Comment by wat10000

It’s how any sensible business sets prices. Your cost sets a floor, that’s all. You set the price at whatever level makes the most money.

Many prices end up being a little higher than costs, but that’s because competition drives prices down close to the floor, not because businesses set out to do that.

Why do grocery stores have coupons? It’s not because they’re charitable. It’s because coupons are a way to charge higher prices to people more willing to pay. Trying to figure out your customer’s willingness to pay and matching that with your price is nothing new or unusual. The tactics just change when the purchase is big enough to have dedicated salespeople.