diff --git a/.gitignore b/.gitignore
index d8027d5..469c11c 100644
--- a/.gitignore
+++ b/.gitignore
@@ -3,4 +3,5 @@
 coverage/
 debug/
 hooked-book/book/
+outputs/
 target/
diff --git a/shell.nix b/shell.nix
index c525851..fc4d19e 100644
--- a/shell.nix
+++ b/shell.nix
@@ -15,9 +15,14 @@ mkShell rec {
   ];
 
   shellHook = ''
+    # Add the outputs directory to PATH where local tools will be installed.
+    PATH="$PATH:$out/bin"
+
     # If Hooked isn't installed, use cargo to install the local version of it.
     if ! [[ -x "$(command -v hooked)" ]]; then
-      cargo install --path hooked-cli
+      cargo install --path hooked-cli --root $out
     fi
+
+    hooked install
   '';
 }