The Competive Edge

Why would a Food Company incur an Expense?

Simple put Kosher Certification is expenses that can only be justified if it has a rate of return exceeds the expense. Companies do this in the hope the expense can be justified to sway people to buy their product over other brands. Nor would a food company price them out of the market.

Furthermore, it's been reported that while retail food sales grew at about 6% in 2006, kosher food sales grew 15%. Source Egg Solution E-News April 2007

Supply and Demand.

In economics, supply and demand describe market relations between prospective sellers and buyers of a good. The supply and demand model determines price and quantity sold in the market. The model is fundamental in microeconomics and is used to explain a variety of microeconomic scenarios, as well as a building block for many other economic models and theories. It was originally described by Antoine Augustin Cournot, and was popularized by Alfred Marshall.

The model predicts that in a competitive free market, price will function to equalize the quantity demanded by consumers and the quantity supplied by producers, resulting in an economic equilibrium.

Bottom line, food companies have board of directors that have to account to their stock holders.