Quick math:
Let's say 1 million cables at $0.50. That costs you $500k. If you get the cost down to $0.49, you just enabled another 20k cables to be manufactured, and another $200k in profit.
1 million for 490k and sold for 10 million is a 9.5 million profit.
10k is a rounding error.
For a typical cable, it's probably around $0.30 to $0.50 to make, and they tend to sell between $5 and $15, depending on the spec.
For simplicity's sake, we'll assume $0.50 cables that sell for $10. Now, if you save $0.01 in manufacturing, so the cost is now $0.49, and if you sell say 100k cables (feels like a believable amount) then you've saved a cool $1000 in making them. So your profits are $1000 larger now, and you can pat yourself on the back. Good job!
The kicker then is how those profits can be used to make MORE cables. And $1000 of extra profits means $1000 of extra cables. Just over 2000 more, in fact, which you can also sell for $10 each.
Those extra 2000 cables have now earned you a cool $20k of profit ALONE, from only $1000 saved dollars, which itself was from only a single saved cent! Amazing job!
If you keep repeating this, you can probably start to see how this begins to run away:
Even starting with only $1 to make $0.49 cables, you end up earning over $1M on your 19th batch, even if you were spending only 10% of your sales to make new batches of cables and pocketing the other 90%! You actually pocket $1.5M on that batch, and then only spend $167k on the next batch, which promises to earn you even more!
Meanwhile, your competitor making $0.50 cables, starting with a similar $1 and 10% to new batches scheme, would only get to pocket $1.1M on their 19th batch! That $400k is a pretty tidy bonus you've earned.
On your 20th batch, you're selling 80k cables, but your competitor can only afford to sell $60k. We've not even reached the 100k a batch mark, let alone a million cables, and you're already way ahead.
And that's compound interest, folks! From $1, saving only a single cent, we can earn $400k more than we would have otherwise. Outstanding.
EDIT: I took so long to write this that I see andrewstuart2 has summed up the first half of the story far more concisely than I. Nicely done! I feel that compound interest is important for seeing the bigger picture of profit over time, so I'll keep this comment as is.
So I use brand (Anker, amazon basics, Apple, etc) and store (amazon.com, best buy, target, etc) to narrow down the countless cable options.
On the device side, the ability to get those few percent extra profitability is the difference between a failed product and a successful one to higher ups. If you give a TPM the option to choose between $0.05 off the BOM and theoretical improvement to reliability, they'll choose the former almost every time.
I remember one product launch that turned into a disaster because it had been cost optimized so hard that the circuit would go slightly out of spec under physical strain and it turned into a yelling match over the few cents of additional plastic in the housing to mitigate the issue.
A penny here, a penny there, and soon you're talking something like $0.15/cable.
If you sell a million cables, that's $150k.
But there's also the fact that people usually buy stuff based on price. If you go on Amazon, as a consumer, you're likely to buy the $3.99 cable over the $4.99 cable.
And with the profit margins necessary that $0.15 cost savings can easily translate to a $1-$1.50 price difference for the end consumer.
Could someone ELI5 this line of thinking? Exactly how is a $0.01 saving so consequential? Is a better-performing $9.99 cable too expensive for some people but a $9.98 cable within their budget somehow? Is each manufacturer manufacturing 100 million cables and saving $1M here? What is the logic?