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To: Patrick Slevin who wrote (15948)12/4/1998 2:51:00 PM
From: Kachina  Read Replies (1) | Respond to of 17305
 
There is a very common practice with larger ticket manufactured goods called "flooring" of merchandise. Washing machines and such are sold this way for example. Effectively it functions as part of the startup loan for a company. It also lets them expand steadily and keep good cash flow.

Often a dealer will gnaw into that cash for his own salary or operating expenses over the course of years. Pretty tempting.

But a properly run megadealerhsip can use this float to cut their margins to the bone and still make money.