Toro's President

Many a young boy's first money-making idea involves a lawn mower. DAVID M. LILLY '39, whose grown-up idea involved thousands of them, parlayed the manufacturing of mowers into a $33-million-a-year business.

After serving three years in the Army in World War II and reaching the rank of major, Dave, an unabashed free-enterpriser from undergraduate days, decided he'd rather give than take orders. Two close college friends, Bob Gibson '39 and Whit Miller '40, had similar experience and shared his ambitions. The three got together and in late 1945 took over the Toro Manufacturing Company in Minneapolis for about $550,000.

According to Investor's Reader they found "a company with a good reputation but an antique plant, confused production, a tired sales organization, and no zest for tomorrow." Lilly became president; Gibson, who is now executive vice president, took on the job of vice president for sales; and Miller, who has since switched to manufacturing mobile homes in Kansas City, Mo., became the company's vice president for production.

President Dave recalls they went hell-bent after sales of institutional grass-cutting equipment and became a national sales leader. The next big push was on power mowers for the home. He reasoned: "A power mower for Dad is just as logical as a vacuum cleaner for Mom."

Originally the plan was to increase the 1946 sales volume of $1,420,000 fivefold in five years. In the first two hectic years, faulty engineering on many of the machines, turned out to supply a fast-growing market, cost plenty in servicing, repairs, and replacement parts, and required borrowing an additional $570,000. But the young management team succeeded in reaching the sales goal in less than four years. By 1957 sales approached $15.5 million. This year's were more than double that. Earnings per share of common stock have risen during the same period from about $1.50 to $3.80.

Toro's product line encompasses items for "growing it and mowing it," all kinds of lawn care tools, snowthrowers - including one compact enough to clear porch steps - golf carts, and sprinklers - from the $25 starter systems to elaborate underground systems for golf courses.

The fastest growing market is for rider mowers. Over half the consumer's power-mower dollar currently goes to riders and tractors. But the most ingenious product is Toro's power handle, a compact 2% hp unit which can be quickly attached to a whole family of machines from trimmers to snowplows. "Once a householder gets one of the handles he's inclined to become acquisitive and want the whole line," Dave says.

He is intensely aware of outside factors that affect his business and talks about "waves of family formations in the sixties." He cites as factors for his sales: health education - people fear the hand mower and shovel and over-exertion which causes serious heart conditions; weight consciousness - they're aware of a need for gentle, regular exercise; and rising labor costs - few can afford to hire a regular yard man.

He states frankly that the most significant factor responsible for the corporation's impressive advance is management's "aggressive commitment to growth."

Dave will never be caught wearing both belt and suspenders. A bona fide entrepreneur takes risks, and in his case they've paid off.