Start a tool company

[squeakz28]

So I’ve had this idea for a while now but I’m not sure if there would be enough demand to support it. I’ve often thought about starting a tool company. Basically, with craftsman going to China, the quality of tool has went down significantly in my opinion. What’s y’alls thought on a new American made tool company that would take place of what craftsman used to be? Quality tools at a middle of the road price. Lifetime warranty with the goal of few exchanges due too the tool holding up that well. I have zero clue as to what the startup cost would be. I also have zero clue if there enough demand to justify it with all of the other tool companies already out there. I would probably start with just hand tools (screw drivers, sockets, wenches) then move into the electric stuff as it grew. It would also start focused on the automotive type tools first and branch out to other trades from there. Is this just a crazy dream or do y’all think there is some validity to this idea? Thanks for any input!

 

[scubadoober]

What is your line of credit, or how much do you think you can get from a VC? What is your marketing budget? If you have to ask a tool forum it is probably not for you.

 

[squeakz28]

Considering that I didn’t ask any of those questions, obviously means I haven’t gotten that far. I was simply asking if there was any interest in it. If there seems to be interest in it, then I’ll cross those bridges as it goes forward. If no one seems interested in it, then it probably means the it’s either not a good idea or this isn’t the crowd for the idea. Being that this is a TOOL FORUM, my guess is, this probably a good place to start to see if there is interest.

 

[Bigblockyeti]

Sounds like you need ~$30M and a LOT of market data to determine the viability of such a venture.

 

[jacked_72]

And Craftsman is coming back to the US.

 

[scubadoober]

Basically, with craftsman going to China, the quality of tool has went down significantly in my opinion. What’s y’alls thought on a new American made tool company that would take place of what craftsman used to be?

The fact that you don't understand the market conditions around this statement indicates this venture is not for you. Let me help you do a little research.
Stanley Black & Decker Announces Opening of New CRAFTSMAN Plant in Fort Worth, Texas

 

[measuredtwice]

I'm on a tool forum so... Yes, I am interested in buying tools. I'm an American so... Yes, I am interested in buying American-made tools. BUT, I have no idea whether I'll want to buy a product that you haven't made or shown.

 

[PelicanPines]

You need to start by limiting yourself to making ONE unique tool that has quality issues in the current market. My job in life was solving problems. Best of luck. Craftsman didn't start by spinning up production of everything.

 

[metlmunchr]

I doubt $30 million would touch it. More like $100 million invested before the first tool goes out the door. The cost of the plating line alone would break anyone who wasn't filthy rich going in.

 

[gatlibs]

SK used to make some of the professional wrenches. Western Forge made the adjustable wrenches and the screw drivers. I'd start by reaching these companies for quotes on the same to similar deals. You may have to design new wrenches, but the adjustable wrenches and likely the screw drivers are so common and old that design parents should be expired. By the way Western Forge and SK are both owned by Ideal now.

Whatever you do don't listen to persons on this forum about warranty. They all want free warranty for everything. That was a part of the reason why Sears went into he toilet. I have seen so many people bring abused tools to Sears for free replacements. It is absolutely ridiculous. Something like mailing the tool and/or a registry would be imperative. Keeping receipts doesn't work, but establishing an account and only selling online thru your one web-site would work very well for this.

Seeing persons pay change for broken hammers to bring them by the bucket to Sears for replacement is enough education for one to know that free replacement with no effort on the end of the consumer doesn't work because this country is dishonest and doesn't value work, but rather receiving free stuff - like no hassle exchanges.

 

[Bigblockyeti]

I doubt $30 million would touch it. More like $100 million invested before the first tool goes out the door. The cost of the plating line alone would break anyone who wasn't filthy rich going in.

Oh, I realize $30M might only get you a building a forging press or two, a few machining operations and a handful of skilled employees. Plating in this country with this EPA, ain't happening. $10M for plating, 10-20 times that for cautionary (IE, not necessary in other countries) environmental equipment.

I have a buddy who has taken over the family business grandpa started ~70 years ago selling corrosion test chambers and plating barrels, they don't sell any barrels that don't leave the country anymore, the EPA has made it too hard to do plating business profitably anymore.

 

[BDT/NWMN]

Take a number and stand in line... There are multitudes of smaller USA companies that produce tools.

 

[squeakz28]

I'm on a tool forum so... Yes, I am interested in buying tools. I'm an American so... Yes, I am interested in buying American-made tools. BUT, I have no idea whether I'll want to buy a product that you haven't made or shown.

I completely understand that. I wouldn’t expect anyone to buy something unseen. I was just curious if there was any potential interest in the idea. Thanks!

 

[squeakz28]

You need to start by limiting yourself to making ONE unique tool that has quality issues in the current market. My job in life was solving problems. Best of luck. Craftsman didn't start by spinning up production of everything.

That makes sense and is probably the way it would initially start, if it starts at all, and grow from there. The ultimate goal would be to cover everything.

 

[kd3pc]

your competition, statistically speaking, will be walmart and amazon. Regardless of what people say, they want the lowest price possible, with lifetime warranty, and so on.

They may say they want SO quality.....but they certainly don't want to pony up $$$.

Hop over to Vandy and grab a couple of marketing majors to do the market research for you. Best nashville hot and brew you ever buy. They will tell you what the market for your venture is.

 

[four.cycle]

You might want to first take a few minutes and quickly skim through this list and note the number of names of now-defunct US tool makers which no longer exist, many of which only made one or two unique items.

Understand that you would be attempting to go toe-to-toe with corporate giants like Stanley Black & Decker, who have virtually unlimited financial resources and already have a significant and well-established share of the market.

As has been suggested, if you are the "imaginitive/creative" type, invent some kind of new gizmo that a mechanic or handyman or homeowner simply cannot live without, and the world will be your oyster.

Ron Popeil started with the "Veg-O-Matic" and became a multi-millionaire.

Inventors of weird, oddball, specialty tools (e.g., "Screwball") - not so much.

 

[metlmunchr]

I'm really surprised that US based tool manufacturers haven't moved to electroless nickel plating as a replacement for hex chrome. EN is far more durable than chrome and the costs are only a fraction.

I buffed out a few parts a while back and had them EN plated by a local company just as an experiment to see what it looked like as compared to some similar parts I'd had chromed in the past. Slight color difference as compared to chrome, but the finish was as flawless as any decorative chrome you'd find. Cost about a hundred bucks, their minimum charge. Same stuff from any of the well known decorative chrome shops would've easily topped $500.

 

[William Payne]

I have way too many big goals myself to completely discourage an idea like this but if you were to want to do full production straight away the capital investment required would be hundreds of millions of dollars. Many tool companies have been around a LONG time so started off small and grew over time.

What could work as a way to start a company like this would be to design one tool that there is a demand for and produce that. As economics allow grow from there.

I would be hypocritical to discourage you as I have my own crazy ideas, however this would require significant capital investment.

Also you would need manpower straight away you could not start as a one man band.

 

[Dumber than lumber]

You should go check out the website for FastCap.
That company also has a bunch of videos about things they make.
They invent stuff, and they also buy inventions from others.
Founder has a "lean" philosophy/approach about how to get things done fast and right. Which is important when you have to make money on the jobsite, or in the shop.
Lots of clever stuff is available from FastCap. For example - Tape Measures with all sorts of features & options that are helpful to various trades and crafts.
Good luck with your quest!!

 

[Farmall450]

I doubt $30 million would touch it. More like $100 million invested before the first tool goes out the door. The cost of the plating line alone would break anyone who wasn't filthy rich going in.

Yup. This is a pipe dream.

 

[RTM]

In the wood working world, these guys made a go of it when the world was going to @#$% quality tools.

https://www.lie-nielsen.com/pages/who-we-are

And these guys are busy as heck making wooden planes, which most thought were dead too.

http://www.planemaker.com/aboutus.html

But neither is cheap, or even inexpensive, but both are high quality tools, I have several from LN, which they made improving on old classic hard to find antiques, fixing the flaws that keeps the antiques from being users.

Find a needed niche, and fill it. But beware, many others have failed along the way, as others have mentioned.

 

[Davefr]

The tool buying public doesn't give a **** about COO nor do they perceive CM as poor quality. Therefore your demand will be very thin in a very crowded field. (GJ distorts our perception of reality)

If you want to become a millionaire in the tool business you better start as a billionaire.

 

[William Payne]

 

[William Payne]

A lot of the old guard of tool companies were making other kinds of forged products before moving into tools.

A lot were horseshoe makers and things of that nature.

 

[toddmorr]

Talking about capital needed is way premature. I haven't heard anything about differentiation--how is your offering truly different from stuff already out there. I'd be thinking really hard about that to start with

Sent from my SAMSUNG-SM-G930A using The Garage Journal mobile app

 

[William Payne]

Talking about capital needed is way premature. I haven't heard anything about differentiation--how is your offering truly different from stuff already out there. I'd be thinking really hard about that to start with

Sent from my SAMSUNG-SM-G930A using The Garage Journal mobile app

I know exactly where you are coming from but in some ways hand tools are like boxes, irrelevant of who makes them they all kind of do the same thing. Now differences in quality, design, and such and such can be a thing.

 

[nh_yota]

Whatever you do don't listen to persons on this forum about warranty. They all want free warranty for everything. That was a part of the reason why Sears went into he toilet. I have seen so many people bring abused tools to Sears for free replacements. It is absolutely ridiculous. Something like mailing the tool and/or a registry would be imperative. Keeping receipts doesn't work, but establishing an account and only selling online thru your one web-site would work very well for this.

I highly doubt that abuse of their tool warranty had any measurable affect on the decline of Sears, and if it did then it was because of bad management. Home Depot offers lifetime warranties on their Husky tools and Home Depot is doing just fine.

You can offer a lifetime warranty on whatever you sell but you need to build the cost of it into the price of the product.

 

[logical]

You can make a small fortune manufacturing and selling USA tools...as long as you start with a large fortune.

Sent from my garage.

 

[lsutigers937]

The tool buying public doesn't give a **** about COO nor do they perceive CM as poor quality. Therefore your demand will be very thin in a very crowded field. (GJ distorts our perception of reality)

If you want to become a millionaire in the tool business you better start as a billionaire.

This x1000, and if a lot of GJer's were being honest CM quality is still plenty good enough to get the job done for the DIY guys and home owners.

I'm a recent college grad, and I have a passion for tools, just bought my first SO ratchet, because I like nice tools, but for someone who doesnt turn wrenches professionally, I realize it's a luxury and a nice one. I also have been using the same walmart stanley black chrome socket set for 7-8 years to work on my truck, and while it's far from the best, my Dakota with 245,000 miles hasn't spent a day in the shop, and that socket set has performed a many a repair on it, including replacing pistons and heads from dropped valve seats.

 

[bobemmerich]

I've often had ideas, but I'm too broke/chicken-S%$t to try them, so I'm not gonna bash anyone's ideas/dreams.
I'm sure there would PROBABLY be some interest, but the costs of getting full production and distribution up and running would be astronomical. If you're serious, then I'd say put a plan on paper, do some research and get marketing/capital investment companies involved.

 

[William Payne]

This x1000, and if a lot of GJer's were being honest CM quality is still plenty good enough to get the job done for the DIY guys and home owners.

I'm a recent college grad, and I have a passion for tools, just bought my first SO ratchet, because I like nice tools, but for someone who doesnt turn wrenches professionally, I realize it's a luxury and a nice one. I also have been using the same walmart stanley black chrome socket set for 7-8 years to work on my truck, and while it's far from the best, my Dakota with 245,000 miles hasn't spent a day in the shop, and that socket set has performed a many a repair on it, including replacing pistons and heads from dropped valve seats.

If Snap-on quality was the minimum to do any kind of automotive work it would put the majority of automotive shops here in New Zealand out of business. Many many professional automotive shops do high quality work with Chinese origin tools.

I love Snap-on tools, they are great tools but many people do just fine without them.

 

[lsutigers937]

I wasn't trying to say that SO is the minimum to do anything, exactly the opposite, SO is a luxury, and I think that point gets lost here on GJ. This site is full of tool enthusiasts, we lose sight of the fact that probably 90% of the tool buying public views modern day CM tools as a high quality brand.

 

[notenuftoys]

If you're just gonna make another ratchet, another set of screwdrivers, some socket sets...

Don't bother.

The market is flooded with very good quality imports. I've never done any market analysis, but my guess any growth in the hand tool market is coming at the lower to mid price point.

I care about COO only to the extent the product is good quality. If a well made USA tool can compete on price with a well made Taiwan tool, fine. But the intersection of price and quality is important, and while subjective, I suspect the vast number of tool buyers focus on more the quality/price factor than COO.

 

[zendriver]

The world needs a better mousetrap, more than they need another American tool company.

If you don't think the quality of Asian tools is adequate today, you might need to open your eyes a little wider.

 

[squeakz28]

So it seems the general consensus is not to waste my time with hand tools and, if I decide to go through with a tool business, focus on specialized tools. This is the type of info I was looking for instead info on financials and if I’m “qualified” on the topic. Thanks everyone!

 

[IPFreely]

So it seems the general consensus is not to waste my time with hand tools and, if I decide to go through with a tool business, focus on specialized tools. This is the type of info I was looking for instead info on financials and if I’m “qualified” on the topic. Thanks everyone!

Exactly. Im reading through the replies and most people are telling you not to do it and not answering your question. It is to be expected. Show me someone with a dream and I will show you a long line of people ready to shoot it down.

Friend of mine quit his mechanic's job to start his own business in the tool industry. He works harder, but makes 10 times what he used to make and is very successful.

Id be interested in an american tool company with internet based sales, offering fast turn around for warranties, great customer service, high quality tools and innovative designs (which you would patent).

Snap on started with sockets and took off from there. Id start with one good tool first, something innovative that will build up the brand's reputation.

 

[Vinny]

Honestly, after converting my tools to made in USA, there really isn't a niche there. Williams (Snap On industrial brand), buying off Zoro with 20% coupons, comes out to about the same price as USA Craftsman used to be, and is probably of a better quality. That covers sockets and wrenches. Screwdrivers and pliers? Klein has that locked, but plenty of other companies off Made in USA options, too. Everything else (hammers, crowbars, chisels, punches, etc.), the choices are endless.

 

[Indexmill]

OP, to answer your question; No, there is no validity to your idea.

It is impossible to manufacture hard line tools in the USA and win against the tools made in Taiwan. Impossible.

 

[gatlibs]

I highly doubt that abuse of their tool warranty had any measurable affect on the decline of Sears, and if it did then it was because of bad management. Home Depot offers lifetime warranties on their Husky tools and Home Depot is doing just fine.

You can offer a lifetime warranty on whatever you sell but you need to build the cost of it into the price of the product.

How long has The Home Depot had it's lifetime warranty for homebrand? How long has The Home Depot been selling Sears quantity of house brand tools? I bought that either metric is similar to the same of Sears. If it is, then it is a comparison of apples to apples. If it is not, then it is a comparison of apples to oranges.

I'd argue that tool truck brands don't bake the price of replacement into the purchase of the tools, but rather rely on lack of replacements because flea market and garage sale consumers do not have access to the trucks for replacement. It's be a different ball game provided that those companies had as many location for walk-in no hassle replacement of the overwhelming, vast majority of it's collection of house branded tools.

 

[dnschmidt]

The world doesn't need this. You would be fighting Taiwan and China both of which are better at it than you would be. I sold TOPTUL for a couple of years and the quality of their stuff was fantastic and I paid very little for it. I just bough ICON ratcheting wrenches with a 20% off coupon for $125 that seem excellent. How do you compete with that?