In this FDD Talk 2017 post, you’ll learn the following:
- Section I – Background information on the Snap-on Tools franchise opportunity, including relevant news updates
- Section II – Estimated initial investment for a Snap-on Tools franchise, based on Item 7 of the company’s 2017 FDD
- Section III – Initial franchise fee, royalty fee, marketing fee, and other fees for a Snap-on Tools franchise, based on Items 5 and 6 of the company’s 2017 FDD
- Section IV – Presentation and analysis of Snap-on Tools’ financial performance representations, based on Item 19 of the company’s 2017 FDD, including information on the:
- number and percentage of Snap-on Tools franchisees for each of the given ranges of “Paid Sales” during the 2016 reporting period, presented in $25,000 increments between $175,000 and $1,500,000+ per year (the sample includes only those franchisees who operated for all 12 months of the 2016 reporting period and for which the franchisor has received Paid Sales information for the full period)
- average discount to franchisees from suggested retail prices, based on all franchisee purchases of Products from Snap-on Tools in 2016
Section I – Background Information
18 Things You Need to Know About the Snap-on Tools Franchise
Snap-on Tools Makes New Acquisitions
1. In late 2016, Snap-on Tools acquired two companies: Car-O-Liner Holding AB (Car-O-Liner) and Sturtevant Richmont.
2. Snap-on paid approximately $155 million in cash for Car-O-Liner and $13 million in cash for Sturtevant Richmont.
3. Car-O-Liner provides collision repair equipment and information, and truck alignment systems. Car-O-Liner’s products and expertise will be integrated into Snap-on’s Repair Systems & Information Group.
4. Sturtevant Richmont designs, manufactures, and distributes mechanical and electronic torque wrenches as well as wireless torque error proofing systems for a variety of industrial applications. Sturtevant Richmont will become part of Snap-on’s Commercial & Industrial Group.
5. According to Snap-on, the acquisitions will help the company provide enhanced solutions that address torque requirements and strengthen its collision repair services.
Seventh Consecutive Annual Dividend Increase
6. In November 2016, Snap-on announced that its Board of Directors had declared a quarterly common stock dividend of $0.71 per share.
7. This was a $0.10 per share increase over Snap-on’s previous quarterly dividend of $0.61 per share.
8. According to Snap-on, this was the company’s seventh consecutive annual dividend increase.
9. In the announcement for the dividend increase, Nick Pinchuk, Snap-on Chairman and Chief Executive Officer said, “Snap-on’s dividend is a core component of our capital allocation strategy, as demonstrated by our payment of consecutive quarterly cash dividends, without interruption or reduction, since 1939.”
10. For the first quarter of 2017, Snap-on’s quarterly common stock dividend remains at $0.71 per share.
Openly Sharing Information With the Public
11. Snap-on often live streams the company’s quarterly and full year financial results as well as the annual shareholder meeting.
12. In April 2016, the company announced that it would live stream the 2016 Annual Meeting of Shareholders and that the archived presentation would be available for some time after the live webcast.
13. Snap-on also provides a live webcast of each quarter’s results along with the conference call that is held to discuss that quarter’s results.
14. Earlier in the year, the company streamed Snap-on’s full year 2016 results as well as the conference call. Snap-on also made the the accompanying information slides available on its website.
15. Snap-on started life as the Snap-on Wrench Company which was founded in 1920 by Joseph Johnson and William Seidemann.
16. Johnson and Seidemann enlisted the help of Stanton Palmer and Newton Tarble to turn Snap-on into the household name that it is today.
17. Today, there are nearly 5,000 Snap-on locations throughout the world.
Entrepreneur’s Franchise 500
18. Snap-on has ranked on Entrepreneur’s Franchise 500 list every year in the last decade. The company’s highest rank was No. 22 in 2016 and its lowest rank was No. 61 in 2007.
Section II – Estimated Costs
- Please click here for detailed estimates of Snap-on Tools franchise costs, based on Item 7 of the company’s 2017 FDD (updated).
Section III – Initial Franchise Fee, Royalty Fee, Marketing Fee, and Other Fees
- Please click here for detailed information on Snap-on Tools’ initial franchise fee, royalty fee, marketing fee, and other fees, based on Items 5 and 6 of the company’s 2017 FDD.