Auto Dealer Floor Plan Definition

Floor planning is commonly used in new and used car dealerships.

Auto dealer floor plan definition. Floor cars for up to. Call or apply now 864 234 9696. However there is a benefit for the dealer since the curtailment will be based on the 8 250 its cash flow will not be affected as much. Let s say you make a profit of 3 000 per car sold.

Keep it with car bucks. Floor planning is a form of financing for large ticket items displayed on showroom floors. There s never been an easier way. No curtailments or audit fees.

A one percent rate increase can raise some dealership costs by millions of dollars. If your holding cost per day per unit is 44 63 and your turn time is 60 days you will spend 2677 of your profit holding on to a non selling car. Contrary to common perceptions most car dealers do not pay cash for the. Floor plan loans are among the safest of all financial instruments.

Monday friday 8 30 5 30 est. Our floor plans offer quick cash flow great terms and no curtailments. Afc helps independent automotive dealers expand their businesses by providing inventory finance solutions and key operations related services. 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.

Floor plan finance companies are uniquely attuned to the needs of auto dealers. Floor plan statements and inventory information available online. For example automobile dealerships utilize floor plan financing to run their businesses. 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.

Variety of floor plan structures and interest rate options to meet your needs and reduce your interest expense. 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. What you don t realize is that like most new car dealers a floor plan was used to finance the cars. With more than 120 locations afc is one of the largest floorplan providers in north america and offers unmatched local access and customer service.

The dealer then receives payment hopefully including a profit and remits the balance to. Simply it is a way for an auto dealer to use a lender s funds to finance the cars and until each of them is sold the lender holds title to the cars.