necessary, probably not. i think they are more than just window dressing though. they help protect the wood from getting split and splintered in a critical area, lots of abrasion and contact there, especially on a plug that sees a lot of water, action and fish. for the low price and ease of installation, considering all the time i put into each plug, why not give them that extra edge? i don't do it for looks, i paint over a lot of mine anyway.
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