The Snap-on franchise's unique system
The Snap-on Franchise System is currently an American ‘Fortune 500’ listed company and worth US$2.5 billion. But the global company’s success story has a humble beginning - the world’s first interchangeable socket.
In 1920 an American named Joe Johnson revolutionised the automobile’s mechanic’s set of tools by creating the first interchangeable socket. The inventor travelled to mechanics in their own workshops to show them the innovation. Immediate popularity led to the selection of self-employed retailers who sold Johnson’s product from a fleet of vans, increasing the number if sockets vended and boosting the ‘Snap-on’ brand.
Effectively, Johnson’s marketing model was a franchise business if the term had existed at the company’s inception. Today, the same system is used – Snap-on franchisees retail Snap-on products from vans, direct to customers - the only difference now is that they can offer mechanics 16,000 plus different tools and associated products. Moreover, the Snap-on franchise operates in four different countries.
The increasing popularity and success of franchising means potential franchisees are faced with a myriad of possible franchises to choose from. But the Snap-on franchise offers franchisees something different.
Most franchises charge their franchisees rents and royalties, which effectively diminish the amount of profit that goes direct to franchisee. The Snap-on franchise does not operate from a stand-alone premise, which means no hefty property rental fees are incurred.
More importantly, no royalties are payable to the Snap-on franchisor. The manufacturer makes its profits by retailing its tools to the franchisee.
Potential franchisees do not need previous experience in the mechanics industry. Franchisees are fully trained in Snap-on Tool’s birth place, in the U.S. One intensive week of training at the Snap-on Training Centre in Dallas, Texas, is then consolidated in the Sydney Head Office for two days. But the training and support that Snap-on gives its franchisees doesn’t stop there.
After a Snap-on franchisee’s initial training has been completed and their territory established, a Field manager is then assigned to spend the first three weeks of business with the franchisee, to see what the franchisee has learnt being put into practice.
The cost of entry into the Snap-on franchise network is around $170,000.00. This includes training, all start-up costs and working capital.
The automotive franchise is the world’s largest independent manufacturers of tools and their reputation for outstanding quality of both product and service is un-matched.
The Snap –on franchise business system has been well proven since its inception, but this does not mean the company has reached its peak. On the contrary, Snap-on is dedicated to keeping its top spot in the industry and is continually innovating new products to meet the still increasing demand in the mechanics business.
Snap-On has big plans for continued expansion. This will occur as a result of increasing brand awareness through an ever extending network of franchisees, who call on clients weekly to meet and go beyond their expectations.
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