Legal Question in Consumer Law in California

Because they are not a contractor, but are a supplier. Plus they may not be able to return the products, or it costs a lot to return the products.

Actually some flooring stores have licenses to do their own installation, but most do not. They arrange for a licensed flooring contractor to do the installation. In that case, they are charging your 50% for the sale of the materials, not for a construction contract. In cases where the store is licensed, they will still structure the sale so that the flooring is a sale of goods and the installation is the contract, again allowing the 50% deposit. If, however, they do not follow proper procedure, and they write it up as all one contract for installed carpet, then the 50% deposit would technically be illegal, and you could get out of the contract and get your money back if you do so before the contract is completed. Once they show up to install, your only remedy would be a CSLB complaint which might get them fined, but does nothing for you.