What would I do differently?
Let’s look at a couple of recent headlines.
Ideal Industries sold SK Hand Tool to Great Star.
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Dewalt came out with a 12V Max Xtreme circular saw.
Dewalt has a new line of Elite power tool accessories on the way.
Lowe’s has bolstered their cordless power tool brand selection, as seen by the different cordless drill kits and promos they had for Father’s Day.
Dewalt has a new 15Ah FlexVolt Li-ion battery.
Metabo HPT have refreshed the brand’s cordless tool displays at Lowe’s and other stores.
A lot of times, new tools or corporate moves make perfect sense and nobody can reasonably find fault to them.
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But, sometimes a new tool is controversial, with some readers saying “who will ever buy that?” Other times, a business move might prompt comments along the lines of “well, that’s a bad call!”
I try to be objective and open-minded, but I also have thoughts, opinions, and preferences. Asking myself what I would do differently tends to help me in sorting things out.
What I have found is that sometimes I wouldn’t change a brand or retailer’s disagreeable decision if given the opportunity. Sometimes a disagreeable call makes sense, although that doesn’t mean I have to like it.
Dewalt discontinued their USA-made screwdrivers. What would I do differently here? By the time the screwdrivers were discontinued, it was already too late. I would have marketed them heavily to help push exposure and sales. But what if retailers weren’t on-board and competitive pricing proved to be too unsustainable?
Sometimes I think I would do things differently, but I also don’t have all the information that went into a tool brand’s decisions.
Also, when playing the “what would I do differently?” game, you can only go back in time so far. Meaning, some tool world happenings are fixed, and others fluid and open to the thought exercise.
There has been some negativity regarding GreatStar’s acquisition of SK Hand Tool. Hangzhou GreatStar Industrial is a publicly-traded company that’s based in China, but with some subsidiaries and tool brands based in the USA.
Ideal acquired SK Hand Tool in 2010 after the tool brand declared bankruptcy, and they announced construction of a new factory a month later. After a few months, SK Hand Tool was taking new orders again. What has the brand done in the decade since then? There’s greater competition, but did they rise to the challenge?
If Great Star didn’t acquire the SK Hand Tool brand, how else could things have turned out?
Ideal Industries closed the Western Forge brand. Might the same have happened to SK if they couldn’t find a buyer?
Stanley Black & Decker acquired Waterloo Industries, which is now manufacturing tool boxes for their Craftsman brand. Stanley Black & Decker has a new mechanics tools factory in the works. Milwaukee Tool acquired Empire Level and more recently, Imperial Blades. Wiha has OEM contracts with USA tool makers to make their new screwdriver handles. The same has been true for Channellock, but that wasn’t always the case.
As far as I am aware, SK Hand Tool wasn’t producing tools for other brands.
We don’t know why Ideal wanted to part with SK Hand Tool, but rumors of Ideal looking for a buyer go back at least as as early as February 2021.
All we know is that SK was up for sale, and GreatStar bought the brand.
Will GreatStar be a great fit for the SK Hand Tool brand? Maybe. And if not, we can look back in a few years and ask “what could they have done differently?”
I have talked to the folks at GreatStar USA a few times, and they seem passionate about tools. I haven’t talked to the folks at SK or Ideal Industries in a very long time, but I don’t think they would make decisions that would hurt the SK brand.
Look at what happened when Milwaukee Tool acquired Empire Level – they poured money into the company and the investment seems to have worked out well over the past few years. It’s possible something similar will happen here with GreatStar and SK Hand Tool, but unfortunately, there’s no relatable basis for gauging its likelihood.
As with other tool industry happenings, all we can do is wait and watch how things pan out.
Jared
Interesting food for thought. It’s a good point that the acquisition isn’t necessarily all gloom and doom. GreatStar might well have great plans for SK.
I can’t help but be curious about what the future holds though.
SK is kind of odd in that they are pretty niche . If you’re a tool enthusiast, you are bound to come across the brand – but it seems to me you could easily be a heavy tool user and still not know it even exists or where it sits in the market. My point is merely that this deal must be quite different than SBD and Craftsman, where the brand has significant cache to be leveraged.
Making off-shore tools under the SK label for big box stores? Doesn’t seem viable to me. SK flies too far under the radar for most folks.
Using the patents, new manufacturing capabilities and USA-based production to start producing products under other labels? Maybe. They’d have to be premium tools, but maybe…
Wayne R.
I’m going to call this out only because it so rarely gets called out and it bugs me; my apologies to Jared:
Cash [kash]: Money
Cache [kash]: A hiding place
Cachet [ka-shey]: Superior status, prestige
Jared
I always assumed it was referring to the french “caché” – but couldn’t figure out how to add the accent to my “e”. Thanks for the tip Wayne – and sorry to bother you.
fred
If you are responding using a regular keyboard that has an “Alt” key and a numeric keypad its easy to add the full ASCII set – you hold down the Alt key while typing in the ASCII code on the numeric keypad:
é – is Alt+130
è is Alt+138
https://www.asciitable.com/
JoeM
Wayne, Jared, Cache is also “Storage Space” or “Holding Area”, since “Hiding Place” is the direct French, the English common usage rule has expanded the number of meanings.
You can find Cache used in Technological terms, such as processors. They have different levels of Cache, literally. L1, L2, and L3, last I checked. And there’s nothing hidden about them, so they’re literally just where ones and zeroes wait in little Cache chips at different stages of processing. L1 is usually outside the processor, often on the Motherboard, and is the same for an entire chipset. L2 is on the Processor, and only takes data from L1 Cache to feed the processor’s many threads and sub-processors, and L3 is often holding space for both combining data between processors on the chip, and for outgoing data to the other devices in the system.
There’s also the Monetary Swap usage. If you have a safe, that everyone can see, or everyone knows about but it has been covered over by art, an example that you can see in a lot of TV and Movies… Whatever you put in that safe may be considered A Cache (as in a Stored Space) but if it is Monetary or Material wealth in any form, Gold Bars, Valuable Comic Books, Pirate Treasure awaiting transport to wherever… Then it is called A Cache in the sense that you Possess it in a Waiting Area. You have a Cache of Wealth. Can you buy a car with an Action Comics #1? Not likely. Can you be paid by an Auction of some sort for selling that Action Comics #1? Definitely. So it isn’t money, but can be valued. Same for Gold Bars. Go ahead, try to walk in and buy groceries with a Gold Ingot. It will start up a very nice conversation between yourself, the manager, and the cashier (a very important character in this scenario, as well as a fun attache to the words we’re talking about.) about where, how, and why, you have this Ingot on you. But, you won’t be buying groceries with it. A good laugh, maybe some new friends, but at some point, that Cache of Cash needs to be created out of the Cache in the Safe.
Okay. I’m way off topic now. I’m sorry. There’s no corrections here, I’m just a Language Nerd, and like to talk about linguistics. I enjoyed this little chat. Carry on with your day!
philip s john
Specifically I will review if I need brushless or heavy duty or not. I really miss my light brushed 6 .25 dewalt circular saw.
I will stay away mostly from 12v cordless. Even though red and now yellow are amazing… 18 60 v is alot to manage.
I will stay away from Milwaukee HO tools and HO batteries. The cost vs performance is the worst. And no more detent pins from Milwaukee… only hog ring impact guns. But they sell out quick.
A good review is to also think ahead of the performance of a cordless light. It’s really hard for a decent light to do everything. It’s very similar to tool storage… needs alot of trial and error to figure out what best for the individual. And then we have design flaws too.
Tom
It would be a mistake to underestimate GreatStar. They have some great people working for them (including a few of my former colleagues) and have an office strategically located proximal to Lowe’s headquarters (not a coincidence).
GreatStar has a track record of successfully leveraging some of the brands they have acquired to gain market share and retail placement (see Pony Jorgensen at Lowe’s). SK Tools may be a niche brand today, but with the right pricing and retail support strategy behind it, anything is possible. Lowe’s is always looking for brands perceived as pro quality to better compete with The Home Depot, and GreatStar has gone toe-to-toe with major brands and won facings at retail before.
JoeM
I… genuinely believe it’s a waste of time to talk about such things. Not that we shouldn’t, just that… The focus is always skewed at this level of conversation.
It’s not about the acquisitions of companies that matter. For all we know, the purchasing company may want a tiny, unassuming, brand in the same markets as competitors’ brands for the sake of having that place in the market. Having a more global reach than the owner before them, they may use that tiny, perhaps failing, brand as a stepping stone to spending money on building a brand, any brand, while having a physical location in the territory required for the permits.
Yes, it’s always about making money, and everyone gets in a huff when money leaves the Western Market. But it may also be that GreatStar wants SK Tools because SK Tools is a known “USA Brand”… which means, when applying for building rights to make a factory, and staff it, filing ownership under that smaller brand is easier through the western governments than if they were to try and purchase land or get building permits from their China HQ.
Now, where the really deep, really interesting conversations are on this topic come from land development deals, and the locations of local offices for the acquired brand. Where they’re going after the purchase is far more important to talk about than what they’ve already done.
Important Questions to Ask: Is there any clarification about closing out the brand? Is there any mention, or hint, of Re-Naming the Brand? Have they purchased the Patents away from the parent company? Has there been a major influx of liquid capital for the purchasing company? This one is very important because plenty of liquid capital means they have room to spend on investment in the new Brand. Buildings, Offices, Factories, Logo or Livery redesign/updating… If the purchasing company has an influx of capital to turn that failing brand into a brand-spanking-new powerhouse… that’s good for everyone.
That’s local jobs, blue and white collar alike. That’s temporary jobs like construction, Real Estate Liquidity in the short term as they may need to buy property to get things done… That’s money injected into small contractors like logo design, architecture inspection, property value inspection… Things they can’t send from overseas to get right, it’s all regulated in the country the company is currently located in.
These are conversations worth having. By the time you get passed the politics of where a company owns another… You see where a brand really is going. You see more of the bigger scheme the purchasing company has. Because if that same company has had the opposite happen to them? A drastic loss in revenues lately? That tells you everything about the purchase. That’s a sacrificial purchase to gain assets, and nothing more. So, that’s what is worth talking about. A lot of what business does is very predictable. Even stock fluctuations are predictable to a point. If you know what everyone was taught in business schools, you can predict where they’re going to go with each move. The same way someone can teach you every move, and counter-move, you can take for every movement in a Chess game, you can reasonably understand what will happen with a business purchase in the same way. What have they got? What did they do with it? What are their options now? It’s Chess using Money.
And, yes… I love those conversations… I’m sorry… I am half Jewish, and was raised with this stuff… My Father even worked on the Montreal Stock Exchange… He used to watch the news, laugh, then tell me “This industry is going to have a surge in buying, and that industry is going to tank… I give it a week” and he’d be right. So, I grew up on business and finance… I wanted to build stuff, but I got higher learning from everyone in my family anyways… It really is more enjoyable once you unlock what their move did for them.
Veering… I think I’m veering… Sorry… Happy higher-learning moment… I get a little giddy when stuff gets super-in-depth.
X lu
This really gets down to what is a brand and what is its value. Retail has gone through mass consolidation which has and will continue to result in producer consolidation. Good better best is giving way to more produced by anyone house brands and a few brands with serious value props. Brands like Bosch, Metabo aren’t going away yet but they are nearly dead-sure they have an installed base and fans but drip drip drop.
Just think about the share of Home Depot wallet Techtronic controls and they will take more and more shelf space and eventually squeeze out the specialty brands eg Dremmel. SBD will also be fine. After that I would say private label or faux private label. That’s all the shelf space except for a few true unique products. I believe it’s best to look at the ultimate consumer to understand the decisions.
More and more power is being concentrated into fewer retailers which goes a long way to explaining the death of producers. None of this is unique. Sears did this better than anyone before gifting their entire paint and hardware franchise to Home Depot.
MM
I think there’s really two separate issues at play here, and different people seem to care more about one versus the other.
On the one hand there’s the question of what’s going to happen to the tools themselves. Perhaps the quality will go downhill as quality is cut to make the tools fit a price point. Perhaps the quality will increase with an infusion of new capital. Perhaps new investment will result in new tools being added to the product line. Perhaps the brand name will be used to market entirely different tools. The fact is that none of us know, but there’s certainly the fear that the quality may drop as we have seen happen before in similar situations.
And on the other hand there is what we might call a human concern: we’re not talking about the tools themselves, we’re talking about the possibility of US plants being closed and employees losing their jobs. And that’s not even beginning to dive into the can of worms that Paul mentioned.
There are certainly many angles to view this from.
fred
To their credit I don’t think that Goldstar was (or is) just in to acquire a recognized brand name in order to slap it on some junk. The Great Star produced tools under the Arrow, Jorgensen/Pony and Goldblatt names seem to be decent. Perhaps they are not being produced in the same old location with the same workers – but they are not junk-bin items either. Time will tell with what happens with SK.
rob
The majority of my SK tools say “Made in France” on them and Ideal had to start from scratch with the brand; so the almost guaranteed rush of interweb remarks about them being some longhaul American manufacturing icon now being “forever tarnished” by foreign owenrship or whatever is just laughable.
All of Ideal’s acquired manufacturing appeared to have been consolidated to that SK facility, so my bs guess is as good anyone else’s bs guess about what the future holds.
Koki has been putting out the goods and all I have to say is that the following sentence is ridiculous: “KKR has purchased Koki from Hitachi and will now call it HiKoki, except in America, where it will be called Metabo, while Metabo, owned by Koki, still exists and by the way we formed a holdings company for all of this called Koki.” It’s seriously the dumbest crap I’ve ever seen with my own eyes.
I just call them Hitachi. Everyone else does. Or would you rather we all manage to convince someone to buy Metabo batteries for their Metabo HPT or vice versa?
And of course; Flex. I checked them out…I’d take Ridgid/AEG over them. And I wouldn’t take Ridgid/AEG. Not sure why the store has Kobalt and “Flex” sitting next to each other at the same time? Aren’t they the same thing? Other than there already being the real Flex that has nothing to do with these grey Kobalts? Then again, Lowes has Dewalt/Porter Cable/Craftsman all next to each other.
In general, Lowes has WAY too many brands and not enough selection in their power tool section. They’re not a tool shop or a supplier, they’re a Lowes. Like, literally, the same four tools, but in 10 different brands multiplied times multiple voltages. Why?
I presumed Dewalt already had “elite” accessories in countries where Black and Decker resumed the old Elu contracts. That was some time ago. I’m pretty sure most foreign nationals would be shocked at what the large power tool manufacturers resell here vs their home country. Randomly we get good jigsaw/recip blades, holesaws and throw away versions of italian sawblades. But that’s really it. Most of the accesories they resell here are bottom grade. I’m looking forward to find out what they have in store. I can’t say “no” to decent consumables at the fast food court.
SBD has been making great investments and leveraging those assets well for a long time. I was supposed to be all mad about what they “did to” Facom; but I ain’t. They’ve done a great job with Facom and USAG. They’ve done an equally great job leveraging Facom and USAG to bolster Proto and MAC. Vice versa. People ask for the MAC/FACOM wrench holders all of the time… go buy a craftsman set for $10. Speaking of, they’ve done wonders for that brand. They pooped all over Porter Cable, but just you wait. I know they’ll eventually ditch the crummy power tools and take advantage of that brand at some point to make moves in the Taiwan woodworking machine game. I still deal with people crapping on them over hand planes and whatnot. So, you’d rather not have Lie Nielsen and Veritas? Because, there sort of was a reason for those companies doing what they do in the first place…and they do it better.
Milwaukee has obviously been going strong against SBD, and their recent acquistions have been smart and well managed.
I think I ranted enough now.