WoodTek OEM, Woodworker's Supply, going out of business

[smorgasbord]

Got an email saying in part:

"Unfortunately, Woodworker's Supply Inc. will end operations on August 15th. It is imperative that you reach out to us for any spare or replacement parts needed before our operations come to an end."

Just an FYI for anyone that might own a WoodTek machine to think about what parts you might need now or in the future and get them while you can. The WoodTek machines are made by various Chinese manufacturers that also make for other names, so you might be able to find compatible parts elsewhere in the future.

 

[squall_line]

Got an email saying in part:

"Unfortunately, Woodworker's Supply Inc. will end operations on August 15th. It is imperative that you reach out to us for any spare or replacement parts needed before our operations come to an end."

Just an FYI for anyone that might own a WoodTek machine to think about what parts you might need now or in the future and get them while you can. The WoodTek machines are made by various Chinese manufacturers that also make for other names, so you might be able to find compatible parts elsewhere in the future.

Sounds like they didn't find a buyer at the price point they were offering for the business.  Always hard to watch happen.

 

[Svar]

They are looking to sell the business to someone who "shares their vision". Perhaps it will remain to be a tool supplier of some sort?

 

[Packard]

They will auction off his machinery and tooling.  So someone could get into that business for 10 cent on the dollar.

After which, they can offer the current owner a few thousand dollars for his old customer list.

Find out the name of the law firm handling the dissolution of the assets and ask to be notified when the auction will take place.

 

[peacefulandpatriotically]

that' a shame, I've ordered from woodworkers supply and they were great to deal with and frequently had excellent clearance sales.

never saw anything interesting in the woodtek line, looks just like all other machinery from that part of the world with a different paint job and name.

 

[dashboardpws]

I did a lot of business with them in my early days and in the era of paper catalogs I poured over theirs every time one arrived. This is a drag.

 

[Packard]

As I recall, Woodworker’s Supply had a huge paper catalog which I would receive (probably) twice a year. That was probably a big expense.

Looking online, it appears that the “Woodtek” line was simply their house brand, and they likely did not actually produce these items, but rather had standard items relabeled for their sales.

If you have one of their machines and you need spare parts, that might be an issue.  After a while the the actual manufacturers may get known and spare parts may become available again. 

The manufacturers may try to line up new vendors for those items.  It may take time, but I doubt all the machinery will simply disappear.  They may have a new name and wear a different style of clothing, but I expect them to reappear. 

At some point I expect one of the woodworking sites will have a post that says, “This lathe (or other machine) appears to be identical to the old Woodtek lathe, and spare parts will likely fit those older machines…”

 

[Peter Kelly]

Sad to hear that, always enjoyed stopping by their store in Albuquerque. Woodtek stuff seemed largely to have been imported from Taiwan, I’m guessing the OEM may have been Geetech.

 

[xedos]

Sounds like they didn't find a buyer at the price point they were offering for the business.  Always hard to watch happen.

which means the fundamentals didn't make sense.

They are looking to sell the business to someone who "shares their vision". Perhaps it will remain to be a tool supplier of some sort?

I'll bet there are more than a few who share their vision, it's simply that bankers don't lend on "visions". 

 

[peacefulandpatriotically]

just noticed the following link posted on their web site:
https://woodworker.zendesk.com/hc/en-us/articles/16256837418253

Interesting for a few reasons... asking price for the business is $3mm which includes pretty much what you'd expect except the land and storefront and warehouse space.  Without knowing any details about the inventory value, its hard to conclude who or what this proposition would work for.  The domain names alone are worth at least $10-15 grand, maybe more.  Not sure about the value of the other included items in the deal.

Anyways, this is a sad thing to see and I hope the owner is able to figure something out.

 

[squall_line]

just noticed the following link posted on their web site:
https://woodworker.zendesk.com/hc/en-us/articles/16256837418253

Interesting for a few reasons... asking price for the business is $3mm which includes pretty much what you'd expect except the land and storefront and warehouse space.  Without knowing any details about the inventory value, its hard to conclude who or what this proposition would work for.  The domain names alone are worth at least $10-15 grand, maybe more.  Not sure about the value of the other included items in the deal.

Anyways, this is a sad thing to see and I hope the owner is able to figure something out.

Without any sort of proprietary IP and/or the store front, what is there that a startup couldn't get by just opening their own business from scratch?  Sure, client lists aren't cheap or free, but in this day and age of social media and other marketing means, they're not the barrier to entry that they once were.  And the sellers want the business to remain local to the current business but without including a storefront to do that.  That narrows buyers down SIGNIFICANTLY, especially if someone out of state was interested.

And the post dances around the fact that the company has debt on the books including but not limited to pension/retirement plan contributions.

Just speculating, but I can't imagine it being very easy to stomach a purchase where any significant portion doesn't include an asset, especially since it's not being purchased as debt but it's being purchased as "seller will use this to pay off debt".

I don't think their vision matches with most buyers.  Sorry to see that happen.

 

[xedos]

Without knowing any details about the inventory value, its hard to conclude who or what this proposition would work for.

I think it's easy to conclude that it won't work for anyone, hence the shuttering.  If it were going gangbusters or even just profitable; a buyer would be easy to find. 

The mere fact that it can't run itself without the owner being around everyday while a buyer is found , speaks volumes.

 

[ChuckM]

It's a family business. As family owners get older and older, we can expect to see more and more such businesses closing or getting sold...unless early sucession plans are put in place.

 

[Michael Kellough]

The founder was close to retirement age at the beginning, nearly fifty years ago.

Now being run by the founder’s wife, Billie Jean.

“ The responsibility for any retirement benefits and accumulated vacation pay will be handled by Billie-Jean Wirth and as such, is NOT to be the responsibility of any new owner(s).”

 

[WillAdams]

Surprised the employees aren't willing to pool resources and buy it.

Setting it up as a co-operative where the customers could buy in as well might be an interesting direction to take things --- I know I'd be glad to patronize such a company.

 

[Cheese]

I've purchased a lot of small items from them over the years, their Slipstop line of drill bit stop collars was exceptionally nice. I think they also offered the complete Festool line of equipment. The only Festool items left are a couple of DF 500 & 700 bits.

[attachimg=1]

 

[Michael Kellough]

Surprised the employees aren't willing to pool resources and buy it.

Setting it up as a co-operative where the customers could buy in as well might be an interesting direction to take things --- I know I'd be glad to patronize such a company.

At this time there are only 20 employees.

 

[peacefulandpatriotically]

Surprised the employees aren't willing to pool resources and buy it.

Setting it up as a co-operative where the customers could buy in as well might be an interesting direction to take things --- I know I'd be glad to patronize such a company.

...if we do some rudimentary math, they state "less than 20 current employees", so lets say for the sake of argument, 15 of them decide to "buy out" the owner at the asking price of $3mm, this equals a cash investment of $200k each. without knowing anything about the revenue, and assuming all employees require a paycheck, we still need to generate cash for payroll, storefront/warehouse rent and a number of other expenses. What about leadership?  You'd think that if current employees had a "vision" that would turn the company around, they would have shared this with the current management in hopes of preserving their own future.

I think we can conclude there are multiple underlying issues with the business as well as management.  Look at the big guys, Lee Valley, Rockler and woodcraft, they each have many stores across the country (LV is the exception, no locations in USA) and I assume robust mail order businesses.  Somehow, someway they are able to make ends meet and continue running their operations. Rockler for example has opened quite a few NEW stores in the past 3 years and has a handful more new stores planned.  Also interesting is that rockler nor woodcraft have any presence in New Mexico, WW Supply home state.

My intention is really not to bash this company or others' comments here, rather, to understand how a retail business operating for multiple decades fails.  Where I live, there isn't a single "woodworking" store within 2++ hours (so a round trip is 4+ hours) and from what I see, local demand for brick and mortar woodworking stores is highly regional-specific (look at the locations of the previously mentioned companies).

As noted in my first post of this topic, i've ordered from WW Supply and had excellent service from them.  To expand on that comment, the only items purchased from them were from their "bargain bin" clearance sales.  Their private label stuff isn't compelling and while they carry many quality brands, we have the issue of shipping charges to consider too.

thanks to all who read this rambling post [smile]

 

[Cheese]

Interestingly enough, Woodworker's Supply also owned the Platte River Engineering trademark. They "manufactured" the Slipstop drill bit stops. They also "manufactured" some really slick 5 mm diameter press-in, clear silicone feet/bumpers.

Here's a list of the goods & services Platte River supplied.

"Woodworking tools, supplies and equipment, namely, hand tools and implements for woodworking, namely, tables especially adapted to hold hand-tools in the nature of router and shop tables, hand tool fittings, drawer slide jigs, miter, crosscut, rail coping sleds, clamps for use in the precision clamping of work pieces, bits for hand drills; woodworking tools, supplies and equipment, namely, hand tools and implements for woodworking, namely self-centering, pull, drawer, slide, box joint, straight line, dowel drilling, shelf drilling, tenoning and hinge router jigs; woodworking tools, supplies and equipment, namely, hand tools and implements for woodworking, namely router accessories in the nature of guide bushings, circle, corner, grommet, gripping devices in the nature of wolf bench paws, templates, and bits, hand operated drill guides and table saw accessories, namely, portable drills guides and drill guide kits, plug cutters"

 

[festal]

I've purchased a lot of small items from them over the years, their Slipstop line of drill bit stop collars was exceptionally nice. I think they also offered the complete Festool line of equipment. The only Festool items left are a couple of DF 500 & 700 bits.

[attachimg=1]

I like that systainer