Actually some business is done this way. The manufacturer has a price list. The dealers are given a discount from that list. Bigger dealers get bigger discounts. If a dealer is caught selling at a lower price its discount is adjusted by the same percent as the discount it was selling at. The manufacturer says if you can do business at a reduced margin then we will take that margin from you in the form of the reduced discount. Now the dealer is forced to sell at the list price. Likewise if a dealer sells at a higher price the manufacturer will quickly raise prices on the price list because it is proven the product is worth more than what was previously listed. Yes they do control margin.