Flooding the market

Okay, so let's imagine you have a toy factory and you make a lot of toys. You have so many toys that you can fill up your toy store and your friend's toy store too. This means there are a lot of toys in the stores and not a lot of people who want to buy them all. So, what do you do with these extra toys?

Well, you decide to sell them really cheaply in hopes of getting rid of them all quickly. This might make some people really happy because they can buy toys for much less money than they normally would. But, it might also make other people unhappy because they might have already bought a toy at a higher price before you started selling them so cheaply.

This is what it means to flood the market - to have too many of something for the amount of people who want it. When you have too many things, you can lower the price to try and sell it all faster, but this might upset some people who paid more for the same thing earlier.