MN Valley Business magazine by Free Press Media

The Definitive Business Journal for the Greater Minnesota River Valley September 2018

Carl Nordmeier moved Tune Town to Old Town Mankato 21 years ago. Photo by Pat Christman

Finding their way Retailers navigate changing landscape Also in this issue • PAUL’S TWO-WAY RADIO REPAIR • KITCHENS, BATH AND MORE • HENDERSON CLASSICAL GLASS

The Free Press MEDIA

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Document Retention Policy Basics What is a document retention policy? A document retention policy is a plan outlining (1) what sorts of documents the operation will keep, (2) how they will be stored, and (3) how and when they will be destroyed. Why is a document retention policy important? Documents can be key evidence in a lawsuit, and are often the most cost-effective way to prove a fact. A text message or e-mail from the opposing party may admit facts critical to a lawsuit—and do so far more cheaply than hours of depositions to get the party to verbally admit the same facts. Document retention policies can also protect an operation when a document cannot be found or has been destroyed. Typically, if you intentionally destroy a document and it turns out it would have been evidence in a lawsuit, the “spoliation doctrine” allows a judge or jury to presume the document would have hurt your case. However, if the document was destroyed in the ordinary course under a document retention policy, the spoliation doctrine usually does not apply. What documents should be included? Documents are not just physical, paper letters, contracts, invoices and receipts. E-mails, text messages, spreadsheets and ledgers, photos, PDFs, and output from proprietary software are all documents that need to be evaluated as part of a document retention policy. Consider organizing your

policy by department or function—for example, create separate lists for Human Resources/employee records, production records, accounting, and so on.

How should documents be stored? Unless a government agency specifically requires the operator to keep the original paper copy, most documents can be stored electronically. However, the electronic storage method must be able to accurately reproduce the original document, and have sufficient security measures in place to demonstrate that the electronic copy was not altered or tampered with. On the other hand, storing paper copies can be cumbersome, and it can be much more expensive and difficult to maintain a “backup” at a remote location in case of fire, flood or other destruction. Most operations find a happy medium that is right for them, relying on electronic storage for some documents but keeping paper originals as a back-up for their most important documents. How long should documents be kept? Some documents should never be destroyed. These documents include corporate records, such as meeting minutes, by-laws or operating agreements and resolutions. Most other documents should be kept based on how long a government agency requires you to keep them, or how long they could be relevant to a lawsuit. For example, the FDA requires veterinary feed directives to

be retained for two years. As another example, the IRS can typically audit tax returns for up to six years, so most experts advise that a business retain tax documents and supporting records for at least seven years. Critically, if you become aware of a potential lawsuit against your operation, immediately halt all document destruction. Once you believe you are going to be sued, destroying documents as part of your ordinary document retention plan will not protect you. Action Items: 1. Create a list of the documents your operation uses, organized by department or function (e.g., Accounting, HR). 2. Work with your legal counsel to determine how long each type of document should be kept. 3. Provide written copies of the policy to key staff. Depending on the size of your operation, charge one employee, or one employee per department, with the task of making sure the policy is carried out. 4. If someone threatens a lawsuit, stop destroying documents immediately, even if you’re just following your document retention policy. Don’t start destroying documents again until your attorney tells you it is safe to do so.

Meet your expert in Agricultural Law. Matthew C. Berger

Recognizing the importance that farmers, agricultural businesses, community banks and other small businesses play in supporting and sustaining rural communities, Matt has focused his practice on serving and protecting the interests of these businesses. Call 507-354-3111 to schedule a meeting with Matt.

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MN Valley Business • SEPTEMBER 2018 • 1

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F E A T U R E S September 2018 • Volume 10, Issue 12

Disruptions continue to rearrange the retail landscape, but business owners who remain innovative, work hard and pay attention to customers’ needs will prosper.

Jake Schrom co-owns Kitchen, Baths & More in Eagle Lake with his dad Troy, working with customers on renovation or construction projects small and large.

Dee and Doug Thomas started their Henderson Classical Glass business when the town was anything but bustling. Today they’re one of many in the booming downtown.

Paul Brudelie has skills few others still possess, which keeps him busy in his rural Pemberton shop fixing two-way radios for customers from around the world.

MN Valley Business • SEPTEMBER 2018 • 3

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SEPTEMBER 2018 • VOLUME 10, ISSUE 12 PUBLISHER Steve Jameson EXECUTIVE EDITOR Joe Spear ASSOCIATE EDITOR Tim Krohn CONTRIBUTING Tim Krohn WRITERS Kent Thiesse James Figy Dan Greenwood PHOTOGRAPHERS Pat Christman Jackson Forderer COVER PHOTO Pat Christman PAGE DESIGNER Christina Sankey ADVERTISING Joan Streit Sales Jordan Greer-Friesz Josh Zimmerman Marianne Carlson Theresa Haefner ADVERTISING Barb Wass ASSISTANT ADVERTISING Sue Hammar DESIGNERS Christina Sankey CIRCULATION Justin Niles DIRECTOR For editorial inquiries, call Tim Krohn at 507-344-6383. For advertising, call 344-6364, or e-mail advertising@mankatofreepress.com. MN Valley Business is published by The Free Press Media monthly at 418 South 2nd Street Mankato MN 56001.

■ Local Business memos/ Company news....................................5 ■ Business Commentary........................8 ■ Business and Industry trends .........24 ■ Retail trends ....................................25 ■ Agriculture Outlook .........................26 ■ Agribusiness trends.........................27 ■ Construction, real estate trends ....28 ■ Gas trends .......................................29 ■ Stocks ..............................................29 ■ Minnesota Business updates...........30 ■ Job trends ........................................30 ■ Schmidt Foundation ........................32 ■ Greater Mankato Growth .................34 ■ Greater Mankato Growth Member Activities ...........................36

From the editor

By Joe Spear

Risk rises with tariffs, immigration Mankato economy in the bullseye

t’s been a while since Mankato area businesses have faced two major national politicaleconomic issues that threaten progress and prosperity. But immigration and tariffs have come to the forefront, possibly to the surprise of many who thought President Donald Trump was good at talking tough on the issues during the campaign but wouldn’t follow through with real policy. Well, we all know a little different now. And while Trump could still back off the plans on immigration and tariffs that would treat American businesses the harshest, farmers and others have increasingly expressed more trepidation, as vast majorities of rural America supported the president. After years of prodding to be more business friendly, Democrats in 1992 with the election of Bill Clinton conceded the Republican idea of free trade would probably work. Clinton brought about the most dramatic expansion of American free trade in decades with the North American Free Trade Agreement, with much opposition from union leaders and others, a key Democratic stronghold that Clinton apparently didn’t think he needed anymore. The turnabout by Trump Republicans has been remarkable on this issue, though many more quiet Republicans continue to oppose tariffs. Both issues have huge implications for the Mankato area economy. Two thirds of all soybeans are shipped to China, who now has imposed retaliatory tariffs. Soybean prices are down 20 percent, though the Chinese went on a temporary buying

4 • SEPTEMBER 2018 • MN Valley Business

spree before the tariffs took effect that may mask the bigger problems for the short term. The problem in most of farm country is that they had little or no warning Trump would act seriously, and they based the assessment on his past erratic behavior, often making threats one day and pulling back the next. So many of them did not take risk hedging actions like selling earlier when prices were still high to at least secure a break even position. If one reads deeper into the concerns of agriculture, we see earlier embargoes like the Russian grain embargo of 1980 had long-term impacts on U.S. grain trade. As a result of the embargo which was lifted in 1981, the Russians learned they could not only cultivate their own grain in Urkaine, but developed new sources of supply from Brazil and Venezuela. Today’s embargo, which pushed grain prices down twice as much as the Soviet embargo, could produce the same results. All the growth in the agriculture sector in the Mankato region, where Blue Earth County is a leading corn, soybean and hog producer, could have long-lasting effects and set back the whole idea of a Green Seam economy. The Trump strategy of course, is that which parallels the so called “art of the deal.” By being tough on China, Trump figures they will eventually come around to our way of thinking and buy even more grain from us. That’s a big risk right now. Even longtime supporters in farm country are worried. Sen. Charles Grassley of Iowa

said he hopes Trump “knows what he is doing.” Immigration also has become a big issue in agriculture country. Witness the recent unprecedented raid on Christensen Farms in Sleepy Eye where the Immigration and Customs Enforcement Agents came to arrest illegal workers and prosecute those companies and executives that were allegedly part of a conspiracy to hire the workers and treat them shamelessly in a raid ICE described as the biggest in history. Tariffs and immigration have produced a double-whammy of bad news for agribusiness. That no U.S. policy maker has even thought about tariffs for 30 years makes them the wild card of uncertainty for the U.S. economy. World trade flows and supply chains have been developing for years. Changing those now will not only cause disruption, but likely change for the long term. The free trade philosophy stems from the idea that certain countries have “competitive advantages” in producing certain products. Certainly the efficiency of today’s modern agriculture gives the U.S. the advantage. The U.S. has thousands of acres of open land for farming. That’s another competitive advantage. Our systems for moving that grain to market via truck, rail and barge is without challenge. You don’t realize the importance of a good grain transpor tation network until you’ve seen what they have in Brazil and Argentina. Does China have competitive advantages in making and shipping steel? They probably do after we conceded the steel industry to them during the Reagan administration. Now, tariffs will simple raise prices for those manufacturers who buy steel. In the end, markets hate uncertainty. We’ve created more of that than any time in the past 30 years. Get ready for a wild and damaging ride. Joe Spear is executive editor of Minnesota Valley Business. Contact him at jspear@mankatofreepress.com or 344-6382. Follow on Twitter @jfspear.

Local Business People/ Company News

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Schmidt’s Meat Market honored

Schmidt’s Meat Market in Nicollet won national recognition at the American Cured Meat Championships in Kansas City, Missouri. Schmidt’s won grand champion in the jerky whole muscle class and reserve champion in the Old World dried fermented sausage class. The event is held in conjunction with the annual convention of the American Association of Meat Processors. The ACMC draws participants from across the United States. This year, there were 678 entries in 29 product classes. Meat processors enter their products for evaluation by judges who are meat scientists and specialists in the industry. All entries are judged on the basis of aroma, flavor, eye appeal, color and texture. ■■■

Bennett promoted at Knutson

Knutson Constr uction promoted Collin Bennett to project engineer. He has assisted on the Mankato East High School renovation, Mayo Clinic Health SystemMankato MRI addition and will be working on the new Eide Bailly Center in Mankato. ■■■

Davis Comfort employees honored

Three Davis Comfort Systems employees placed in the top 10 of the North Central Region Trane Seasonal Sales Incentive Program. Receiving awards were Tim Ireland (3rd), Mitch Allore (4th) and Ken Davis (10th). ■■■

Pratt honored by Forbes

Bryan Pratt has been named to the Forbes’ Top Next Generation

Wealth Advisors list for 2018. He is with Pratt, Kutzke & Associates, a financial planning and investment management firm in North Mankato The list was published on Forbes.com. He is one of 23 advisors selected from Minnesota, and of those, one of two based outside of the Minneapolis-St. Paul metro area. The 2018 ranking of Forbes’ Top 1,000 Next Generation Wealth Advisors1 recognizes advisors born in 1980 or later with a minimum of four years of experience. ■■■

Graham joins FMJ

Kate Graham has joined Fafinski Mark & Johnson in their New Ulm office. She is in the agriculture and trusts & estates practice groups of the Eden Prairie-based law firm. Graham will focus on estate planning, farm succession planning, elder law, and agriculture and food law. Before joining FMJ, Graham received her L.L.M from the University of Arkansas in agriculture and food law. During this time, she also served as an adjunct professor teaching a “Wills, Trusts, & Estates Drafting Lab” for law school students interested in learning the practice of estate planning and probate administration. She earned her J.D. from William Mitchell College of Law and her B.A. in American Studies from Carleton College. After graduating law school and prior to getting her L.L.M, Graham clerked for the Minnesota Court of Appeals for Judge Larr y Stauber for two years before practicing for three years doing estate planning, elder care law, and probate administration at a firm in Richfield. ■■■

MN Valley Business • SEPTEMBER 2018 • 5

Penny honored by CGMC

Southern Minnesota Initiative Foundation President Tim Penny received the “Friend of the CGMC” Award from the Coalition of Greater Minnesota Cities during the coalition’s three-day summer conference in Mankato. The award recognizes individuals and organizations that have helped advance the interests of Greater Minnesota. As president of SMIF and a member of the board of directors for the Greater Minnesota Par tnership (a sister organization of the CGMC), Penny has been a leader for economic development issues in Greater Minnesota. During the past legislative session, he assisted in the CGMC’s efforts to address the child care shortage that plagues many rural communities across the state. ■■■

Promotions at Eide Bailly Eide Bailly promotions.

made

several

Jenna Christensen was promoted to audit manager. She has over five years of public accounting experience. Kate Stenzel was promoted to business outsourcing & strategy manager. She has more than 10 years of experience processing payroll. Angie Ziegler was promoted to business outsourcing & strategy senior manager. Ziegler has more than 18 years payroll experience with clients ranging from corporate multi-state payrolls to single sole proprietors. Jamie Fay has been promoted to audit senior manager. Fay has more than nine years of public accounting experiencing providing audit services to clients with a focus in the government industry. Jenn Faust, formally the Mankato marketing manager has transitioned into a regional marketing manager. In her new role, Faust will oversee and support eight regional Eide Bailly offices around the Midwest in their business development, marketing planning and

recruiting. Jessica Brovold has joined Eide Bailly as marketing manager, working with both the Mankato office and the firm’s healthcare industry. ■■■

Title Resources honored

Title Resources, a full service title company, has been named the 2017 Leading Title Agency by the Fidelity National Title Group. The award is given in recognition of outstanding dedication to protecting property rights. Fidelity National Title Group is a member of the Fidelity National Financial family of companies and the nation’s largest group of title companies and title insurance underwriters. ■■■

Robinson accredited

Tim Robinson, a financial advisor with Ameriprise Financial in Mankato, recently received the accredited portfolio management adviso designation from the College of Financial Planning. Individuals who hold the APMA designation have completed a course of study encompassing client assessment and suitability, risk/retur n, investment objectives, bond and equity portfolios, modern portfolio theory and investor psychology. Robinson is part of Wealth Management Solutions team, a private wealth advisory practice of Ameriprise Financial Services, Inc. ■■■

ISG a Top Hot Firm

For the seventh year in a row, ISG landed on the Zweig Group Top f100 Hot List, this year coming in at No. 14. This year also marks ISG’s back-to-back Tri-Fecta Award recognition, with the firm winning in multiple marketing excellence categories and earning a top spot on the Best Places to Work list. Zweig Group polls firms ranging from 14 employees to 15,000 plus, comparing each organization’s dollar and percentage revenue growth rate

6 • SEPTEMBER 2018 • MN Valley Business

over a three-year period, workplace culture, and marketing strategies within each category submitted.

Office. Attorneys are selected by their peers. ■■■

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Sanger joins Pioneer

Pioneer Bank announce that financial advisor Kevin Sanger of Minnesota Financial Services is now working in the North Mankato location on Commerce Drive. Sanger brings more than 20 years of expertise and will work with individuals, families and businesses to create strategies for financial success.

Wolner honored

professionals in each state. Those selected must pass AIOREP’s selection process, which is based on client and/or peer nominations, thorough research, and the group’s independent evaluation.

The American Institute of Real Estate Professionals has recognized the performance of Christa Wolner as 2018 10 Best Real Estate Professionals for Client Satisfaction. The institute is a third-party rating organization that publishes an annual list of the Top 10

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Fisher Group adds staff

Coldwell Banker Commercial Fisher Group has created two new positions Eric Harriman is the director of innovation and operations. Cate DeBates is the director of growth and engagement. The new positions will work in the areas of market research, public relations, property management and client services. Harriman has worked at CBC Fisher Group since July 2017. Harriman is also a commercial agent. Harriman was previously director of the City Center Par tnership with Greater Mankato Growth. DeBates comes from her previous role as the donor relations manager with YWCA Mankato. Prior to her role at YWCA Mankato, she was the associate director of alumni relations at Minnesota State University. ■■■

Gislason lawyers honored

Gislason & Hunterhad several attorneys named to the 2018 Super Lawyers and Rising Stars List: Super Lawyers are Dustan Cross and Michael Dove, both of the New Ulm Office. Rising Stars are Jennifer Lurken of the Mankato/New Ulm office, Kaitlin Pals, New Ulm office and Andrew Tatge of the Mankato

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MN Valley Business • SEPTEMBER 2018 • 7

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Business Commentary

By Dean Swanson

Three ways to use a domain name for business I

n a coffee shop chat with some new, prospective small business CEOs I was reminded that I have not addressed the topic of an online presence for the small business recently. Registering a domain name is one of the first steps to starting a new business. That’s because whatever name you choose will represent your business’s space on the internet – and, possibly, a customer’s first impression of your company. But once you have that domain name, what do you do? Don’t stress over building your online space. You can start using your domain name right away. Here are three ways to do it.

Set up a company-branded email address

Your web address can also be your email address. A companybranded email address can give you and your employees a more professional-looking branded channel for communication with customers, as well as free marketing for your company. In a 2015 survey, Seventy-four percent of consumers said they would trust a company-branded email address more so than a free email address. It’s easy and cost-effective to set up too. The provider you use to register your domain name can most likely help you set up your email address quickly and inexpensively.

Start a website

A website is one of the best tools to grow your business. These days it’s even easier to create than most people might

think. While a social media presence can be a great asset, it may not provide the same level of marketing opportunities or credibility that a website does. In fact, in a 2015 survey, 77 percent of consumers believed a website made a business appear more credible. You can start with a simple, one-page website and scale it as you grow. Easy, do-it-yourself tools allow business owners to create their own, and most service providers offer bundled services with everything you may need to build and maintain your website (e.g., domain name, web hosting, design templates). Many businesses that offer professional services find that, generally, all they need is a oneto four-page website that includes general information, contact information, product/ service information, social media icons and links, and customer testimonies. If you plan to open an online store, or your business requires showing videos or other multimedia, then a more robust website may be needed. For example, you can add e-commerce capabilities to your website, so you can take orders, process payments and provide customer support. Do-it-yourself website builders, like Weebly or Wix, also have packages that you can add on at any time, or a web developer can integrate the functionality for you. Even if you don’t plan to sell products online through standard e-commerce functionality, enabling lead capturing and processing, such as an email subscription list, on your website or social page to

8 • SEPTEMBER 2018 • MN Valley Business

collect prospect information for further sales follow-up may still be a good idea.

Brand your social media presence

If your main business page is currently on a social media site like Facebook, Etsy or Houzz, chances are the web address provided to you is branded to the specific platform and not for your business. These URLs are usually long and not very memorable, making it hard to market your page to customers. You can change that by using your domain name as the web address for your social media business page. This is called web forwarding, or redirecting. It gives you an easy-to-remember online address to help build your brand and use in your marketing efforts. To start web forwarding, log in to your account (where you registered your domain name) and change the settings on your domain name. Oftentimes, the provider you registered your domain name with can also help you forward it. You can start building your brand with your domain name right away. Add it to social media platforms that your customers frequent and online directories where your business is listed. That way, no matter where your customers find you online, you can always drive them back to your main online presence. Likewise, include your web address on your business cards, ads, email signatures, uniforms, brochures, newsletters and other collateral you give to customers. This is a great way to promote your brand offline and gives

potential customers an easy way to learn more about, and connect with, your business online. A 2015 study showed that 64 percent of consumers preferred to buy from businesses they can contact online. In today’s internet-centric world, many use the web to look for and research products or services. So the name your customers associate with your business is an important step to not only build your brand online, but possibly establish credibility. For more ways you can use a business domain name to build your brand, check out the infographic which was designed in partnership with Verisign.

Sorenson is a volunteer Certified SCORE Mentor and former Regional Vice President for the North West Region. seminnesota.score.org

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Lisa Phillips, the new owner of Arizona Olive Oil Co., outside of the business’s new location on Belgrade Avenue in North Mankato.

Constant change Successful retailers persevere, adapt By Tim Krohn | Photos by Pat Christman

etail is all about competition, luck, the economy and consumer choices. No one knows that better than Carl Nordmeier. In his long career operating Tune Town, he’s been through it all. While once mighty big-box stores are falling, malls look for new modes of operation, and brick-and-mortar retailers both big and small fight against online competition, Nordmeier has a unique perspective as he sells used vinyl records from his corner store in Old Town Mankato. While he’s been battered several times, near to the point of extinction, he’s doing well amid what he believes is a resurgence for small family-owned stores.

“Now that a lot of these big-box stores are closing, I think people are a lot more in tune with the small mom-and-pop, brick-and-mortar stores,” said Nordmeier, who’s been on Riverfront Drive for 21 years. But his business goes back further than that. He opened in Faribault in 1993 and a few years later opened a second location near the Minnesota State University campus, selling new and used records and cassettes. Tucked out of the way, it took a few years for people to find him near MSU, but business started going strong. “Then Best Buy opened here and they crushed us.

Cover Story

10 • SEPTEMBER 2018 • MN Valley Business

The Rooftop Bar + Kitchen is planned at the site of the former convenience store on Belgrade Avenue in North Mankato. Architect rendering courtesy Bright Pixel Design Our sales were cut 40 percent.” He added video rentals to his offerings to make up for lost business. “We were up and running and then Netflix started and Red Box showed up and a video store opened nearby.” He moved to River Hills Mall, hoping the higher profile would help. But the growing popularity of streaming music led to consumers ditching their record players and vinyl records, new or used. In ’97 he opened at his current spot, at a time when downtown and Old Town Mankato were not the bustling retail and entertainments centers of today. “There were a lot of vacancies, the whole area was kind of sketchy as far as shoppers were concerned. People didn’t travel down there to shop. They just went to the hilltop.” But the development of River front Park and the revitalization of the city center steadily improved business. “It was tough down here for a couple of years, but people found us. I concentrate on the used market and that’s done well for us.” While more and more shopping

is done online, Nordmeier said there’s plenty of interest in smaller shops, but store owners need to be creative. “You have to have events and make things more interesting.” He has a small stage inside his store for local performers to use. And he said the National Record Store day is a big boost. “We’ll do a month’s worth of business on that day. And the Shop Small Saturday has really helped a lot.” While he’s enjoyed watching Old Town and downtown Mankato bloom, he’s hoping the city’s efforts to find a more pedestrianfriendly layout for Riverfront Drive happens soon. “There’s a lot of traffic here, people don’t slow down at all,” he said. “I feel like I’m watching a live game of Frogger out my window.”

Hilltop changes

While the downtown is surging, hilltop Mankato remains the hub of retail commerce in the region. But the dramatic reshaping of the retail landscape is upending the tradition of large, dominant retail players. Sears is gone from River Hills Mall and Herberger’s also is closing all its stores, leaving two

large vacancies in the mall. Across Highway 22, the Gander Mountain and Gordmans building is vacant. Other large chains are facing strong headwinds. It’s a trend seen across the country, as Toys R Us and other giants fall. While some worry about what will become of the large amount of vacant retail space — an estimated 200 million square feet since the beginning of 2017 — others say creative approaches are filling in. Many malls are converting former store space into flexible shared work spaces, condos, apartments or entertainment venues. And there are retailers who are expanding. Arts and crafts retailer Hobby Lobby, off-price chains Burlington Stores, T.J. Maxx, Marshalls, Big Lots and Scandinavian Designs are just some of the stores snapping up vacant spaces according to the Wall Street Journal. Analysts say even Amazon, which was the cause of many brick-and-mortar store deaths, is now adding or planning grocery and other stores, demonstrating the importance of physical retail.

MN Valley Business • SEPTEMBER 2018 • 11

Jenna Odegard has had success with her home-based Bumbelou business and is opening a shop in Old Town.

Coming in

Several new businesses are in various stages of development locally. A home-based business that makes and sells clothes, hair accessories and gifts for babies and young children is making the move to a storefront location in Old Town. Jenna Odegard, who started Bumbelou three years ago, and her husband, John, purchased the building at 405 North Riverfront Drive, the location of a former antique store. She hopes to be open in October. “All of the Bumbelou products are made by us here or a couple of contractors in the area who work at home. All the clothing items, we cut and sew and do everything.” Currently she sells all her products online only (bumbelou. com). Odegard said that with more space in the new location she’ll also add some other lines of baby and kids clothing and some things for moms. “It will all be from U.S.

vendors and some local vendors too.” The 7 West Tap House is going up quickly on the site of the former Eatery Tap along Madison Avenue on the hilltop of Mankato. The restaurant, which will offer 50 taps of craft beer, burgers and other food, is opening this fall. Renovations have been going on over the summer on the former Snell quick lube building, just off Riverfront Drive at 228 Poplar St., for a brew pub, called LocAle Brewing Co., The vacant gas station on Belgrade Avenue in North Mankato is slated to be a new restaurant with a rooftop dining area. The Rooftop Bar + Kitchen will feature a rooftop room that will be used year-round, along with an open air seating area that will be used spring to fall.

Avenue. Lisa Phillips bought the business from Matt and Leah Grams in June. The building was formerly White Orchid boutique, which earlier moved to the Mankato hilltop. Phillips said Arizona Olive meshes nicely with her family’s Blue Skye Farms near Good Thunder. They are offering some of their produce, such as sweet corn, at Arizona Olive Oil when it’s in season. And they’ve expanded the offerings beyond olive oils. “We’ve added more food items, pasta, mustards, horse radishes, pickled foods, salsa, chips.” Also Curiosi-Tea owner Heidi Wyn is in the process of moving from Old Town to upper North Mankato, in the former Laura’s Candy building at 1745 Commerce Drive.

On the move

Mattresses, mattresses

A couple of businesses recently decided to take up residence in North Mankato. Arizona Olive Oil Co. relocated from Old Town to 237 Belgrade

12 • SEPTEMBER 2018 • MN Valley Business

If it seems like there are more mattress stores around, you’re not mistaken. Several new mattress retailers

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Top: An assortment of honey-based products at Arizona Olive Oil. Owner Lisa Phillips said she gets the honey products locally from Sleepy Eye. Bottom: BethAnn O’Halloran and Jeremy Jackson look through bins of records at Tune Town during last year’s Record Store Day. have opened in Mankato and it’s a trend being seen across the country. Nationwide in 2017 there were 15,525 mattress stores, a 21 percent increase over the 12,975 in 2012, according to IBISWorld Inc., a New York-based market research firm. Analysts say there are a couple of things behind the increase in choices for those looking for a good night’s sleep. First, there was a gap in the market left after Mattress Firm, the largest player, bought the second largest mattress retailer — called Sleepy’s — in 2016. Analysts said merging the two companies didn’t go smoothly and they lost some market power and consumer loyalty. Also, consumers have shifted away from buying mattresses at general furniture stores, preferring specialty retailers for their bed needs. MV

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Name Change Announcement

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www.blethenberens.com MN Valley Business • SEPTEMBER 2018 • 13

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Josh Zimmerman Digital Sales Leader

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Jake Schrom runs Kitchens, Baths and More in Eagle Lake. The business was started by his dad years ago but they only opened a storefront a couple of years ago. Bottom: Cambria countertops, in a wide variety of designs, are popular items for people building or renovating.

Building business Kitchen and bath store grows in Eagle Lake By James Figy Photos by Pat Christman

hether tackling a new apartment “He started it as a side hobby helping people complex or a tiny bathroom with their kitchens, and it just grew into remodel, it’s always nice to cut costs supplying for other contractors,” he said. on construction projects Schrom grew up without cutting corners. helping his dad with This is what inspired an construction projects, but area contractor to open he star ted running Kitchen, Baths and More Kitchen, Baths and More KITCHENS, BATHS in 2006. The company two years ago around the AND MORE sells cabinets, countertops time it opened its Eagle 708 Parkway Ave., and finish accessories to Lake storefront. He Eagle Lake lumber yards, contractors previously worked as a and homeowners supervisor at the Unimin 507-257-5100 throughout southern facility in Ottawa but kitchenbathsandmore.com Minnesota. didn’t like how it cut into Co-owner Jake Schrom family life. That’s when said his father, Troy Schrom of Schrom his dad suggested he take over the store. Construction, opened Kitchen, Baths and The company specializes in Merillat and More as a way to lower costs on his projects. KraftMaid cabinets, along with Cambria

16 • SEPTEMBER 2018 • MN Valley Business

Cover Spotlight

quartz and Leslsie marble countertops, but it has access to many brands. About 80 percent of the company’s sales are for new construction, Schrom said, but they also help walk-in customers with renovations as small as new countertops. Schrom believes there’s a misconception that big box hardware stores offer lower prices than small retailers. Big box stores buy a larger quantity, but they often pay the same manufacturer prices as local wholesalers, and smaller stores can keep their markup lower, Schrom said. “We’ve had a lot of people come in that are just price shopping, and they’ll quote us next to the box stores,” he said. “We’ll beat them nine times out of 10.”

Building for the future

It’s a good time to operate a business in the construction industry. New housing starts for both single- and multi-family units reached 1.35 million in May, which equals an 11 percent increase from 2017, according to Census Bureau data. Remodeling also continues to grow, with homeowners spending an estimated seven percent more than last year, according to Har vard University’s Joint

Centers for Housing Studies. “Annual spending on residential improvements and repairs by homeowners is set to exceed $340 billion by early next year,” a recent JCHS report states. With the steady rise in spending, Schrom has looked at hiring another designer and an in-house carpenter to complete installations. The company would also like to open a second location at some point, possibly in Rochester. However, the number of projects being completed nationwide has stalled due to a shortage of workers in the skilled trades. Last year, the Associated General Contractors of America stated that 70 percent of members “are having a hard time filling some hourly craft positions.” For Minnesota contractors, this figure reached 78 percent. “It’s hard to find good help,” Schrom said. “One of our contractors says he even has a hard time finding bad help.” Without an in-house carpenter and with his usual contractors being so swamped, Schrom has been forced to turn away some work. “It’s hard to do because you want to take on as much as you can, not knowing when it will dry up again,” he said. “But at the

same time, you want to do justice to the jobs that you’re working on.”

Inspiring customers and projects

Whether customers know exactly what they want or just want something different, staff designer Emily Kopischke can refine the ideas. This process starts with looking at designs on websites like Pinterest and Houzz, then creating a 3D renderings of the project. Some customers follow trends, which requires the staff to stay current. “With the last couple of years, everything has been white painted, black stained and with a lot of grays. Now we’re seeing navy blues and a lot of gold coming back. It’s kind of a clean, elegant look,” Schrom said. However, many customers like to do their own thing, choosing their favorite colors and styles. “Ever y single project is so different,” Schrom said. “Just seeing how happy people are when they have the final project and they can’t believe that this is theirs, then starting the next day with somebody else and going through the same process — it’s pretty enjoyable.” MV

MN Valley Business • SEPTEMBER 2018 • 17

Dee Thomas in her business Henderson Classical Glass. Thomas has owned the business for 14 years and said, “I want people to know that I have a full gift line, we custom make gifts all of the time.” Bottom: A detail of one of the many stained-glass lamps in Henderson Classical Glass. Customer Claudia Miller said “I love coming to Henderson. Every time we (she and her sister from Florida) get together we come here.” Owner Dee Thomas said 20 percent of her customers are local and 80 percent are from the metro area.

Classical Glass Shop a fixture of Henderson’s revitalized downtown By Dan Greenwood Photos by Jackson Forderer

hen Dee Thomas and her husband town and make it vibrant,” Thomas said. Doug moved to Henderson in the “Now it’s pretty tough to rent any retail 1990s, the space especially on this downtown area was block because it’s a very rundown. One structure promising business to had a caved roof and a open up.” tree growing inside of After retiring from a HENDERSON it. Most others needed decades’ long career as major renovation. Then a high school principal CLASSICAL GLASS a group of locals got and educator, Dee 515 Main St., Henderson together with the plan to Thomas now focuses on 612-290-8701 renovate the historic her glass studio and hendersonclassicalglass.com buildings to boost shop full time. She tourism. Dee and Doug delved into the trade by Thomas purchased the chance 37 years ago as a old butcher shop, stripped it down and customer. renovated it. In 2004, they opened “I lived in Amboy at the time,” Thomas Henderson Classical Glass. It makes up said. “I went down to Vets Glass in several thriving businesses in Henderson’s Winnebago to get a mirror cut and Dick transformed historic business district. (Duesbabeck) said ‘come on back.’ There “There’s a group of people who have was this beautiful glass laying on the table. gotten together that really want to save the I thought ‘Oh! I have to learn how to do • SEPTEMBER 2018 • MN Valley Business

Feature

Top left: Dee Thomas puts stained glass into a kiln to be fired at her business Henderson Classical Glass. Thomas said she learned the traditional ways of working with glass from Dick Dusbabeck in Winnebago, but admitted to having some modern tools which makes her job easier. Top right: Dee Thomas, owner of Henderson Classical Glass, cuts a piece of glass for a decorative wedding invitation. Thomas has owned the business since 2004. this!’” Duesbabeck offered to teach her. She caught on quickly, borrowed an instruction book and taught herself how to stain the glass with paint and heating it at a high temperature in a kiln. It wouldn’t take long before she was teaching classes herself at Vets Glass. During that time, Thomas became interested in alternative approaches to teaching, like project-based learning and individualized education. When the opportunity to open a new school arose with that in mind, Thomas moved to Henderson with her husband to open the Minnesota New Country School. The downside to that was it would be an hour commute back to Vet’s Glass in Winnebago. But another chance meeting gave her the ability to work remotely on projects for regional glass shops. “I was at a high school principals’ meeting in Sleepy Eye and I saw Sleepy Eye Glass,” Thomas said. “I went in and met Mike Mason.” Mason, who has been in the business for 40 years, wanted to see samples of the glass painting that Thomas had been developing, a skill he knew would be helpful with area church windows he was commissioned to repair and restore. One of those churches was badly damaged in the 1998 tornadoes that swept through St.

Peter and Comfrey. “The tornado went through Comfrey and I ended up with the job of repairing and restoring windows in the Congregational church,” Mason said. “To do that I needed some glass painted and fired for the medallions that were in the windows that were destroyed that I was rebuilding. She did those for me. And she’s been doing a lot of painting for me ever since.” Mason says that Thomas has to use special paints that can handle being infused with the glass at high heat. “She uses inorganic paints that won’t burn up. She paints on the glass and fires it in a kiln to about 1,200 degrees. That actually fuses the painting into the glass so that it becomes part of the glass. That’s how you achieve the painted figure windows and things like that.” The two have been collaborating for 20 years now. Thomas said it’s a symbiotic relationship. “I do the design work and all the painting,” Thomas said. “He does all the fabrication and installation. He loves his end I love my end.” On a mild summer day, Thomas steps outside of her shop to take in the fresh air and soak up the beauty of Henderson’s revitalized downtown and the forested bluffs in the background. Since its transformation, visitors from the Twin Cities Metro Area flock to

Henderson and its downtown businesses. “If it’s a beautiful weekend we’ll have 300 motorcycles in town,” Thomas said. “They come in and they look and they say, ‘I’m on my motorcycle but I’ll be back.’” A little over half of the work Thomas does is on commission. Someone will come into the store and say they want to convert a window with a stained glass pattern, image or scene. On this particular day she’s working on an elaborate stained glass landscape scene with a sunset, animals, trees and a man on a boat in a pond for a family from Bloomington. She compares it to piecing together a jigsaw puzzle. She says a project of this magnitude will require eight hour days, seven days a week for three weeks. Each new project poses new challenges and Thomas says what she enjoys the most about stained glass work is that even though she teaches the art form to new students, she considers herself a lifelong student herself. She’s recently delved into sandblasting, fusing black and white photos onto the glass and glass blowing, all on display at her shop. At Henderson Classical Glass, the inventory is always expanding. “I’m constantly learning and trying new things,” Thomas said. MV

MN Valley Business • SEPTEMBER 2018 • 19

Paul Brudelie in his home office in rural Pemberton, where he repairs two-way radios for his business Paul’s Two Way Radio Repair. Bruderlie was laid off from EF Johnson but said, “My first full year in business my old employer was my best customer.”

Worldwide clientele Two-way radio repairman in high demand By Amanda Dyslin | Photos by Jackson Forderer

aul Brudelie of rural Pemberton had just completed a pretty lucrative project for a client in Israel when the subject of payment came up. He had repaired 50 radios for a guy, a service job worth about $12,000, and on the phone Brudelie told the client that he’d included a small gift with the shipment as a thank-you for his business. “He said the funniest thing. He said, ‘I’m not paying you till I see what the gift is like,’” Brudelie said with a laugh.

Luckily, the business pen Brudelie included was impressive enough for the gentleman to pay his bill. The service job was, too. Brudelie’s reputation in twoway radio repair has reached Israel, after all. “I’ve got customers in 15 to 20 states, and also global: four international accounts in Israel, Moscow, New Zealand and Canada,” said Brudelie, owner of Paul’s Two-Way Radio Repair. Brudelie’s business has, in many ways, been 40 years in the making. Having grown up on a farm south

Profile

20 • SEPTEMBER 2018 • MN Valley Business

Paul Bruderlie takes apart a two-way radio in his home office in rural Pemberton. of Madelia, he liked tinkering with electronics and decided to take a two-year radio electronics program at South Central College after high school. He started working at a TV repair shop in St. James for a year before moving onto EF Johnson Company in Waseca on Sept. 25, 1978, where he stayed for 26 years. Brudelie worked in various departments over the years, and his specialty was customer radio repair (think high-tech walkietalkies). At EF Johnson Brudelie was becoming an expert on hand-held radios that cost $2,000 apiece. The devices are designed to meet high durability standards for being shock-absorbent, waterresistant and heat-resistant, which is why they need to be serviced by professionals. “Police, fire and utility companies are three major businesses,” he said, adding that off-shore well-drilling businesses are also big clients. “There are new mics that are good to up to 500 degrees.” When EF Johnson moved to Texas, Brudelie was laid off. He

worked at Winland Electronics in Mankato (now Nortech Systems) for 13 months, but there wasn’t enough business to keep him on, so he was laid off again. All of this was happening at a pretty inconvenient time for Brudelie personally because he and his wife had purchased acreage in rural Pemberton and were planning to build a house. They’d already sold the house they were living in. So when his former clients at EF Johnson started calling and asking specifically for him, Brudelie took that as a sign. “One guy got a hold of EF Johnson and got my phone number, and he said he had radios repaired, but they still didn’t work. He said, ‘I can’t program them.’ He says, ‘Can you fix them?’ ” Brudelie said. “I said, ‘Absolutely!’ He said, ‘Well, consider yourself owning your own business then.’ ”

Sought out

So as of October of 2006, that’s exactly what Brudelie did. He got his paperwork in order, and he started building his clientele.

Brudelie said he was a little nervous at first about having enough business on his own to make a living. But fortunately, two-way radio repair is a service not many folks provide. He’d also kept up on training for all the emerging technology over the years and attended an annual radio conference in Las Vegas. Having the business in his home helped with keeping costs down, he said. “My commute is like 10 feet,” he said. Brudelie is so prolific in his repairs that he doesn’t know off the top of his head how many projects he goes through. It takes him only about an hour to complete a repair. Once in a while he’ll get a radio with a problem that stumps him, in which case he’ll start replacing parts inside from the numerous radios he has stored all over for exactly that reason. “I don’t throw anything away,” he said. “Right now I’ve got three or four different customer radios in my shop for repair.” Todd Supalla, who works in parts at Kibble Equipment in

MN Valley Business • SEPTEMBER 2018 • 21

TRUSTWORTHY ADVISOR Janele Fowlds, L.S., Mankato Principal Surveyor

Janele always takes the opportunity to educate her clients, “It’s not just what they ask, but what they don’t ask.” Finding efficiencies and improving processes is important to her. Janele also mentors high school students, having been involved with Minnesota Society of Professional Surveyors TrigStar Program for the past 17 years. We take pride in our work. We live here too.

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151 ST. ANDREWS CT MANKATO 124 E. WALNUT ST MANKATO 101 PAULE WAY MANKATO 110 W DUKES STMANKATO 111 STAR ST MANKATO 124 E WALNUT ST MANKATO 1400 MADISON AVE MANKATO 1415 FIRST AVE MANKATO 1600 MADISON AVE MANKATO 1961 PREMIER DR MANKATO 209 S SECOND ST MANKATO 220 E MAIN ST MANKATO 304 LUNDIN BLVD MANKATO 480 INDUSTRIAL RD MANKATO 500 INDUSTRIAL RD MANKATO 501 HOLLY LN MANKATO 54945 - 210TH LN MANKATO 600 S RIVERFRONT D MANKATO 800-826 S FRONT ST MANKATO 1754 COMMERCE DR NORTH MANKATO 406 BELGRADE AVE NORTH MANKATO 1123 S. MINNESOTA AVE ST. PETER 111 N. STATE ST WASECA 299 JOHNSON AVE SW WASECA 318 BROADWAY ST CLEVELAND 312 BROADWAY ST CLEVELAND 105 SOUTH STATE ST FAIRMONT 709 SECOND ST NORTH LE SUEUR 436 LYD BLVD MANKATO 1820 WILLOW ST MANKATO 7 HAEFNER DR MANKATO 1521 TULLAMORE ST MANKATO 828-832 N. SECOND ST MANKATO 1710-1712 JAMES DR NORTH MANKATO 1745 COMMERCE DR NORTH MANKATO SUNRISE DRIVE & BROADWAY ST. PETER MINNESOTA AVE & RITT ST ST. PETER 2300 BROWN AVE WASECA 151 ST. ANDREWS CT MANKATO 124 E. WALNUT ST MANKATO 101 PAULEY WAY MANKATO 110 W DUKES STMANKATO 111 STAR ST MANKATO 124 E. WALNUT ST MANKATO 1400 MADISON AVE MANKATO 1415 FIRST AVE MANKATO 1600 MADISON AVE MANKATO 1961 PREMIER DR MANKATO 209 S SECOND STMANKATO 220 E MAIN ST MANKATO 304 LUNDIN BLVD MANKATO 480 INDUSTRIAL RD MANKATO 500 INDUSTRIAL RD MANKATO 501 HOLLY LN MANKATO 54945 210TH LN MANKATO 600 S RIVERFRONT DR MANKATO 800-826 S FRONT ST MANKATO 1754 COMMERCE DR NORTH MANKATO 406 BELGRADE AVE NORTH MANKATO 1123 S. MINNESOTA AVE ST. PETER 111 N. STATE ST WASECA 299 JOHNSON AVE SW WASECA 318 BROADWAY ST CLEVELAND 312 BROADWAY ST CLEVELAND 105 SOUTH STATE ST FAIRMONT 709 SECOND ST NORTH LE SUEUR 436 LYD BLVD MANKATO 1820 WILLOW ST MANKATO 7 HAEFNER DR MANKATO 1521 TULLAMORE ST MANKATO 828832 N. SECOND ST MANKATO 1710-1712 JAMES DR NORTH MANKATO 1745 COMMERCE DR NORTH MANKATO SUNRISE DRIVE & BROADWAY ST. PETE MINNESOTA AVE & RITT ST ST. PETER 2300 BROWN AVE WASECA 151 ST. ANDREWS CT MANKATO 124 E. WALNUT ST MANKATO 101 PAULEY WAY MANKATO 110 W DUKES STMANKATO 111 STAR ST MANKATO 124 E. WALNUT ST MANKATO 1400 MADISON AVE MANKATO 1415 FIRST AVE MANKATO 1600 MADISON AVE MANKATO 1961 PREMIER DR MANKATO 209 S SECOND ST MANKATO 220 E MAIN ST MANKATO 304 LUNDIN BLVD MANKATO 480 INDUSTRIAL RD MANKATO 500 INDUSTRIAL RD MANKATO 501 HOLLY LN MANKATO 54945 - 210TH LN MANKATO 600 S RIVERFRONT D

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Paul Bruderlie points to one of his clients that he repaired two-way radios for in South Dakota. Bruderlie has marked his national and international clients on a map in his home office. Owatonna, said his company has hired Brudelie many times. Supalla said he’s quick and his rates are reasonable, especially considering it’s not easy to find people who do these kinds of repairs. Kibble has hired Brudelie to fix radios, odd electronic equipment and circuit boards. “The people that do it are selective on what they repair and what they know how to repair,” Supalla said. “As far as Paul goes, he probably fixed 99 percent of what we hand him.” Jobs come in from all over, and Brudelie said his website is what drives most business his way. In addition to repairs, he also sells new EF Johnson and Kenwood equipment. In early July he had a large radio order totaling about $40,000 for security radios for a large Twin Cities area high school. One of Brudelie’s newest products that he became a dealer for is the Magnetic Mic, a universally compatible mic clip for radios, which he learned about at a trade show. Brudelie also has a passion for stereo repair, especially vintage stereos with the metal chassis and sound quality that you don’t get from modern-day plastic stereo equipment. He had one this summer from 1968 that he was restoring. “I usually buy them off eBay, restore them and sell them,” he said. “I bought one for $50,

restored it, and my brother said, ‘I’ll give you $250 for it.’” Some people might think about retiring after 40 years, but Brudelie said he’s got more work to do. “My wife said I’ve got a while to go yet,” he said with a laugh. MV

MN Valley Business • SEPTEMBER 2018 • 23

■

Business and Industry Trends

Economy

Energy

GDP to be up 3.6%

Electric use up

Real GDP, which grew by 2.3 percent in 2017, is forecast to grow by 3 percent in 2018 and by 2.6 percent in 2019. Total industrial production is forecast to increase by 3.6 percent in 2018 and 2.7 percent in 2019—up from 1.6 percent growth in 2017. Growth in nonfarm employment averaged 1.6 percent in 2017 and is forecast to grow at the same rate in 2018 and slow to 1.4 percent in 2019.

Investments grow

Private real fixed investment is forecast to grow by 5.1 percent in 2018 and 5 percent in 2019, compared with 4 percent growth in 2017. Real consumption expenditures are forecast to grow by 2.5 percent in 2018 and in 2019, compared with a 2.8 percent increase in 2017.

For the first half of 2018, the Energy Information Administration estimates average residential retail sales of electricity were 7.5 percent higher than sales in the first half of 2017. Much of this higher electricity usage occurred in the first quarter, when U.S. temperatures were much colder than the mild winter of 2016–17. This trend was especially true in the west south central states where first quarter 2018 residential electricity sales were 21 percent higher than the same period in 2017, and in the south Atlantic states where first-quarter sales were 17 percent higher. Warmer expected temperatures during the summer of 2018 compared with the summer of 2017 contribute to EIA’s forecast of 2.1 percent year-over-year growth in residential electricity sales during the second half of 2018.

Liquid fuel consumption up

Total U.S. petroleum and other liquid fuels consumption is forecast to average 20.4 million barrels per day in 2018, an increase of 470,000 b/d (2.4 percent) from the 2017 level.

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Consumption is forecast to grow by 330,000 b/d (1.6 percent) in 2019. Higher consumption of hydrocarbon gas liquids (HGL) is the primary reason for the growth. In addition, distillate fuel and jet fuel consumption are forecast to increase in 2018 and in 2019, while motor gasoline consumption is forecast to decline slightly in 2018 and to grow in 2019. HGL consumption is expected to increase because of increased use of ethane by the petrochemical industry.

Retail/Consumer Spending Vehicle Sales Mankato — Number of vehicles sold - 2017 - 2018 1500

1,011 852

1200

Cold spring spurs gas use

Total U.S. natural gas consumption averaged 74.2 billion cubic feet per day in 2017 and is forecast to increase by 7 percent in 2018 before slightly decreasing to in 2019. In 2018, increases in total natural gas consumption are mainly attributable to higher electric power sector use, which is forecast to increase by 10 percent from 2017 levels. The 2018 increase also reflects higher residential and commercial demand because the first quarter of 2018 was colder than the first quarter of 2017. The cold weather in the first quarter of 2018 increased natural gas consumption in the residential and commercial sectors in U.S. Northeast.

Renewables at 17%

Renewable generation provided 17.1 percent of total electricity generation in 2017, and EIA expects the share of generation from renewable sources to decrease slightly in 2018 and to increase to 17.4 percent in 2019. Within the renewables category, hydropower was 7.5 percent of total generation in 2017 and is forecasted to decline slightly to 6.8 percent in 2018 and to 6.6 percent in 2019. The share of total generation for renewables other than hydropower, which was 9.6 percent in 2017, is forecast to rise to 10.1 percent in 2018 and to 10.8 percent in 2019.

Adding solar

EIA forecasts 6 gigawatts of utility-scale solar photovoltaic capacity will be added in 2018 and 11 GW will be added in 2019. In addition, nearly 8 GW of small-scale solar PV capacity is expected to be installed in 2018 and 2019. Domestic PV markets have been affected by a number of factors over the past six months, including: tariffs on PV modules imported into the United States (announced in late January 2018) starting at 30 percent and phasing out over four years; revision of PV installation targets in China, which may produce a near-term surplus of PV modules on the international market; and recent publication by the Internal Revenue Service of a safe-harbor provision for PV installations to qualify for a 30 percent investment tax credit, which allows for a four-year construction period upon project initiation (start of physical construction or expenditure of 5 percent of project value).

900 600 300 0

Source: Sales tax figures, City of Mankato Includes restaurants, bars, telecommunications and general merchandise store sales. Excludes most clothing, grocery store sales.

Sales tax collections Mankato (In thousands)

600

- 2017 - 2018 $444

$410

500 400 300 200 100 0

Source: Sales tax figures, City of Mankato

Lodging tax collections Mankato/North Mankato

- 2017 - 2018

70000 52500

$43,360 $43,944

35000 17500 0

Source: City of Mankato

Mankato food and beverage tax - 2017 - 2018 175000 140000

$65,600 $66,400

105000 70000 35000 0

Source: City of Mankato

C. Sankey

MN Valley Business • SEPTEMBER 2018 • 25

■

Agricultural Outlook

By Kent Thiesse

Flexible cash rental leases come in many variations

nce harvest is completed in any given year, farm operators and non-farm landowners begin the tenuous task of negotiating annual land rental rates for the following crop year. Approximately 60-70 percent of the crop land in the Upper Midwest is under a land rental agreement, and most rental agreements are negotiated on an annual basis. In the past, many land rental arrangements have been between farm operators and landlords that usually have known each other quite well, sometimes being neighbors or family members; however, that trend is changing, as more and more landlords are further removed from the actual operation of the farm. In recent years, land ownership has been transferred to family members or family trusts outside of the local area where the land is located. Some land owners are hiring the services of a land management company to represent them in land rental negotiations, and many times the farm operators have had very limited previous working relationships with the newer landlords or those representing land owners. This can lead to more challenges when negotiating annual land rental rates, especially during more difficult economic times in crop farming, such as we have been experiencing in the past few years. Crop producers in the Upper Midwest will likely realize mixed crop production results in 2018. Some producers will likely have good-to-excellent corn and soybean yields, while producers in other areas that were impacted by excessive rainfall may have yields that fall below average. Some farm operators in the region have had two or three years in a

row of crop yields that have exceeded their 10-year crop insurance actual production histor y (APH) yields by 10 percent or more. Sometimes this can lead to farm operators being overly optimistic about future yield expectations, and can also result in some landlords being unwilling to reduce high cash rental rates, even though crop prices are quite low. Cash corn prices have remained fairly low for the past 2-3 years, and are not showing any signs of significant improvement in the near future. Soybean prices have taken a sharp decline in 2018, due to increasing U.S. soybean supplies, as well as in response to the tariffs that have been implemented on soybeans being exported to China. The projected cash forward prices for the fall of 2019 are only slightly higher than current price levels, near $3.50 per bushel for corn and near $8.50 per bushel for soybeans. Many of the current cash rental rates that are at higher levels were established when crop prices were near $4.00 per bushel for corn, and $10.00 per bushel for soybeans.

Tight cash flow

The current tight cash flow margins in crop production, which will likely continue for the 2019 crop year, will create some challenges for farm operators as they negotiate land rental rates for the next year. The very tight, or even negative, profit margins for next year’s crop will also likely be a concern for ag lenders as they begin to re-finance crop producers for the 2019 crop year. Some farm operators will need to do some serious evaluation before agreeing to pay very high land rental rates for 2019, which could

26 • SEPTEMBER 2018 • MN Valley Business

potentially lead to some large financial losses for their farm operation. In many cases, landlords have been reluctant to lower land rental rates, due to the high commodity prices that existed from 20102013, and the good to excellent crop yields in past few years in many areas. In addition, real estate taxes on farm land in some areas have been quite high in recent years. However, as crop economics have changed significantly in the past 3-4 years, farm operators have found it more difficult to achieve breakeven levels from crop production. This has started temper the strong demand for rented land at the higher land rental rates. Serious and honest negotiation between farm operators and landlords will be required to arrive at equitable rental rates for 2019 and beyond. An alternative to a straight-out cash rental rates that may be difficult to “cash flow” for 2019 might be for producers and landlords to use a “flexible cash lease” rental agreement, which allows the final cash rental rate to vary as crop prices and/or yields vary, or as gross revenue per acre exceeds established targets. The use of a flexible cash rental lease is potentially fairer to both the landlord and the farm operator, depending on the situation, and how the flexible lease is set up. Flexible leases can work well for newer or younger farm operators that may not be able to afford the higher cash rental rates for farm land. Most Ag Lenders support of the use of flexible leases as a way to reduce financial risk in a farming operation. A flexible lease makes it easier for producers to utilize risk management tools such as crop revenue insurance policies and forward pricing of grain. A flexible

lease, with a fair base rental rate, allows landlords the security of a solid base rental rate, while having the opportunity to share in added profits when crop prices and/or yields exceed expectations. Flexible leases are a nice alternative for Landlords that want to continue to work with long-standing farm operators, without setting cash rental rates too high to keep the current tenants.

Many variations

Agriculture/ Agribusiness Corn prices — southern Minnesota

A “true” flexible cash lease allows for the landlord to receive additional land rental payments above a “base” land rental rate, if the actual crop yields and/or market prices, or the gross revenue per acre, exceed established “base” figures. A “true” flexible cash lease would also allow for the “base” rent to be adjusted downward, if the actual crop yields and prices, or revenue per acre, fall below the established “base” figures. Most flexible leases have been modified in recent years, and only “flex” upward with added rental payment to the landlords, if the “base” crop yield and/or prices, or revenue per acre, are exceeded. The modified “base rent plus a bonus” approach is acceptable if the “base” cash rental rates are kept within a reasonable range. If the “base” rent is set too high, above breakeven levels, resulting in a “loss”, it is very difficult for 8 the producer to recoup any of those losses with a flexible lease. There are many variations of flexible land rental leases6 in existence, some very workable, and some not so good. In most “flex leases”, and bonus or additional rents 4 with the second half or final rental payment. are paid Just as with crop yields and prices, determining the established cost of production for a crop for the year can be 2 a challenge. Some possibilities would be to use cash flow statements for the year prepared by a farm management 0 M Aor M J A themselves. S O N DMany advisor, Jag Flender, the Jproducer Universities and farm management associations have average cost of production data available. There also probably needs to be allowances in a flexible lease to allow for added 8 costs or expenses due to weather or emergencies. There are many variations to setting up a flexible lease 100 agreement between a landlord and farm operator, including 6 using85yield only, price only, or a base crop revenue compared to a harvest crop revenue, with or without using 4 cost of 70production, and many more. The big key, regardless of the flexible lease agreement, is that both the landlord 552 and tenant fully understand the rental agreement, and the calculations that are used to determine the final rental rate. 400 It is also very thatJflexible as J F important M A M J A lease S agreements, O N D well as 25 all land rental contracts, be finalized with a written J F M A M J J A S O N D lease agreement.

20 100 25 16 85 22 12 70 19 8 55 16 4 40 13 0 J F 25 10 J F J F Source: USDA

Resources

Milk prices

For additional information on flexible land rental leases and sample flexible lease agreements, please forward an 100 e-mail to: kent.thiesse@minnstarbank.com. Iowa State 85 University also has some very good resources on flexible cash leases and written cash rental lease contracts, which 70 are available on their “Ag Decision Maker” web site, which is located at: http://www.extension.iastate.edu/agdm/. 55 The University of Minnesota has a computer spreadsheet titled 40 “Fair Rent” which is an excellent resource for determining equitable land rental rates and evaluating 25 J data. F MIt is A available M J on J the A following S O Nweb D site: flexible lease https://fairrent.umn.edu. Kent Thiesse is farm management analyst and senior vice president, MinnStar Bank, Lake Crystal. 507-381-7960); kent.thiesse@minnstarbank.com

(dollars per bushel)

— 2017 — 2018

8 6

$3.27

2 0

$3.10

Source: USDA

Soybean prices — southern Minnesota

(dollars per bushel)

— 2017 — 2018 8 20 100 16 6 85 $8.89 12 470 8 255 $8.18 4 40 0 0 J F M A M J J A S O N D 25 J F M A M J J A S O N D J F M A M J J A S O N D Source: USDA

Iowa-Minnesota hog prices

185 pound carcass, negotiated price, weighted average

— 2017 — 2018

$80.26

22 19 16

$54.75 M M M

A M J A M J A M J

J J J

A S O N D A S O N D A S O N D

Minimum prices, class 1 milk Dollars per hundredweight

— 2017 — 2018 25 22

$17.48

19 16 13 10

$15.20 J

20 25 16 22 12 19 8 16 4 13 0 J 10

Source: USDA. Based on federal milk orders. Corn and soybean prices are for rail delivery points in Southern Minnesota. Milk prices are for Upper Midwest points.

C. Sankey

MN Valley Business • SEPTEMBER 2018 • 27

Construction/Real Estate Residential building permits Mankato

Commercial building permits Mankato

- 2017 - 2018 (in thousands) $16,705 18000 $3,314

- 2016 - 2017 (in thousands)

30000 25000

13500

10000

4500

5000

Source: City of Mankato

Information based on Multiple Listing Service and may not reflect all sales

- 2017 - 2018 (in thousands)

Median home sale price: Mankato region - 2017 - 2018 (in thousands)

250

300

Source: City of Mankato

Existing home sales: Mankato region 213

240

$180,000 $159,450

200

240

150

180

100

120

0 J

Source: Realtors Association of Southern Minnesota

Source: Realtor Association of Southern Minnesota

Interest Rates: 30-year fixed-rate mortgage

Includes single family homes attached and detached, and town homes and condos

Housing starts: Mankato/North Mankato

— 2017 — 2018

- 2017 - 2018

5.5

5.0

4.5%

4.5

27 12

4.0

3.5 3.0

$11,751

15000

9000

$4,042

20000

4.0% J

10 J

Source: Freddie Mac

Thank You for voting us one of the Best of Mankato 7 years in a row

Source: Cities of Mankato/North Mankato

Real Knowledge. Real Experience. Real Dedication. Real Results.

We Know Commercial Real Estate.

Tim Lidstrom CCIM/Broker

100 Warren Street, Suite 708, Mankato, MN 56001

507-625-4606

www.lidcomm.com Karla Jo Olson Broker

28 • SEPTEMBER 2018 • MN Valley Business

Let us help you define the great outdoors

Gas Prices

Gas prices-Mankato

— 2017 — 2018

54 43 $2.62

32 21 10 0

$2.29

Gas prices-Minnesota

— 2017 — 2018

5 54 $2.70

43 32

$2.30

21 10

C. Sankey

Source: GasBuddy.com

Stocks of local interest

July 9

August 8

Percent change

Archer Daniels

$47.27

$50.25

+6.3%

Ameriprise

$145.76

$140.77

+0.7%

Best Buy

$75.21

$77.29

+2.8%

Crown Cork & Seal

$45.88

$45.15

-1.6%

Consolidated Comm.

$13.45

$11.02

-18.0%

Fastenal

$49.62

$57.29

+15.5%

General Growth

$20.89

$21.57

+3.3%

General Mills

$44.31

$46.48

+4.9%

Itron

$61.95

$64.50

+4.1%

Johnson Outdoors

$88.96

$97.70

+9.8%

$200.53

$208.57

+4.0%

Target

$77.76

$82.24

+5.8%

U.S. Bancorp

$51.36

$53.30

+3.8%

Winland

$1.50

$1.26

-16.0%

Xcel

$45.16

$47.20

+4.5%

Complete Landscape Featuring Landscape Supplies at our DIY headquarters DESIGN & BUILD

32 Years in Business! www.thomastreeandlanscape.com

507.625.4960

C. Sankey

19922 State Hwy 22 3 miles south on Highway 22, Mankato

MN Valley Business • SEPTEMBER 2018 • 29

Minnesota Business Updates

■

Excluding items, General Growth reported adjusted earnings of $347.20 million or $0.36 per share for the period.

■ More tech centers coming With a looming labor shortage compounded by a lack of training in technology skills, Best Buy said it will have opened 21 tech centers around the country by September as part of a broader effort to provide hands-on learning and mentorship to low-income high school students, according to the Star Tribune. By the start of the school year, the retailer and its various corporate and nonprofit partners will have expanded the Teen Tech Center model into 15 states, including four in Minnesota, with a goal of opening 60 centers across the U.S., Canada and Mexico over the next two years. The centers are part of a $20 million initiative launched several years ago in which the Richfield-based retailer pledged to amp up its skills training to reach 1 million teens a year by 2020 through the tech centers and other programs.

■ Consolidated earnings disappoint Consolidated Communications released earnings disappointing those who had been following management guidance on their growth plan. Revenues were $350.2 million, compared to $369.1 million for the second quarter of 2017. While commercial and carrier data and transport service revenue increased 3 percent or $2.4 million compared to the same period last year, voice services revenues continue to decline across all customer channels, accounting for $10.6 million of the revenue decline. Income from operations was $5.1 million, compared to $20.7 million in the second quarter of 2017. The year-over-year decline is due to an $18.9 million decline in revenue, offset by reductions in operating expense of $11.2 million from integration and efficiency improvements.

■ GGP profits down General Growth Properties Inc. said profits for the second quarter decreased from last year. The company’s earnings came in at $89.63 million, or $0.09 per share compared with $121.88 million, or $0.13 per share in last year’s second quarter.

Employment/Unemployment Initial unemployment claims Nine-county Mankato region Major June Industry 2017 2018 Construction Manufacturing Retail Services Total*

64 83 33 193 373

Local non-farm jobs Percent change ‘17-’18

107 156 37 211 511

127,256

139000 126000

2100 1400

113000

700 100000

Minnesota initial unemployment claims

Minnesota Local non-farm jobs

Major Industry 139000 139000

2017

2018

Percent change ‘17-’18

Construction 126000 126000 Manufacturing Retail 113000 Services 113000 Total*

2,154 1,488 795 5,228 9,665

1,987 1,454 790 4,694 8,925

-7.8% -2.3% -0.6% -10.2% -7.7%

Services consist of administration, educational, health care and social 100000 assistance, food andJ otherF miscellaneous services. M A M J J A S O 100000 J don’t F equal M total A because M Jsome Jcategories A not S listed. O N *Categories

30 • SEPTEMBER 2018 • MN Valley Business

3500

132,247

2800

+67.2% +88.0% +12.0% +9.3% +37.0%

Services consist of administration, educational, health care and social assistance, food and other miscellaneous services. *Categories don’t equal total because some categories not listed.

June

- 2017 - 2018

Nine-county Mankato region

(in thousands)

8000 3500 3500 6000 2800 2800 4000 2100 2100

- 2017 - 2018

2,956 3,042

2000 1400 1400

700

700 0 J F M A M J J A S O N D 0 J F M A M J J A S O N D J F M A M J J A S O N D

200000 150000 100000 50000 0

McDonald’s supplied with French fries, is scrapping plans for a big expansion into forested northern Minnesota land after years of controversy and debate over water issues. The Star Tribune reports on the move by R.D. Offutt, which had sought permission to build dozens of highcapacity water wells to irrigate planned new farms near the Mississippi River headwaters. The move had drawn criticism from local residents who worried about the conversion of forests into farms and the effect of agricultural runoff on the aquifers and private wells. The state’s Department of Natural Resources, which 139000 had also voiced alarm after Offutt began clearing land for the farms in 2015.

■ Target on campuses Target announced it will open more small-format stores near college campuses in the near future. The mini-Targets are custom designed to serve the neighborhoods in which they exist. Seven smallformat Targets have opened on or near college campuses. Small-format versions of big gox reatilers have been on the rise in recent years including Kohl’s, Sephora, Whole Foods and IKEA.

■ ADM beats expectations

126000

3500 2800 2100

■ Ecolab has solid quarter Archer Daniels Midland blew past earnings estimates 1400 for the second quarter. ADM said it had net income of Despite the effects of rising fuel costs, Ecolab reiterated 113000 $566 million, or $1 a share, in the second quarter, up its full-year 2018 expectations after second-quarter 700 from $276 million, or 48 cents a share, in the yearsales and profits spiked amid growth gains from all earlier period. Adjusted per-share earnings came to 100000 according to the Star Tribune. 0 divisions, J F M A M J J A S O N D J $1.02, ahead of the FactSet consensus of 77 cents. Officials at the St. Paul-based maker of sanitizing and Revenue soared to $17.07 billion from $14.94 billion, filtration chemicals also revealed plans to cut $200 well ahead of the consensus of $15.442 billion. million in selling and administrative expenses by 2021, The company said its merchandising and handling resulting in unnamed plant closures and staffing division was up significantly driven by North American reductions. 139000 3500 grain. 8000the quarter ended June 30, sales rose 7 percent to 200000 139000 “Supply disruptions in Argentina and Brazil led to 3500 For strong global demand for U.S. commodities,” the 2800billion. Profits rose 19 percent to $351 million or $3.7 2800 company said in a statement. 6000 a share. Excluding one-time items and a lower tax 150000 126000 $1.20 2100 126000 2100 rate, adjusted income rose 13 percent to $1.27 cents a 4000 Results met analysts’ average expectations. 100000 share. 1400 ■ Potato grower won’t expand 113000 113000 Fargo-based R.D. Offutt Co., whose potatoes help keep 100000

100000 J F

J M

M J

J A

J S

1400 2000

A O

S N

O D

8000 6000

4,678 3,947

4000

0 F F

J F M A M M A M J J M A M J J

J A A

J S S

A S O N O N D O N D

100000 50000 J

F M A M AJ FA M

M MJ

J JA

J JS

A AO

S N S

O D O

N N

D D

(includes all of Blue Earth and Nicollet Counties) 200000 150000

June

100000

0 F

J M

F M A A M J

M J

J A

2017

2018

3.3% 57,555 1,950

2.6% 60,679 1,618

J S

A O

S N

O D

Unemployment rates Counties, state, nation County/area

- 2017 - 2018

112,434 91,369

150000

0 0 J F JM

Unemployment rate Number of non-farm jobs 50000 50000 Number of unemployed

100000

200000

50000

Mankato/North Mankato Metropolitan statistical area

150000

2000

700 0 J 0 J

D 0

200000

Minnesota number of unemployed

- 2017 - 2018

Nine-county Mankato region

4000 2100

700 2000

700

Employment/Unemployment

F M A A M J

Local number of unemployed 8000 3500 6000 2800

1400

Blue Earth Brown Faribault Le Sueur Martin Nicollet Sibley Waseca Watonwan Minneapolis/St. Paul Minnesota U.S.

June 2017

June 2018

3.5% 3.7% 4.1% 3.8% 3.7% 2.9% 3.3% 3.9% 4.2% 3.4% 3.5% 4.0%

2.7% 3.0% 3.1% 3.0% 3.4% 2.4% 2.7% 3.7% 3.2% 2.4% 2.9% 3.1%

Source: Minnesota Department of Employment and Economic Development C. Sankey

Minnesota initial MN Valley Business • unemployment SEPTEMBER 2018 claims • 31

Sponsored by the Carl & Verna Schmidt Foundation

Best time to be an investor? Yes. Best time to invest? Meh.

By Associated Press

his may be the best time in history to be an investor. Never has it been so cheap to put money into the market, and it’s about to get even cheaper following Vanguard’s recent decision to end online commissions for most ETFs. Financial advice is easier to get, particularly for people with smaller account sizes. And advances in technology mean investors can keep tabs on their accounts simply by pulling their phones from their pockets. That increasing ease plus the strengthening job market are helping to coax more Americans into the stock market. Slightly more than half of all U.S. families own stocks in some way, the highest rate since 2007, when the Great Recession was beginning. And stocks, with their long history of providing better long-term returns than bonds and other investments, are one of the most powerful tools to help people’s savings grow. The only downside in all of this is that it didn’t happen sooner. Because while it may be a good time to be an investor, it’s not necessarily the best time to be investing. After a long run of more than nine years of gains for stocks, more voices along Wall Street are saying the good times could end in the next few years. If they’re right, it will be up to investors not to turn all these newfound advantages and trading tools into implements of destruction. Even though it’s easier – and less expensive – than ever to trade, sometimes the best thing to do when markets are falling is nothing. Barry Bannister, head of institutional equity strategy at Stifel, says the bull run that began for the S& P 500 in March 2009 may end by the first quarter of 2020.

32 • SEPTEMBER 2018 • MN Valley Business

Predicted cause of death: continued interest-rate increases by the Federal Reserve. The Fed has already raised rates seven times since 2015 off their record lows, and it says two more increases may be coming this year. Higher rates have historically put the brakes on stocks and other risky investments, and Bannister says the Fed’s pace means the federal funds rate may cross a key threshold next year. With profit margins already high, Bannister says the next decade will likely have weaker returns for stocks than the previous one. “I think we’re looking at a rotating and trading market for 10 years,” Bannister said. “So the ability to move fast and be flexible is probably at a premium.” That’s good for investors who are able to take advantage of their new trading tools. Funds that cover everything from foreign bonds to low-volatility stocks to global technology companies have all been getting cheaper to own. Improved websites and lower commissions also make ETFs easier to trade. It’s also important to remember that many investors, for all their confidence, have a long history of selling and buying at inopportune times. When stocks are soaring, everyone’s happy to pile into the market on the expectation that more gains are to come. The biggest year for flows into stock mutual funds was in 2000, for example, according to the Investment Company Institute. That’s when the stock market hit its peak and the dot-com bubble burst. When stocks are falling, meanwhile, antsy investors sell their holdings. That may help avoid losses, but it creates a tough decision: when to get back into the market? Many investors who dumped stocks during the Great Recession missed out on the big gains that followed. MV

Sponsored by the Carl & Verna Schmidt Foundation

Trust the machines? Funds run by artificial intelligence By Alex Veiga

computer can trounce a human chess master and solve complex mathematical calculations in seconds. Can it do a better job investing your money than a flesh-and-blood portfolio manager? Investors willing to test that question can do so with a couple of exchange-traded funds, or ETFs, which leave the investment decisions to a computer’s socalled artificial intelligence, or AI. ETF Managers Group and Ocean Capital Advisors launched an AI-powered fund last month dubbed the Rogers AI Global Macro ETF (BIKR) that invests primarily in single-country ETFs. The fund’s AI sifts through millions of data points from countries around the globe and uses what it learns to determine how best to allocate the fund’s holdings. (Humans carry out the trades, however.) Does this approach work? Another AI fund launched last November by ETF Managers Group and Equbot shows some promise. The fund, which is called the AI Powered Equity ETF (AEIQ), invests in a variety of U.S.-based companies and seeks to beat the returns of the S& P 500. So far, it’s getting it done. The ETF is up 8.1 percent this year, while the S& P 500 has gained about 1.5 percent. Still, a track record of less than a year on a single fund isn’t nearly enough to gauge the merits of the AI approach. Also, like any fund, one should weigh potential gains against the fund’s fees. At 75 basis points, AEIQ’s expense ratio is on the higher end of ETF fees, even if the AI is doing all the thinking. By comparison, Schwab’s US Broad Market ETF, which also invests in a broad swath of U.S. stocks, has an expense ratio of 3 basis points. Sam Masucci, founder and CEO of ETF Managers Group, recently talked about his firm’s investment funds and why an AI fund manager might prove to be better at generating investment returns than the human variety.

How is AI different or better than the computer algorithms used for high-speed trading or robo-advisers that can rebalance an investor’s retirement portfolio?

It’s different. If you think about algorithmic trading or robo-advisers these are tools that are used by human portfolio managers to make decisions on what to invest in. Artificial intelligence is very, very different. While there are humans that obviously are continuing to feed data into it, it’s the computer, the AI environment, that is distilling that information and making the ultimate portfolio selection. In the case of AI, the portfolio manager is not looking at a trade signal and making a decision. The AI model is prescribing the action that needs to be taken, whether it’s a purchase or a sell.

Is AI better at picking stocks and curating funds than more conventional approaches?

We will find out. Theoretically, it should be better, because it has the ability to crunch a much larger universe of daily information and risk-weigh and apply it to a portfolio much faster and efficiently than humans can. In addition, the computer learns from its past actions and the result of those actions and gets smarter over time. And it removes any human bias, because it’s a machine. But it’s still new. We launched the first AI fund, AIEQ, in November. That fund is designed to offer S& P 500-like exposure with a better return and less volatility, and it has been doing that. And it’s getting better at doing that. MV

MN Valley Business • SEPTEMBER 2018 • 33

2019 PATHFINDER AWARD NOMINATIONS SOUGHT

Martin Luther King, Jr. Community Celebration Nominations Deadline: November 20, 2018! The Pathfinder Award honors individuals, organizations or businesses who, in the spirit of Dr. Martin Luther King, Jr., are initiators or action takers in the struggle for equal treatment, human rights and non-violence. Eligible nominees can be, but are not limited to, community and/or service projects or faithbased projects or organizations. There also is no time restriction for when the program or event took place or whether it was a one-time event or ongoing program. Nominees must be located in Greater Mankato (Mankato-North Mankato and the surrounding communities).

Co-sponsored By:

This event is organized by the Martin Luther King, Jr. Commemorative Board.

Event to be held January 21, 2019. Find out more at: mankatodiversity.com

TAKE A TOUR

tourofmanufacturing.com

Thursday, October 4, 2018 9 am - 3 pm & Saturday, October 6, 2018 9 am - 1 pm (Job Seeker Saturday)

34 • SEPTEMBER 2018 • MN Valley Business

Presenting Sponsors:

The South Central Tour of Manufacturing Partnership invites all manufacturing businesses from across South Central Minnesota to participate in the 2018 Tour of Manufacturing. The event is similar to a “Parade of Homes” that is FREE for students, job seekers and the general public. Community members will be able to stop by throughout the day for a self-guided tour or a guided tour of any of the participating manufacturers. This event is open to the public.

moremankato.com

Thank you to our partners for your GREATER MANKATO continued support.

WHY JOIN GROWTH? EXPOSURE

Build your Brand; grow your business. Stand out and get noticed!

NETWORKING TW WORKING ORKING It’s not just st WHO WHO you ou know, it’s who knows k YOU. Networking IS Powerful.

BE IN THE KNOW

LEARNING

Gain access cces to Member Exclusive Content to help grow your business.

TALENT RETENTION

MEMBER EXCLUSIVE BENEFITS

Keep your employees engaged and retained with access to our member only events and programs.

Receive our member only emails making you the first to know the latest news.

REFERRALS We only refer member businesses. Word of mouth and direct referrals come from being a valued member of GMG.

SHAPE YOUR CREDIBILITY Raise your reputation by COMMUNITY belonging. Research shows

Your investment helps us continue to build the best environment for your business and its employees.

that businesses who belong to a chamber of commerce are more successful.

n June 30 and July 31, more than 200 community members worked to complete the “All For One” greatermankato.com/join Community Mural under the leadership of artist Michael Cimino. The project transformed a wall April 2018 of Bellissimo Paint & Coatings into a work of public art featuring colorful mandalas. This was the first completed project in the City Center Partnership’s INFUSE: Artists on Main Street program, which is activating the Old Town alleyways through public art, performances and artist-led creative placemaking. Artists on Main Street is a program of the Minnesota Main Street program with Springboard for the Arts, with support from the Bush Foundation.

MN Valley Business • SEPTEMBER 2018 • 35 greatermankato.com/join

RENOVATION

AmericInn Hotel & Conference Center 240 Stadium Road, Mankato

Bradley’s on Stadium 1600 Warren Street, Suite 17, Mankato

NEW OWNERSHIP

GROWTH

Heintz Toyota of Mankato 1234 Raintree Road, Mankato

in Greater Mankato

RIBBON CUTTING

NEW LOCATION

Mogwai Collaborative 424 North Riverfront Drive, Mankato

Tip Top Tux 1850 Adams Street, #434, Mankato

CENTURY 21 Landmark Realtors 921 Madison Avenue, Suite 100, Mankato

Cubic 3D 424 North Riverfront Drive, Mankato

Kate Simonson MA Career & Life Coaching Mankato

Primerica - Joleen Koenigs 1400 Madison Avenue, Suite 348, Mankato

Mankato Industrial Coatings 58103 200th Street, Mankato

Mogwai Collaborative 424 North Riverfront Drive, Mankato

NEWEST

Greater Mankato Growth Members

36 • SEPTEMBER 2018 • MN Valley Business

7:30 - 9:00 am

5:00 - 7:00 pm September 4 October 2

Stifel Sesquicentennial Event in collaboration with the Mankato Brewery and Radio Mankato at the brewery (4 - 8 pm) Children’s Museum of Southern Minnesota J. Longs for Men

WHY JOIN November 6 December 4

EXPOSURE

Build your Brand; grow your business. Stand out and get noticed!

2018 Business After Hours Sponsored by:

September 19 October 17 November 14 December 19

Minneopa Golf Club MRCI Affinity Plus Federal Credit Union Nesbit Agency

GREATER MANKATO GROWTH?

NETWORKING TW WORKING ORKING It’s not just st WHO WHO you ou know, it’s who knows k YOU. Networking IS Powerful.

July Business Before Hours hosted by iSpace Environments BE IN

THE KNOW

LEARNING

Gain access cces to Member Exclusive Content to help grow your business.

TALENT RETENTION

MEMBER EXCLUSIVE BENEFITS

Keep your employees engaged and retained with access to our member only events and programs.

Receive our member only emails making you the first to know the latest news.

REFERRALS We only refer member businesses. Word of mouth and direct referrals come from being a valued member of GMG.

Business After and Business Before Hours gives representatives from Greater Mankato Growth member businesses at the Engaged Level or higher an opportunity to get together with one another to exchange ideas and learn about each other’s businesses. For more information on these and other member events, visit greatermankato.com/events.

SHAPE YOUR CREDIBILITY Raise your reputation by COMMUNITY belonging. Research shows

Your investment helps us continue to build the best environment for your business and its employees.

BUSINESS AWARDS

and

HALL of FAME

that businesses who belong Nominate a Deserving to a chamber of commerce are more successful. Business or Professional

Your opportunity is NOW. Nominate a deserving business or professional for the Greater Mankato Business Awards & Hall of Fame. The 2018 event will be on Tuesday, November 13 and is a time where Greater Mankato Growth, Visit Mankato, City Center Partnership and GreenSeam honor outstanding businesses, professionals and organizations within the Greater Mankato community & the GreenSeam region. Nominations will be accepted until September 15. greatermankato.com/join April 2018

New awards this year will be featured from GreenSeam and the Greater Mankato Growth Business Legacy award. Visit greatermankato.com/awards to nominate.

MN Valley Business • SEPTEMBER 2018 • 37 greatermankato.com/join

GATHER IN THE GREENSEAM, A Growing Event by Katie Adelman, Marketing and Communications Coordinator

he inaugural Gather in the GreenSeam in 2017 was a huge success and Visit Mankato is looking to grow the event in its second year.

In 2017, twenty-two partners joined Visit Mankato in promoting our rich ag history and exciting future, garnering more than 4.5 million estimated impressions (through online, print, social media, etc.) from the event. The Greater Mankato area saw a five percent increase in the hotel average daily rate over the previous three-year average (September through October) and experienced a three percent increase in hotel occupancy rate over the previous three-year average. Gatherinthegreenseam.com captured more than 9,555 website sessions. In 2018, Gather in the GreenSeam will again focus on the celebration of agriculture and drive visitors to agritourism related services and activities, as well as GreenSeam partners. Gather in the GreenSeam this year is presented by Blue Earth County Soybean and Corn Growers Association and their checkoff.

Unique deals and special incentives from participating businesses at Gather in the GreenSeam will be offered. People can download and print partner coupons/ incentives for any of the events they wish to attend.

The 2018 Gather in the GreenSeam will be a thirty day harvest celebration running from September 14 - October 14. Kicking off the first weekend event will be the Taste and Tour Old Town, featuring the Old Town Art Fair, food trucks at The Hub Food Park, farm-to-table fare, a culinary showcase using locally-grown food and more. Back by popular demand are experiences like grape stomps, farmers markets and art fairs, among other family fall favorites. Farm tours and combine rides will be a returning element October 12-14. Many more activities and events will be added, so check out gatherinthegreenseam.com for full details.

4.6 million total estimated impressions

9,556 website sessions

38 • SEPTEMBER 2018 • MN Valley Business

Celebrating the entire spectrum of people, organizations and businesses that make this agricultural region, Gather in the GreenSeam will follow the heart of the harvest season. Community partners provide an ag-related special, activity, service or educational component during this time frame so visitors can look forward to an array of experiences.

Visit gatherinthegreenseam.com for more details about this year’s Gather in the GreenSeam weekends. More information about the GreenSeam can be found at greenseam.org.

2017 Farmamerica Fall Festival Photo credit Farmamerica

increase in hotel average daily rate over previous three-year average

increase experienced in hotel occupancy rate over previous three-year average

participating partners

10.27.18

WHY JOIN O nce again, the City Center Partnership will team up with Minnesota State University Maverick Hockey to present Hockey Night in EXPOSURE the City Center on Saturday, October Build27. your Brand; grow your business.

Hockey Night is a fan-friendly celebration Stand outfeaturing and get live music, kids’ activities and the highly-anticipated noticed! mechanical bull! There’s also great food and beverages available. The festivities start at 4:30 pm and continue right up to the puck drop.

LEARNING The party is held on the Civic Center Plaza; it Gain access ccesstage to Member features a permanent and abundant space for Exclusive Content to help vendors, games and the bounce house, as well as grow your business. hundreds of fans.

GREATER MANKATO became the home for Minnesota State Hockey with bothGROWTH? the men’s and women’s programs moving fulltime to new facilities built on the west side of the building. Besides locker room facilities and offices, NETWORKING TW WORKING ORKING the Verizon Center also features a new weight room, training It’s notathletic just st WHO WHO you ou and equipment facilities, and player and alumni lounge areas. Minnesota State know, it’s who knows k YOU. Networking IS hockey players are training, University, Mankato Powerful. and playing in the City Center, bringing studying energy and excitement to ourIN downtown. BE

KNOW All areTHE welcome to join Receive our member only in the fun on Hockey Night! emails making you the first to Saturday, know theOctober latest news.27 4:30-7:00 pm Civic Center Plaza

MEMBER Over the past few years, Maverick HockeyEXCLUSIVE TALENT has increased its City Center presence and REFERRALS commitment. In 2015, the Verizon Center indeed BENEFITS We only refer member RETENTION Sponsored by:

businesses. Word of mouth and direct referrals come from being a valued member of GMG.

Keep your employees engaged and retained with access to our member only events and programs.

VOTE FOR PEOPLE’S CHOICE

SHAPE YOUR CREDIBILITY he public is Raise your reputation by COMMUNITY belonging.encouraged Research shows

Your investment helps us continue to build the best environment for your business and its employees.

2017 Winner “Maestro” - Lee Leuning & Sherri Treeby

to visit each

that sculpture businessesand whocast belong to a chamber of commerce a vote for their are more successful.

favorite sculpture – the People’s Choice Award. The winner is purchased by the CityArt program for display in the City Center.

Ballots are available in the marked boxes along the Walking Sculpture Tour route; they may also be picked up at the greatermankato.com/join Visitor’s Center in the Graif April 2018 building at 3 Civic Center Plaza, Suite 100 and at Twin Rivers Council for the Arts. Vote online at citycentermankato.com/sculpturevote. Voting closes on October 31, 2018, and the winner will be announced at the Greater Mankato Business Awards and Hall of Fame on November 13.

MN Valley Business • SEPTEMBER 2018 • 39 greatermankato.com/join

» C OME JU DGE

for Yourself.

GOLFERS FROM AROUND THE WORLD COME TO CHALLENGE THE JUDGE and the two other golf courses in Prattville at RTJ Capitol Hill. Bring your clubs and come take on Judge hole number 1, voted the favorite hole on the Trail. Complete your day in luxury at the Marriott and enjoy dining, firepits and guest rooms overlooking the Senator golf course. With the Marriott’s 20,000 square feet of meeting space, 96 guest rooms and luxurious Presidential Cottage combined with three world-class golf courses, business and pleasure can definitely interact in Prattville.

THE ROBERT TRENT JONES GOLF TRAIL AT CAPITOL HILL offers three magnificent 18-hole championship golf courses. The Marriott Prattville is part of the Resort Collection on Alabama’s Robert Trent Jones Golf Trail. Visit www.rtjgolf.com or call 800.949.4444 to learn more.

MN Valley Business • SEPTEMBER 2018 • 41

KEEP YOUR EMPLOYEES HEALTHY.

Mayo Clinic Health System Occupational Medicine offers the services you need to help keep your employees healthy and safe. • DOT physicals

• Injury care

• Medical surveillance

• Pre-employment exams

Mayo Clinic Health System in Mankato Call 507-594-7370 to learn more. mayoclinichealthsystem.org

MN Valley Business • SEPTEMBER 2018 • 42