Quote Originally Posted by blue sky View Post
I know that you’re cleverer than this question makes you appear. You are undoubtedly familiar with the term “loss leader”.

Of course, the 3p in the pound doesn’t apply uniformly across all products and sales. Setting prices on individual products is probably mostly handled by algorithms and AI nowadays. We’ve just been through Easter when lamb prices are slashed. Morrisons sold legs for £7 a kilo, I’d imagine that Sainsburys and Tesco did the same. I popped into Leckwith Asda after visiting the CCS on Ash Wednesday and legs of lamb were £5 a kilo so I grabbed a couple and told my family and friends about it, and a few of them made the most of these insanely cheap prices. Asda must have made a loss on this promotion but they got people through the doors and spending.
I don't know if you needed the little dig at the start of that response. But anyway, I was thinking of an infographic like this one, although I think it's Canadian.

supermarket.jpg

At the end of it, the supermarket makes 3%/3p in the pound. But if the supermarket has a stake in the manufacturer or supplier (vertical integration), or IS the manufacturer and supplier, then they're also making a profit elsewhere along the line.