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Donald Trump just visited the headquarters of Snap-on Inc. On paper, this looks great. The business dates back to the s and makes tools used by blue collar workers. But that's not the whole story here. Snap-0n uses franchisees to sell its tools and it has an unsettling relationship with these small business owners.
These franchisees accuse the company of keeping them trapped in a cycle of debt, by taking advantage of its position as a lender, charging rates of The company has said that those rates are commensurate with the quality of the borrower — which is to say, they know that their franchisees are not in the best financial position. It has drawn other complaints and lawsuits from its franchisees, and some on Wall Street find it disconcerting that this tool maker's fastest growing business segment is its lending business.
Oh, and it manufactures some of its tools overseas, including in China. Snap-on did not respond to Business Insider's request for comment on this story.
Snap-on CEO Pinchuk Talks Trade Policy, The Future Of Manufacturing
If you read Snap-on's public documents, you won't find much about its issues with franchisees. Just a short boilerplate message:. Although it is not possible to predict the outcome of these legal matters, management believes that the results of these legal matters will not have a material impact on Snap-on's consolidated financial position, results of operations or cash flows. Luckily, there is a fairly extensive log of Snap-on's settlements and alleged misdeeds on the Internet.
Here's one from , courtesy of the Los Angeles Times, when a group of Southern California franchisees accused the company of making their routes too small for them to make a profit:. The dealers claimed at a Claremont news conference that the Kenosha, Wis. By making each dealer sell to fewer and fewer mechanics, the company ensures that every dealer will give the maximum possible sales effort, but without necessarily showing a profit, the dealers said.
And here's another — a suit filed by the wives of Snap-on franchisees who alleged the company hurt them by making "'false, fraudulent and misleading representations' that not only led to the collapse of their husbands' franchises but also resulted in the loss of the wives' own money and family savings. Google will also lead you to the charming parody site, Crap-on.
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It hosts a litany of complaints from franchisees, including that the company refused to honor thousands of dollars in warranties. You can also take a look at what is purported to be the page franchisee disclosure document you have to sign before joining Snap-on. That document includes a list of allegations made against the company — we're talking everything from slander and defamation to fraud, breach of contract and negligence in handling plaintiff's inventory insurance claim.
It's not the only place you can learn about disgruntled franchisees.
Front and center on another site — UnhappyFranchisee. When he started to return new items that he no longer wanted to sell, he and his wife contend that Snap-on made that as difficult for them as possible. Here's what they wrote on UnhappyFranchisee.
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In August , we were sent a letter detailing a "newly created return procedure" for especially for King to use when sending in warranties. This letter was a direct violation of the contract with Snap-on.
The warranty process does not include the ridiculous procedure that Snap-on regional manager Mike Doweidt outlined. We tried on numerous occasions to compromise with Mr. Now, to be fair, the Regians obviously have an ax to grind and they're grinding it in a very public way.
How much does a Sales Representative make at Snap-on in Canada?
They also have a Facebook page where they sell t-shirts to fund their fight with the company. They are in great shape. I'm in Niagara Falls. Please Contact. Phone: Snap-On toolbox. Selling my Snap-on rolling box. Open to reasonable offers. Slide style drawers. Snap-On Roll Cab Toaster. Strathcona County.
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