Toronto Star: March 21, 1994
His Two Sons Have Now Taken Over the Algood Which Has Sales of $5 Million
By John Picton– Special to the Star
Max Guttmann was working so hard his sons would take him dinner once a week so they could see him. Eating and sleeping in his small plant, he put in seven days a week from 8 a.m. to 2 a.m. to build his fledgling company.
That was in 1961, when the Czech-born tool-and-die maker set up shop in North York. His company, Algood Casters Ltd., now has sales of $5 million a year and employs 50 people.
“I learned the trade in displaced-persons camps in Germany,” says 61-year-old Guttmann, who’s just stepping down as head of the company in favor of his 30-year-old son, Craig.
Says Craig: “When I started, with the company, I asked my dad where I was to sit. He gave me a mop and a bucket and said to clean the floors because I was to start at the bottom.”
Says Max: “But I could never teach him tool-and-die making.”
Adds Craig: “We’re even, because I couldn’t teach him sales.”
Max Guttmann came to Canada in 1951 and was working for Massey-Ferguson when he bumped into a friend who needed some dies for a car-brake contract.
Thinking Big
They put in $1,750 each and started their own company, in which the friend was a silent partner. But when Guttmann tried to borrow $6,000 from a bank to build a die, he was told the brake job was too big for him and was turned down.
“So I made a sample and asked the brake company to lend me the money, and they did. I saved them $300 per 1,000 pieces and they used as many as 150,000 pieces a year.” That meant the saving was $45,000 annually.
Working 18-hour days, Guttmann built his company — then called A. and G. Dies — to such an extent that the brake company told him: “Either you sell out to us or we’ll tool up against you.”
When he arrived home from the lawyer’s office after signing the sale agreement, which included a non-competition clause that said he could no longer make brakes, there was a $30,000 contract waiting for him from another brake company.
“In 1969, that was a lot of money,” says Guttmann. “If I’d known, I wouldn’t have sold. I cried.”
He set up another firm, Algood — still with his silent partner — and started making tubular TV stands. Then he noted there were only two companies producing casters, both of them multinationals who mostly assembled’ them in Canada.
But when Guttmann tried to buy wheels for them, he was given prices for which he could have produced the finished product.
“That’s when I bought an injection-molding machine to make polyurethane wheels — and I’ve never looked back since.”
Algood became a major supplier of casters to the office-furniture industry, while landing a contract to supply parts for McCulloch chain saws, a contract Guttmann retains although the customer moved to Los Angeles more than 20 years ago.
Business kept growing by word-of-mouth, with every cent being invested in new machinery.
When he wanted to buy a $7,000 punch press, his alarmed partner told him: “If the firm goes bankrupt, I only lose my original investment — but you’ll lose everything.
“But if you still want to buy it, go ahead.” The company did.
Then, when Algood needed an $8,000 milling machine, Guttmann asked a machine dealer to buy it for him, promising to pay it off in six months.
The dealer did — and was paid back in four months.
Guttmann was overseeing every facet of the company’s operations, even making deliveries himself in emergencies. (“It’s said his Lincoln is the most expensive pickup truck you’ve ever seen,” says Craig Guttmann.)
Well-Rounded Choice
Max Guttmann has sold his caster-manufacturing business to sons Craig, 30, centre, and Mark, 33. Max Guttmann’s three sons bought Algood at the end of 1993 and their father now is enjoying his first-ever vacations — “spending the children’s inheritance,” as he puts it, with a laugh.
And he chuckles proudly when he tells the story of a Mexican buyer who recently showed him a caster and said: “That’s what I want.”
Says Guttmann: “It was one of ours. She got it from one of our U.S. distributors.”
Algood Casters Ltd.
Business: Designs and makes casters for home and office furniture.
Start Up Capital: $3,600 in savings.
Employees: 50.
Sales: $5 million in 1993.
Goal: To become the biggest in their field in North America.