Company Histories

Men Of Achievement In Wisconsin, 1946, Page 191, John Moranz Associates, Milwaukee, Milwaukee Co., WI.

LeRoy McVey Bickett was one of the few Wisconsin men honored in the first edition for manufacturing in that state.

L. M. Bickett

L. M. BICKETT COMPANY

L. M. Bickett became identified with the rubber industry in the year 1908, and after five years experience with several large rubber manufacturers organized the Xenia Rubber Mfg. Co. at Xenia, Ohio in 1913. In 1917 the Xenia Rubber Mfg. Co. was sold to a group of Milwaukee industrialists who organized the Ever Wear Rubber Co. and the business was transferred to Milwaukee, L. M. Bickett becoming General Manager of the Milwaukee organization. In 1920 the Ever Wear Rubber Co. was taken over as a going concern by Rubtex Products, Inc., of Indianapolis and manufacturing activities were transferred to that city.

After having resided in Wisconsin for approximately three years he decided to remain in Wisconsin and in the fall of 1920 the Bickett Rubber Products Corp. of Watertown, Wis. was organized to manufacture industrial rubber goods. In 1932 the Bickett Rubber Products. Corp. reorganized and became the L. M. Bickett Company and this reorganized company has met with remarkable success specializing in the manufacture of sponge rubber cushions, desk and chair mats, and other rubber products distributed through the office supply trade. During the war all civilian production was suspended and the plant operated 100% on war work and had numerous contracts, both direct and subcontract.

Prior to the war an extensive market was developed for a patented type of office chair cushion called the RESPIRATOR, and the slogan THE WORLD IS SITTING ON RESPIRATOR CUSHIONS was adopted for the reason that they were shipped to foreign countries completely encircling the globe. The Respirator ventilated seat cushion was developed and patented by L. M. Bickett and several additional patents were secured, all dealing with the manufacture or use of rubber products.

L. M. is a hard working individual spending a minimum amount of his time in the office, preferring to work in the factory working with rubber products or preparing mold equipment to be used in producing special products. Quite frequently salesmen refuse to believe that they had interviewed the boss himself as in the course of his work, soiled clothing, dirty face and hands led visitors to believe they were talking to one of the factory employees.

L. M. Bickett's hobbies are bowling, fishing, and hunting, and as the result of his outdoor life whenever occasion permits, also exercise secured by bowling, he has always enjoyed good health and his physical activity is a great endorsement of temperance, exercise and fresh air.

In anticipation of the time when he can retire from more active life he has acquired a number of adjoining farms representing a total in excess of 700 acres, and it is his plan to convert this into a ranch, specializing in the raising of steers, sheep, poultry and the usual line of grain crops. This project will be known as Le-Ki-Re Ranch a duplicate of the dude ranches found in the western states.

Having had many years experience in the rubber industry, principally in the mechanical and industrial field, his advice and cooperation in adapting rubber to industrial requirements are of great advantage to the various industries located in Wisconsin, and this to a great extent is responsible for the success of the L. M. Bickett Company.

The Watertown Daily Times, Watertown, Jefferson Co., WI, Saturday, June 26, 1954, Centennial Edition

Businessmen Purchased Pan-American Rubber Co., Started Bickett Firm Here

The rubber business in Watertown dates back to 1918 when a group of Watertown businessmen purchased controlling interest in the Pan-American Rubber Co., which had been operating in South Milwaukee, manufacturing a sponge rubber tube filler. After severing control of the company, the businessmen purchased a building at 600 South First Street in Watertown and moved the equipment from South Milwaukee to Watertown. The Pan-American Rubber Co. experienced considerable difficulty in disposing of its product; also, had some trouble in manufacturing sponge rubber fillers for the larger size tires, and as the result operations were not successful and profitable. In the fall of 1920 the group arranged for L. M. Bickett to come out to Watertown and, if possible give them some advice regarding the solving of their problems. At that time a meeting of all the stockholders was held to discuss the situation and to listen to the suggestions made by Mr. Bickett. After reviewing the entire situation Mr. Bickett suggested that they discontinue manufacture of the sponge rubber tire fillers and convert the factory into mechanical rubber goods, for which there was a great demand and orders could be secured without sales expense. After several conferences it was decided to liquidate the Pan-American Rubber Co. and to organize a new mechanical rubber goods company, and although L. M. Bickett was at that time employed by the Rubtex Products Corp., he agreed to resign and accept a position with the new corporation to be organized, and accordingly, in April of 1921 the Bickett Rubber Products Corp. was organized, the Pan-American Rubber Co. was liquidated and immediately thereafter the newly organized Bickett Rubber Products Corp. started operations.

Three Still Living

The following is a complete list of all the original incorporators of the Bickett Rubber Products Corp., and all, excepting three of the gentlemen listed, have passed on: L. M. Bickett, R. A. Cebell, Charles Feisst, R. J. Hoge, E. J. Hoermann, Dan Kusel, Louis H. Kusel, Max G. Kusel, A. F. Mayer, Fred Saxmann, Edward L. Schempf, W. S. Siebert, Herman Wertheimer, O. C. Wertheimer and G. Pritzlaff. Of this group Mr. Bickett, Mr. Hoge and Dan Kusel, are the men still living. Due to the fact that the equipment used by the Pan-American Rubber Co. was not suitable for the manufacture of mechanical rubber goods it was necessary to purchase approximately $100,000 worth of new equipment, and this was accordingly done and installed within 12 or 18 months after incorporation. In order to get into production as soon as possible, while developing the mechanical rubber goods business, the company secured contracts from a number of chain store organizations for stair treads and rubber heels, and within three years time the company achieved the honor of being the largest manufacturer of stair treads in the United States. As mechanical rubber goods orders were received the volume of business increased and profitable operations resulted.

Operations Moved

In 1931 the Bickett Rubber Corp. received a proposition from a group of citizens in Anderson, Ind., to transfer the business to Anderson, Ind., and in view of the fact that 80 per cent of the company's business was in the eastern states, which could better be served from Anderson, Ind., than Watertown. The offer made was accepted and in August, 1931, operations were discontinued in Watertown and removal of the equipment was made to Anderson. Unfortunately, in October, 1931, the bank at Anderson which had undertaken the financing of the transfer and had agreed to invest $100,000 in the Anderson organization, was forced to close, and as the result the Wisconsin corporation lost all of the equipment, finished goods, raw materials and current assets which had been transferred to Anderson. It was the plan of the Indiana stockholders to operate the rubber business at Anderson just as soon as it was possible for them to raise the capital and reopen their bank; however, under such a plan the Wisconsin stockholders would have lost their entire investment, although in their plans for the reopening of the Anderson factory Mr. Bickett was to remain at Anderson, he refused to do so and instead took legal steps to secure the release of the buildings and equipment at Watertown so that operations at Watertown could be resumed. In order to secure the release of the assets at Watertown Mr. Bickett personally had to assume obligations of approximately $73,000, and in addition it was necessary to borrow from the Falk Corporation of Milwaukee $17,000 with which to reopen the Watertown plant and resume production. Approximately $14,000 of the borrowed $17,000 was expended for equipment to replace the most essential part of the equipment, which had been transferred to Anderson, leaving less than $3,000 as working capital for the newly organized L. M. Bickett Company which was incorporated in April, 1932.

Stock Exchanged

Although it was deemed advisable and planned to continue operations under the original charter issued to the Bickett Rubber Products Corp. and using the same name, unfortunately this was not allowed and it was necessary to organize a new corporation. However, stock in the new corporation was exchanged for stock in the old corporation held by the original stockholders and not one of them was called on to contribute $1 to the new L. M. Bickett Company. Starting operations in the spring of 1932 was extremely difficult because at that time and for two or three years thereafter the entire country suffered from a severe depression, and this resulted in a great handicap to the company. However, resulting from the goodwill established under the name of the old corporation, production was started and increased continuously and within three or four years time the production equaled production established by the old corporation.

In 1934 L. M. Bickett secured a patent on a new and greatly improved type of seat cushion. Although he was offered $100,000 for this patent three days after it was issued it was assigned to the L. M. Bickett Company at a total cost of $258, which represented the lawyers' fees in securing the patent. The trade accepted the new ventilated type of cushion, which was named “Respirator”, and within five years time was being sold and used in approximately 45 foreign countries. This business continued to increase until the war in December, 1941, at which time the government prohibited the use of rubber in seat cushions and all other non-essential products reserving everything or wartime needs. The rubber restraining order continued until the conclusion of the war in 1945. In order to keep the factory in operation essential war orders were secured and the factory operated approximately 18 hours per day during the years 1944 and 1945. At the conclusion of World War II all restrictions on rubber were removed and the company resumed production on civilian products and there has been no interference with production since the war ended and the company has been in continuous profitable production ever since.

Plant Enlarged

In 1942, and continuing up through 1946, additional buildings were constructed and additional equipment was installed - all from profits resulting from operations, and as the result the plant is now completely equipped to an even greater extent than it was before the transfer to Anderson, Ind. Since 1932, after the reorganization and with a starting working capital of less than $3,000, the L. M. Bickett Company has transacted up to December, 1953, a grand total of $3,188,965 of business. Earnings have been sufficient to pay dividends to all stockholders, and the company has an established trade extending from coast to coast with approximately 3,000 customers located in practically every large city in the United States. Unfortunately, the foreign business which had been created during the years 1935 to 1941 has been wiped out due to restrictions in the various foreign countries which prohibit the importation of non-essential products, the difference in exchange resulting from World War II and economic conditions which still prevail in a great many of these countries. Operating as the Bickett Rubber Products Corp. from 1921 to 1931 and as the L. M. Bickett Company from 1932 up to date, the company has never had an idle period and continuous operation has been the rule. It might be stated that this situation is because of the diversified nature of the products manufactured, also the possibility of adding additional lines whenever any particular line indicates a slack period. Within six years after the organization of the L. M. Bickett Company all the obligations which had been assumed in the separation from the Indiana corporation had been paid, the Falk Corporation loan was repaid and occasionally new equipment is installed which automatically increases our production. Acknowledgment is made by Mr. Bickett to the original stockholders and incorporators of the Bickett Rubber Products Corp. for their assistance in creating a new industry in Watertown, which because of the fact that it was one hundred per cent locally owned has been a contributing factor to the industrial prosperity of Watertown for the past 33 years.

Original employees at the start of business at Hi-Rubber Products, 110 Lincoln Street, Johnson Creek, WI.

James Stanley Frear (Born November 18, 1889 - Died May 26, 1969). In 1950 he and his wife, Adeline C. (Sell) Frear, lived at 1113 Center St., Watertown, Dodge Co., WI. He was a rubber chemist.

Leigh Larson note: About 1960, Wesley Harrigan contacted Wilbur Larson and suggested that making inflations was a good business to be in, and that he could help Mr. Larson get started. Mr. Bickett had given Wes his first rubber industry job in Milwaukee around 1919, and he felt a kindred connection with his past. In 1920, Wesley Harrigan (age 23) was a Production Foreman Assistant at a Rubber Factory, and was living at 184 Knapp Street, 1st Ward, City of Milwaukee, Milwaukee Co., WI. These fortunate circumstances evolved into the eventual Larson family success in the manufacture of milking machine inflations for the dairy industry. Wesley Wallace Harrigan was born September 29, 1896, in Rhinelander, Oneida Co., WI, and died March 28, 1972, in Johnson Creek, Jefferson Co., WI, at age 75. His sister, Winifred Harrigan, was born July 25, 1892, and died October, 1969, in Oconomowoc, Waukesha Co., WI, at age 77.

On March 31, 1976, Wilbur Larson, Leigh Larson abd Reed Larson became Charter Members of the Wisconsin Rubber Group.

Frank Cooper Traver was born December 30, 1908, in Lincoln, Lancaster Co., NE, and died July, 1982, in Sun City, Maricopa Co., AZ, at age 73. Buried in Wyuka Cemetery, Lincoln, Lancaster Co., NE. In 1942, he was married to Genevieve June Cook, and was working for Gates Rubber Co., Denver, Denver Co., CO. Their, Julie Ann Traver (born about 1943 in Wisconsin; died May 9, 1982, at a Madison hospital, Madison, Dane Co., WI, at age 82, due to cervical and another cancer), married Michael David "Mike" Schnarr (born August 16, 1939) April 8, 1967, at the First Methodist Church, Waukesha, Waukesha Co., WI. Two children, Derek and Darby. In January, 1966, she graduated from United Airlines stewardess training center, and was assigned to San Francisco International Airport, and was living in San Mateo Co., CA. Michael Schnarr then married January 14, 1984, at Covenant Presbyterian Church, Madison, Dane Co., WI, to Sally Jean Zastrow (born January 20, 1954).

Wesley Wallace Harrigan died March 28, 1972, in Johnson Creek, Jefferson Co., WI, at age 75. Buried along side his wife, Anna C. (Polinski) Harrigan, in La Belle Cemetery, Oconomowoc, Waukesha Co., WI. They had no children.

Universal Milking Machine Co. was incorporated July 3, 1916, under the laws of the state of Ohio, with factory and general offices in Columbus, OH.

E. B. Shurts moved to Waukesha, WI, in 1924 and was one of three owners and officers of the Universal Milking Machine Company. He developed many patents patented items for use in the dairy field.

In 1942, E. B. Shurts retired as secretary and sales manager of Universal Milking Machine Co., in Waukesha, Waukesha Co., WI.

In 1943, National Cooperatives , Inc. purchased the Universal Milking Machine Co., located in Waukesha, WI.

The Waukesha Rubber Co. was started in early 1947 in the Crown Dairy Supply Co. building, 324 W. College Ave, Waukesha, Waukesha Co., WI, distributor of replacement parts for dairy cow milking machines. Sta-Rite Industries Inc. bought the entire Crown and Waukesha Rubber operations in 1963. Crown's distribution business was absorbed into Sta-Rite's own dairy division, but Waukesha Rubber continued much as before. Sta-Rite Molded Products Division, (consisting of subsidiaries, Waukesha Rubber Co., INC, Waukesha, and Sta-Rite Plastic Corp, Burlington, WI, which were both acquired in 1963) headed by Frank C. Traver, General Manager, acquired the Illinois Industrial Rubber Co., Ladd, IL, operation, which then was operated as a division of Waukesha Rubber. In 1974, the management of Waukesha Rubber decided to consolidate the molding operations and so moved all but the mixing department of the Ladd, IL, factory to Waukesha.

In June, 1949, Universal Milking Machine Co. moved to the old American Gas Machine building in Albert Lea, MN, after company officials found that the Waukesha building was not large enough to take care of the added business.

Engelbert Ben "E. B." Shurts was born January 11, 1886, in Lebanon, Hunterdon Co., NJ, and died December 31, 1967, in Waukesha, Waukesha Co., WI, at age 80. Buried in Prairie Home Cemetery, Waukesha, Waukesha Co., WI.

In July, 1972, John Davis Kanters (age 49) was made president of two Sta-Rite subsidiaries, Waukesha Rubber Co., and an Illinois firm, and as general manager of Sta-Rite's molded products division. He replaced Frank C. Traver (age 63), who was made chairman of the board for the two firms. Traver was president for 25 years, while Kanters joined the firm in 1953 and had been vice president there.

In November, 1975, a group of seven top employees, headed by John Kanters, president and chairman of the board, and Don Lippke, vice president and board member, Arthur W. Moline, director of polymer chemistry, George T. Thompson, Sales Manager, and Edward F. Ziel, manager of the mixing division at Ladd IL, as well as John R. Marshall, bought Waukesha Rubber Co.

John R. Marshall joined Waukesha Rubber Co. as an accountant, and after the 1975 purchase was name CFO. He eventually became president. He sold the business in 1999 and retired in 2000. He died November 1, 2016, at Waukesha Memorial Hospital ICU, at age 74.

MR & MRS ERVIN LANGE - Angeline was our first full-time female employee, and who has faithfully served with us for 23 years. Currently she is forelady of the finishing department.

December 1, 1989

Something very special is happening to us this year. We're celebrating our 25th year in business. It doesn't seem so long ago that, on December 1, 1964, I founded HI-LIFE RUBBER PRODUCTS as a sole proprietorship. The business started up in the former Hawthorn-Melody milk plant in Johnson Creek. Our ten-acre property lacked suitable electrical and plumbing services, but the main building was structurally sound, and the price was right. Let's just call it a "diamond-in-the-rough," with the emphasis on "rough." We served a small nucleus of customers with industrial molded goods and rubber office supply products. Setting the stage for the future, however, were a smattering of specialty milker inflations we made in our own-design transfer molding presses. I was the owner, salesman, office manager, chemist, payroll clerk and bill collector. I'm sure I left out some more, too. Let's just say I was very busy.

I was also very fortunate to have my son Reed in the business from the very beginning. He was in charge of production as well as maintenance and shipping. His unique abilities, enthusiasm and hard work enabled us to get-the very most out of our limited budget. We started with a grand total of just seven employees, of which two were Larsons. As I look back, those early days were frightening, yet very challenging and exciting. Here I was, fifty years old and just starting out. I had no way of realizing the many good things that would eventually come our way. As we struggled to get on our feet we felt our best hope for growth was to specialize. We decided to make the products with the most sales potential - milker inflations. We learned the basics of inflation manufacturing with the help of a consultant, but were still lacking in several key areas. I was again fortunate when my son Leigh joined us in the fall of 1965, even though he had been helping right along in his spare time. As a mechanical engineer he brought us the needed skills of product and equipment design and mold-making. We then made a company commitment to produce the very finest inflations found anywhere.

Times can be tough for a "new kid on the block." We had few inflation customers and no established reputation for quality or delivery of these products. In fact, we had very few products, and you know a salesman can't sell out of an empty wagon. The decision to have our own line of unbranded inflations helped open the door to our farm store customers. As we made more molds our product line became more desirable, and HI-LIFE began to be more widely recognized as a legitimate source for inflations. We made steady gains in sales which required more people, equipment and building space. Our inflations were now being included in the supply programs of large dairy cooperatives. Our expertise was getting the attention of the milking machine manufacturers, too. Our product design assistance, tooling capabilities, excellent product quality and fast delivery (and favorable prices, too) helped us eventually become the largest inflation manufacturer in the United States.

Along the way we've gained new customers and friends, and attained a level of prosperity so we could share more with our employees. We have enjoyed a stable and growing workforce over the past twenty-five years, and now comprise a company of one hundred employees. We've had our share of heartaches along the way, too, but that's a part of life which is unavoidable over such a span of time. These years have seen great things happen for our company, but it couldn't have been possible without our customers, suppliers, fellow employees and most of all, my family. People are what life is really all about, and I've been blessed to have been surrounded with talented individuals who have helped make our success possible.

They say a generation is about twenty-five years long. I'm truly fortunate that my sons chose to join me in the business, and am particularly pleased that my grandson Robert has now joined us, too. My goal was to create a company that would be committed to the ideals of honesty, hard work, fairness and competence, and one that would perpetuate itself. I believe I've succeeded on all points, and fondly look back upon these last twenty-five years as just the beginning. We're certainly off to a great start! Just imagine what good things the next twenty-five years have in store for all of us! Thank you one and all for making it possible.

Bill

1. Describe the Company's founding. When, how and why did the Company begin operating? The founder, Wilbur A. Larson, had years of prior experience with another molded rubber products company in Wisconsin. When that company ceased operations, he believed there was a future for certain product lines made by that company. At age 51 he started Hi-Life Rubber Products on December 1, 1964 as a sole proprietorship in the former Hawthorne Melody milk processing plant in Johnson Creek, Wisconsin. At that time there were approximately seven (7) employees, including himself and one son Reed. The real estate was owned personally by Wilbur Larson, while the rubber molding equipment was leased from a company owned by Wilbur Larson's sons.

2. How and why has the Company grown since inception? Describe the Company's major historical milestones. The Company has always been family-owned. The business was incorporated in 1967 as Hi-Life Rubber Products Inc. By that time another son Leigh had also joined the Company, and there were approximately fifteen (15) employees. The direction of the business was rapidly evolving toward the manufacture of molded rubber products for the dairy industry, especially rubber inflations for milking dairy cows. Inflations are a replacement product that, while low in unit cost, will produce a steady stream of repeat business if customers are satisfied. In 1976 the manufacturing company merged with the equipment leasing company, with Wilbur Larson owning 51% of the Common Stock, and Leigh and Reed Larson owning 49% of the Common Stock. In 1979 Hi-Life Rubber Inc. was recapitalized, with Wilbur Larson converting to Preferred Stock (while maintaining his 51% voting control), and with Leigh and Reed Larson owing all of the Common Stock (while maintaining 49% voting). During that time Wilbur (by then age 66) had turned all of the day-to-day control over to Leigh and Reed. From inception, the manufacture of inflations became increasingly important. Critical to this growth were the hands-on production contributions from Reed and the design engineering contributions from Leigh. By 1979 it became apparent that the original equipment manufacturers (OEMs) and the after-market customers should be served independently, so Hi-Life Rubber Inc. formed an internal operating arm named the Milk-Rite Division. This provided the opportunity to create a brand identity (previously only available as unbranded or private label parts), and also to advertise. Equally important, the Milk-Rite Division provided the means for unusual and distinctive products to be designed and marketed. Since OEM and after-market sales are perpetually in conflict, in 1986 the Milk-Rite Division was spun off into a separate corporation named Milk-Rite U.S.A. Inc. At that time Wilbur Larson retired from Hi-Life Rubber Inc., but assumed the presidency of Milk-Rite U.S.A. Inc. Leigh Larson became president of Hi-Life Rubber Inc. and Reed Larson became Vice President. Wilbur Larson retired from Milk-Rite in 1993, and also resigned from all Boards of Directors, and sold all his remaining Common and Preferred Stock in all companies. Critical dates: Started in business in 1964. Created own machine shop for mold making in 1967; First sold replacement inflations to farm stores and dairy cooperatives in 1968; Purchased Banbury internal rubber mixing machine in 1978; Formed Milk-Rite Division in 1979; Patented radial-spoked rubber inflation in 1983; Purchased first automatic rubber injection molding machines in 1985: Created management support positions of Chemist, Personnel Manager, Administration Manager, and Assistant Administration Manager in 1986; Created Milk-Rite U.S.A. Inc. in 1986. Developed long-lasting European rubber compound in 1989; Patented silicone rubber inflation assembly in 1991; Milk-Rite assumed distribution of its products in Western USA in 1990; Milk-Rite West moves to distribution offices and warehouse in Stockton, California, in 1991, and Modesto, 1993. Created Hi-Life Rubber LLC in 1995.

1. Who owns the Company today? Hi-Life Rubber LLC is owned 98 percent by Hi-Life Rubber U.S.A. Inc. (50% by Leigh Larson, 39.3% by Reed Larson and 10.7% by Robert Larson), and 2% by Robert Larson. Milk-Rite U.S.A. Inc. is owned 50% by Leigh Larson and 50% by Reed Larson.

2. What are the Company's core competencies and competitive advantages? Hi-Life Rubber LLC is a self-contained manufacturer located in a single production facility, completely processing from compound development to mixing of the rubber to molding to warehousing and shipping. The manufacturing equipment has been continuously modernized and state-of-the-art computer controlled automated injection molding equipment employed to allow high efficiencies. Hi-Life designs and machines its own molds. Hi-Life's staff is hands-on, which permits great attention to detail. Hi-Life also has specialized transfer molding equipment which permits efficient production of small volume product styles. Milk-Rite has the advantage of a small but highly knowledgeable and dedicated sales staff. The registered trademark branded products (including ULTRALINER, TLC, LT, etc. for which an exclusive distribution agreement exists between Hi-Life and Milk-Rite) are recognized by customers throughout the Northern Hemisphere, and increasingly throughout the world. Milk-Rite's products are well known for high quality and value. Milk-Rite has the advantage of selling through numerous distribution channels, including farm stores, equipment dealers and dairy cooperatives.

3. What distinguishes the Company from its competitors? Hi-Life produces the most inflations of any inflation manufacturer in the USA, and is believed to be one of the largest in the world. Hi-Life mixes and processes its own rubber. Uniform quality is assured by modifying the curing of the rubber (if necessary) to match the rubber's molding time and temperature parameters, rather than altering those conditions. Hi-Life gives its full attention to making inflations, rather than making a diverse number of other products with different manufacturing needs. Hi-Life makes all of its molds in its own machine shop, and has in-house CAD/CAM expertise second-to-none. Its association with the Milk-Rite company provides a wealth of information about product performance and needs. It also provides the ability to coordinate product development testing. Milk-Rite has the advantage of exclusively selling recognized brands, backed by a wide range of customers which is the envy of the competition. Milk-Rite's sales managers travel all across the country to make direct face-to-face contact with the customers, and therefore get a good perspective of current market conditions. Milk-Rite attends all major dairy trade shows.

4. What is the Company's corporate strategy and how has it changed over time? Hi-Life Rubber has been and remains committed to be the very best manufacturer of inflations in the world. Its strategy is to keep its existing customers by remaining highly efficient, and by constantly pushing forward its R&D efforts. There are no current plans to diversify beyond the core business. Its original "make for others" philosophy changed in 1980 when the Milk-Rite Division was formed, starting what has turned out to be a very successful effort to become a leader in product design. Milk-Rite's mission of being a distributor of inflations has remained intact. Milk-Rite assumed distribution of all regions in the USA in 1990. Milk-Rite relies on outside distributors for most markets outside the USA.

5. What is the Company's defensible leadership position? Hi-Life is the largest manufacturer of inflations in the USA. Milk-Rite is the largest distributor of replacement inflations in the USA.

1. What untapped potential growth and/or profit improvement opportunities exist for the Company? Hi-Life's opportunities in the USA are to obtain additional business through the growth of existing customers. Since the market itself is not growing, this must come by taking market share away from other manufacturers. The largest opportunities are in the export markets, where the dairy industry is growing and Hi-Life has not been a factor. Good possibilities exist for additional OEM business in Europe. Profit improvement will come through increased efficiencies due to more units of production. In the export market, the Milk-Rite company can be helpful in competing against those OEMs where Hi-Life has no sales opportunities.

2. What barriers-to-entry exist for those who would manufacture and/or sell these products The greatest barrier for others is the exacting manufacturing needs of the product. Since a rubber product is made through a chemical reaction and combines ingredients which by their very nature are variable, the challenge is to achieve a consistent result. Very few companies have demonstrated that they are able to do this. The molding equipment is very expensive and specialized. Another barrier is the limited nature of growth, plus the fact that there are already several competent manufacturers world-wide. Still another barrier is the need for special rubber formulations. Hi-Life, as well as all other inflation manufacturers, have developed proprietary compounds which are not divulged to the customers. Milk-Rite has use of well-recognized brand names which connote consistent quality.

3. What are the sizes of the markets the Company serves and how quickly are these markets expected to grow in the future? The USA has the largest single market for inflations because there are between 9MM to 10MM cows, and they are used for a shorter time (annually approximately 18MM to 20MM inflation units). Hi-Life manufactures approximately 8MM inflations per year, or approximately 40 to 44 percent of the market. The USA market is not growing, but remaining stable. The export market is collectively larger than the USA market and can be expected to grow perhaps two to three percent per year. Hi-Life's export market share is very low at this time, but good growth opportunities exist with European OEMs, especially when the US Dollar is not too strong. Milk-Rite's growth opportunities are limited mostly to price increases in a static domestic market.

4. What is the Company's R&D strategy/method? Hi-Life's R&D strategy is two-fold. First, rubber compound development must remain a high priority. This includes not only natural and synthetic organic rubber formulations, but also inorganic formulations such as silicone. A second strategy is new product development. Hi-Life's growth has been partially the result of new products, some of which have contained patented features. Fortunately, the Milk-Rite company allows a way for such new products to reach the market, providing a symbiotic relationship with Hi-Life Rubber. Milk-Rite provides Hi-Life with product evaluation R&D assistance.

5. Describe the Company's design capabilities. Hi-Life has an excellent product design program which allows producing a product completely in-house. A customer may provide a part drawing, or maybe just an existing molded part might be available. A part drawing on the Hi-Life AUTOCAD system is prepared. Mold drawings and CAM programs are made following customer approval of the part drawing. Designs that are presented to or originate within Hi-Life are reviewed by experienced engineers and technicians. It is important to have a working knowledge of milking machine function, and Hi-Life personnel understand many of the subtleties of inflations as they relate to reactions by the cow. Hi-Life's in-house machining and molding allows R&D to be an interrelated activity, so the results of even minor changes to a prototype product can be observed and considered for further adjustments. The result is that prototype inflations made at Hi-Life can be made more rapidly and fine-tuned to a greater degree of refinement than at other manufacturers. Milk-Rite does not design products.

1. Who are the Company's major customers and what level of business has been done with them historically? (We will not use the names of customers in the book). What percent of the Company's revenue is derived from sales to its largest accounts? Projected Hi-Life Gross Sales in 1997 is $11.5MM. Hi-Life's major customer is Milk-Rite U.S.A. Inc., accounting for approximately $6.9MM (60% of all Gross Sales). Hi-Life's next two customers are Dairy Equipment Co. (an OEM milking machine company), and IBA Inc. (a nationwide distributor and route sales organization of their own branded products), each at approximately $1.25MM (11% of all Gross Sales). Westfalia amounts to $0.5MM (4% of Gross Sales). All other customers account for the remaining $1.6MM (14% of Gross Sales). Historical level percentages are relatively steady. Milk-Rite's major customers are WALCO (11% of Gross Sales), Farm Fleet/Fleet Farm (6% of Gross Sales), Ezell (5% of Gross Sales), Dairy Partners (4% of Gross Sales), TDS (4% of Gross Sales), and KemRite (4% of Gross Sales). Hi-Life Rubber LLC in 1996 had Gross Sales of $10,684,444. Milk-Rite U.S.A. Inc. in 1996 had Gross Sales of $11,434,886. If both companies had operated as a single company, the combined Gross Sales in 1996 would have been $14,201,912. Hi-Life's OEM sales in 1996 were $3,868,612 (27%), and Hi-Life Proprietary/Milk-Rite sales would have been $10,333,300 (73%).

2. Who are the end users of the Company's products if different from the Company's customers? For both companies the final end users of the products are dairy farms that milk cows.

1. How does the Company's sales break down geographically? Hi-Life's sales are 96% to companies in the USA (in the Mid-west and East) and 4% to companies outside the USA (mostly Europe and Australia). Milk-Rite's sales are 91% in the USA (41% East and 50% west), and 9% foreign (mostly Canada and Mexico).

2. What is the Company's marketing program and can the results of this program be quantified? Hi-Life Rubber is a manufacturer for others in the dairy industry and, as such, solicits business from a small group of targeted customers. Research and development of products plays an important role in fostering the sales initiatives of the Company. Milk-Rite's marketing program revolves around the promotion of the three main inflation brands ULTRALINER, LT, and TLC. This includes advertising in trade publications, participating in trade shows throughout the USA, providing an internet site, producing sales literature, and making in-person sales calls to customers' places of business.

3. What are the Company's primary sales/distribution channels? Hi-Life Rubber sells mainly to a small targeted group of milking machine OEMs and farm supply distributors. Milk-Rite sells mainly to farm stores, milking machine dealers, dairy supply distributors and dairy cooperatives.

4. Describe the Company's customer service programs/capabilities. Hi-Life's customer service program is limited to reviewing occasional product returns containing questions about product service life or premature failures. These are handled through a technical review of both the general appearance and possibly a rubber physical properties test. Many products contain a laser marked date-of-manufacture code which is helpful in resolving the complaint. Milk-Rite's program is more structured, with a sales and marketing assistant or a regional sales manager obtaining preliminary information. When necessary, products are returned along with a return authorization form. The review then follows the same analysis as for Hi-Life Rubber returns. Results are obtained and a course of action is then communicated to the customer.

1. Who are the Company's key employees and what are their positions/responsibilities? Hi-Life Rubber has Leigh Larson (President and General Manager, responsible for overall operation, and also serves as Engineering Manager, responsible for product design); Reed Larson (Vice President and Plant Manager, responsible for overseeing all manufacturing operations, including scheduling and shipping); Robert Larson (Sales Manager, responsible for all sales contacts with customers; also serves as Systems Manager, responsible for all computer-related hardware networks); Clyde Filas (Administration Manager, responsible for overall financial well-being of the company and solicits insurance and benefit programs); Judith Kuykendall (Assistant Administration Manager, responsible for day-to-day accounting and payroll, and oversees several assistants); Paul Smits (Laboratory Manager and Chemist, responsible for R&D and QC of the rubber compounds); Dennis Berg (Human Resources Manager, responsible for administering most personnel programs); Steven Pirtle (Maintenance Manager, responsible for overseeing all plant equipment and preventive maintenance programs). Milk-Rite has Leigh Larson (President and General Manager, responsible for overall operation); Reed Larson (Vice President), Thomas Novotny (Marketing Manager, also handling all export contacts), Mark Schmuhl and Randy Dreger (Regional Sales Managers in the Eastern Division, each responsible for managing all customer contact activities,); Jay Cooke (Facility Manager for the Western Region, responsible for coordinating warehouse distribution and sales activities); Mark Paulsen (Regional Sales Manager in the Western Division, responsible for managing all customer contact activities for his customers, and also serves as R&D coordinator); John Maxwell (Sales Consultant, responsible for sales contacts with select customers in California).

2. How many other employees does the Company have and how are their positions categorized (i.e., sales, operations, administration, etc.)? Hi-Life Rubber operates only in Wisconsin, and has a total of 97 employees. In addition to the eight (8) key positions, there are Office Administration (4), Machine Shop (5), Molding press (36), Finishing (30), Material Processing/Mixing (8), Laboratory (2), Shipping (2), Maintenance (1), Housekeeping (1). Milk-Rite operates in Wisconsin and separately in California, and has a total of fifteen (15) employees. In addition to the eight (8) key positions, there are Sales and Marketing Assistant East (1), Administration East (4), Administration West (1), Shipping West (1). Please note that Hi-Life and Milk-Rite use a Common Paymaster, and there are some duplicate allocations of administrative duties that will slightly adjust these totals.

3. What are the Company's employees' average wage rates and what benefits do they receive? Employees are paid above average wages for the area where the companies are located.

4. Are you interested in staying on with the business during a transition period? Both Leigh Larson and Reed Larson plan to completely retire. A very short transitional period is possible if it does not extend beyond September, 1998. Robert Larson has not yet decided what his plans would be, which may be dependent upon the situations available with the new owners.

1. Who are the Company's primary competitors? Hi-Life Rubber's (8MM units) main domestic competitors are other domestic manufacturers of milker inflations. Avon, located in Michigan, is a subsidiary of Avon, England, and manufactures mainly the SURGE brand for Babson Bros. Co. (estimated USA annual volume 3.5MM units); Hudson Valley Polymers, located in Missouri, is a subsidiary of Alfa-Laval, Sweden, and manufactures mainly the ALFA-LAVAL, DE LAVAL and DAIRY-RITE brands for Alfa-Laval Agri USA (estimated USA annual volume 4MM units); Skellerup Industries Ltd., located in New Zealand, manufactures mainly the CONEWANGO brand for Conewango Products, New York (estimated USA annual volume 1.5MM units). Milk-Rite's main competitors are all OEM and replacement inflation sellers. Speaking strictly replacement brand competition, it would be mainly CONEWANGO.

2. Is the Company's competition geographically based? Product-line based? Does its intensity differ by area? Hi-Life's competition is generally geographically based (should be located in the USA). Milk-Rite's competition is product line based.

3. Would any of these competitors be a logical buyer of your company? Both Hi-Life and Milk-Rite are so strategically allied that a sale should be both companies to the same buyer. The Alfa-Laval company and the Avon company are both likely buyers, however, Alfa-Laval may present a market-share restraint of trade problem.

1. Describe the Company's production facilities in terms of type, location, square footage and expansion possibilities. Hi-Life has a single 78,000 square foot manufacturing and office facility in Johnson Creek, Wisconsin. The building is entirely of masonry construction. The site does allow room for expansion. Milk-Rite only leases office space from Hi-Life Rubber in Johnson Creek. Milk-Rite leases from Hi-Life Rubber U.S.A. Inc. a 20,000 square foot office and warehouse near Modesto, California. This tip-up wall masonry building is located in an industrial business park, but offers little expansion possibilities (the building is already more than adequate to accommodate future growth).

2. What are the Company's primary pieces of equipment? Hi-Life's primary pieces of equipment are Mixing Dept.: Banbury No. 3A mixer, Three (3) 22x22x60 open mixing mills, Crowe preformer, Barwell preformer; Molding Dept.: Nine (9) Rutil fully-automatic 8-cavity horizontal injection molding presses (with 2 more on order), Five (5) Rutil 2-cavity vertical injection molding presses (with 2 more on order), Two (2) Desma general purpose vertical injection molding presses, Two (2) Wabash general purpose vertical transfer molding presses, Seventy (70) custom-designed vertical transfer molding presses; Shipping and Material Handling Depts.: Three (3) fork lift trucks, Stretch wrapping machine; Laboratory: Two (2) Curemeters, Tensile testing machine, 12x12x24 open mixing mill, Computerized records network; Machine Shop and Design: AUTOCAD Design/ EZ CAM programming systems with two work stations, Sharnoa CNC vertical milling machine with 4th axis, ELOX electrode EDM machine, MITSUBISHI wire EDM machine, Two (2) COLCHESTER CNC lathes, Two (2) COLCHESTER gap bed lathes, Three (3) BRIDGEPORT vertical milling machines, One horizontal plate grinder, One cylindrical grinder. Milk-Rite's primary pieces of equipment are two (2) forklift trucks in Modesto, California.

3. What is the nature of any recent investments in the business? Hi-Life's recent investments include upgrading the computer controls for injection molding presses, replacement of air handling unit above molding presses, purchasing of four (4) additional injection molding presses, upgrading of computer system, purchase of automated labeling equipment, and other items too numerous to list. Milk-Rite's recent investments are an additional forklift truck for the California warehouse and storage racking improvements, also for California.

4. What are the Company's current capacity constraints and activity levels? Hi-Life is currently operating at or over capacity, and is addressing this in the short term by running overtime (meaning weekends, due to the normal 3-shift operation). In the longer term, additional molding presses are expected to be delivered in April or May of 1998. All other departments can accommodate additional activity levels.

5. Does the Company have a preventive maintenance program and if so what is this program? Hi-Life's annual week's shut down in July allows for maintenance that would interfere with normal production. Preventive maintenance targets the annual scheduled replacement of high service items, such hydraulic pumps. The Maintenance Manager uses a computer to keep track of normal maintenance, such as the lubrication of equipment. Annual maintenance attention includes electrical substation, high pressure steam boiler, air compressors, and Banbury internal rubber mixer. Milk-Rite does not manufacture, so maintenance is not applicable.

1. Who are the Company's primary suppliers and what do they supply you with? Hi-Life's major suppliers are for the raw material ingredients for the rubber inflations. These include: Zeon Chemical Co., Harwick Chemical Co., Dynagen, and Elastochem. Milk-Rite's primary supplier is Hi-Life Rubber LLC. Secondary suppliers include: Norton Company (plastic dairy tubing), KenAg (milk filters), and Skellerup Industries (rubber dairy tubing).

2. How long has the Company been doing business with these suppliers? All supplier relationships extend over many years, and the relationships are excellent.

1. Has the Company implemented QC procedures and if so what are these procedures? Hi-Life has its own program of procedures. The quality of the rubber is determined by the Laboratory analysis of every batch of mixed material for correct rubber hardness and state of cure. Numerous check points during the mixing and preforming processes assure the mixed rubber meets specifications. Molded rubber quality starts with part inspection by the press operator, and ends at the time of final inspection at the packing stations. The Hi-Life Quality Control manual spells out specific departmental requirements. Milk-Rite does not have QC requirements.

3. Describe your employee training, production scheduling and safety programs. Employee training and safety begin with the Human Resources Manager (also the Safety Officer) at time of hiring. Most training is done on the job by supervisors. Forklift training is performed, as needed. Fire drills are performed as needed. Hi-Life has been OSHA inspected several times, with favorable results. Hi-Life also enjoys an exceptionally favorable Workers Compensation rating, attesting to the success of the excellent safety program and working conditions. Production Scheduling is done exclusively by the Factory Manager, using a combination of office computer spread sheet, and factory wall-mounted Production Scheduling Board. Inventory control personnel interact with this and use other means to provide a team support to the scheduling process.

1. What reports do you use to run the Company? Both Hi-Life and Milk-Rite use the Monthly Income Statement to show overall profitability. Weekly Gross Sales Reports show overall sales comparisons weekly and year-to-date. Additionally, Monthly and Quarterly Sales History Reports help track individual customer sales, and are also used to determine Part Usage by Individual Product Style. Certain sales information is individually accessible for customized reports.

2. How often do you receive these reports? Weekly and/or Monthly. See above.

3. What systems generate these reports? Are these systems "Year 2000" capable? All information is obtained through access to the ACCPAC business software programs, which are Year 2000 compliant.