The automotive tool market is really changing these days due to the recession in the United States. Automotive tool manufacturers and distributors have streamlined their product lines to better position themselves in the market and have cut many products from their lines. Tool manufacturers cannot afford to produce items that don’t move off of the shelves, so they have stopped manufacturing the slow movers.

Owner Doug Gillis at Skyway Tool Center in Chico, Calfornia has customers calling his store regularly looking for tools that used to be standard, but are now no longer made. For example, he had an online customer looking for a lighted circuit tester a few months ago and quickly discovered that the item is no longer available. His staff searched out suppliers throughout the US to find one, but nobody had that tool in stock. Later they discovered it was a tool that is no longer made, so they then focused on finding a tool that was similar, but it turned out nobody makes an inexpensive, lighted circuit tester anymore. It is not something that is commonly used, so the manufacturer just stopped making it as the result of the recession.

Another trend in the tool industry is that tool stores are fading out of the landscape of American towns. Recently a tool store in Chico, California, Northern California Tool & Supply, went out of business after 75 years. It was a family run business and sadly had to close it’s doors because of the stiff competition in the tool industry. Small tool stores can no longer compete with large retailers like Home Depot, Sears, Lowes and the many tool trucks that drive around and sell directly to the mechanics. Before the recession tool sales were brisk and there was enough business to go around for any reasonably operated tool store, but now it has gotten so cut throat that most tool stores have gone under.

The latest trend is that large online retailers like Amazon, Ebay, Sears and Walmart are acting as storefronts for the manufacturers of tools to sell directly to the public at wholesale prices, which is now cutting the throats of tool businesses and hardware stores nationwide. These online retailers have placed tool manufacturers and tool suppliers in the United States in direct competition with their own customers, the tool and hardware stores. There is no way for the tool and hardware businesses to compete when their pricing structure is higher than the price the manufacturers are charging the public. In other words, it costs as much or more for the local tool retailer to purchase products from the manufacturer today as it does for the public to purchase the exact same item from the manufacturer online.

Tool manufacturers have upset the supply chain nationally by going direct to the public. In the earlier days of the internet the manufacturers and tool suppliers treaded lightly when it came to competing with their own supply chain, but in recent years that has changed. Today’s tool manufacturers leave little to the imagination by selling out of Amazon and competing with the stores that had formerly kept the manufacturers in business for decades. The public love it because they can now buy tools for the same price that the tool or hardware store can, but will there be any downside to this?

The downside is that we have millions of people out of work now, because this is happening in every sector – not just the tool business. In every sector of retail trade, manufacturers have put the businesses out that had kept their products moving for decades. So one of the downsides is that we now have many unemployed workers who can’t afford to buy retail items, even if they are coming directly from the manufacturer and are being sold on the cheap. Another downside is that as the manufacturers increasingly take on the load of supplying the public directly, the buying public will receive less and less service.

Right now a guy can go into a local tool store, look over a tool, hold it, try it out, discuss it with the store employee, then go to Amazon and buy it directly from the manufacturer. Essentially the local tool store has gone to all of the trouble and expense of paying rent on the store, paying for the utilities and a staff to represent the tools, they have purchased thousands of items to display to the public, have spent money on advertising so you know they are around, paid taxes and insurance and everything else that goes with retailing to the public – then the public use them as a free resource. Pretty good idea, isn’t it? The manufacturers don’t even have to provide an ounce of service for their products, because when the thing breaks down, the public will bring it to their local tool store.

Unfortunately, local tool stores are not going to be able to provide the customer service for tools that break or otherwise don’t work that they would have if the customer had made the purchase in the store. If a customer buys an item online directly from the tool manufacturer, they need to be aware that the manufacturers are not set up to provide assistance with problems – thats what they had tool stores for in the past. The regular little retailer provided customer service all across the country, but now will have to send the Amazon customer back to the internet if they need help with the product they purchased online.

Eventually the retail trade will go the way of many other businesses – like the gasoline business. It used to be that there were many local gas stations across our country that were unaffiliated with any particular gasoline wholesaler. They were mom and pop dealers. Today you only have the choice of a few brands of gasoline and you don’t have anyone to wash your windshield, check the air in your tires, check your oil level, or pump that gas when it is pouring down rain or snowing. You have to provide all of that service for yourself and the gas is horribly expensive – it never came down in price as we lost all service.

The sad part about the way the tool manufacturers and suppliers have operated in the last few years is the way they scurried around behind the scenes and cut the throats of the very people that put them in their positions of power and wealth. They set up dummy websites and went on retail sites like Amazon to sell directly to the public, then sent their reps out to sell the stuff they couldn’t move out of their warehouses to their retailers, doubling up their efforts to ruin their customers. The only hope for any tool retailer these days is to find products that are not being hawked by their manufacturers directly to the public – and that is an almost impossible task.