Post 4: Why Do We Own So Much Stuff We Almost Never Use?

I have more than 30 screwdrivers, multiple hammers, drills, saws and other power tools. Some may go two or three years without being used. Some tools I bought for one project and one intended purpose yet it is still in the garage, unused and occupying its place on a shelf.

Millions of homeowners are in the same situation.

Why don’t we sell them? Because keeping them can be perfectly rational!

The main reason is the replacement value versus the liquidation value.

Suppose a saw costs $150 to replace but might sell used for $40. To get the $40 I need to take a picture of it, making sure I get the best lighting possible (my wife has become a master of lighting and insists that if you are going to take a photo to sell something, it should be the best it can be), list it on Craigslist, Facebook Marketplace, OfferUp etc, deal with multiple “Is this still available?” responses from “buyers”, arrange pickup at my residence or plan to meet someone at Home Depot at a particular time only for them to show up 20-30 minutes later after they have already messaged me that they are 5 minutes away. Of course there is shipping, packaging and all that comes with that side of the transaction as it meeting in person is too much trouble. Only to accept that in 6 months, I may spend $150 replacing it because my wife decided she wants a few inches taken off of her office ottoman legs.

So I keep it.

The saw is useful, valuable and almost completely idle. The economics of transferring it are worse than letting it sit.

That is a friction-stranded asset.

I am not really buying a saw

When I buy a saw, I am buying the ability to cut wood whenever I need to.

The saw is simply the mechanism guaranteeing that capability.

The same applies to ladders, generators, trailers, pressure washers, boats, RVs and aircraft. Owners tolerate low utilization because immediate availability has value.

Businesses do the same thing with excess equipment, warehouse space, backup generators, safety inventory, servers, suppliers and machinery sized for peak demand.

This raises a larger question: How much excess exists because ownership is currently the easiest mechanism for guaranteeing future access?

This is not a tool-rental idea

As previously mentioned, a neighborhood tool marketplace is exactly the kind of operational business I do not want to build.

The screwdriver is a clue, not the product.

It reveals a structural pattern:

valuable asset + low utilization + high replacement value + low liquidation value + transaction friction + demand for guaranteed availability

The interesting question is where this structure exists when the assets are worth $100,000 or $10 million.

I am looking for the industrial equivalent of the screwdriver problem.