Assuming that the retailer can actually get a refund or replacement from the manufacturer (for some products, only the consumer can actually do that), usually they just replace the item or the wholesale price. They don't replace the retailer's gross margin. Thus the retailer ends up eating the cost of things like stocking and actually processing the warranty. For e.g. a one-person operation, that means extra work for zero profit.
It's usually not that much, but I can see why they might eventually be upset about it.
