Most of the time, the printer will be printing not just your flyers but upto 8 other clients flyers so the cost for the machine to be running is spread across 8 clients, which makes for the job to be so cheap.
There can be a couple of downsides though, firstly unless the printer is busy, you could wait upto a week or so for your job, as they wait to fill the sheet of jobs. Then there can be quality of colour and print, as the printer needs to balance the colour/print across many jobs on the sheet, rather than focus on yours. And lastly you get the stock available, rather than maybe the one you would wish for.
Saying all that, plenty of guys on here that use this method to give great prices, and provide great work.
Neil