The dealers often give certain discounts off msrp, not markups from cost.
Example:
Av 4x4= $42k sticker
Av Z71= $43.5k sticker
If the dealer advertises $10k off sticker including all incentives (employee pricing etc) he will still sell the Z71 for $1500 more than the regular 4x4. Part of that $1500 is dealer invoice cost and part is profit to the dealer.
That is why the "savy" dealers order things like white lettered tires that cost $125. It does not effect the buying decision to the consumer b/c of its low unnoticed cost, but it might add $50 to the profit of the truck.
Back in 1999 A Z71 package on a tahoe yielded many differences such as painted bumpers, roof rack delete, 17" wheels (only way to get 17s back then), two tone leather, and the suspension package. Today it is mainly an emblem with skid plates. Dealers on LI order over 75% of their trucks with the Z71 package (my experience trying to find a non-Z), yet we live on a flat island with no offroading in sight. After talking to a friend at the dealer he said they make more on them that way...