One name-brand cereal manufacturer is about to reduce wholesale prices for its cereals by 20 percent because consumers have been switching from its cereals to cheaper store brands  The success of this strategy relies on the assumption that supermarkets will pass on all of the savings by lowering the prices they charge consumers for the manufacturer' s cereals
Although supermarkets usually pass on such savings, in this case it is likely that supermarkets not do so because
supermarkets make far more profit on sales of store-brand cereals than on sales of name-brand cereals