Tokheim Corporation

1898–1996

Tokheim Corporation is one of the fastest growing and most successful firms in the global petroleum equipment industry. The company and its numerous subsidiaries design, manufacture, and provide maintenance service for innovative mechanical and electronic petroleum dispensing systems around the world, including service station equipment, card and cash-activated transaction systems, and point-of-sale control systems. Although Tokheim Corporation has always been highly regarded within the industry and well-known for its product line and services, in 1996 the Fort Wayne, Indiana, company made a move that suddenly catapulted it to the forefront of the petroleum equipment market by acquiring Sofitam, S.A., a company operating in the same industry. The purchase and subsequent merger of Paris-based Sofitam, with extensive business holdings and large market shares throughout Europe, French-speaking Africa and Indo-China, is widely regarded by industry analysts as a strategic victory. The combined revenue of the two companies was estimated at over $400 million at the time of the acquisition and immediately positioned Tokheim Corporation as the world's leader in the petroleum equipment industry.

Early History

The founder of Tokheim Corporation was John J. Tokheim, an entrepreneur in the retail hardware and well pump business who also provided customers with kerosene and gasoline for cooking and stove use. During the late 19th century, as automobiles began to appear on roads throughout the country, gasoline for these horseless carriages was dispensed from a steel drum into a measuring can, and then filtered through a chamois-covered tube into the gas tank--a time consuming, laborious, and sometimes even dangerous process. Tokheim was asked by his customers if he could find an easier way to dispense gasoline.

In February of 1898, Tokheim conceived of the first gasoline dispensing pump for automobiles, and later that year also conceived and installed the first underground gasoline storage tank. As a result of his efforts, Tokheim decided to close up his retail hardware and well pump business and open a company that manufactured visible gasoline measuring pumps for the growing automobile market. In 1901, Tokheim incorporated his business, the Tokheim Manufacturing Company in Cedar Rapids, Iowa, and received from the U.S. patent office the first patent for the visible measuring pump. By 1906, Tokheim had improved upon his original design and introduced a combination visible and cylinder measuring pump. Designed to serve automobiles directly, the new pump measured the gasoline by a mechanical counter which was geared to the capacity of the cylinder. Equipped with an innovative three-way discharge valve and gallon counter, the pump soon become the standard gasoline dispenser in the country. During the next ten years, the Tokheim Manufacturing Company became one of the best-known firms in the Midwest.

Recognizing the growing need for refinements in the gasoline and oil dispensing equipment market, and having heard of the Tokheim Manufacturing Company, Ralph F. Diserens, the general manager of Wayne Pump Company in Pittsburgh, Pennsylvania, traveled to Cedar Rapids to discuss the purchase of Tokheim from its owner. In 1918, Diserens formed a consortium of investors, purchased the company and, due to favorable property rates, relocated its entire operations to Fort Wayne, Indiana. Incorporated under the name of the Tokheim Oil Tank and Pump Company, the new enterprise was capitalized at $200,000. Diserens served as the company's chairman of the board, president, treasurer and general manager.

Within six months, the company had expanded its physical plant to include a small tank shop, a machine shop, assembly plant, paint department, and testing department. Business was booming, and sales of Tokheim's electrically operated visible pump, the first of its kind, were increasing dramatically. Although the company was contracted by the U.S. government to produce much-needed war material for the American involvement in World War I, this did not interrupt Tokheim's continued growth and expansion within the gasoline pump dispensing market.

Incorporated under the name of the Tokheim Oil Tank and Pump Company, the new enterprise was capitalized at $200,000.

1920–1945

During the 1920s, Tokheim's pumps were seen everywhere in the United States. In 1920, the company introduced a pump with a lamp globe, a one-gallon blind curb-pump which was used extensively in front of drug stores and groceries. Within the same year, a sidewalk pump for lubricating oil was introduced, and one year later the company introduced an innovative five-gallon hand-operated pump unit that was designed for dispensing gasoline in a filling station or at the sidewalk. Uniquely engineered in many ways, this new pump provided greater delivery speed and more accurate measurement than any previous pump. This unit was the first pump to incorporate a completely enclosed quantity stop mechanism.

Founder and president Ralph F. Diserens died in 1925, but the management of the company continued its winning ways. Two of the most important and innovative designs of the company came immediately after Diserens's death. The first, a "master control" mechanism, was incorporated into the operations of a pump and prevented an attendant from performing more than one operation at a time. This mechanism had the effect of drastically reducing the number of accidents while dispensing gasoline. The second pioneering development during this time was the siphon discharge device. This device enabled the gasoline in a pump to flow through the discharge line at a uniform rate of speed. Simultaneously, the device cut off the gasoline flow abruptly when the required number of gallons had been dispensed. In addition to these technological developments, Tokheim also expanded its plant facilities in order to meet the ever-increasing volume of business. Over 24,000 square feet were added to the floor space of the company's manufacturing plant at this time.

The Depression and World War II

Although the Great Depression swept across the United States after the New York stock market crash in 1929, and many companies were devastated by the economic repercussions, Tokheim was one of the very few firms in the country that was hardly touched by the financial maelstrom. On the contrary, since the one common factor in American life was transportation by means of an automobile, the demand for more efficient and less expensive gasoline pumps continued to increase. As the demand grew, so did Tokheim's capacity to design and manufacture newer, more innovative pumps. In 1930, the company introduced the industry's first power pump with an air separator. With the ability to dispense gasoline at a maximum rate of 15 gallons per minute, this pump enabled Tokheim to grab the lion's share of the gasoline pump market in the United States and firmly established the company as the leader in the industry.

In 1932, the company introduced a dependable low-priced dispensing pump that garnered huge sales, and in 1934 Tokheim brought out its first computing pumps. These latter pumps incorporated state-of-the-art technology by accurately measuring, computing, and indicating to the customer the exact amount of gasoline sold in dollars and cents, including the number of gallons and fractional parts dispensed. One of the first pumps to provide equal protection to both the motorist and the service station attendant, it was a brilliant merchandising concept and sold in high volumes throughout the country. In 1935, the company designed and built a pump for Gulf Oil Corporation according to the firm's exact specifications for external appearance. In 1936, Tokheim introduced the "Stationliter Pump" which included a lighting column as part of the pump itself, and significantly helped to improve the night trade at service stations across the United States. The Stationliter Pump eliminated the need for lights on the station island, thereby reducing the cost of electricity at a time when every penny was important.

At the beginning of World War II, Tokheim was approached by the British government to manufacture war materials for England and its Allies. The first war materials contract involved the production of 250-pound Royal Air Force demolition bombs. This was followed by a contract awarded by the British Purchasing Commission for the production of three-inch, 10-pound trench mortar bombs. In July 1941, when U.S. President Franklin Delano Roosevelt negotiated the Lend-Lease agreement with England for the transferral of more than 50 aging American warships to the British Royal Navy, Tokheim was again contracted by the British Purchasing Commission for the manufacture of more trench mortar bombs. When America entered the war in December of 1941, Tokheim was awarded numerous contracts by both the American and British governments for the production of war material. These contracts continued throughout the remainder of the war years and, at the end of hostilities in Europe in April of 1945 and the subsequent surrender of Japan in August 1945, Tokheim was well prepared to take advantage of the experience it had accrued during the global conflagration.

1945–1993

Growth and Expansion after World War II

From 1945 onward, Tokheim engineers were working at a dizzying pace to develop new and highly innovative gasoline dispensing pumps. In 1946, the company introduced pumps that were specifically developed to serve the farm and commercial markets, where the speed of delivery and accuracy were most important. In 1951, Tokheim provided gas stations and customers with E-Z fill pumps, with longer hoses and in either non-computing or computing models. In 1956, the company brought out what was dubbed the "Tokheim Twin," a model with two complete pumping systems which operated within just a bit more space that the standard single dispenser. The advantage to this model was that it allowed one or two customers to dispense gasoline simultaneously. Twin Tokheim units delivered up to 30 gallons per minute, and soon became the most popular dispenser within the industry.

During the 1960s, Tokheim designed and manufactured the first multi-blender pumps, with two tanks, one dispenser, and one to nine grades of fuel. An entirely new kind of dispensing system, the multi-blenders included automatic preset, central control, key control pump, and money-operated systems. This multi-dispenser was followed up during the 1970s by the revolutionary dollar fuel dispenser, where a customer was able to insert dollar bills and dispense his own gasoline. By simplifying and speeding up the fuel dispensing process, more motorists were able to fill up their cars with gasoline at self-service stations. Other developments during the 1970s included solid-state single dispensers with revolving tops, twin dispensers with twin hoses and one product, twin dispensers with twin hoses and two products, and a gasoline dispenser incorporating a control console and roll receipt printer.

During the 1980s, Tokheim was at the forefront of technological advances within the industry. The company was the first to include modular electronics in its gasoline dispensers. In 1984, the company developed the MQD dispenser, doubling the hose capacity of the pump in the same island space, and offering the customer the capability of pre-pay or post-pay operation, high hanging hoses for quick and easy grasping, and eye-level digital electronic monitors for fueling transactions. The MQD soon became the dispenser of choice at convenience stores, service stations, and truck stops across the United States.

The 1990s and Beyond

In the early 1990s, Tokheim was so successful in selling its gasoline dispensing systems that the company greatly increased its share of the market despite an economic downturn in the industry. In 1993, the company introduced an entire new family of dispensers, which was intended by management to replace all of its existing equipment. Called the "Premier Series" of dispensers the new equipment was designed with improved serviceability and greater convenience for consumers in mind. The dispenser's central display area was designed to provide digital messages to guide the user through the entire fueling process.

1996

By the mid-1990s, Tokheim was the undisputed leader in the North American gasoline dispensing market and was experimenting with improved graphic display areas on all its dispensers, robotic fueling, a low-cost card activation fuel management system, high-speed electronic commercial pumping, and enhanced credit and debit card capabilities. The company had also established a comprehensive global network of offices to provide support to service stations that had purchased Tokheim equipment. Over 20 full-service distributors were located throughout Mexico, Central and South America.

The most important development for the company, however, occurred in 1996 with the acquisition of Sofitam, S.A., the largest manufacturer and distributor of petroleum dispensing systems in Eastern Europe, West Africa, India, Asia, and the Pacific Rim. Even in France, where Sofitam is based, the company has cornered a 30 percent share of the dispensing systems market. The acquisition immediately catapulted Tokheim into the leadership position within the global industry. The two companies began integrating their technologies, product offerings, distributorships, and service facilities to take advantage of a new globalization strategy that required broader and more comprehensive support services to accommodate customer needs.

Tokheim/Sofitam is poised to dominate the gasoline dispensing systems market within the next decade. With the entire globe covered by either one or the other of the two companies, management at Tokheim seems confident of increased sales for years to come.