Mac Tools Franchise Cost, Profit & Failure Rate 2024

Did you ever think about owning a Mac Tools franchise? They are a famous brand with thousands of employees around the United States. They offer franchising to those interested and have adequate capital.

This article will give you an insight into Mac Tools’ franchise system, how it works, what support they provide, and what you need to know.

Mac Tools Franchise

About Mac Tools and Mac Tools History

Mac Tools is an American professional tool and related equipment manufacturer with headquarters in Ohio. They have over 8,000 tools in their line and produce their own line of tools and carts in their manufacturing plant.

They were founded in 1938 as the Mechanics Tool and Forge Company in Ohio. Their aim was to manufacture high-quality professional and mechanic tools. They grew quickly, acquiring large government contracts and producing quality work.


Franchise Model Table

Cost Or FeesAmount
Initial Investment      $120,010-$343,535
FranchiseYES
Franchising Since2011
Franchise-Fee$8,000
Royalty-Fee$1,200/year
Liquidity$40,000
Estimated Outlets1,130

How Much Does it Cost to Open a Mac Tools Franchise?

How Much Does it Cost to Open a Mac Tools Franchise

The total expected initial investment is between $120,010 and $343,535 to open a Mac Tools franchise. This cost includes the $8,000 franchise fee and all other related startup costs. The rent or the mortgage, equipment, training, salaries, and some operational expenses.

Depending on the location and the number of routes you want to operate, this number could be higher or lower than the average.


Franchise Requirements

Mac Tools doesn’t require any kind of personal background in the potential franchisees. It’s a plus if you have management experience or an experience in the industry, but it’s not a must.

On the other hand, you require a liquid capital of $40,000 and enough cash to cover the expected initial investment, including the franchise fee.

There is no net worth requirement, only liquid capital.


Profit & Revenue

Mac Tools franchise Profit & Revenue

Mac Tools is owned by Stanley Black & Decker, so there is no detailed information on the profit and revenue numbers of Mac Tools.

According to some reports, the net income for Mac Tools, as per the latest report, was $39 billion.

The Mac Tools average franchise store sales numbers were $440,474. The average profit margin is between $10% to 20%, which leaves an estimated profit of between $44,047 to $88,094, with the average being $66,071 annually.

This is how we calculated this amount:

Financial OverviewPercentage of RevenueAmount ($)
Individual Franchise Annual Revenue100%440474.00
Rent10.62%(46800.36)
Insurance5.31%(23400.18)
Salaries21.25%(93600.72)
Franchise Royalty Fees5.31%(23400.18)
Utilities2.13%(9360.07)
Cost of Goods Sold (COGS)26.56%(117000.91)
Labor (Variable)13.81%(60840.47)
Total (Expenses)85.00%(374402.90)
Net Profit15.00%66071.10

Note: The displayed expenses are estimates based on industry averages and standard costs. Actual expenses may vary due to factors like location, business size, and market conditions. We recommend conducting detailed research or consulting with a financial advisor for a tailored financial analysis.


Payback Period Of Mac Tools Franchise

With an investment of $343,535 and an estimated 15% profit margin, the yearly profit would be $66,071.

So, to find out how long it will take to earn back the initial investment:

Payback Period = Investment / Yearly Profit = $343,535/ $66,071= 5.1 years

Based on these figures, it will take approximately 5 years to pay back the initial investment for Mac Tools. This time period could be longer or shorter depending on your sales, revenue, and profit figures.


Failure Rate Of Mac Tools

Franchised Outlets:

YearOutlets at the Start of the YearOutlets at the End of the YearNet Change
2020687703+16
2021703751+48
2022751772+21

For the Franchised outlets:

  • In 2020, the growth rate was (16)/687×100≈2.32%
  • In 2021, the growth rate was (48)/703×100≈6.82%
  • In 2022, the growth rate was (21)/751×100≈2.79%

According to the above-mentioned data, there is no failure rate for franchised outlets as the outlets at the end of the year increased during the span of 3 years.

We can see that the franchised outlets for Mac Tools grew from 2020 to 2022, showing a growth rate between 2.32% and 2.79%. 


Training and Support

The franchise candidate must join an existing Mac Tools franchisee on the franchisee’s route selected by the franchisor.

This is called a mentor ride, and it lasts approximately five business days, and the candidate has to attend it one week before the initial training.

The initial and mandatory training is classroom training that lasts five to eleven days, depending on the class’s size, and it’s held in Ohio.

The franchisee also receives one-to-one training with a Mac Tools representative in the first five days of their operation.


Obligations and Restrictions

Mac Tools Obligations and Restrictions

The franchisee must have or form a corporation or an LLC to operate a Mac Tools franchise unless the franchisor agrees beforehand for them to operate as an individual.

The owner of the franchise branch must also actively participate in the management of the store and operate it. If the franchisee has multiple routes, an employee can manage the other.

The customers you make sales to must be commercial users of tools and equipment. The products can not be sold to someone in the reselling business.


Terms of Agreement & Renewal

The term of the first franchise agreement you are going to make with Mac Tools is for 10 years.

Unless one party or both parties would like to terminate the agreement under the terms laid out in the agreement.

So if the franchisee meets the renewal conditions, a renewal is available. This renewal is one renewal term of 10 years.


Financial Assistance

Mac Tools doesn’t offer direct financial assistance, but they have a contractual relationship with a third-party provider, Wells Fargo.

They offer financial assistance to qualified applicants to buy the starter inventory, truck, and also other operational expenses.

The means and conditions of the financial assistance are determined by Wells Fargo.

Potential franchisees interested in automobiles can investigate opportunities with Harbor Freight Franchise.


Comparison

NameFranchise FeeRoyalty FeeInitial Investment
Matco Tools$8,000N/A$77,236-$313,646
Snap-on-Tools$8,000-$16,000$145/month$201,433-$465,436
Mac Tools$8,000$1.200/year$120,010-$343,535

Conclusion

So Mac Tools is a popular tool manufacturing company operating since 1938. They currently offer franchising to those interested, and they have a very extensive support system in place.

The required investment is between $120,010 to $343,535 on average. The average profit per franchised store is between $44,000 to $88,000. It could be an extremely lucrative opportunity.


FAQs

What is the franchise fee for Mac Tools?

The franchise fee for Mac Tools is $8,000 in a lump sum and is a one-time payment fee.

Is Mac Tools a franchise?

Yes. Mac Tools is currently a franchise.

Who owns Mac Tools?

In 1961, the company changed its name to Mac Tools, and in 1980, Stanley Works bought Mac Tools. It is still a part of Stanley Black and Decker Group.

Where is the headquarters of Mac Tools?

It is headquartered in Westerville, Ohio.

Who founded Mac Tools?

Mac Tools was founded by Russ Darrah under the name Mechanics Tools and Forge.

How many locations does Mac Tools has?

Mac Tool’s business model is a franchise system with roughly 1,500 distributors across North America.

Sources

https://www.franchisedirect.com/automotivefranchises/mac-tools-franchise-08859/ufoc/
https://thefranchisemall.com/franchises/details/14553-0-mac_tools.htm
https://topfranchise.com/products/mac-tools-automotive-tool-franchise/
https://www.mactools.com/pages/owning-a-franchise
https://en.wikipedia.org/wiki/Mac_Tools
https://www.franchisedirect.com/automotivefranchises/snap-on-tools-franchise-07086/ufoc/
https://www.matcotools.com/franchise/investment/cost

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