jump to example.com

A couple of things you might not know about that place you go to pick up cheap-ass screwdrivers and wrenches: It’s family-owned. And the family, it seems, isn’t getting along all that well. This article in the Ventura County Star indicates that a few days ago everything came to a head with ‘Freight founder Allan Smidt escorted out of the door and locked out of the building.

The drama in short (according to VC Star): Smidt’s son nagged him to hand over control of the company for years, and back in 1999, he relented. Unhappy with how his son “dramatically leveraged the company,” Smidt complained, resulting in Smidt’s untimely departure. Smidt filed a lawsuit afterward “accusing the son of looting the company to buy such things as a $20 million Manhattan apartment and a single painting for $100 million.”

Normally we don’t think too much about this kind of stuff at Toolmonger, but hey — $20 million will buy a lot of tools. A hell of a lot of tools if you’re buying at Harbor Freight. Our concern lies primarily in terms of what this means to the consumer. Will it affect the stores in any obvious way?

Honestly, we just don’t know, But we’ll keep an ear to the ground and let you know if we come across any new news. And if you hear anything, don’t be afraid to let us know.

(Thanks, Tom, for the tip.)

Harbor Freight CEO Accused By Parents of ‘Looting’ Company [VC Star]

 

16 Responses to Harbor Freight Family Drama

  1. Toolhearty says:

    Well… He just got the new apartment, and he needed to furnish it so he got the painting. Seems like a reasonable use of company funds to me. In fact, I think he got a good deal on the apartment. My company paid $30M for mine.

    Hey, I’ve got a few items he might be interested in. He could just make me an offer:

    – umbrella stand (paid $15K)
    – shower curtain (paid $6K)
    – wastebasket (paid $5K)

    I don’t get much use out of these things any more as I’m currently doing 8 – 25.

    D. Kozlowski

  2. hmburgers says:

    Hey Kozlowski,

    How much for your solid gold toilet brush holder and your plunger made from elephant skin with an ivory handle?

    Seriously, I need to stage my house for the short sale.

    Thx

  3. Davo says:

    I have long suspected that there was more to the Harbor Freight story, than meets the eye…all that Chinese merchandise, that was always oh-so-affordable!

  4. DocN says:

    HF may already be hurting, to say nothing of the internal squabbles. No facts yet, but with the Chinese decoupling their yen from the dollar, and combined with their workers’ growing demand for better living conditions and higher wages, the day of the cheap import knock-off tool is fading fast.

    Now, many companies will relocate to India or Vietnam, etc. but there’ll be teething problems there, and even still, shipping costs will go up. (That’s a given, regardless of the Chinese situation.)

    Once the cheap tool stops being so cheap, places like HF and Northern Hydraulic will see their biz drop markedly. They won’t disappear, of course, but their lines of products will thin out some, prices will go up, and in some cases quality will go down.

    Fortunately, I stopped buying shitty import tools five or six years ago, so HF can go hug a rope for all I care. 🙂

    Doc.

  5. Ivan says:

    The problem with not buying at HF is that even the ‘name’ brands are made in China. So what’s the true difference? I was shopping around for a nice contractor saw and noticed that a Ryobi which sells for a couple hundreds but even the Dewalt which sells for over 500 dollar? So who’s really making the big bucks.
    It’s easy to put the blame on the little man who needs tools. And who to blame for me buying a $119 hardwood floor nailer in HF to add install 1000 sq ft of 3/4″ oak floor without any misfire. Where I could rent one at for $50 a day or buy a $500 in the other stores?
    We weekend workers don’t buy to re-use but to use at least once, that’s the big difference.

    If corporate greed and shareholders won’t expect a steep profit every quarter, year after year. We could expect some cheaper tools from the big names as well.

    Go HF !

  6. DocN says:

    Notice I said -shitty- import tools. 🙂

    I’m an unrepentant gadget freak, and I don’t buy “one use” tools. I’m lucky enough to have lots of similar friends, and if I need something like that- say, a wet tile saw for a single tiling job- I can almost always borrow one.

    I fully understand that there are those that buy disposable cordless drills and the like, for that one home remodelling job. More power to ’em.

    But I make my living with my tools, and I learned- admittedly a bit late- that buying crap tools doesn’t save me any money.

    Doc.

  7. JW says:

    Keyword being shitty, not import. I agree. I like me some Bosch, Festool (too rich for my blood though). I like a quality tool. The job is usually frustrating enough, why add to that with a crappy tool. Like previous poster said, with the decoupling of the yuan (yen is Jap currency), the price of their products is gonna go way up, probably about 40% (but with their coupons for 20% off, wont be too bad :). So it will still be really cheap, just not as cheap. But the new CEO sounds like a real douchebag. This also provides another lesson. Even your own flesh and blood will fuck you over for enough money. Not all the time, I wouldn’t ever do that to my wife, but I don’t have a love of money like most everyone else does, so it’s a little harder to corrupt me (I’m not normal unfortunately *sigh*).

  8. Rob says:

    Those crappy tools you don’t like at HF are sometimes the same ones other stores sell with their logo on them for 2-4 times the price. If you are going to buy, or have to buy, imported tools then you might as well get them for the lowest price.

  9. Coach James says:

    Please define “corporate greed”. And not the lame “CEO’s all make millions while the workets get laid off” routine. Find people willing to be a CEO for no pay and it will not make any difference in jobs leaving this country. A corporation cannot be greedy any more than your car can be.

  10. Mac says:

    Wow, lots of possibilities here… Sure there’s way more to this story than meets the eye as well.

    On the surface, seems like dad is pissed son does not have same priorities as he did. Hope dad had attorneys set up transition such that he take back what he gave up. Otherwise, he may be sol.

  11. Squidlow says:

    Oh, poor Coach James:

    >A corporation cannot be greedy any more than your car can be.

    he’s totally bought into the whole logic of capitalist exploitation. These poor corporations, inanimate, without rights (until the most conservative Supreme Court we’ve had in generations ruled they could buy elections and had more power then people).

    A corporation is a body of people. People are greedy. Ergo, corporations are greedy.
    The son sounds like a greedy, ungrateful little f*ck, if the allegations are true.

    It’s funny, but the very Americans who are exploited in the country and need protection from big business are the first to defend it. The working and middle classes vote against their own interests, time and again. Why? Because they think they “too” will someday become rich. And yet, very few of them ever do. But they are wiling to live their lives (and cast their votes) to support the very system that in the end, leaves them with nothing.

  12. Coach James says:

    Squidlow, save the sermon for someone else. By your logic, every organization is greedy since they are all made up of people. Explain the Supreme Court decision where they ruled corporations could buy elections. And while you are at it, explain what would be better than a capitalist system.

    The one correct statement in your post is that the son is a greedy ****.

  13. russ says:

    Remember the MagLite divorce years back…remember those guys that kicked Steve Jobbs out of Apple and drove the company almost into the ground? Well Steve came back and so did Apple. MagLite is still around.

    I think we would all be surprised about some companies we deal with or know about if we knew the drama going on inside and maybe their employees also.

  14. Fabian says:

    That painting must be the same place where the US gets its hammers for 10k…

  15. J P says:

    maybe the son could use a few more paintings for that NYC apt. Lol, I’d be happy to get just a cool mil for my work.

  16. Hyratel says:

    Well, I donno, but this sounds like it happened right around the time when the HF website came out of 1996 and into 2010

Leave a Reply

Your email address will not be published. Required fields are marked *