Snap on from a different perpective

[UncleJoe]

A lot of talk goes on here and on other sites about Snap On. Some love it and some can't justify the prices. I am a hobby guy and own no Snap On but I found it very interesting when I was watching one of my business investing shows and they interviewed the current president of Snap On. He was a very good spokesman for the company and the direction it is heading in the future.

So I looked up the stock. It is not on my normal investing radar. Here is a brief snapshot of what I learned and I thought it might be interesting to guys that buy their tools and use them daily.

If you invested $10,000 in 2005 in Snap On stock that stock would be worth $46,093.31 today and would have paid an additional $3,872.19 in dividends over that time. Not as good as some but not too bad either.

The president convinced me that the company is poised to remain on top of the tool market as technology becomes a more important tool in the professional mechanics arsenal. In all he made a very good presentation.

 

[d.mcfarland]

From a business perspective, they really can't be beat. Others are obviously in the market, but Snap On is high profit and high margin. $422 million in profit last year alone. I like the long term potential for sure!

 

[ChevyEFI]

An understood point.

Whether those who feel a $150 ratchet that lasts 7 years is a better value than a $65 ratchet that lasts 5 will understand is something else.

 

[Evilunclegrimace]

If your $150 ratchet is only lasting 7 years I would hate to see what you are doing to it.

 

[jimindm]

I think snap on just has the ability to buy smaller, good companies, and through their network, make them better. A company that had good products, and give them the ability to reach far bigger markets. Sometimes into certain areas of marketability.

I look at sioux tools as one. Several years ago you could find sioux air tools for sale just about anywhere. Not so much any more. What SO did was get a company that could make air tools for them, but also provide a niche market towards the industrial side, that they may have not had before.

There are many products that SO sells through their network of dealers, but there is a whole bunch more that is available through SO as a whole.

I had a dealer on a truck for 18 years, before he went to the corporate side, selling industrial brands. He said it is like starting over in the business. Some of his larger manufacturing facilities that he services have product that he had no idea that they even had access to.

Over 18 years he has become a great friend, and I see him a lot. Just last week he asked if I could cut a band saw blade in half so he could ship it back. It broke at the weld and SO wanted to see that part of it. I said sure no problem, but was thinking why not just box up the blade and send it back. How big could it be. I was shocked at how large this thing was, and could absolutely see why he just wanted the broken weld cut out off it. It was like cutting an old hand saw in half.

What has surprised him the most is stuff like drill bits, punches and just stuff that goes along with the manufacturing process that he now has access to sell now.

 

[75toolman]

An understood point.

Whether those who feel a $150 ratchet that lasts 7 years is a better value than a $65 ratchet that lasts 5 will understand is something else.

Short of losing it,how would the ratchet not last a lifetime?

 

[txvwnut]

An understood point.

Whether those who feel a $150 ratchet that lasts 7 years is a better value than a $65 ratchet that lasts 5 will understand is something else.

I must have the anomaly ratchet, 30 years old bought it new off the truck and use it pretty much daily, of course that's pretty much the story with all my SnapOn tools.

 

[92integra]

An understood point.

Whether those who feel a $150 ratchet that lasts 7 years is a better value than a $65 ratchet that lasts 5 will understand is something else.

this is what i don't understand? why do you think like that, anything thats a hand tool is good for life. LIFE!!!! by boss broke a bit ratchet last week that he bought 15 years ago. handed it to the snap on dealer, 5 minutes later it was rebuild and back in his hands.

 

[organ]

Let's get this party started... Snap-On *****!! More like Snap-Off!

 

[Ponchoguy]

A lot of talk goes on here and on other sites about Snap On. Some love it and some can't justify the prices. I am a hobby guy and own no Snap On but I found it very interesting when I was watching one of my business investing shows and they interviewed the current president of Snap On. He was a very good spokesman for the company and the direction it is heading in the future.

So I looked up the stock. It is not on my normal investing radar. Here is a brief snapshot of what I learned and I thought it might be interesting to guys that buy their tools and use them daily.

If you invested $10,000 in 2005 in Snap On stock that stock would be worth $46,093.31 today and would have paid an additional $3,872.19 in dividends over that time. Not as good as some but not too bad either.

The president convinced me that the company is poised to remain on top of the tool market as technology becomes a more important tool in the professional mechanics arsenal. In all he made a very good presentation.

Their target market has always been the professional mechanic, whereas the other brands (like Craftsman) have been to the DIY-er. Most home DIY-ers in the past may have gotten their Snap On through someone used, but the distribution in the past wasn't as vast as some of the other brands.

S-K which always seemed to bridge the gap on DIY and professionals did both---you'd see S-K in your local parts store and you could get it mail order if you wanted to.

Of course with the internet now, that has all changed.

 

[2ndGearRubber]

Short of losing it,how would the ratchet not last a lifetime?

You use it on stubborn rusty fasteners for 10 hours a day, 5 days a week.




Quite easy, actually. How a non-professional would do so, I have no idea.

 

[DodgeMech]

You use it on stubborn rusty fasteners for 10 hours a day, 5 days a week.




Quite easy, actually. How a non-professional would do so, I have no idea.

ain't that why you have the good ole mg325 though? the king of flat rate

 

[stage20]

i have a friend who sells snap on. their margin has to be HUGE. he can sell me anything i want for half off and give me free shipping on anything but toolboxes.

im just a home mechanic working on my own stuff. i pick up snap on when i get deals, or when they have a specific tool that i need.

i can understand for a professional, the service they offer when you are on their routine route is hard to beat when you need a specific item or your broken tools replaced readily because you are trying to make a living.

for buying snap on just so your friends see it in your toolbox is stupid. most tools at a 1/6th the cost will do the job for most backyard guys.

 

[Dmoen]

You use it on stubborn rusty fasteners for 10 hours a day, 5 days a week.




Quite easy, actually. How a non-professional would do so, I have no idea.

And then what? You just throw it away? No you get it rebuilt or replaced for free. Not go out and buy another cheap $20, or $30 ratchet that will break in the next 6 months tops. Doesn't take too many times to have just bought a snap on.

I watch our oil changer struggle with this issue every few months. Keeps buying "lifetime warranty" junk from a local farm and fleet place. Guess what? You have to mail it in, pay the postage, and wait. Ooh the head was stripped out and handle bent a bit? Abused. Voided.
The guys got probably $200 in busted junk ratchets and still continues to buy them. Guys got rocks in his head or something.

Now he has moved on to the parts store where they can ORDER him Titan ratchets. They do not stock them for some dumb reason. They seem to be of decent quality, but not snap on by a long shot. He has broke it once in the last few months, and had to wait 2 weeks to get it back. If you are only going to have 1 ratchet, and do something for a living repetitively, with the same tool. Get something quality with easy no questions asked warranty.

At home? I have a lot of garage sale ratchets. Older craftsman, sk, new Britain, wright. I also bought one long head non flex SO, and a set of flex head Titan ratchets. SO gets used the most. The rest I should just sell, but I'm kinda a hoarder.

 

[oldtools]

i have a friend who sells snap on. their margin has to be HUGE. he can sell me anything i want for half off and give me free shipping on anything but toolboxes.

im just a home mechanic working on my own stuff. i pick up snap on when i get deals, or when they have a specific tool that i need.

i can understand for a professional, the service they offer when you are on their routine route is hard to beat when you need a specific item or your broken tools replaced readily because you are trying to make a living.

for buying snap on just so your friends see it in your toolbox is stupid. most tools at a 1/6th the cost will do the job for most backyard guys.

Plus HF allow you to exchange tools without question and receipt. Snap On requires receipt so their lifetime warranteer is pretty useless especially for a DIY that don't buy off of the truck (truck guy won't exchange).

 

[75toolman]

You use it on stubborn rusty fasteners for 10 hours a day, 5 days a week.




Quite easy, actually. How a non-professional would do so, I have no idea.

You lost me. I'm 20 years in as a tech. Most of my ratchets have been warrantied at one time or another.

 

[d.mcfarland]

Maybe the Snap On tools being available by web purchasers says something that a company like Cornwell could learn from.

 

[Dmoen]

Plus HF allow you to exchange tools without question and receipt. Snap On requires receipt so their lifetime warranteer is pretty useless especially for a DIY that don't buy off of the truck (truck guy won't exchange).

If you require a receipt on the snap on truck, you have a bad rep, or he doesn't like you. No receipts required. Now HF, all I hear on here is one needs a receipt. Your the first to say you don't need one

 

[JohnB40]

I am a retired mechanic who bought my Snap-On tools back in the 70's to 90's. I recently noticed my 8.5" diagonal cutters were getting loose at the rivet. I called Snap-On's customer service and explained the problem and that I no longer had receipts for my purchases. I told them where I was employed and who my truck sales guy was during the time period. The rep took down my shipping details and one week later a new pair (current style) arrived by UPS.......
I am sure glad I paid the extra coin for Snap-On tools back in the day,absolutely outstanding customer service and the best tools on the planet.

 

[Dave455]

At the moment, it's nothing but good times for Snap On! This is because, by and large, they produce the best tools out there, and that's a good place to be! Their customer service is second to none as well, though sometimes I think they go well beyond their obligations!

But.... nothing stays the same, and there may be trouble in store!

The main problem for Snap On seems to be some of the decisions taken by their own management!

If you've been a user of their tools for many years, as I have, you may have noticed a subtle cheapening of some of the lines!

The beautifully usable Tenite handled screwdrivers of the mid 80's gave way to the more modern patterns (forget what they called them) with the classic hard handles. Although not to everybody's taste, you couldn't fault the quality. We now have 'Instinct' drivers, which seem to offer no advantage, but have much less durable handles, but are probably much cheaper to make!

I used to love Snap On pliers, but models of the past have given way to 'Talon Grip' which we are presented with as an 'improvement' but which see carefully fitted joints replaced by much simpler/cheaper lap joints, and a rougher finish as well! The last of the original, but uber quality, Vacuam Grip models have of course disappeared too!

They still strike gold from time to time of course, as with the Dual 80 ratchet, but what on earth were they thinking of removing 'Made in USA' from a tool that can only justify it's price because it is!

Part of the problem may be that they place too much reliance on market research. My own experience of the U.S. is that Americans are wonderfully supportive of domestic companies, and if they're shown something new the're reluctant to 'piss on another man's strawberries' so tend to say "that's really cool" when privately they're not mega happy (Remember Coca Cola?)

In the U.K. we don"t have that problem, and if a company shows you something new, we'll always tell 'em it's shite, but it probably is! In the case of Snap On, the British phrase would be 'Don't piss in my pocket and tell me it's raining'!

If I was to offer Snap On advice, it would be to maintain the quality of their 'hard line' tools at all costs! If they do that, there will always be a market! I would not be placing too much emphasis on 'technology', by which I assume he means electronic tools! The problem there is that electronics are easily copied, and can generally be produced cheaper elsewhere!

I don't mind admitting that I am a lover of Snap On tools, and a supporter of the company - my life would genuinely not be as enjoyable if I didn't have their products to work with! But if they spend too much time worrying about electronics, and let the quality of their hand tools slip in a misplaced attempt to save costs, I worry that someone else will come along and do what they don't!

Uncle Joe - don't make the mistake of thinking that Snap On isn't for you just because you are a 'hobby guy'! You like the company, so at treat yourself to something of theirs, even if it's just a ratchet and a couple of sockets in sizes you use!

 

[Wakefield]

I think Snap On was the first professional tools from the truck company to make an effort to sell tools by phone to diy homeowners. "tools 4 U" or something like that before most households had a computer or Amazon.

 

[WhiffySpark]

And then what? You just throw it away? No you get it rebuilt or replaced for free. Not go out and buy another cheap $20, or $30 ratchet that will break in the next 6 months tops. Doesn't take too many times to have just bought a snap on.

I watch our oil changer struggle with this issue every few months. Keeps buying "lifetime warranty" junk from a local farm and fleet place. Guess what? You have to mail it in, pay the postage, and wait. Ooh the head was stripped out and handle bent a bit? Abused. Voided.
The guys got probably $200 in busted junk ratchets and still continues to buy them. Guys got rocks in his head or something.

Now he has moved on to the parts store where they can ORDER him Titan ratchets. They do not stock them for some dumb reason. They seem to be of decent quality, but not snap on by a long shot. He has broke it once in the last few months, and had to wait 2 weeks to get it back. If you are only going to have 1 ratchet, and do something for a living repetitively, with the same tool. Get something quality with easy no questions asked warranty.

At home? I have a lot of garage sale ratchets. Older craftsman, sk, new Britain, wright. I also bought one long head non flex SO, and a set of flex head Titan ratchets. SO gets used the most. The rest I should just sell, but I'm kinda a hoarder.

I have at least 8 3/8 ratchets. All but two are snapon. One Cornwell and a stubby craftsmen

I probably have at least 6 1/4 ratchets.

I like having back ups for backups on my main tools

 

[Air21]

Talk about margins... So those famous four way angle wrenches, you can find them on the Snap-On website under the Caterpillar part numbers and see what they sell them to CAT for. Apparently that "Snap-On" stamping costs an additional $30 per wrench.

 

[Skin]

i have a friend who sells snap on. their margin has to be HUGE. he can sell me anything i want for half off and give me free shipping on anything but toolboxes.

Your friend doesn't make money on selling tools and isn't a franchise if he can offer you that discount on everything. That's for government/industrial/school reps. They're volume sellers and don't make a living off marking up the tools hence the discounts. He's also violating his agreement with Snap-On selling to individuals and could be terminated for it. Just saying.

For franchises the mark-up from cost is roughly 20% or less.

 

[Kensgarage]

Much of Snap-On success is based on the dealer-truck model and the "no problem-pay next month" system the vast majority of us grease monkeys get right into.I did. 35 years ago before I grew a brain.
Americans love perpetual debt and Snap-On makes it a breeze !

"Boy I sure would love to have a box like that ? How much are they ?"
Dealers response(enter~business 101) ? "Can you spare $225/month ?"
I'll throw in 3 free oil changes, your first alignment and a full tank o......OOPS. Different salesman.

Being the crack dealer in the school locker room is a great business model too. Get them addicted early on !
https://www1.snapon.com/SEP

 

[Skin]

Much of Snap-On success is based on the dealer-truck model and the "no problem-pay next month" system

Actually that extends to the franchises themselves. For the most part financing is handled through Snap-On directly and minimum start-up amount for a truck is ~$150,000. They quote smaller numbers, I think as low as 100k, but they're really not realistic.

 

[2ndGearRubber]

ain't that why you have the good ole mg325 though? the king of flat rate

You mean IR2115?


Sometimes they don't fit my man.

And then what? You just throw it away? No you get it rebuilt or replaced for free. Not go out and buy another cheap $20, or $30 ratchet that will break in the next 6 months tops. Doesn't take too many times to have just bought a snap on.

You lost me. I'm 20 years in as a tech. Most of my ratchets have been warrantied at one time or another.

Right, they get warrantied. That has nothing to do with my sheared off teeth or severe auto reversing. It still broke, and I grab another one to finish the job. A warranty repair means, to me, the counter starts over on that tools life.


My grandfathers axe is on it's 3rd head and 2nd handle. No, you replaced parts, not the same thing as a "lifetime" of usage. No different than saying you can get 5million miles out of an engine, and omit the fact it's been over bored twice, then sleeved.

My grandfathers ax, the hypothetical engine, and the ratchet ALL failed. IE: failed to last a lifetime.




Granted, the snap-on ratchets last longer that my GW, Armstrong, or SKs between rebuilds, but they ALL die.


Multiple gear sets, means it didn't last a lifetime.

 

[stage20]

Your friend doesn't make money on selling tools and isn't a franchise if he can offer you that discount on everything. That's for government/industrial/school reps. They're volume sellers and don't make a living off marking up the tools hence the discounts. He's also violating his agreement with Snap-On selling to individuals and could be terminated for it. Just saying.

For franchises the mark-up from cost is roughly 20% or less.

not real sure on all the politics. He has one truck and is looking to buy another. He stays extremely busy. Last time I chatted with him he said he had made 160 stops that week

 

[K-Dog]

My wife and I bought SO stock a few years ago and it has done very well for us. We really should buy more.

 

[Dmoen]

You mean IR2115?


Sometimes they don't fit my man.







Right, they get warrantied. That has nothing to do with my sheared off teeth or severe auto reversing. It still broke, and I grab another one to finish the job. A warranty repair means, to me, the counter starts over on that tools life. I


My grandfathers axe is on it's 3rd head and 2nd handle. No, you replaced parts, not the same thing as a "lifetime" of usage. No different than saying you can get 5million miles out of an engine, and omit the fact it's been over bored twice, then sleeved.

My grandfathers ax, the hypothetical engine, and the ratchet ALL failed. IE: failed to last a lifetime.




Granted, the snap-on ratchets last longer that my GW, Armstrong, or SKs between rebuilds, but they ALL die.


Multiple gear sets, means it didn't last a lifetime.

But at least it got replaced easily, and didn't have to pay.

 

[2ndGearRubber]

But at least it got replaced easily, and didn't have to pay.

Exactly. I'm not crapping on their product, I just laugh at the idea of any tool being "lifetime".

 

[nine4gmc]

An understood point.

Whether those who feel a $150 ratchet that lasts 7 years is a better value than a $65 ratchet that lasts 5 will understand is something else.

Who said the $65 won't last as long as the $150? Then where would you stand?

 

[75toolman]

You mean IR2115?


Sometimes they don't fit my man.







Right, they get warrantied. That has nothing to do with my sheared off teeth or severe auto reversing. It still broke, and I grab another one to finish the job. A warranty repair means, to me, the counter starts over on that tools life.


My grandfathers axe is on it's 3rd head and 2nd handle. No, you replaced parts, not the same thing as a "lifetime" of usage. No different than saying you can get 5million miles out of an engine, and omit the fact it's been over bored twice, then sleeved.

My grandfathers ax, the hypothetical engine, and the ratchet ALL failed. IE: failed to last a lifetime.




Granted, the snap-on ratchets last longer that my GW, Armstrong, or SKs between rebuilds, but they ALL die.


Multiple gear sets, means it didn't last a lifetime.

You pay a premium for the guarantee of lifetime replacement. Nobody in their right mind would expect a tool to last a lifetime under professional use...

 

[shoggoth80]

You know. It's been a good long while since I've thought about investment opportunities.
Overall, there are worse investments than a track record of roughly quadrupled investment + dividends. When the market was down, and Ford was $1 a share, I was kicking myself for not having a few grand of investment capital. For what it is worth, I've never had investment capital. Something that I actively have to work on changing, because there are markets I wouldn't mind investing in.

From a tool user standpoint, they do a pretty darned good job on their hardline stuff. I'm not a fan of rebrands, but I have seen plenty of techs that either don't know, or don't care. They get what they need to get the job done and call it good enough. Plenty of that came off the trucks. I've got limited amounts of Snappy, Matco, Mac, and Cornwell stuff... but from a user standpoint, they are nice to work with. All brand rivalry aside, each pro-grade brand offers nice products... and when you use stuff day in, day out... being comfortable, smooth, and reliable matters. I really enjoy my Snappy ratchets.

Now I want to go look at projections, stock prices...

 

[warmpancakes]

For franchises the mark-up from cost is roughly 20% or less.

its higher than that, and if they make sales numbers theres bonuses or discounts on their tool bill, I have a great driver whos route has a GM facility on it, he moves alot of chrome. He makes a great living he was a district manager for SO and quit to buy this route.

But he a smart guy knows when to buy tools, He just ordered 250k at the convention because of the special pricing offered there. Plus a Free 84 Epiq for ordering more, so by him ordering at the convention he gets better pricing , a free toolbox, and that equals more profit.

SO is set up so that if you are willing to work hard you can make serious money selling it, but if you dont want to put in the effort you wont last its a full time job on the truck and 10 hours of so a week doing paperwork.

 

[sberry]

Its a few minutes a day 5 days a week.

 

[chadster1]

its higher than that, and if they make sales numbers theres bonuses or discounts on their tool bill, I have a great driver whos route has a GM facility on it, he moves alot of chrome. He makes a great living he was a district manager for SO and quit to buy this route.

But he a smart guy knows when to buy tools, He just ordered 250k at the convention because of the special pricing offered there. Plus a Free 84 Epiq for ordering more, so by him ordering at the convention he gets better pricing , a free toolbox, and that equals more profit.
SO is set up so that if you are willing to work hard you can make serious money selling it, but if you dont want to put in the effort you wont last its a full time job on the truck and 10 hours of so a week doing paperwork.

The profit margin varies depending on the item. Smart dealers load up at SFC. They offer the best deals of the year to the dealers and the purchase incentive boxes are icing on the cake. I never called them free boxes because you had to pay your way to SFC (flight, hotel, day off the route etc..) and buy a **** load of tools to get that "free" box.

It's more like 2 full time jobs. One full time job on the truck running the route and one restocking the truck, sending off repairs and broken tools, paperwork etc.

I did it for a little over 10 years. Made a very nice living at it. Walked away with a nice chunk of change and a nice chunk of SNA stock. Not enough to retire on but enough to allow me to focus on getting my new business up and running.

To the guy who says his buddy sells him everything at half price. You need to buy your buddy several cases of beer. He is selling stuff you you below cost.

 

[Tim37]

A lot of talk goes on here and on other sites about Snap On. Some love it and some can't justify the prices. I am a hobby guy and own no Snap On but I found it very interesting when I was watching one of my business investing shows and they interviewed the current president of Snap On. He was a very good spokesman for the company and the direction it is heading in the future.

So I looked up the stock. It is not on my normal investing radar. Here is a brief snapshot of what I learned and I thought it might be interesting to guys that buy their tools and use them daily.

If you invested $10,000 in 2005 in Snap On stock that stock would be worth $46,093.31 today and would have paid an additional $3,872.19 in dividends over that time. Not as good as some but not too bad either.

The president convinced me that the company is poised to remain on top of the tool market as technology becomes a more important tool in the professional mechanics arsenal. In all he made a very good presentation.

That isn't that impressive of an investment there where a lot of stocks in bad shape back in 08 and 09 the company I worked for in 08's stock was down to about $2.50 now its around $90. And of coarse I sold out after I got laid off.

 

[chadster1]

That isn't that impressive of an investment there where a lot of stocks in bad shape back in 08 and 09 the company I worked for in 08's stock was down to about $2.50 now its around $90. And of coarse I sold out after I got laid off.

Maybe this will impress you. Here is a 10 year chart comparing SNA to the S&P 500.

Best performing investment I have.

 

[2ndGearRubber]

You pay a premium for the guarantee of lifetime replacement. Nobody in their right mind would expect a tool to last a lifetime under professional use...

I agree.


Previous posters asked how a ratchet doesn't last a life time. I explained how it doesn't.