Hamel, MN--During the late 1940s and early 50s, Burton Toles sold racks, conveyors, forklifts, and other such materials handling equipment to companies in the Minneapolis area. His most important clients included the giant makers of baking products--International Multifoods, Pillsbury, and General Mills. He discovered that these firms needed a practical means of taking small bags of product and combining them into a bale for shipment to distribution centers.

Appreciating the old adage that one man's problem is another's opportunity, Toles went to his customers and proposed that he supply them with a machine that could make up bales of small bags. Production people at the three giant food companies agreed to work with Toles. He sought out a compatible engineer to help him, and the two designed a mechanical baler-sealer. During the course of the project, they were forced to invent several patentable products--among them the Float-A-Shaft^TM right-angle gear drive, the cable cylinder, the disc-cone clutch, and certain caliper brakes.

In 1954, Toles incorporated Tol-O-Matic, Inc. as a manufacturer of specialized packaging machinery. For a time, the future looked golden. All three of the big milling companies bought machines from Burton Toles. Then reality began to bite. "There were only the three big milling companies, and they only had six packaging plants between them," says William Toles, Burt's son and current CEO of Tol-O-Matic. Because Burton Toles built his baler-sealers quite solidly, replacement orders did not come rolling in, and prospects for future business looked thin.

Toles realized that his baler-sealer solved a specific set of problems for a certain industry. But the components designed for the baler-sealer might solve a variety of problems for many different companies. To find potential customers, Toles de-cided to prepare news releases describing his components and send them to some 150 trade journals that covered everything from engineering design to plumbing. Getting the mailing out involved every member of his family.

"I was ten or eleven years old. My sister and I would help my dad stuff envelopes, and I didn't know how to use a sponge to seal envelopes," says Bill Toles. "I was doing it with my tongue, and I remember the cuts and the blood." He also remembers the Saturday when he went to his father's office, after the trade journals had begun printing the Tol-O-Matic news releases. "The postman came in carrying two large canvas bags filled with inquiries," Bill Toles recalls.

Making it. Business at Tol-O-Matic grew slowly but steadily, and the company acquired a reputation for innovative, reliable design. The company also initiated 10-day delivery when the industry standard was 30 days or longer. After studying marketing and engineering at the University of Minnesota, William Toles went to work as a manufacturer's rep, and then started his own industrial distribution company. In 1980, he agreed to purchase most of Tol-O-Matic from his father, and became the company's president and CEO.

Bill Toles realized that to prosper his company needed proprietary products. He set out to develop those products by investing in the engineering side of Tol-O-Matic. A number of young engineers hired in the early eighties rewarded Toles' efforts by producing--among other innovations--the company's rodless band cylinder.

One of those young engineers was Gary W. Rosengren, now engineering manager of Tol-O-Matic. "By 1997, I will have worked at Tol-O-Matic for half my life," says Rosengren. "I was born and raised in a small community and grew up where everybody knew everybody else. Tol-O-Matic, when I first started here, was so small you could see exactly what happened--from the initial contact with a customer, to engineering, to manufacturing, until the customer has the thing in his hand and is happy with it. That's pretty gratifying."

Times have changed at Tol-O-Matic. When Rosengren joined the company, it offered three or four core products. Today Tol-O-Matic produces approximately 40 basic products and literally hundreds of variations on those basic products, all backed by a training program that's well-known in the industry. Does the place still feel like a small town to Rosengren and William Toles?

"It feels less that way," says Rosengren. "The new people are probably less able to see that entire chain of events, but I'd still go to work here." Bill Toles also sees some changes. "The one thing I never want to do is walk in here and feel like a stranger," says Toles. "Of course, as you grow you begin bringing in skills and talents you didn't have before,and those people don't have the long history with the company. Yet there's still an atmosphere that's jovial, concerned, and respectful."

Moving on. Sales at privately held Tol-O-Matic have grown at a double-digit rate for 20 years. Continuous introduction of new products keeps the company moving forward. To solve specific customers' problems, Tol-O-Matic engineers developed magnetically coupled actuator products, electric linear-motion actuators and controls, a broad range of rodless band cylinders, and grippers and rotary actuators. Rosengren believes the company will do more and more work that involves electronic controls.

He sees the Axidyne product line, which includes screw- and belt-drive actuators, and stepper and dc controller systems--as typical of what's coming at Tol-O-Matic. "That's the sort of marriage that can occur between pneumatics and electronics." Rosengren expects more and more electrical and electronic engineering to show up in products designed at Tol-O-Matic, which traditionally regarded fluid power expertise and mechanical engineering as its strengths.

Bill Toles agrees that the company, which achieved ISO-9001 certification in 1996, should continue to move forward. "Over the next 20 years, clearly the trend will be up significantly. Our growth really depends on our ability to help our distributors and customers understand their challenges and deal with them, whether that be done pneumatically or electrically."

A message comes through when you talk to management and workers at Tol-O-Matic. The message is that the company is a community of people who need each other and who work together to achieve success, not a collection of adversaries. And the meaning of it all? Simple enough: now and then, nice guys finish first.