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07/11/2022

Northern Tool + Equipment sees room to run

The Minnesota retailer manufactures plenty of its own tools and has ambitious plans for more store openings.
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Northern Tool storefront
Northern Tool + Equipment projects plenty of store openings over the next decade.

Northern Tool + Equipment has built its retail reputation on three pillars: a deep assortment of quality tools, a fully functioning parts and service department, and store associates with practical, real-world expertise. 

On that foundation, the company serves professional customers and DIYers through a fleet of 125 stores across 22 states. And today, the company sees an opportunity to more than double its store count over the next 10 years.

“Northern Tool sees tremendous value in growing our retail footprint and is excited to add new stores in many new communities over the next decade,” CEO Suresh Krishna says. “While other companies have pulled back from opening new stores, we have doubled down by demonstrating that we are a big believer in brick-and-mortar, with plans to have over 300 stores by the next decade.” 

Located in both the Midwest and the Southeast, Northern Tool + Equipment’s offerings include more than 100,000 tools and a broad range of equipment. The retail’s in-store experience allows it to showcase customer-centric values to the pros in the skilled trades and serious DIYers, offering an “excellent retail experience,” Krishna told HBSDealer. 

The retailer opened its 120th store in Humble, Texas in 2021 with five new locations added since. 

Part of the accelerating growth plan calls for the company to build up its presence in key legacy markets while expanding into new markets. 

An edge that Northern Tool + Equipment brings to the workbench is its manufacturing capabilities in addition to its vast product selection across more than 60 categories. The company’s NorthStar private label brand of tools and equipment is designed and built in Faribault, Minn. Offerings from NorthStar include pressure washers, generators, log splitters, air compressors, and much more.

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Northern Tool CEO Suresh Krishna
Northern Tool CEO Suresh Krishna discusses the need for training in the skilled trades.

Pros account for roughly 40% of total sales, with the balance being serious DIYers. The retailer’s pro customers include everything from a one-man operation — such as a handyman — to multi-million-dollar commercial companies including landscapers, automotive repair shops, contractors and light manufacturers, electrical and HVAC installers and more.

 “There aren’t many retailers who carry the broad and unique assortment of tools and equipment that we carry, plus we are one of a very few who also manufacture our own tools,” Krishna notes. “So, we’re in a unique position to take direct customer feedback and turn it into highly productive tools.” Beyond NorthStar, house brands include Ironton, Klutch, Powerhorse, and Ultra Tow. National brands are also carried such as Milwaukee, Stihl, Honda and Lincoln Electric Welders. 

Northern Tool is also heavily wired for e-commerce.

 “We have a saying that Northern Tool was ‘omnichannel’ before that term even existed, through our unique mix of retail locations and mail order catalogs that date back to our company’s inception,” Krishna says.

When online sales became an option in the 1990s, Northern Tool quickly embraced e-commerce. 

“We excel at making our online experience reflect the expertise and helpful project know-how our customers find in our stores: organized so it’s easy to shop and highly informative with suggestions for accessories so customers can get the right tools for their projects – no matter how unique or challenging they may be,” Krishna says. 

Regarding the in-store experience, store associates bring strong knowledge and experience to Northern Tool stores while being trained to properly support each customers’ unique question or need. 

“This means we can be an expert resource spanning across several skilled trades professionals such as landscapers, automotive mechanics, contractors and light manufacturers, electrical and HVAC installers, welders/metal fabricators and more,” says Krishna. 

Additionally, all 125 stores include a small engine repair shop and parts department. This service was taken to new heights after Northern Tool acquired Jacks Small Engines in April 2021.

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Northern Tool Manufacturing
One of Northern Tool's strengths is the wide assortment of private label equipment and tools that are manufactured in-house.

Another strategy implemented by Northern Tool is creating easier and speedier access to its unique assortment of products by establishing stores as micro distribution centers. This enables added and faster reach to regions outside its current retail spaces. 

The CEO says innovation will continue. “Don Kotula started the company by creating a first-of-its-kind log splitter,” Krishna says. “That innovative engine still drives us today, and we are constantly working to conceptualize and build products that our customers want.” 

Krishna grew up in Jamshedpur, a blue-collar town in the eastern part of India. He began his education in a Jesuit school and obtained a mechanical engineering degree. Initially, Krishna’s career was in the automotive industry for two decades. The top executive worked in India, the Middle East, Europe, and eventually the United States. 

Prior to becoming CEO of Northern Tool + Equipment, Krishna served on the company’s advisory board 2014-2019. He also held senior executive positions at Polaris Industries and Sleep Number.

In late 2019, Northern Tool was looking for a new CEO. The search committee that was composed of the second-generation owners, Ryan Kotula and Wade Kotula, and some board members asked me if I would be interested in the role. 

“After much consideration, I decided I couldn’t pass up an opportunity to lead and help build a company that they could pass on to their family’s next generation,” Krishna says. 

Today, Krishna along with Northern Tool + Equipment, have their sites set on assisting skilled trades gap. “Our company has been supporting pros and the professional trades for over 40 years, so we clearly recognize the significance of this issue,” he says.

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Northern Tool Online Sales categories
The top-selling e-commerce categories at Northern Tool + Equipment.

The business has elevated its commitment to supporting future skilled trades professionals through its Tool for the Trades program along with the Texas High School Welding Series. Tools for the Trades partners with high school career and technical education programs by donating much needed tools and equipment to provide instructors with the right tools they need to teach the classes. It also allows students the opportunity to work with professional-grade tools. Through its leadership in the Texas High School Welding Series, Northern Tool partner with other Texas companies to host welding events where students can earn their welding certifications.

“These programs are the on-ramp to encouraging and empowering students to pursue a career in the trades. We are dedicated to ensuring students have that opportunity and are supported every step of the way to entering a professional trade,” Krishna says. 

Northern Tool + Equipment remains a family-owned company with a rich tradition dating back more than 40 years. 

“Our founder, Don Kotula, got his start in the Iron Range of Minnesota on his family’s scrap yard. That hard-working, blue-collar mentality and ‘get it done’ spirit has reverberated across the company over the decades to propel our growth,” Krishna explains. “The growth from our first store in Burnsville, Minn., to 125 stores today demonstrates the company’s hustle and underdog fight, and we’ve got plenty of runway to build on what we’ve accomplished."

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