Snap-on Tools Franchise Costs, Fees & FDD

Year Business Began: 1920

Franchising Since: 1991

Headquarters: Kenosha, Wisconsin

Estimated Number of Units: 4,675

Franchise Description: The franchisor, Snap-on Tools Company LLC, offers a license to operate a franchised mobile store selling high quality repair and diagnostic tools and equipment. Snap-on manufactures and/or distributes these tools and equipment to professional mechanics and other tool users in the United States. The franchisor’s parent corporation is Snap-on Incorporated.
Training Overview: Before franchisees begin operation of the franchise, the franchisor provides store management training. Franchisees or their store manager (in the case of an additional franchise) must complete Snap-on Franchise Store Management Training. Training currently consists of over 80 hours of classroom training and 135 hours of on-the-job training. The training school is currently located in Grapevine, Texas, but Snap-on reserves the right to relocate it at any time or conduct the training online. The franchisor conducts the field initial training at the time franchisees begin operations. Between four to eight months after franchisees begin operating their business, franchisees are required to attend Franchise Store Management Training – Level 2 currently held virtually via web-based meetings, but may be at the franchisor’s training workshop located in Grapevine, Texas, or by such other method or at such other location as it designates. Once franchisees begin operation of their franchise, the franchisor suggests, but does not require, that franchisees and their store manager, if applicable, participate in ongoing training, including Franchise Performance Team meetings (if provided by the franchisor). The franchisor generally holds these meetings on a monthly or quarterly basis, but may hold them more or less frequently as it determines appropriate. The franchisor also suggests, but does not require, that franchisees their franchise store managers attend training opportunities provided by Snap-on each year. Training opportunities may include delivering specialized training, kickoff meetings, and the Snap-on Franchisee Conference.

Territory Granted: The franchisor grants franchisees the right, subject to terms, to use the Snap-on Program, and to purchase products from the franchisor for resale only at the locations identified on their “List of Calls.” The List of Calls consists of a series of business addresses or “stops” at which the franchisor has determined that there are, or should be, tool users who purchase their own tools. While the number of potential customers on a List of Calls will vary to some extent from franchisee to franchisee, it is the franchisor’s intent that each List of Calls contains at least 200 potential “Core Customers” at the time a Franchise Agreement is signed. In addition to Core Customers, the List of Calls identifies potential additional tool purchasers either at the same or additional business addresses who are not considered potential Core Customers according to Snap-on's criteria, but to whom franchisees are allowed to sell products and are identified as potential “Exception Customers.” With some exceptions, during the term of the Franchise Agreement, if franchisees are not in default under the Franchise Agreement, the franchisor will not sell, or license others to sell, products at those locations identified on the List of Calls without the franchisee’s consent.

Obligations and Restrictions: Franchisees will use their best efforts to promote aggressively and develop fully the sales of products at stops on their List of Calls. Franchisees will maintain an inventory of products in at least the minimum amount specified in the “Snap-on Program” in order to maximize their sale of products and provide service expected by their customers. Franchisees must refrain from engaging in activities that would conflict with these purposes and they will devote all necessary business attention and efforts to these purposes. Franchisees will not sell or give away items of merchandise which are directly competitive with the products that are manufactured by or for the franchisor, except items of merchandise which franchisees have taken as a trade-in. In addition, franchisees will refrain from selling items which are inappropriate or inconsistent with a business selling tools and equipment. Franchisees may sell products only to customers at stops on their List of Calls. Franchisees will assist the franchisor in honoring all warranties on products, which means that franchisees will perform service on tools and equipment at the customer’s place of business.

Term of Agreement and Renewal: The length of the initial franchise term is 10 years. Franchisees can add one term of five years if they meet requirements. The franchisor may grant an additional five-year renewal at expiration of the renewal franchise at its option.

Financial Assistance: The franchisor and Snap-on Credit offer certain financing programs described in the FDD. If franchisees meet all the requirements, Snap-on Credit, may lend franchisees funds to cover certain initial investment costs and expenses of their franchise. Snap-on Credit may also lend franchisees funds to cover initial investment costs and expenses for an additional franchise to purchase additional inventory, finance their RAs or recapitalize their business. Snap-on Credit is owned by Snap-on Incorporated.

Estimated Initial Investment

Name of Fee	Low	High
Real Estate	$0	$0
Initial License Fee	$8,000	$16,000
Initial Inventory	$139,000	$149,000
Electronic Signature Pad	$0	$270
Supplies	$0	$600
Van	$65,000	$195,000
Van Insurance (3 months)	$827	$4,953
Van Delivery Charge	$200	$4,800
License	$200	$2,400
Acquisition/Development of Revolving Accounts	$0	$85,000
Other Equipment, Fixtures, Expenses	$150	$170
Computer Software License Fee	$3,200	$3,200
Additional Funds - 3 months	$5,174	$38,705
ESTIMATED TOTAL	$221,751	$500,098

Other Fees

Type of Fee	Amount
Weekly Remittance for Products and Services Purchased from Snap-on	The minimum amount is 100% of miscellaneous charges less miscellaneous credits, plus any amount necessary to be $1 under the franchisee’s credit limit.
Monthly License Fee	$152
Software Development, Maintenance and Support Fee	$94
Franchise Finance Program Loan Payment	No payment for the first 90 days (interest accrues from inception of loan); thereafter, the estimated payment is $1,713–$1,904/month, except for a Transfer Franchise the estimated payment is $1,713- $3,119/month; and the second financing option is $2,919/month for the first 9 months, then $2,036-$2,484/month thereafter.
RA Loan Payment	$1,109-$1,221/month, except for a transfer franchise the estimated payment is $0-$1,221/month, and except for participants in the second financing option the estimated payment is $1,200-$1,417.
Credit Program Payments	To be determined.
Open Account Payments	To be determined.
Transfer Fee	This fee is currently $16,000.
Renewal Fee	50% of the then-current initial license fee, which is currently $8,000.
Insurance and Other Coverage	$6,540–$23,042
Indemnification	To be determined.
Administrative Handling Charge	To be determined.
Van Lease and Maintenance Fee Payment	$2,755–$3,518/month van lease payment plus $325/month maintenance fee.
Van Lease Termination (under Snap-on Credit Van Lease Program)	Unless franchisees purchase their van, franchisees must return the van to a location designated by Snap-on Credit (estimated cost to the franchisee is between $200-$4,800, depending on their location) and franchisees are responsible for damage in excess of ordinary wear and tear. Up to one month’s lease payment for early termination will be due. If franchisees purchase their van, Snap-on Credit may charge them a processing fee up to $190 to transfer the title of the van to them.
Late Charges (under Snap-on Credit Franchise Finance and Credit Programs)	Under franchise finance loan: 4% over regular rate (subject to maximum permitted by law). Under Snap-On Credit van lease program 5% of amount due (plus interest at 10%) for payment delayed more than 10 days or $10, whichever is greater (subject to maximum permitted by law).
Charges for Insufficient Funds/ Dishonor of Payment under Snap-on Credit Franchise Finance and Credit Programs or for Payment to Snap-on	Up to $35, which may increase during the term of the Franchise Agreement.
Training	$0 - $3,800

The above information has been compiled from the FDD of Snap-on Tools. Year of FDD: 2025.
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