why if change manufacturing of a product not change the price for the buyer?
In highly developed and competitive industries companies tread a continuous and very fine line between maximising shareholder profits by keeping prices up while making products as cheaply as possible, vs competitors lowering prices when they work out a way to make equivalents cheaper. In the short run you will quite often see companies hold onto large portions of efficiency savings (particularly if they make a major breakthrough in a specific manufacturing process etc) by holding old prices up, but in the long run competition pretty quickly lowers prices as the companies trying to keep high margins and prices get ruthlessly undercut by smaller competitors happy to make a bit less.
The public was sold the idea that losing manufacturing didn't matter. They were told not only do you get cheaper products. But you will get new cleaner service, and tech jobs that pay the same or better! People bought into it but 30 years later Ross Perot was proven right. There is a highly related question which is much easier to answer: what normally value-increasing news about a company would cause that company to fall in value in the public stock market? By answering that, we can answer your question by proxy. The answer to that question being: anything that makes investors believe that the company won't be able to maintain the level of profit. For example, let's say a company announces a 300% profit growth compared to the previous year. This should push the stock upwards; maybe not by 300%, but certainly by quite a bit. Let's also say that this company is in the business of designing, manufacturing and selling some highly useful gadget that lots of people want to buy. Now suppose that the company managed such an profit increase by one of: In scenario 1 (firing the engineering department), it is highly unlikely that the company will be able to come up with, manufacture and sell a Next Generation Gadget. Hence, while profit is up now, it is highly likely to go down in the months and years coming up. Because stock market investors are more interested in future profits than in past profits, this should push the value of the company down. In scenario 2 (selling off the machinery), the company may very well be able to come up with a Next Generation Gadget, and if they can manufacture it, they might very well be able to sell it. However, no matter how you slice it, the short-term costs for manufacturing either their current generation Gadget, or the Next Generation Gadget, are bound to go up because the company will either need to rent machinery, or buy new machinery. Neither is good for future profits, so the value of the company again should go down in response. In scenario 3 (their product getting a large boost), the company still has all the things that allowed them to come up with, produce and sell Gadgets. They also have every opportunity to come up with, manufacture and sell Next Generation Gadgets, which implies that future profits, while far from guaranteed, are likely. In this case, the probability remains high that the company can actually maintain a higher level of profit. Hence, the value of the company should rise. Now apply this to a slightly more realistic scenario, and you can see why the value of a company can fall even if the company announces, for example, record profits. Hence, you are looking for news which indicate a present and sustained raised ability to turn a profit. This is the type of news that should drive any stock up in price, all else being equal. Obviously, buyer beware, your mileage may vary, all else is never equal, nothing ever hits the average, you are fighting people who do this type of analysis for a living and have every tool known available to them, etc etc. But that's the general idea. This is how mints make money. They sell limited runs of items at a price significantly higher than their manufacturing cost. Some buyers hope that the scarce nature of the item will cause others to value it higher than the initial offer price but also some people just like to have them. For a company the size of Amazon a 1% increase in prices is substantial.  Many of their products are in fiercely competitive price sensitive markets.  There are some products that people would notice a 1% difference from competitors.  So the actual increase would have to be concentrated on a smaller subset of products that are not as price sensitive.  However, that would still mean reduced sales.  In short, I don't think amazon is foregoing a 50% bump in profits if they could get it.  Also a 5% SGA cut is absolutely enormous for a lean organization.  In any one year that would mean an effective ~10% cut once you factor in inflation. "WF has trust in certain customers.  I doubt that they will lose that trust by lowering prices, and they will probably gain other customers as well.  The thing you should probably do before making your judgements is to realize that the CEO of Amazon is probably a pretty smart person and he has access to information that you don't.  So maybe you should lean on the side of ""Wait and See"" before making any judgements to a certain move." "The entire time you've talked about cost. Changing incomes matters little if the cost scales with it. Me thinks you don't understand how a market works, even a semi-planned one. If more people make more money, the price of most goods goes up. This isn't due to real actual demand, its due to something called inflation. When the amount of money in circulation increases, we have inflation. Lets say I make 35k a year as a store clerk. Is my labor being undervalued compared to the income of a store clerk in the past? Or is the price of goods scaling faster than my income has scaled?  Simply adding more money doesn't fix anything. The price of the good or service is what matters the most. While everyone having more money is good, you can't just magically give everyone more money without the cost of goods and services rising. I imagine that if everyone suddenly were at least a millionaire, the price of a laptop would sky rocket. The cost of the laptop in parts wouldn't be that much more, but since most people would have disposable income beyond their needs some goods would then get more expensive. Once that happens, the inflation of prices starts to spread until its effects are seen across the market.  I don't think the ""fruit of my labor"" is being stolen by the ""upper class"". If anything, the fruit of my labor gets taken more and more by my own government and transferred to the lower classes more and more. I'm not rich, not even close. But I know I've had at least 15k of my income in the last 5 years taken and distributed through taxes ON my income to people that are generally unable to earn enough on their own.  If these people are the upper class, then I must be Marie Antoinette!" It does have to do with supply and demand in a sense.  My salary, as an engineer, has relatively little to do with the supply and demand of the parts my employers company makes.  My salary does, however, depend (in part) on the supply of fellow engineers that have comparable skill sets to mine and the demand that companies have for engineers with comparable skill sets to mine. "It seems this will be very much driven by price discrimination.  If there are some customers who will pay up to $100, sell at that; and if there are others who'll pay $1 sell at that price. For instance you see computer games, which have zero marginal cost of production, sold at ""normal new release"" prices, at premium prices with a special box or doo-dad, and at discount prices once the game is a bit old." Balanced out might be a better way to put it.  Imports become cheaper, driving down inflation, which should permit companies to operate at a lower cost, which should eventually work to limit or eliminate the impact of the shift.  These balancing factors generally occur in the long term and specific sectors of the economy will be impacted to different degrees. News about a company is not the only thing that affects its stock's price. There is also supply and demand.  That, of course, is influenced by news, but it is not the only actor.  An insider, with a large position in their company's stock, may want to diversify his overall portfolio and thus need to sell a large amount of stock.  That may be significant enough to increase supply and likely reduce the stock's price somewhat. That brings me to another influence on stock price: perception.  Executives, and other insiders with large positions in their company's stock, have to be careful about how and when they sell some of that stock as to not worry the markets.  Many investors watch insider selling to gauge the health of the company. Which brings me to another important point.  There are many things that may be considered news which is material to a certain company and its stock.  It is not just quarterly filings, earnings reports and such.  There is also news related to competitors, news about the economy or a certain sector, news about some weather event that affects a major supplier, news about a major earthquake that will impact the economy of a nation which can then have knock-on effects to other economies, etc... There are also a lot of investors with varying needs which will influence supply and demand.  An institutional investor, needing to diversify, may reduce their position in a stock and thus increase supply enough that it impacts the stock's price.  Meanwhile, individual investors will make their transactions at varying times during the day.  In the aggregate, that may have significant impacts on supply and demand. The overall point being that there are a lot of inputs and a lot of actors in a complicated system.  Even if you focus just on news, there are many things that fall into that category. News does not come out at regular intervals and it does not necessarily spread evenly.  That alone could make for a highly variable environment. "The simplest answer would be: Because they can. Why charge less for something if people will pay more? One example are Apple products. While there the price number is not exactly the same in EUR and USD, they are so close that, effectively, the EUR product is more expensive. Many things go into a price. There might be reasons for products in the EU being more expensive to produce or distribute. Or people in the EU might be in general more willing to pay more for a certain product. In that case, a company would forgo profits when they offered it cheaper. Also, prices are relative. Is the USD price the ""correct"" one and the exchange rate should dictate what the EUR price is? Or vice versa?" The mechanism of supply and demand is imperfect.  Producers don't know exactly how many purchasers/consumers for a good there are.  Some goods, by their nature, are in short supply, and some are plentiful. The process of price discovery is one where (in a nominally free market) producers and purchasers make offers and counter-offers to assess what the price should be.  As they do this the historical price changes, usually floating around some long-term average.  As it goes up, we experience inflation.  As it goes down, deflation. However, there isn't a fixed supply of producers and purchasers, so as new ones arrive and old ones leave, this too has an impact on supply and prices. Money (either in electronic or physical form) needs to be available to reflect the transactions and underpin the economy. Most central banks (at least in more established economies) aim for inflation of 2-4% by controlling the availability of money and the cost of borrowing new money.  There are numerous ways they can do this (printing, issuing bonds, etc.). The reason one wants some degree of inflation is because employees will never accept a pay cut even when one would significantly improve the overall economy.  Companies often decrease their prices in order to match lower demand, but employees don't usually accept decreased wages for decreased labour demand. A nominal degree of overall money inflation therefore solves this problem.  Employees who get a below-inflation wage increase are actually getting a wage cut. Supply and demand must be matched and some inflation is the inevitable consequence of this. This sort of thinking is one of the problems with economics. It's way too simplistic, and unrepresentative of how a company works. No company increases the price of a product because they hired a more expensive employee, unless said employee is dead weight.   It might be a process engineer, that right now costs the company a bit more, but 12 months down the line will improve production efficiency by at least the value of his salary. And if they improve it more, by say 200% of their salary? Product price stays the same, he gets a pat on his back from the boss, and the company increases it's profits.   And what usually happens when you nickel-and-dime your employees? They lose engagement and interest, or worst, they hire a shit employee for a shit salary and get little to no benefit from hiring. "Yes and no. First off, commodity prices reflect the cost of a good about 3 steps back in the retail supply chain; the agreed-upon price for the raw foodstuff between farmers/ranchers and manufacturers. Your grocer may carry bags of whole grain wheat, but that's certainly not all he carries that contains it. Same for corn, rice and other staple grains, as well as for fruits and vegetables, herbs (yes, you can buy basil by the ton on the CME), meats, various sugars, etc. So, a long-term sustained change in prices of a commodity foodstuff will eventually affect the real cost to you to buy things they're made from. However, in the short term, the retail supply chain will generally act as a buffer between these prices and the ones you see on the store shelf. Consumers don't like price increases, especially of necessities like food. When food costs go up, consumers can and will very quickly change their spending habits, buying cheaper options to get their needed calories. That makes manufacturers nervous; consumers not buying their product is a worse scenario than consumers buying their product at a reduced gain or even at a loss. So, manufacturers, and suppliers and retailers, will all absorb as much as they can of the cost of a commodities increase before beginning to pass it on to consumers. On the flip side, while consumers like price drops, they don't notice them as much as price increases. So, the supply chain will also absorb a fall in commodity prices by resisting price reductions in the consumer goods, as long as they can get away with it (which is usually longer than the price reduction actually lasts). The net effect is that processed food prices typically follow the gentle upward climb of long-term inflation, and only rarely do you see drastic price increases or decreases. Where this model breaks down a little bit is in highly perishable foodstuffs, especially seasonal or ""wild-managed"" foods; fruits and vegetables, seafood, etc. The limited time in which the stuff can be sold makes the process of getting a fish out of the ocean and a fruit off the tree and into your grocery store much more market-driven; the producers, suppliers and grocers are all in constant contact over what's available and how much they can get for what price. The prices therefore are typically a lower markup (unlike highly processed grain-based foods, there's not much added value to be marked up between the apple farmer picking the fruit and the grocer putting it on display), but also much more volatile; if there's a bumper crop of fruit, the farmer has to unload it all or it goes to waste, while similarly if an early freeze decimated the apple crop, the suppliers can't just get some of last year's bumper crop out of storage; they fight with everyone else for what little made it to market. Farmers will sometimes intentionally let excess crop spoil in order to maintain a minimum price for what they sell (the rest can at least be composted and used for fertilizer, saving them some money on maintenance), but there's no silver bullet for a shortage. This is why a lot of these foods, especially seafood, are considered luxury items; they're not stable enough for everyone to get as much as they want whenever they want, unlike staple grains." Stuff like this came about mainly when setting the new guidlines in medicare part D. Basically companies are able to reset their prices if they come up with a new method of delivery of a drug, sometimes it's faster and better but not always, especially since it's put into effect regardless. Since they already have a monopoly status due to the patent they set price equal to marginal revenue, which in this case happens to be quite a bit and since they own the only competing drug from what it sounds they are perfectly within their right to pull the old one.