Overall, I think supply and demand are the major factors here. Matching-price-with-higher-quality or undercutting-with-lower-price are sufficient for industrial goods.

For goods that are retail-only, selling them at anything lower than you could make at retail is, I think, a mistake. If you're that heavy on manufacturing, why not expand your own stores to soak up the missing demand? Especially now, when you have more fine-grained control over how much of a store's power is going toward a single product?

In short, I would say that anytime you make less than 2x cost on a product, regardless of what that product is, you've done something wrong. Maybe you need that influx of cash, maybe you put more money in your factories that would've been more profitable in your stores... but a mistake was made somewhere along the chain. (If driving other people out of a particular market was something that could reasonably be done in the current system, I could potentially see that, but I'm pretty confident we're nowhere near that point right now.)