Well, I cannot speak for Chris Reeve Knives, but I will offer an opinion.
I've known Chris and Ann for many years. We worked together when Chris was in South Africa.
A CRK knife is not a custom knife, nor is it a production knife. They are in a class by themselves. They've taken many years to develop their reputation.
Each piece is custom made by skilled custom makers. CRK tolerances and standards are the highest I've seen in processes like surface grinding and heat treat. There is a limit to their production capacity.
Chris is pretty anal on quality. "Quality is time. = Time is money". He pays his craftsmen a fair wage, and he charges a fair margin, he gives the world a product like no other. Chris and Ann work hard and they make a good living. "Enormous profits" is an inside joke that Chris and I laugh about. Frankly, I think they'd feel guilty if they made too much money.
The "Market" will determine if his business strategies work, regardless of what they are. If they don't work, adjustments are made....that's how businesses survive.
BTW, the flip side of a "bargain driven" market is manufacturers are forced to import product (export jobs) from China to compete in the need for the "lower price". More complications.