Best Product – Theory: Lowe’s will Partner with SK Tools

SK Tools Logo

SK Tools, a brand of USA-made tools, was recently acquired by GreatStar from Ideal Industries.

Lowe’s recently brought in Ideal Industries hand tools to replace many different Southwire offerings in their electrical tools aisle. That’s not really relevant here, it’s just an interesting development with coincidental timing.

Advertisement

SK Tools went bankrupt a decade ago, and although they have a strong following, we don’t know why Ideal was seeking a buyer for the mechanics tool brand.

Ideal Industries closed Western Forge, a brand of screwdrivers, pliers, and other hand tools in early 2020.

Basically, SK Tools is changing hands, from being owned by Ideal Industries to being owned by GreatStar Tools.

There have been few communications from either company about their plans for SK Tools.

Here are several notable phrases extracted from GreatStar’s July acquisition announcement:

We are excited to build on our foundation and gain all of the proprietary SK patents and designs to help us provide diverse products and new opportunities to our valued customers.

Supported by its patented products and valuable technologies, SK has been able to build strong lasting relationships with its customers across various markets, such as industrial supply, automotive repair, and hardware repair.

Combining all of our patents, technologies, and resources will allow Great Star and SK to deliver the best innovative and professional products to our customers on a daily basis.

All of this is very vague. Does it mean that GreatStar is interested in SK for their patents? It’s possible.

Lowes Logo

Let’s shift a little bit and talk about how Lowe’s fits in here.

I recently posted about new Pony and Jorgensen developments at Lowe’s stores. The clamp companies suspended operations in 2016, and were later acquired by GreatStar.

GreatStar also acquired Arrow, an iconic brand of staplers, staples, and other such fastening tools, in mid-2017. Here is part of what they said in their original announcement:

Arrow’s President said that the acquisition will help them:

extend the Arrow brand into new tool categories, new channels and new geographic regions.

This sounds a lot like what GreatStar has done with the Pony and Jorgensen tool brands, bringing them to Lowe’s.

Although sales floor promotional displays might not seem like a big deal, but they are. When you have a quarter or half pallet tool display placed in a high-traffic position at a retail store, and with similar displays at every location of that retail store, that’s not small arrangement.

With Pony and Jorgensen, their Father’s Day display was also noticeable because it included tools that aren’t part of the brands’ clamping product portfolios. Chisels? Hand Saws? Isn’t this Irwin’s territory? What could have happened here? Was Irwin – a Stanley Black & Decker brand – not competing for similar placement, or did GreatStar’s Pony and Jorgensen brands win the spot with a better deal?

Keep in mind, Lowe’s is the customer here, and it seems that the customer wanted more Pony and Jorgensen tool displays for Father’s Day promotional period. From what I saw, there were more tools than the same brands’ holiday season displays last year. Plus, most of the clamping tools in the main aisle were also Pony and Jorgensen products.

GreatStar seems to have applied a similar strategy to their Pony and Jorgensen brands, as the plan announced for Arrow.

The acquisition announcement also said that:

Arrow will continue to manufacture and distribute its iconic T50 staple gun, staples, and other tools at the Saddle Brook, New Jersey facility.

They also announcement plans to use the NJ facility as a distribution center for broader GreatStar products.

GreatStar acquired Shop-Vac after they closed facilities and were in the process of being liquidated. To my surprise, the Williamsport, PA plant had reopened (via Philadelphia Inquirer), and there were local reports of employees being rehired (via The Express).

So, GreatStar pledged to keep their Arrow manufacturing in New Jersey, and they reopened a closed Shop-Vac facility in Pennsylvania.

Home Depot Logo Large

Although this post is about GreatStar, SK Hand Tools, and Lowe’s, Home Depot plays a part in this too.

Home Depot has been changing up their mechanics tool section.

Mechanics Hand Tools at Home Depot Fall 2021
Mechanics Hand Tools at Home Depot (September 2021)

They’re still working on things at my local store, but I noticed several changes.

A few months ago, I noticed new Milwaukee mechanics hand tools at my local Home Depot, as well as a “try me” ratchet station.

Now, Home Depot has started bringing in more Gearwrench products, such as wrench and socket sets. Now, all of the Home Depot stores near me have Gearwrench mechanics tool sets.

What does Lowe’s have? Mainly Craftsman and Kobalt.

Craftsman V-Series Socket Set

Craftsman is soon coming out with a new V Series tier of mechanics tools, with lots of SKUs teased about so far.

Lowe’s is Craftsman’s biggest retail partner, and they revamped their mechanics tools department around the brand a few years ago.

However, there is room for more.

We don’t know what led to Pony and Jorgensen having promotional tool displays at Lowe’s that could – and would – have featured Irwin hand tools in previous years. Did the GreatStar brands vie against Stanley Black & Decker’s Irwin brand to win Lowe’s business and the highly successful in-store promo placement?

Stanley Black & Decker could have worked with Lowe’s to bring a higher tier or pro-grade mechanics tools to Lowe’s stores. Remember, Craftsman’s parent company also owns Proto and Mac Tools. Proto is more of an industrial brand, and Mac Tools more automotive.

Craftsman’s V-Series tools seem to bridge the gap between current Craftsman mechanics tool offerings and those from their pro-oriented sibling brands, but it’s also too soon to tell.

With all of these puzzle pieces in mind, I believe that Lowe’s will partner with SK Tools.

Some of SK Tools’ users and customers have complained on social media about the company’s shipping speeds. Well, Lowe’s can help with that.

Featuring SK Hand Tool products at Lowe’s stores would definitely give the brand greater visibility.

SK Tools at every store, even if we’re only talking about a couple of promo SKUs during holiday seasons to start with – that could also help with the brand’s visibility and boost their potential for growth.

Digressing for a moment, let’s talk about wet/dry shop vacuums. Sears used to have Craftsman. Home Depot has Ridgid. Lowe’s has Craftsman, and before that they carried an aisle full of Shop Vac vacuums. In recent years, Shop-Vac and Craftsman seemed to share the sales floor at Lowe’s.

But, the takeaway here is that Lowe’s and Shop-Vac had a very strong business relationship, and GreatStar likely acquired the brand with hopes (and maybe even guarantees) of the same.

With Pony and Jorgensen, GreatStar could have potentially bested Stanley Black & Decker’s best offer for a similar Irwin Tools display.

Talk about new channels for their Arrow brand could apply here. With GreatStar continuing USA production efforts for the Arrow brand and possibly Shop-Vac as well (although the brand also had overseas operations before their closure and acquisition), that could serve as a precedent.

A month ago, I wondered aloud whether SK Hand Tools will be made in the USA or China. We still don’t know, GreatStar and SK have been hush about the matter and really everything else surrounding the brand. Is this because they’ve got bad news for loyal fans of the brand, or because they don’t want to spill the beans prematurely? When companies are this quiet, it’s often to avoid cluing in their competitors.

It could be a stretch, but things can change until contracts are signed and tools are in physically delivered to stores.

Look at what happened with the EGO brand. Home Depot announced they were discontinuing EGO at their stores, preempting Lowe’s announcement of an exclusive partnership with EGO. I later speculated as to what prompted all this, and it seemed to me that Skil was also a part of things. Now, FLEX is also a Lowe’s specific brand. So, the EGO and Lowe’s partnership also extends to Skil cordless power tools, outdoor power tools, and also a new line of Flex premium pro-focused cordless power tools.

Is there space at Lowe’s for premium mechanics hand tools? Possibly. Probably? Consider the new Craftsman V-Series tools and their eventual USA-made offerings once their new factory is finally up and running. Flex offers a higher tier of cordless power tools compared to Craftsman and Kobalt offerings.

Would SK Hand Tools improve Lowe’s mechanics tools selections? Absolutely. Will typical Lowe’s customers care? Frankly, probably not. However, there is strong potential here. Look at Harbor Freight and their ever-increasing line of more premium (and higher priced) Icon mechanics tools. Aren’t Icon’s seemingly strong sales a good indication that shoppers are interested in being able to buy better tools at retail stores?

GreatStar is also acquiring a tool box manufacturer. Might we see a new line of tool boxes sporting modern features and popular trends? The manufacturer that GreatStar is acquiring has also criticized Waterloo, the tool box manufacturer that Stanley Black & Decker acquired to produce their Craftsman tool storage products, for not innovating enough in the past. Once that deal is done, I bet we will see new Kobalt or SK Tool steel tool storage products take the place of certain Craftsman offerings.

Lowe’s wouldn’t take a lot of space away from entry or mid-price point Craftsman and Kobalt mechanics tools to make room for higher price point SK Hand Tools, but I’m sure they can find a way to bring select SK Tools to stores.

I could be wrong, but there are significant long-term gains that could arise from a partnership between Lowe’s and SK Tools. Such a partnership could be vastly rewarding to both companies, as well as to enthusiasts and more demanding users whose purchasing decisions depend more on quality than on lower price points.

There is some risk involved, but there are gains outside of direct sales alone. If new USA-made SK ratchets or wrenches landed at Lowe’s, would you not visit a store to check them out firsthand? While you’re there, what else might you look at or buy?

There is also the potential for a new line of SK-made premium Kobalt tools at Lowe’s, in case the executives holding the purse strings were worried about SK familiarity. But, I think GreatStar would heavily advocate for their own labels. Kobalt had premium origins, but that changed years ago.

GreatStar and SK want to sell more tools, and Lowe’s is in perpetual one-on-one competition with Home Depot.

They need to work out a deal, if they haven’t already. This is the kind of deal that would pay out huge dividends down the road.

I wonder – we have seen that Ideal Industries worked out a deal with Lowe’s to carry their electrical hand tools at all stores. If there was the potential for a lucrative partnership between SK and Lowe’s, would Ideal have been so eager to sell the brand? But, all parties involved could have realized the potential for this, driving up the acquisition price. Ideal would have gotten a higher payday, with GreatStar also being in a better position to ensure the success of such a partnership.

Remember, this was not a case of GreatStar acquiring a closed or bankrupt company – there were months of rumors about SK being up for sale should they find “the right buyer.”

If all this does come to pass, it’ll be a win for end users. But, other changes would need to be made as well. In my rose-colored optimistic fantasy world, any such SK-Lowe’s deal should also involve improved warranty exchange practices – maybe even a tool drop-off or verification process with replacements to be shipped to to customers.

What do you think about all this?

Do you agree? Disagree? Would you be eager to see a partnership between SK Tools and Lowe’s?