Okay, lets say I'm the manufacturer(Sony) in this situation and you are the retailer(Best Buy).
Now I'm in the business of making baskets. Now, the basket costs about 20 dollars to make (Parts and labor) but I don't feel like my baskets are good enough to sell at that price so I sell them at a 10% loss for 18 dollars to the stores who would turn around and sell them to customers.
So, you buy my basket for 18 dollars. You aren't going to turn around and sell it for 18 dollars. You would lose money that way. You need to pay your employees. You are in the business of making money. You have a 5% jack up rate. So you sell the product for 19 dollars. You get 1 dollar extra from selling the basket and use probablly 50 cents to pay your employees. That would mean you got a 50 cent profit.
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