Dealer Incentive
If you go to a store that gives you a special sale on Pixel over Galaxy, Nissan over Toyota, Hunt’s Ketchup over Heinz, or any other kind of equivalent products, chances are a dealer incentive is involved. The company who sold you that product is the retailer; they get a spiff or extra commission or additional dollars on top of whatever spread they made in selling it to you, from buying it at $2.88 and selling it for $3.71.
One of the great aspects of the free market economy is the variety of choices the consumer has in almost any product, from cell phones to cars, from dresses to guitars, and so forth. From the service or product providers’ perspective, they need to get an edge against their competition for market share from the same targeted customers.
Think: Rebates, discounts, bonuses, or other pricing revisions that allow the dealer a better profit margin for specific items, and further perks as the market...warrants.
Related or Semi-related Video
Finance: What is a Broker-Dealer?16 Views
Finance a la shmoop.. what is a broker-dealer? It's one of [Homeless guys holding help signs]
these guys who's making less than minimum wage right no that'd be a broke
dealer and you won't find too many of them in Lake Tahoe but yeah a broker is [Man talking about broker-dealers in Lake Tahoe]
just someone who takes a commission for selling stuff they live wherever there
are transactions in cars, boats, planes, homes and securities like stocks and
bonds so yeah it's a broker - dealer sort of like a writer-director
sexual deviant in Hollywood... Key takeaway here the broker dealer brokers
securities ie they take a commission and they deal in securities like they carry [People playing blackjack]
their own inventory of ten million shares of Amazon this week's selling
them for twelve hundred ninety dollars and 32 cents a share and buying them for
twelve hundred eighty eight dollars seventy nine cents a share making a
spread of...
equals a dollar fifty-three a share the dealer makes a spread of a buck fifty [Dealer and market transferring cash and stock]
three every time she trades a share of the Walmart killing behemoth yeah it's
sort of a Goliath slaying Goliath story there that Amazon Walmart thing we're
watching it so think about broker-dealer making money on both sides of the trades
that's the way to go if you're going to Wall Street make money no matter what [Man walking on Wall Street]