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I mean yes and no. If the supermarket never sells it because they can't make a profit (and it's not in enough demand to be a loss leader that brings people in), then the supermarket won't sell them, driving down demand to the supplier. If that exists for one supermarket it likely exists for others driving down the demand more (even if said demand would have otherwise remained high) .

You see this dynamic in markets fairly frequently and the profitable goods and services will be promoted more heavily. One can get philosophical about what is supply and what is demand, but middle man profitablity is a factor in those things as they're at once a customer and a seller.

TLDR supermarket profitablity definitely drives pricing as well. Just another component.



>> supply and demand in the labor market has nothing whatsoever to do with the profitability of a firm

> [supermarkets]

All supermarkets have to pay the same price to buy strawberries, regardless of their individual profitability.




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