How buying Snap On may actually cheaper than Harbor Freight

Jacobson · May 10, 2016

So, I was looking to buy an extra long fine tooth 3/8” flex head ratchet.

I am sure any of the below are more than sufficient for my occasional amateurish projects.... But, it turned into an example of “cheapest is the most expensive option”

I know you guys have been with this mindset for years, but it finally hit me.

Harbor Freight $25
Resale value = $0.
Net cost $25

GearWrench $40
Resale value = $25 (WAG)
Net cost $15

Snap-on $75 used.
Resale value = $75
Net cost $0. Basically free.

Find a deal for $65 and net cost is potentially negative,
and you're getting paid to own the best ratchet..
Also, unlike typical used stuff, if the SO ratchet is broken (or ever breaks),
you can just send it in for replacement, right?

The obvious key to all this is that SO has a healthy resale market, while the other 2 are perhaps non-existent, hence a possible 100% loss. I am classifying GW as C-Man, and assuming a 50% discount. Of course, you could buy a used HF or GW and enjoy the same "free" aspect of any used tool.

Jacobson · May 10, 2016

Admit it, has anyone tried to pass off this logic to their wives?

kctyphoon · May 10, 2016

I just have to laugh at this.. You should get a job in politics..

bczygan · May 10, 2016

The logic is flawed unless you actually sell the SO ratchet.

If you intend to keep and use it for the lifetime tool it is, then it is simply a matter of cost versus cost, and the others cost less.

And any loss of the ratchet also negates the sales value.

Bill

Ghost11 · May 10, 2016

Sounds like your trying to convince yourself. Excellent logic !

Pipe · May 10, 2016

Lol you and 3/8s ratchets

Sent from my 0PJA2 using Tapatalk

slow · May 10, 2016

it is also flawed unless you purchase said items used as well. But I agree, I have ended up with 2 craftsman ratchets that I would have been better off just going with the snap on, which is what I wanted in the first place.

Ryan

jd_1138 · May 10, 2016

SO is cheaper than HF because everytime you use a SO tool it pays for itself.

kctyphoon · May 10, 2016

bczygan said:
The logic is flawed unless you actually sell the SO ratchet.

If you intend to keep and use it for the lifetime tool it is, then it is simply a matter of cost versus cost, and the others cost less.

And any loss of the ratchet also negates the sales value.

Bill

No, the logic is flawed because there is no logic.. I'm sure I can find a way to make leasing a Benz to save money seem logical to myself too if I tried hard enough.

jakemac · May 10, 2016

bczygan said:
The logic is flawed unless you actually sell the SO ratchet.

If you intend to keep and use it for the lifetime tool it is, then it is simply a matter of cost versus cost, and the others cost less.

And any loss of the ratchet also negates the sales value.

Bill

^^^^^ THIS ^^^^^
Your expense model requires you to occasionally liquidate your tools every 10-15 years or so. You are assuming that your tools are disposable commodities, therefore your model fails. By replacing your "inventory", you then incur greater costs to replace it as the cost of tools increases as time goes by. Your "net cost" now becomes a negative loss.

If you plan on rotating your tools on a regular basis, even selling the old tools at 50¢ apiece, your net cost over time is less by purchasing cheaper brands more often.

The advantage of purchasing top quality tools, isn't in what you gain, the advantage is to your children and grandchildren as they get passed down through the generations. The presumption is that a better quality tool is more likely to survive, if cared for, than a cheap quality tool.

CJM8515 · May 10, 2016

What logic? Its only logical i you buy it and use it and then resell it for what you paid for it. I see no logic at all.

Empty Pockets · May 10, 2016

kctyphoon said:
No, the logic is flawed because there is no logic.. I'm sure I can find a way to make leasing a Benz to save money seem logical to myself too if I tried hard enough.

Does that mean I messed up when i traded the Bentley for a Rolls?

Empty Pockets · May 10, 2016

Jacobson said:
Admit it, has anyone tried to pass off this logic to their wives?

The logic would never work on my wife, when i buy 1 or more tools, unless I unpack them and use them immediately, she's off to the mall.

Just the cost of having good tools

Flat-rate · May 10, 2016

Just buy the used HF for $0.00

Silly

BrokewrenchLS1 · May 10, 2016

When you look at the expected duration of use for a ratchet (say, on the short side, 10 years), it's pretty easy to amortize the cost of a more expensive ratchet over a cheaper one. $75 vs $25 isn't a huge difference when you figure you'll be using it for 10 years, and 10 years is very conservative given the track record for life on quality US-made ratchets.

Assuming resale price of anything - from tools to guns to cars - has always seemed a strange way to justify buying something.

eyeball · May 10, 2016

Jacobson said:
Snap-on $75 used.
Resale value = $75
Net cost $0. Basically free.

So what you are saying is that Snap On ratchets are an ideal way to store wealth similar to gold bars and t-bills.

I wonder how long until the Chinese government catches on and tries to corner the Ebay market in used Snap on ratchets?

Jacobson · May 10, 2016

jakemac said:
Your expense model requires you to occasionally liquidate your tools every 10-15 years or so. You are assuming that your tools are disposable commodities, therefore your model fails. By replacing your "inventory", you then incur greater costs to replace it as the cost of tools increases as time goes by. Your "net cost" now becomes a negative loss.

I have no idea what you're saying. Even if I do not sell, I have a an asset with a market value. It does not need to be sold to have value. Mark to market. The key is that it CAN be sold, if desired or needed. This can not be said for HF or GW, which may not have a used market at all.

If I need to replace the ratchet if it reaches the end of its service life, then my model fails. But, I am assuming the tool will last the duration of my remaining lifetime. And free replacement, actually. So, the model holds.

jonti48310 · May 10, 2016

I don't understand your logic. You're buying Snap-On to resale it? Or are you buying Snap-On to use it?

Jacobson · May 10, 2016

eyeball said:
So what you are saying is that Snap On ratchets are an ideal way to store wealth similar to gold bars and t-bills.

No, it's a bad way to store wealth since it's not an appreciating asset. What I am saying is that used SO is not a depreciating asset, like common tools with zero resale value, which results it a complete and total loss upon purchase.

Owning used SO tools is basically free since they lose 0% of their value when you buy them used. It's like buying a 1967 Camaro for $15,000, driving it for 3 years, making zero repairs, and then selling it for $15,000.

The only factor is opportunity cost of your money ******* in a non-appreciating asset, but it's probably better than taking a 100% loss on anything you spend on HF, assuming no one buys used HF stuff.

Jacobson · May 10, 2016

jonti48310 said:
I don't understand your logic. You're buying Snap-On to resale it? Or are you buying Snap-On to use it?

To use, with the option of selling it at a later date.

DemoFly · May 10, 2016

The problem with that logic is that sort of tool "investment" requires capital. Which a HF buyer usually doesn't have in the first place, which is why they are shopping at HF.

This is also not true unless you purchase your Snap-On equipment used...But I agree. I purchased an FLF80 to try it out with no worries about getting my money back if I ended up not liking it.

malykaii · May 10, 2016

Huh dude, huh?

Lookin4'67Galaxieconv · May 10, 2016

Jacobson said:
No, it's an idiotic way to store wealth since it's not an appreciating asset. What I am saying is that it's not a depreciating asset, like common tools with zero resale value, which makes it a complete and total loss upon purchase. Owning used SO tools is basically free since they lose 0% of their value when you buy them. It's like buying a 1967 Camaro for $15,000, driving it for 3 years, making zero repairs, and then selling it for $15,000. Either you get it or you don't. The only factor is opportunity cost of your money ******* in a non-appreciating asset, but we're just talking about a few thousand in tools, so whatever.

Your assumption that buying a brand new ratchet that's going to be sold for the price you bought it for after using it (or not) is asinine.

Entertaining, but asinine.

Jacobson · May 10, 2016

Flat-rate said:
Just buy the used HF for $0.00

Silly

You're assuming you can find used HF ratchet. If you can, then the model doesn't fail, it just means you also get a free tool, assuming you can find a buyer. If both HF and SO are free, might as well use the SO, assuming you have the extra money sitting there.

CutterFarms · May 10, 2016

Quality vs cheap, working vs broken. In my eyes snap on is always cheaper the first time around.

LesserSon · May 10, 2016

If you earn your living with the tool, you pass the cost of new tools on to your customers.
If you don't earn a living with it, then it is an entertainment expense.

DemoFly · May 10, 2016

Jacobson said:
No, it's a bad way to store wealth since it's not an appreciating asset. What I am saying is that used SO is not a depreciating asset, like common tools with zero resale value, which results it a complete and total loss upon purchase.

Owning used SO tools is basically free since they lose 0% of their value when you buy them used. It's like buying a 1967 Camaro for $15,000, driving it for 3 years, making zero repairs, and then selling it for $15,000.

The only factor is opportunity cost of your money ******* in a non-appreciating asset, but it's probably better than taking a 100% loss on anything you spend on HF, assuming no one buys used HF stuff.

The opportunity cost is offset by the money you make/save with the tool.

Jacobson · May 10, 2016

DemoFly said:
The problem with that logic is that sort of tool "investment" requires capital. Which a HF buyer usually doesn't have in the first place, which is why they are shopping at HF.

Correct, you need to have the difference in cost just sitting there doing nothing anyway. If you're broke, this model can't work for you.

Lookin4'67Galaxieconv said:
This is also not true unless you purchase your Snap-On equipment used...But I agree. I purchased an FLF80 to try it out with no worries about getting my money back if I ended up not liking it.

Your assumption that buying a brand new ratchet that's going to be sold for the price you bought it for after using it (or not) is asinine.
Entertaining, but asinine.

To review the first post, the premise of my model is that you're buying USED SO. If you buy new SO, the model implodes like a Fukushima reactor, and you will take a large 50% hit, and it will be the most expensive option.

jakemac · May 10, 2016

Jacobson said:
..................... Even if I do not sell, I have a an asset with a market value. It does not need to be sold to have value. Mark to market. The key is that it CAN be sold, if desired or needed. ...............

I could say the same thing about my liver, but it still doesn't mean that anyone would think that it has any value while I'm still using it. :dunno:

Norcal · May 10, 2016

The "logic" does not account for the money being *******, & no interest being made on the money.

ssdave · May 10, 2016

I think your logic is flawed, based on a logic flaw called assumption bias. Assumption bias is defined like this: You only look at data that supports your assumption, and discard data that doesn't support it. YOU value Snap-on, and assign zero value to used cheap tools, therefore you assume in your model that everyone else has similar values.

I want to a large tool auction this weekend. The fellow that had died with the tool accumulation was an indiscriminate accumulator, and not a user. He had multiple sets of craftsman and HF tools, along with a few USA tools scattered in the mix. Most of the HF and craftsman tools were essentially new. The USA tools were mixed, some new, some used.

The bidders bought most of the HF wrenches and socket sets at about 3 times what they cost new now. Craftsman sets brought about twice full retail. And, this wasn't an isolated incident, there were probably 50 to 80 sets sold. Most of the USA high quality sold for low to medium going rate; I bought a $500 Greenlee set for $80, a fellow outbid me on a mixed Snap-on and Proto 1" drive socket set at $99. I bought a box of stuff with a new Mitutoyo dial indicator and a Starrett indicator and articulating stand/holder for $36.

The point being, in this recent example, fairly ignorant bidders bought used HF at a 300% of new and Craftsman at 200% of new, or 400% of Christmas season discount. The USA quality stuff brought going rate, about 30% of new or less. There were about 5 to 10 tool buyers buying the good stuff, about 80 buying the junk.

So, your logic works on tool snob Garage Journal buyers, but not on the great unwashed masses.

You really don't need to justify spending a bit more on good tools as an investment, there's nothing wrong in spending funds for your own enjoyment and for your own safety, and for being able to do a better job. Not everything has to be an investment.

shortykorte · May 10, 2016

True, you "may" be "able" to sell the SO ratchet for what you paid for it but you best not use it. Also, as stated above, your wife doesn't care if it is a SO or a HF. A thief will definitely appreciate the SO since he can get a couple of dollars for a SO whereas $0 for a Chinese ratchet at on the street, at the flea market or pawn shop.
IMHO, when you invest in a tool, a quality (does not equal high mark up) tool is usually better in the long run. A fair/good inexpensive tool has equal value if it meets the needs and last long enough to do whatever job(s) you purchased it for.

It all depends on the tool, the cost, the available funds, the need, the use when determining which tool is the best buy or value.

hoye0017 · May 10, 2016

Jacobson said:
Correct, you need to have the difference in cost just sitting there doing nothing anyway. If you're broke, this model can't work for you.

To review the first post, the premise of my model is that you're buying USED SO. If you buy new SO, the model implodes like a Fukushima reactor, and you will take a large 50% hit, and it will be the most expensive option.

The other premise in the post was that snap on would replace a product that you bought used. Which, as others have pointed out, is not true.

So, while not as likely to break, the danger in your premise is breaking or losing the tool. Even it was worth what you paid for it when it broke or disappeared, it's still worth nothing now.

kctyphoon · May 10, 2016

the problem with buying expensive tools is way too many young people "invest" in them, justifying it to themselves saying it's a lifetime purchase so just buy it once. All of that thinking kinda implodes if the unthinkable happens and they find themselves out of work or a life event demands money quickly. Then, having very little savings when it's all been "invested" in the most expensive tools on earth becomes a real problem.

Yes - they "could" have a high resale value, but that doesn't do many people much good when it comes down to having to sell the very tools they make their living with if they need to recoup that money. Worse still, is it can take a long time to sell these things off, so the only way to do that quickly is to take an even heavier loss. Not much of a high resale value then, and that Gearwrench or Armstrong ratchet starts to look like it might have been a better choice if we are talking about making,saving, and HAVING money.

The smarter "investment" (in the literal sense of the word) is to buy comparable tools that are less expensive. Most times they will earn you the same salary, and will enable you to have both a savings account and a tool collection that wont be your only asset/investment into your future. Having to RELY on their resale value is not a wise choice or a good way to spend money.

texchappy · May 10, 2016

What happened to our helping each other rationalize our tool puchases?!? After all, that is one of the main reasons I come to the site ;-)

ibedayank · May 10, 2016

still loose money gas to pick them up is not free neither is the cost of shipping

PJNJ · May 10, 2016

Your initial premise that the price of a used Snap On tool does not go down is flawed and incorrect for a number of reasons but the following I consider to be primary factors:
1. The passage of time and the use of cosmetic design changes that imply "new" and "improved" but don't actually make the product any better. Examples include changing the design of the stamped logo or shape of the tool such as a newly designed handle. The change "dates" the earlier tool as being older in the minds of purchasers. At any point Snap On has, can and will do that if it believes it will result in an increase in sales and profits.
2. The introduction of a new, changed or improved function of a tool. What happens if they come out with a "Dual 100" ratchet while you own your dual 80? I doubt very much if the Dual 80 is going to remain as popular or valuable unless the "Dual 100" is a dud or too expensive to purchase. I doubt SO will make those missteps.
3. Use and wear of the tool. I buy tools to use. That $75 ratchet is probably going to be in very good condition. After ten years it will no longer look nearly as good (unless I decide to become a tool polisher) and will probably lose value.
4. The assumption that the economy and market for tools will remain the same or become better from the time of initial ownership until sale. If a prolonged recession occurs not only can the number of used tools on the market increase (from sellers trying to raise capital) but the number of potential buyers will decrease depressing the sale price/value.

If you want to buy SO, then do it. But rationalizing a purchase through that reasoning is useless.

:beer:

finn · May 10, 2016

Then $50 saved by buying the alternative low cost tool could be used to invest in a quality dividend paying stock. Maybe even Snapon stock. Multiply this $50 investment by a whole box full of tools, and the dividends and, hopefully, stock value growth and reinvestment income growth will surely make you more money in the long run than the sale price of that worn out box of Snapon tools.

Buy the cheap tool and invest the money saved by not buying a premium tool.

53chevy5 · May 10, 2016

I kinda get it, your moving money instead of spending money. But it only works if you sell the Snap on at some point. I don't think you will get 75 dollars for the SO ratchet in 25 yrs though.

anndel · May 10, 2016

Jacobson said:
Admit it, has anyone tried to pass off this logic to their wives?

She'll never buy that lame excuse. If I did you're sleeping with the dogs. :lol_hitti

How buying Snap On may actually cheaper than Harbor Freight

Well-known member

Well-known member

Banned

Well-known member

Well-known member

Well-known member

Well-known member

Well-known member

Banned

Well-known member

Well-known member

Well-known member

Well-known member

Well-known member

Well-known member

Well-known member

Well-known member

Well-known member

Well-known member

Well-known member

Well-known member

Well-known member

Well-known member

Well-known member

Well-known member

Well-known member

Well-known member

Well-known member

Well-known member

Well-known member

Banned

Well-known member

Well-known member

Banned

Well-known member

Well-known member

Well-known member

Well-known member

Well-known member

Well-known member