### Comment:
'Gross margin is the difference between revenues and the cost of goods sold, which leaves a residual margin that is used to pay for selling and administrative expenses' 
  
 they're putting a lot of their costs over in SG&amp;A instead of into the sale of goods because they're using drop shipping to run the business 
  
 when they stop subsidizing sales, or when someone else decides to offer the same furniture cheaper, they'll lose that business

### REPLY:
Interesting, I didn't realize their whole business was based on drop shipping. Still not sure I understand how they are subsidizing sales. Are you saying they are literally selling items below cost (Not including normal SG&amp;A)?

### END.