For commodity products, pricing is the most important factor for purchases, especially for bulk buyers. If 2 companies offer the same level of support and the quality of the product is similar, the customer will choose the company offering lower prices.
The CEOs / manager has to decide whether he wants to sell
A. 1000 nos at a profit of 1$ each – Total profit : $1000
B. 10 nos at a margin of 2$ each – Total profit : $20
If they are greedy and want a profit of $2 each, the customers will go other companies who will work with a lower margin.