Future tool
As power tools change, so should retail channels
The Ryobi Quiet Strike is one of the new breed of specialised tools
The Ryobi Quiet Strike is one of the new breed of specialised tools
 
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The range of cordless power tools continues to expand, and retailers cannot keep up. What kind of distribution channels will emerge in the future?
HNN Sources
What are the major trends we have seen emerging in power tools, and what do these trends indicate about the direction of the industry? The established trends that we can see today are:
  • The further development of the "connected tool", as pioneered by Techtronic Industry's (TTI's) One-Key system.
  • An increasing diversity in tool voltages, as manufacturers seek to create more powerful alternatives to corded tools.
  • An expansion in range and functionality of tools, as manufacturers seek to enter more niche markets.
  • An increasing interest in and servicing of the outdoor power equipment (OPE) market, which is a special case of combining the two trends listed immediately above.
  • Further development in batteries, including higher amp-hours, coupled with more compact battery units.

  • Each of the four major power tool companies - Stanley Black & Decker (SBD), TTI, Bosch and Makita - are typically engaged in three of these four trends.

    TTI has a particular emphasis on the connected tool, range expansion into niche areas, and further battery development, for example, but only a small program for tools featuring motors with voltages above 18 volts. Makita does not have a connected tool program, SBD arguably does less niche expansion than the others, and Bosch does have an OPE program, but it is very different from that of the other three.

    A shared consequence of these general trends, however, has been something of a massive range expansion by each of the manufacturers, and it seems this expansion is set to continue. This has consequences in particular for the retail channels that service these brands. While the manufacturers are free to continue to produce new models that split familiar categories into several sub-niches, retailers have limited shelf space, limited warehouse/stock space, limited funds to allocate to stock, and, quite frankly, less expertise than they might really need to effectively sell many of these different variants of cordless power tool.
    A prime example

    One tool in particular has stood out for HNN as a prime example of how these product range expansions have come to affect retailers, even large retailers with a great deal of resources to make use of. This single power tool has been sitting on the desk of one of HNN's editors. There is nothing all that spectacular about the tool - in fact, as it was purchased used on eBay, it is somewhat the worse for wear.

    It's a Ryobi. It performs a function that is very common. It uses the conventional Ryobi battery system. It is well-liked - according to online reviews - by those who use it, but it is not, in any way, really a "game changer" - though it does have some notable and interesting innovations.

    There is one outstanding quality it does have, however: despite being a mainstream Ryobi product, it is not sold by Bunnings. That could have something to do with supply issues, but given the outstanding sales growth that Ryobi has experienced in Australia, it seems unlikely that Ryobi parent company Techtronic Industries (TTI) would be inclined to deny Bunnings access to the tool.

    This tool is probably not sold by Bunnings because Australia's largest hardware retailer would likely struggle to find a place in the market for it - even as a non-stocked "special order". Bunnings may boast a very wide range of power tools, but it is no secret that even the swath of space allocated in its largest warehouse stores is no longer sufficient to display even a significant portion of what the power tool industry has served up over the past five years.

    The tool in question is the Ryobi Quiet Strike (pictured on the opening page of this article). The Quiet Strike is an unusual tool, even for Ryobi, which does have some unusual tools. This tool is based on a different take on a Milwaukee/AEG tool, the oil-pulse impact driver. Where most impact drivers rely on a tensioning spring to deliver the rapid pulses of power that help drive self-tapping screws into wood very quickly, oil-pulse impact drivers instead rely on a more complex hydraulic system to deliver similar results.

    The hydraulic systems are, ultimately, more effective, and they give tool designers a great deal of freedom in terms of how they are setup to perform. In the AEG oil-pulse driver, the system is oriented to deliver the maximum bang (literally) for the buck, resulting in surprisingly quick screw drives. The Quiet Strike, as the name implies, has taken a different approach. It is designed to perform at around the same level as a standard Ryobi impact driver - but at a sound level that is close to half that of most impact drivers.

    It isn't just the design that makes this Ryobi so interesting. People who pay close attention to the types of tools being used for common tasks have probably spotted the same trend that HNN has: far from being, as Ryobi modestly describes its products, designed strictly for DIY, these tools have become more accepted by certain types of tradies and handymen. Though still rare on construction sites, they've become very common among those primarily concerned with different types of standard maintenance work.

    So, while Ryobi may claim the advantage of the Quiet Strike is that a cross neighbour may not drop over at 8am on a Saturday morning to complain about the deck you are building in your backyard, the "real" purpose of this tool is to make life easier for maintenance workers in commercial premises such as schools and hospitals, where noise containment is essential.

    Which illustrates just exactly why Bunnings likely does not sell the tool: we're not talking just about a niche use here, we're talking about a niche within a niche. And Bunnings, as HNN has frequently suggested, just doesn't do segmentation. There are two reasons for that (as far as we can determine). Segmentation can be appealing, but it nearly always ends up saying both "yes" and "no" at the same time - and Bunnings goes out of its way to not say "no", under any circumstances.

    Secondly, segmentation often requires explanation and genuine salesmanship. Bunnings offers some guidance to customers, but it doesn't always match up to the more sophisticated products.

    What is highlighted here is an inefficiency in the way Bunnings is able to service some newly developed markets: it is a new, innovative product, with an evident, and perhaps eager, market - but Bunnings lacks a legitimate, assured path to that market.

    HNN would argue that it isn't just Bunnings that finds itself in this kind of curious situation - it's actually large segments of the power tool industry, both retailers and manufacturers, that find themselves facing similar contradictions. While these forces have been present for around the past decade or so, recently they have come increasingly into focus, to the point where they are starting to exert a dominant force on some market sectors.
    The Bosch paradox

    While it might be tempting to see this situation as having to do mostly with the professional, tradie end of the market, in fact it has come to affect the consumer range of tools as well, though with a slightly different inflection. We can see this mostly clearly with the new range of consumer-oriented tools that Bosch has released in 2018. These tools are relatively unique, in that they are aimed not just at the consumer market, but at the lower-skilled end of DIYers, with the explicit purpose of enabling them to do more in a better, less stressful way.

    Some of these changes are useful tweaks to existing product types. Thus the new AdvancedDrill 18 and AdvancedImpact 18 take the conventional drill and impact driver and make them a little easier to use for DIYers, with a low unit weight of one kilogram, an electronic switch to handle forward/reverse, and a way to preset the drilling speed. The same is true of Bosch's PushDrive screwdriver, which is a battery screwdriver that responds to a push against a screwhead by starting its motor and driving in the screw. Similarly the Gluey hot glue pen is a reformatting of the standard trigger-based hot glue gun to a pen-like shape, which makes it work more like a standard adhesive applicator.

    Stepping away from the standard, Bosch has also expanded its range of NanoBlade cutting tools, adding both corded models and an 18-volt alternative to the range of what seem like micro-chainsaws, with 4mm cutting blades. These are designed to make cutting material such as wood as simple as possible, and are suited to areas such as gardening and crafts.

    Perhaps the most interesting DIYer product, though one which is simpler than the rest, is Bosch's SystemBox. These are containers designed to hold the tools associated with a specific task - such as sawing, or screwdriving and drilling - as well as providing a suitable work surface. Bosch describes this product:
    In the future, DIY enthusiasts will also be able to implement projects simpler and faster with our SystemBox range. What's behind this? With the SystemBox from Bosch, you have your tools, accessories and any materials you need to hand at all times. The new stackable storage and transport system clearly organises everything that is required to carry out preparatory and follow-up work for projects while saving time. The SystemBox is available empty or already equipped for the three most common DIY tasks: Sawing, drilling and screwdriving as well as working with multifunction tools.

    These are innovative tools, and this shows Bosch is moving in a very useful direction, by helping to equip the less-skilled with the resources to achieve some basic tasks. At the same time, however, the same range-expansion problems that we've seen with the tradie end of the market are now likely to affect the consumer end as well. In addition to the standard range of "green" drills and impact drivers, there is now an additional number of tools, some with new and unfamiliar uses.

    More than that, though, Bosch is likely to find itself engaging with an interesting paradox in launching these tools. In the past, less-skilled DIYers would tend to buy the cheapest tools on the market, on the basis that they would not get value from more expensive tools. These new tools from Bosch, however, are quite expensive. For example, the corded version of the NanoBlade-equipped EasyCut 50 sells for GBP74 (about AUD135) on Amazon UK and the cordless EasyCut 12 sells for GBP106 (about AUD190). That's far more than the equivalent jigsaws would sell for - and justifiably so, given the new technology.
    A coming change?

    What we are beginning to see develop in the power tool industry is a mismatch between the tools that are being developed by the manufacturers and the channels to market that are offered by retailers. While product ranges have dramatically increased in size over the past six to seven years, retailers continue to rely on the same sales process they were using 15 years ago.

    Online selling has taken up some of the slack in the system. Notably Bunnings offers a "special orders" service, where customers can buy products such as Makita's extensive 12-volt range, and it has recently enabled ecommerce on those transactions. However, even retailers that are predominantly online, such as Sydney Tools, struggle to represent the breadth and depth of products available, and typically fall back on providing only the more popular products.

    It has become a familiar recitation to mention that 20 years ago if you had to get someplace and didn't have your car with you, you hailed a taxi. You rented your entertainment from stores that stocked racks of DVDs. And if you went on holiday anywhere, your choice of a place to stay was limited to hotels, motels, and possibly dodgy bed-and-breakfast places. All that has changed now.

    Individually, innovations such as Uber, Lyft, Netflix and Airbnb seem fairly innocuous. Taken together, they don't so much signal the rise of technology (in particular of the social interactions that get privileged by what mobile phones make possible), as a deeper understanding by consumers of what it is they really need and are willing to spend money on. Consumers don't want taxies, they want to get from A to B with the least possible inconvenience. They don't want the "convenience" of digital media stored on physical media, they want vast selection, and immediate, spur-of-the-moment access. Nor do they actually need or want the stuffy rituals of hotels. They want a place to sleep and to perhaps eat a meal, and having direct contact with "real" locals, rather than hotel staff, seems a particular plus.

    A good question to ask is what happens when we begin to apply that same kind of thinking to the power tool industry. How much do consumers really benefit from owning, say, a cordless power drill? They may be cheaper, more powerful than ever, and so forth, but all that has not altered the use pattern that most follow, where the drill is used a maximum of 50 hours a year, and for the rest of the time sits fallow in a toolbox or drawer somewhere, becoming rapidly outdated, its Lithium-ion batteries ageing into oblivion.

    Of course, there is the argument that, try as you might, power tools remain a very physical product that requires a very physical presence - you can't simply choose to download them. But, unlike movies and Netflix, but very much like Uber and cars, it is likely that consumers will be able to plan and anticipate when they want and need this kind of service/tool. It's very rare that today the average homeowner manages to avert disaster because they have, waiting in a drawer somewhere, just the right kind of impact driver.
    Download full article

    This is only an introduction to this article. To read the full article, please download the PDF of HI News Vol. 4, No. 3 at:
    HI News 4-03: Future tool
    HNN Sources


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