Is Snap-On Tools a good franchise opportunity? How much is a franchise to buy and do franchise owners really make 3 million a year? Today on Franchise City.

Not a week goes by we dont get a call asking about Snap-On Tools. And we have had many ex-owners call us to complain over the years. There is more we can advise people on the phone than we can say publicly but let's address what we can say. So you may have seen other sources referencing Snap-On Tools franchise owners are making over 3 million dollars a year. You also may have heard that Snap-On Tools has almost zero failed franchises. Is this true? Yes. Is it misleading as heck. Absolutely.

The total investment to begin your own Snap-On Tools franchise will range from $217,505 to $481,554. A Snap-On Tools franchise is not really a low cost business and there are many other options that can be less work, more scalable and demonstrate much higher average revenues in this Investment range. The start-up cost breakdown are on your screen with the major outlays being Initial Inventory $135,000-$145,000. Your Van $65,000-$195,000. Three months of working capital $5,382-$27,516. And don't make the mistake many inexperienced buyers make thinking that 3 months of money is all you will need. You may need a lot more depending on how your business goes. Your license fee is between $8,000-$16,000 plus various expenses for insurance, software etc. Now you can see here they have put zero for real estate, but your local laws may prohibit you from parking a Snap-On Tools van in the driveway of your residence, so check restrictions beforehand as this might be an additional expense and a potential headache.

So 3 million a year, where is this from? Well its from their own latest franchise disclosure and it is true that the highest total sales of a franchisee is over 3 million dollars. But this is one owner in a system of over 3,000 owners and I can guarantee this owner has been building that busines for years and probably owns multiple routes. You won't make anywhere near that amount. Also, that's gross sales, don't forget you have to buy the tools and you only get at a 10%-44% discount over suggested sales price, then make your van payment, pay for gas, insurance taxes how much is left.

You can see the average sales are closer to $800k, and if you have a 10%-15% margin you are taking home between $80 - $120K. But, as many owners attest on the internet you are working 60 hours a week not only driving your route and working evenings and weekends doing paperwork, doing warranties, handling inventory. This franchisee suggests he is not happy.

$100,000 a year divided by 60 hours a week X 50 weeks = $33.33 hr. is it worth the headaches and risk of business ownership? That's for you to decide.

Even Forbes included Snap-On as a top 20 Franchises for the buck and lauded their zero failures. Well we have called our Forbes and the franchise 500 as garbage, and even Forbes issues a sort-of apology that their coverage was misleading. Im sure the franchisees that lost $200K on a franchise forgive you.

So here is the problem. A franchise only has to report a closure if the franchise closes. If the franchise buys back a failed franchise, even for pennies on the dollar, that is technically not a failed franchise. Take a look at the hundreds of franchises acquired and resold by Snap-on Tools just in the 2024 disclosure alone. Look at this route in Florida it closed in 2022, acquired by Snap-On, refranchised and closed again and sold again all in one year alone!! And you can see all of these states listed have Snap-On Franchisees who ceased operations or were terminated. Snap-On Tools discloses they made almost 20 million dollars a year from franchise fees and related revenue.

A handy website to see all lawsuits is Casetext.com and you can search through hundreds of lawsuits involving Snap-On Tools for cases ranging from slander and defamation to fraud, breach of contract and negligence.

Some of the common complaints from franchisees are territories being so small they cant make money, Snap-On treating their franchisees badly and forcing them out of profitable territories, having to extend credit and then lose money, and that they were lied to or misled by the sellers regarding profits and time required to operate the business.

At the end of the day if you are a social person, you love automotive, you look forward to visiting with every customer once a week, which is contractually required by the way, Snap-On might be a fit if there is a good territory remaining but depending on your city demand and skills there are many options in that price range that show higher average revenues.

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