth that you've found on them? Chances are, you've been selling them to a vendor. Well, stop that, right now! There are at least two things you can do with them that are better than that.
Firstly, various professions can use these scraps of cloth. For instance, if you are a tailor, you already know that they can be turned into the most beautiful costumes; if you have the first aid profession, you can turn them into bandages.
Secondly, if you don't have a use for the cloth, sell it to an adventurer who does. Your fellow adventurers pay a lot more than vendors for it. But how do you sell it to somebody else? The Auction House is how. Go to the auction house, select an auctioneer, and search for the cloth you want to sell. You'll find loads of it, at various prices. Decide on the price you want to sell your cloth for (make sure the price you set is above the price a vendor would give you for it), and post it! If you select a low enough price, you'll find it will sell easily, and often within a few minutes. You'll get paid by a letter in your mailbox an hour after the sale.
And it's not just cloth that sells well. Every green item that you loot and that you can't use youself can be sold in the auction house. The secret here is that people will usually buy these item not to wear, but to disenchant into various magical powders, crystals, essences and so on, needed by enchanters. This gives even the lamest green item a value much higher than the vendor puts on it.
As well as green items, many white items also sell well at auction: consumables (like cloth) that are used in other professions or for quests. For instance those small eggs that you get from the birds in Westfall are worth quite a bit to chefs.
Also, while you're at the auction house, don't forget to buy some bags. You can get some from vendors. You can get bigger bags from tailors who sell their wares at the Auction House. Obviously, the bigger your bags, the more loot you can carry.
I don't want to turn this into a guide to using the auction house here; that's been done very well already in loads of places, including Just My Two Copper (http://justmytwocopper.blogspot.com/). I just want to draw your attention to its importance. Don't be poor. Sell your loot in the Auction House. At the very least, the AH is a great way to turn your unwanted loot into gold. The trading game can also be fun in its own right; I love trawling though the auctions looking for bargains that I can resell for profit later.
By the way, if you want to get the most out of the Auction House, you'll really want to get the AuctioneerAddon. This improves your pricing by tracking historical prices and letting you see when items are cheap or overpriced. If you never get any other World of Warcraft addon, get this one. And check out Marcko's guide to using it: http://justmytwocopper.blogspot.com/2009/02/22-steps-to-using-auctioneer-correctly.html
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