What Is Flooring A Car

Retail floor planning also referred to as floorplanning or inventory financing is a type of short term loan used by retailers to purchase high cost inventory such as automobiles these loans are often secured by the inventory purchased as collateral.

What is flooring a car.

Auto dealership slang to finance vehicles for sale lit. How does floor plan financing work specifically to benefit auto dealers. In the case of monocoque designs the floorpan is the most important metal part establishing the chassis body and thus the car s size it serves as the foundation of most of the structural and. The floorpan is a large sheet metal stamping that often incorporates several smaller welded stampings to form the floor of a large vehicle and the position of its external and structural panels.

Front money to put vehicles on the floor of a dealership. The bank is flooring all these cars said the sales manager to the new hire. Floor planning is a form of financing for large ticket items displayed on showroom floors. Contrary to common perceptions most car dealers do not pay cash for the.

But because inventories are so immense the car business is very sensitive to both floor plan interest rates and the tax treatment of interest expenses. Floor planning is commonly used in new and used car dealerships. Using cash or a bank line of credit to purchase inventory can work for some car dealers but many floor plan financing companies offer a variety of dealer specific benefits.