Floor Plan Financing Car Dealership

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 financing car dealership. 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. Dcg capital has helped numerous new car dealers acquire floor plan loans getting customers the best terms and conditions while providing a stunning inventory increasing sales and expanding their. A one percent rate increase can raise some dealership costs by millions of dollars. Contrary to common perceptions most car dealers do not pay cash for the.

The dealer then receives payment hopefully including a profit and remits the balance to. For example automobile dealerships utilize floor plan financing to run their businesses. What you don t realize is that like most new car dealers a floor plan was used to finance the cars. Afc helps independent automotive dealers expand their businesses by providing inventory finance solutions and key operations related services.

Though dealership savings can be used to purchase inventory one of the simplest means of acquiring inventory is using floor plan financing for used car dealers. 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. So you need floor plan financing that will infuse your automotive dealership with new cars without terms that could prove difficult down the road. These floor plan finance formulas incorporated with your turn time can help to make or break your dealership s profitability.

With more than 120 locations afc is one of the largest floorplan providers in north america and offers unmatched local access and customer service. Acquiring a floor plan before lending funds floor plan financing companies will often ask dealers to provide additional information and documentation to verify dealership details. Let s say you make a profit of 3 000 per car sold. How does floor plan financing work specifically to benefit auto dealers.

Floor plan finance companies are uniquely attuned to the needs of auto dealers. Floor planning is commonly used in new and used car dealerships. No curtailments or audit fees. Floor cars for up to.

Keep it with car bucks. 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. Monday friday 8 30 5 30 est. There s never been an easier way.

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. Our floor plans offer quick cash flow great terms and no curtailments.