Left to right: Mike Pennington, operations manager, Northwestern Glass Fab; Priscilla Koeckeritz, president and CEO, Brin Glass Company; Bob Kill, president and CEO, Enterprise Minnesota
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ROCHESTER
Enterprise Minnesota’s Bob Kill reflects on how Minnesota’s manufacturers can make the most of today’s business climate — especially at the Legislature.
How Two Rivers Enterprises uses operational sophistication to become a premier manufacturer of
Bob Kill
Behind the Numbers
Minnesota’s
economy depends on strong manufacturers.
Don’t take them for granted.
The Minnesota Legislature reconvened in January after a disastrous 2023-2024 session during which members enacted legislation that profoundly and negatively impacted Minnesota companies. These new laws imposed onerous family and medical leave requirements on every employer, imposing financial and administrative burdens that many will struggle to meet, especially the small ones.
Not coincidentally, Enterprise Minnesota’s latest State of Manufacturing® (SOM) survey reveals a level of concern and pessimism among manufacturers that we haven’t seen in past polls, including the ones taken during the 2008-09 recession and the global pandemic. The usual optimism expressed by our respondents was notably absent from the latest survey.
As the next session of the legislature begins, and with the SOM survey results in mind, now is a great time to remind Minnesotans of the critical role manufacturers play in the success of our economy.
• There are more than 8,600 manufacturers in Minnesota, with about 50%
in the metro area and 50% in Greater Minnesota.
• Manufacturers exported $22.5 billion in goods and contributed $57.2 billion to the state’s economy in 2023.
• For every dollar spent in manufacturing, $2.69 is added to the economy.
• Manufacturers account for 11% of the state’s jobs but drive 14% of the wages. At an average weekly wage of $1,387, manufacturing employees earn more than $72,000 per year, totaling $32.4 billion in 2023.
• Manufacturing accounts for 325,000 direct jobs and nearly two times that in indirect jobs, for a total of 1,045,814 jobs attributable to manufacturing. The ripple effect is significant because manufacturers rely on other well-paid employees for support in other areas, including packaging and distribution, at a level service industries do not.
• Wages are certain to accelerate as companies need higher-skilled employees to operate more complex machinery with the embrace of advanced manufacturing.
• Minnesota’s manufacturers and our network of community and technical colleges enjoy an increasingly symbiotic relationship.
When smaller companies invest in employee development, improved operations, and outreach to new markets, they often grow into thriving firms with 50-75 employees. Those investments are tough to make if they are struggling with the legislature’s unfunded mandates concerning leave requirements.
I hope lawmakers keep in mind we need manufacturers to thrive to employ Minnesotans and drive economic growth in the coming years. The costs and administrative burdens they face because of new leave laws put them at risk for cutting jobs, or worse, leaving the state.
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Lynn K. Shelton
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Scott Buchschacher
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Helping Manufacturing Enterprises Grow Profitably
Bob Kill is president and CEO of Enterprise Minnesota.
The Fine Print
Manufacturers
need to plan now to effectively navigate new workplace requirements that begin in 2026.
A INNOVATIONS
s the calendar turned to 2025, Minnesota employers were one year away from implementing a new Minnesota Paid Leave program for employees.
Employers of all sizes that have employees working in Minnesota must provide paid time away for a variety of reasons, according to the Minnesota Paid Leave regulations. Exceptions include federal employees, certain seasonal workers in the hospitality industry, independent contractors, and self-employed people. Through Minnesota Paid Leave, employees will have two buckets of leave available for each 52-week benefit year, says Sarah Dahl, a benefits consultant with Marsh
McLennan Agency, who has been meeting with Enterprise Minnesota’s Peer Councils to provide informa tion and answer questions.
The rules say that full- and part-time employees will have access to a maximum of 20 weeks total paid leave annually. One bucket provides 12 weeks for their own serious health condi tion, such as cancer, surgery, or childbirth. Another bucket covers 12 weeks for bonding time with a new child, caring for a seriously ill family member, safety leave, or to
Sarah Dahl, a benefits consultant
has captivated Enterprise Minnesota’s Peer Councils with her analysis of the new paid leave requirements for Minnesota’s businesses.
with Marsh McLennan Agency,
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support a military family member who is deployed. If an employee has both a serious health condition and family support needs during a benefit year, they don’t receive 12 weeks for each situation. Then a 20-week maximum applies, and employees would need to cap one of their leaves at eight weeks.
Both buckets require a health care provider or authorized professional to certify the need for the leave and the amount of time off required, Dahl says.
As with any new benefit, questions abound about the finer details of implementing the paid leave program. “Employers in Minnesota are all having to deal with this,” Dahl says. “Many employers have similar concerns and fears going into it. They should partner with resources such as their benefits broker or employment law attorney to walk them through the options.”
Dahl has been helping manufacturers solve the puzzle of how Minnesota Paid Leave fits into various other programs, including the state’s new Earned Sick and Safe Time program, short-term disability, and federal Family and Medical Leave Act (FMLA). First steps for manufacturers involve selecting the structure for their programs. The choices include:
A public option that will be funded through a payroll tax paid to the State of Minnesota in which employers cover half (or more) of the cost and employees pay the rest. With this plan, the state will administer claims and pay out benefits to employees. The rate is estimated to land
on at least 0.88% of earnings capped at Social Security taxable wages but will be reduced for employers with fewer than 30 employees.
A fully insured private plan that will enable employers to pay premiums to a private insurance company, which will administer claims and benefits. Costs could be higher or lower for employers depending on the insurer; employers may not charge employees more than they would under the state plan.
Employers could opt to pay for the cost of the program out of their own pockets through a self-funded private plan, backed by a surety bond. Odds are that most manufacturers won’t pick this option, where they would need the cash on hand to fund leave benefits for up to 20 weeks a year, Dahl says.
In any setup, the barrier for obtaining access to Minnesota Paid Leave is lower than FMLA and other programs. Employees are eligible if they have earned
5.3% of the state’s average annual wage — roughly $3,800 total — from any Minnesota employer in the four quarters prior to their leave. “Employees don’t need to have earned a lot of money to be eligible, and it doesn’t need to come from one specific employer,” Dahl says.
Many manufacturers are concerned about how they will keep operations running if employees take significant time off. “Minnesota Paid Leave is going to mean that more employees will be able to take more time off of work,” Dahl says. “In some cases, that’s a good thing because you don’t want people to come to work if they can’t safely do it.”
There is relief for small manufacturers who worry about covering the premium cost, Dahl says. In addition to reduced premiums for small businesses, those with 30 or fewer employees might be eligible for assistance to cover the cost of hiring temporary workers or increasing existing workers’ wages, according to the Minnesota Department of Employment and Economic Development.
Other manufacturers have been asking Dahl about how to pay staff on leave. The state will send wages to employees — similar to when it pays unemployment benefits — based on a graded income scale. Based on the new regulations, the less people
Many manufacturers are concerned about how they will keep operations running if employees take significant time off.
earn, the more they will be paid through the program, Dahl says. Employers are responsible for continuing group insurance coverage during employee leaves.
Employers should not count on the Legislature pulling the plug on this program before it gets off the ground, although it might tweak some aspects during the current
session. Whether manufacturers support or oppose the new regulations, they can make their opinions known to legislators during this session, Dahl says.
Abbey Hellickson, an Enterprise Minnesota business growth consultant, says that employers should ensure that employees understand the terms of Minnesota Paid Leave. They will need to know what types of leaves are covered, how they initiate access to the program, and how Minnesota Paid Leave functions with other federal programs like FMLA, she says. (FMLA is a federal program that will run concurrently with Minnesota Paid Leave when applicable, providing job protection but no wages.)
“The big thing is to plan now,” Hellickson says. “Be proactive and figure out what your structure will be so that in 2026 you are ready to roll.” Employees with qualifying events in 2025 may be eligible to use their paid leave right away in 2026, she adds. “That’s where employers need to be on the ball.”
Suzy Frisch
TECHniques’
Bespoke Services & Delivery
TECHniques of Roseau customizes every aspect of the filtration business.
ECHniques Incorporated has expanded a niche market into a business that customizes, sells, and distributes filtration products for industrial and commercial applications. But what makes the company distinctive is the way it customizes its services and delivery.
Owner Tony Fichter had worked in procurement and purchasing for Polaris for 15 years before he partnered with Chris Hamness. Hamness had been working for Marvin Windows and developed a “technique” or process to refurbish the brushes and rollers on Marvin’s glass-
washing equipment and upgraded the filter system on their equipment. He left Marvin in 1987 to start TECHniques, a company that provided glass-washing services to a list of clients including Marvin.
In 2006, Fichter bought into the company, which also distributed filtration products for industrial and commercial applications. About 10 years ago, after TECHniques had grown and further diversified, Fichter and Hamness decided to buy each other out. Fichter kept the filtration part of the business and the TECHniques name.
He had realized early on that many of their competitors knew filtration but did not necessarily know manufacturing.
“They may have known a lot about filters for air conditioning systems,” Fichter says, “but when it came to a paint system, they didn’t really understand those applications.” Fichter combined his manufacturing expertise with his experience in procurement to help fulfill the filtration needs of his customers.
“We’re not manufacturers’ representatives,” he says. “We’re distributors. We carry product lines from 12 or 15 different manufacturers, so we’re able to cherry pick their product lines to get the best possible combination of products for a customer, as opposed to being a one-sizefits-all.”
TECHniques conducts site surveys to assess all filtration needs within an organization: what products are currently used, any issues or problems with the systems, and how often filters are replaced. Then they make recommendations for the best, most efficient products and put together a customized package for the consumer.
But the customization doesn’t end there. Based on that assessment, TECHniques puts the order together and labels each item to designate exactly where each piece goes, saving the customer valuable time and energy.
Branching out from manufacturing needs to HVAC systems
Most of TECHniques’ customers were initially manufacturers; but the company has now evolved into heating, ventilation, and air conditioning (HVAC) systems for big markets like educational institutions and health care facilities, districts, colleges and universities, as well as nursing homes, clinics, and hospitals.
Spurred by demand during COVID-19,
leadership team, left to right: Owner Tony Fichter, his son CJ Fichter, and Matt Heddan, operations manager
TECHniques branched into manufacturing and customizing filters.
“COVID was an excellent thing for us in that regard,” Fichter says. “Everybody was scrambling to get masks, but the raw materials used to produce masks are the same raw materials used to produce filters, so all the raw materials were diverted toward people making masks.”
That demand made it difficult for TECHniques to maintain its supply of filtration materials. Lead times were getting longer, costs rose, and logistics were challenging. So, TECHniques started manufacturing and customizing some of its filters in-house.
Producing some of their own filters gave them more control of their supply chain, helped reduce their overall cost of doing business, and reduced lead times.
Fichter says, “These things gave us the flexibility to make custom-sized products –– something some of the bigger manufacturers weren’t very good at.”
Producing filters involves some science and engineering, but the manufacturing is
straightforward. There’s a lot of cutting, sewing, and simple fabrication –– done today in a new steel building on the site. The company had expanded its footprint with a 10,000-square-foot facility about 12 years ago in Roseau. Just this spring, the company completed construction of another 10,000 square feet of work and warehouse space and, Fichter says, they’re already running out of space.
Operating with a carefully selected crew of just 12 employees, virtually all of TECHniques’ manufacturing and customizing is done manually with a band saw, cutting tools, and a sewing station. As the company moves forward and gains volume, Fichter says they can explore investing in more equipment and automation.
“We have to walk before we can run, with respect to our ability to make those investments and then get the right people hired.”
Fichter’s son CJ started working at TECHniques about eight and a half years ago and has taken on many of the managerial duties. He estimates about 10% of all
orders are produced in-house, but 60-70% involve some customization rather than just distributing ready-made filters.
“Manufacturing companies continue to be our bread and butter,” Fichter says, still accounting for over 60% of their business, supplying filters for some 250 paint stations and other needs for major regional manufacturers like Polaris in Roseau, Marvin Windows in Warroad, New Flyer and Motor Coach Industries headquartered in Winnipeg, Cirrus Aircraft in Duluth and Grand Forks, and numerous others.
In the 18 years he’s been involved in TECHniques, Fichter says he has reinvested every penny back into the business. Since shipping bulky filtration systems is expensive, the company does nearly all shipping with their own trucks (four of them) and drivers.
This somewhat limits their range to the five-state area and Manitoba, but, Fichter says, “on the other hand it makes it hard for anybody else to do business in our neck of the woods.”
Sue Bruns
Mission, vision, and value statements need to be more than “words on the wall.”
–Michele Neale, business growth
consultant, Enterprise Minnesota
PROBLEM SOLVING
Smart Talk
How four communication competencies improve employee engagement.
t’s a common problem. Supervisors think they’ve given clear instructions yet employees deliver very different outcomes. The result may be defective work, incorrect priorities, wrong projects, on-the-job confusion, or worse. The solution is clarity and an intentional approach.
“As leaders, we need to think about how we are communicating the what, the when, and the process to avoid misunderstandings or misperceptions,” says Michele Neale, a business growth consultant and talent expert for Enterprise Minnesota. Neale explained how to build a culture of engaged
problem solvers at the recent Lakes Area Manufacturing Alliance annual meeting in Brainerd.
Developing engagement among employees has real bottom line benefits, she says. Gallup findings indicate that manufacturers that develop a culture of engagement outperform their competitors by 202%, have reduced turnover, and experience fewer safety incidents. But to create and maintain that culture, leaders need to communicate intentionally, daily, and usually in a team setting where ideas and learning can be shared. They also need to master four key competencies that drive engaged behavior, Neale says.
Articulate ‘the why’
The first key competency is being able to articulate “the why” of your organization. Mission, vision, and value statements need to be more than “words on the wall,” Neale says. They need to be explained and modeled by company leaders.
Employees are more effective if they understand how their work fits into the organization. They may be machining a small part or assembling a component, but if they understand where their work fits — who the customer is, why the specifications on the job are important — they’re more likely to see and call out potential problems before they become a crisis.
“The more leaders can articulate the big picture, the more everybody can come in knowing what their role is and why it matters,” Neale says. “Employees want to be tied to a larger mission and be told why their role is important.”
Neale is a big fan of University of Minnesota football coach P.J. Fleck’s concept of “row the boat.” “Everyone has their place, understands their role, and knows when it is time for them to row,” she says. The same idea can be applied to the production area or the organization as a whole.
Set the right measures and expectations
Setting appropriate expectations for employees and meaningful measures of success connects “the why” with daily work, Neale says. Leaders — from the supervisor level upwards — need to make sure they are measuring the right things and explaining measures clearly. Are the measures connected to strategic goals, such as revenue, profits, or growth? Or are they linked to important day-to-day issues relating to safety, quality, on-time delivery, or
BY ROBERT LODGE
employee development?
“You need to measure the things tied to value,” Neale says. “We also need to be clear about what the measures are and why they are important. If you are not clear, people make things up.”
While every organization will have its own measures, they generally should be set for areas like on-boarding and training new employees, best practices, and team-based collaboration. Tracking them every day through a daily huddle or team meeting keeps measures top-of-mind for all employees, says Neale, who teaches the Leading Daily for Results program for Enterprise Minnesota with business growth consultants Ally Johnston and Ryan Steinert. “Metrics can be flexible,” she says. “When teams create their own metrics you have buy-in, and that leads to meeting team goals.”
Focus on process
Process is everything in driving effective engagement. Employees should know exactly what their jobs entail and how to do
them in the safest and highest quality way. Documenting and teaching processes — and why they are done as they are — is a good first step. Asking “is this important to the customer?” helps refine processes.
Neale tells the story of a company that devoted considerable time to cleaning a product before shipping it out to its customer. But when employees looked at the process more closely, they discovered that shipping and post-shipping handling of the product made the cleaning unnecessary.
“You want to try eliminating siloed approaches and move toward team collaboration,” she says.
Engage and coach daily
Providing employees with the skills and confidence to make improvements in their work is a key part of any leader’s job, Neale says. At a basic level, employees need to understand their roles and have the tools and resources to perform them well.
“The leader’s job is to ask what do you need to do the job right,” Neale says. “It may mean having the right people in the right
seats, even the right tools.” At one company Neale worked with, an employee was using an older hand-tool to do his job and it was slowing him down. For a very minimal investment, the employee’s productivity skyrocketed after receiving a new tool.
Regular feedback and opportunities for employees to collaborate with each other and supervisors through daily huddles make coaching a natural part of the workplace rather than an uncomfortable correction. Asking questions, talking about challenges, successes, and upcoming issues encourages accountability and continuous improvement, Neale says.
“The key is doing this daily,” she says. “Employees find they are learning by having other people ask questions and collaborating on problems.”
In the Leading Daily for Results course, Neale, along with her colleagues, explains how to use daily huddles and other techniques to build these four leadership competencies and demonstrate them to employees.
Mary Lahr Schier
STAFF PROFILE
A Do-it-All Consultant
ames Thomas’ colleagues at Enterprise Minnesota value his skilled and personable expertise from two decades of experience in manufacturing as he helps clients earn crucial certifications, even under sometimes-intense pressure.
James, who was hired at Enterprise in January 2022 after about 20 years in manufacturing and quality control, has helped a wide range of manufacturers earn ISO cer-
tifications. He can do the same for a variety of ISO standards, such as production part approval processes –– PPAPs –– environmental regulations, aerospace and medical standards, among others.
“His experience helps him really connect with the people on the floor,” says Bob Kill, Enterprise Minnesota’s president and CEO.
Thomas has worked in quality assurance
in the aerospace, automotive, and medical fields. He’s helped make offshore wind farms in the United Kingdom for Siemens Wind Power, and, more recently, he oversaw quality and compiled sustainability reports for Nilfisk, a company that makes motorized sweepers found in airport concourses across the world. A single father of three, Thomas was briefly a self-employed contractor before heading to Enterprise Minnesota, which lured him with the promise of a flexible schedule, state insurance benefits, and working from home.
Kill says Thomas’ broad capabilities were immediately evident when he introduced himself to his new colleagues at Enterprise Minnesota. “We all realized his expertise broadened the services we could help our clients obtain. I don’t think we completely knew the incredible depth that he brought with him,” Kill says.
Eagan-based Shield Technologies Corporation earned its ISO certification thanks in part to Thomas’ handiwork. The company’s “anti-corrosive covers” are meant to keep equipment dry underneath like a tarp, but, unlike a tarp, are breathable enough to keep moisture from accumulating underneath, too. A vapor corrosion inhibitor layer in each cover forces water out through the membrane. The covers are meant for the military, as well as oil, gas, and construction companies.
Thomas helped staff consolidate their documentation ahead of their pre-certification audit and fit it to ISO standards.
“When you first go into it, it’s like this giant mountain that you’ve got to climb,” says Caleb Sabroski, a project engineer at Shield. “James makes it look like it’s just a hill.”
The company earned its ISO certification in September 2024.
Thomas also recently helped ForwardEdge ASIC, a small subsidiary of Lockheed Martin, earn AS9100 certification, a valuable standard for the aerospace industry.
“To do business, everybody requires an ISO 9001 certification,” explains Tom Scanlon, lead ISO implementor. “When you move into the military and defense space, they require this higher level of certification.”
Earning that certification meant that ForwardEdge staff needed to define their procedures, their “process flows,” and create different “quality manuals.” Thomas helped company staff formalize a list of key customers and partners, determine key performance indicators, and identify
potential risks.
“James was instrumental in helping bring up the customer’s perspective,” Scanlon says.
The company earned its AS9100 certification in November 2024. Thomas helped the company note and fix flaws in its processes, Scanlon says. Thomas also conducted an internal audit of the company before it applied for the realdeal audit that would determine whether it earned the aerospace certificate.
It was a ForwardEdge staffer who first compared Thomas to a Swiss Army knife, whose multiutility of blades transform a simple pocketknife into a highly adaptable toolkit.
“We all realized his expertise broadened the services we could help our clients obtain. I don’t think we completely knew the incredible depth that he brought with him.”
–Bob Kill, president and CEO, Enterprise Minnesota
Thomas thinks a more appropriate simile might be firefighter –– someone who answers the figurative alarms as companies try to earn or re-up a crucial certification.
Take, for instance, the leaders at a motor manufacturer who feared they would fail an imminent audit for an aerospace certification. Thomas helped them revamp their entire quality control system beforehand, and the company now has the certification.
Or consider the water filter manufacturer that wanted an ISO certification but hadn’t had a quality control manager in about a year and needed help getting the company’s documentation in order before a pre-certification audit.
Both companies, with Thomas’ help, passed their audits. Thomas says he can take on risky contracts, and he feel confident that he can shepherd the company through challenges.
“Not only do they pass their audit,” Thomas says of those clients, “but they pass with no findings.”
Joe Bowen
RECRUIT. TRAIN. RETAIN.
Four Questions
Laura Bordelon, Senior Vice President, Minnesota Chamber of Commerce
and political engagement strategy.
Many of the laws enacted in the 2023-24 session of the Minnesota Legislature took businesses by surprise. What happened?
It was a combination of several things. There was pent up interest by activists and interest groups who for years had attempted to pass some of these mandates, like paid family and medical leave. Combine that with single-party control of the legislature and governor’s office and
we had no brakes on passing all these mandates and tax increases. They had a moment, and they took that moment to pass an absolute laundry list of policies with far-reaching impacts on our state and our economy. I think a lot of the impact remains to be seen.
What concerns you most about the mandated leave policy?
It is the most comprehensive state mandate I’ve seen in my career. No
one is exempted, and it is a very major change to employee benefits. Some have compared it to the state’s unemployment insurance program. It’s nothing like that. Unemployment insurance is about as straightforward as it gets. This type of leave is really complicated. The eligible caregiver definition is very broad in scope. It’s not FMLA (Family and Medical Leave Act) type of eligibility, which I think most businesses understand since they’ve been complying with it for years. It also has so many different types of leave. We have a lot of concerns about how it’s going to work given that it takes effect in January of next year.
I don’t know of any employee who wants more money taken out of his or her paycheck right now. And I don’t know of any employers who want their employees dealing with a state bureaucracy when it comes to the most sensitive life events. Anecdotally, some of our members that operate in states with similar laws have shared examples where employees weren’t paid or had to come back to work early and missed leave time because of issues with the program. So, there’s a lot of consternation about this plan, and the small businesses that may not have HR expertise are especially worried about it, with good reason.
Might lawmakers modify the leave requirements during this legislative session?
I’m optimistic. I think we have some legislators who’ve been hearing about the concerns employers — including private-sector businesses and publicsector employers like cities or counties — have about this mandate, and I’m hoping they take action. We are speaking with some Democrats who want to make sure that the program is successful or make sure that employers and employees aren’t harmed. We’ve been having a lot of conversations over
Laura Bordelon has served as senior vice president of advocacy for the Minnesota Chamber of Commerce since 2011. She leads the organization’s public policy, grassroots,
the past several months, and we’re excited to keep that going.
There’s a big difference from the 2023 and 2024 legislative sessions when Democrats had full control and a sweeping agenda to now where you have an almost exactly evenly tied House and Senate and a more moderate stance from Gov. Tim Walz. He’s not recommending a lot of spending in his budget, he’s cutting some taxes, he’s reducing the cost of some fast-growing programs. That cautious approach is very welcome, and I think we might be able to revisit some aspects of the paid family and medical leave mandate. I will say that I think if there are modifications or revisions, they will be less about eliminating the mandate and instead be about making sure the program is operational for employers and employees when it takes effect.
How can manufacturers help influence possible modifications to the leave provisions?
There is one thing I ask your readers to consider doing — reach out to your legislators now and share with them your concerns, share with them the benefits you offer, and explain to them how this program is going to impact those benefits and your employees.
This is a good time for manufacturers to connect with elected officials. The November election results show people want more balance, and I think the policymaking will moderate. The governor’s approach on the budget is a very good sign that they’re stepping back from this more aggressive and extreme agenda. I am hopeful that legislators who were there last session are going to be more reasonable in their approach. We also have some new legislators who are far more attuned to employers in their communities.
One of the realities of the past few years is that many legislators are not involved in business, don’t have business experience, and haven’t been to many different workplaces. They’re just distant from the realities of the private-sector workplace. Sharing information about the impact of these mandates, even if legislators might be reluctant to make changes, is educational and beneficial for them. So absolutely make the call.
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ADVICE
Need to
TELL & SELL Manufacturers
Their Stories
BY BOB KILL
Enterprise Minnesota's Bob Kill reflects on how Minnesota’s manufacturers can make the most of today’s business climate — especially at the Legislature.
Enterprise Minnesota’s latest State of Manufacturing® (SOM) survey contains the most consequential data in the 16-year history of the poll. Since its inception in 2009, manufacturers have endured the Great Recession, the global COVID pandemic, and a supply chain shock for the ages. During each of those potentially catastrophic events, manufacturers’ response to our pollster was twofold: We’ve faced tough times before, and let’s look for the opportunity in this crisis.
That can-do, seize-the-moment attitude was notably absent in the most recent survey. Respondents feel beaten down, particularly by recently passed unfunded mandates concerning paid sick and safe
leave, which offer no flexibility for smaller manufacturers. Pessimism runs high among manufacturers. Many stated outright during the SOM focus groups that they have no plans to expand in Minnesota.
What follows are some lessons based on my 40-plus years in manufacturing, particularly the last 18 I’ve spent as president and CEO at Enterprise Minnesota.
1. Manufacturing is essential to Minnesota’s economy and communities.
More than 8,600 Minnesota manufacturers employ roughly 325,000 workers. In terms of compensation, manufacturing punches above its weight, accounting for 11% of jobs but 14% of wages. There’s
a huge and positive ripple effect as well: More than one million total jobs in Minnesota depend on manufacturing, either directly or indirectly.
In Greater Minnesota, the presence of a strong manufacturer or two means a small town can survive and thrive. Manufacturers outside the metro area often employ –– at higher-than-average wages –– a significant portion of the area while anchoring the community with charitable donations and volunteer efforts.
While 84% of manufacturers employ fewer than 50 people and 60% have less than 10 employees, they consistently position themselves for growth. They prioritize training and development for their employees, they invest in advanced equipment, and they strategize to expand
In Greater Minnesota, a strong manufacturer or two means a small town can survive and thrive.
As president and CEO of Enterprise Minnesota, Bob Kill has spent 18 years leading the organization’s efforts to help manufacturers achieve their strategic and operational goals. A long-time manufacturing executive, Bob is passionate about helping manufacturing enterprises of all sizes grow and thrive.
It could easily be said that no one is more closely connected to Minnesota’s manufacturing community. He has appeared before the Minnesota State Legislature and the U.S. Congress, emphasizing the critical role of manufacturing in Minnesota’s economy. A champion of giving elected officials an inside look at manufacturing, Kill has helped organize more than 600 legislative tours of manufacturing facilities. He’s participated in more than 120 focus groups related to Enterprise Minnesota’s annual State of Manufacturing® survey and has presided over more than 150 regional rollouts of survey data.
The most recent survey revealed a troubling sentiment among respondents. Manufacturing leaders expressed more pessimism than at any time in the history of the poll, prompting Kill to prepare the following exposition of key lessons he’s learned as Minnesota’s most visible advocate and spokesman for Minnesota’s thriving manufacturing sector.
His reflections are part analysis and part pep talk. They offer enlightening information about the value of manufacturing for policymakers as well as advice for manufacturers as they face an uncertain business landscape.
into new markets, often worldwide. Because of their focus on growth, their future is bright. In our experience, a manufacturer with 25 employees in 2025 has good odds of becoming a 75- or 100-employee company in the coming years.
2. Tell and sell the story of manufacturing.
Manufacturers are a humble group. Often working in anonymous-looking buildings on the outskirts of town, they focus on operations. They don’t take time to appreciate — much less share! –– their considerable entrepreneurial accomplishments. That’s understandable. Owners and leaders seem to be scrambling constantly –– either to survive or to keep up with skyrocketing demand. They focus on business, not public outreach. But as we saw from the 2023 Minnesota legislative session, not sharing the story of manufacturing can have devastating consequences for business.
Our SOM pollster surveys manufacturers in other states around the country. He
Manufacturers who haven’t connected with their local educational institutions are missing out. They are the workforce pipeline of the future.
says Minnesota’s manufacturers expressed far more concern about the business climate and far less confidence about the future than manufacturers in other states he’s surveyed, a direct result of the legislature’s unfunded mandates concerning leave requirements that apply equally to multi-national corporations and small start-up companies.
To prevent a repeat of similarly misguided mandates, manufacturers should open their doors and share what’s happening inside their plants. Over the past 20 years, Enterprise Minnesota has orchestrated almost 700 tours in which manufacturing executives show their operations to legislators and community leaders. Tours supplement statistics with real people and real stories.
Looking inside a manufacturing company is an eye-opening experience for all. Some still expect to find bored employ-
ees completing monotonous tasks for low wages in a dirty, and even dangerous, environment. Legislators are always surprised and impressed when they see a manufacturing business that’s clean, organized, and humming with engaged, well-compensated employees who enjoy enriching careers. But they can’t be surprised unless they are invited inside.
Manufacturers need to take the initiative and invite elected officials (and other community leaders) to tour their facilities. They’ll want to do it. I can’t think of a single policymaker who has declined a tour. (Not for nothing, the staff of Sen. Amy Klobuchar always tries to join in when schedules align.) Think of it: The November election brought in 22 new members of Minnesota’s House of Representatives (give or take!). Building personal relationships with these leaders can pay considerable dividends to manufacturers who want to be heard when the legislature is considering proposals that directly affect their business.
3. Share the promise of manufacturing careers with the next generation.
Manufacturing offers outstanding careers for tomorrow’s workforce, but future employees must grow up understanding the potential in manufacturing. Unfortunately, there are still educators, parents, and school counselors telling students that manufacturing jobs are a fallback for those who aren’t quite cut out for college.
One of the reasons parents and teachers have historically resisted encouraging students to pursue technical education as a path into manufacturing is their lack of understanding about the future upsides in manufacturing careers.
We work every day with executives who started their careers on the manufacturing floor as welders or CNC operators and now run thriving companies that employ large numbers of well-paid workers.
With ever-rising price tags associated with traditional four-year degrees, many young people are looking for career options that offer high wages and promising futures without requiring a large upfront investment. Manufacturers can nurture this interest and attract a new generation of workers by opening their doors to the community, sharing what they do and how their employees contribute to their ongoing success through the challenging and satisfying work they do each day.
4. Build relationships with community and technical colleges, an unbelievable asset for manufacturers.
There was a time when community and technical colleges operated without much input from the manufacturers who hired their graduates. Those times have changed for the better. Collaboration has become the common theme among local leaders, manufacturers, and college administrators. Local leaders recognize the value of manufacturing as the job-creating economic engine that drives their communities, and they understand that well-trained employees are vital to its survival and growth. Administrators realize that their curriculum finds relevance with input and support from manufacturers. And many manufacturers regularly reach out to these educational institutions, sharing their current and future workforce needs to help ensure that students develop the skills necessary to thrive in manufacturing.
Good training programs are costly to run, but manufacturers understand that their own success depends on a steady source of well-trained employees. Many companies have partnered with schools, offering financial assistance or contributing the equipment students need for training.
Manufacturers who haven’t connected with their local educational institutions are missing out on the workforce pipeline of the future. Getting involved can be as simple as offering student internships, serving on advisory boards, or contracting with schools for customized training needs.
Finally — and significantly –– community and technical colleges depend on state funding for their survival and growth. As manufacturers build relationships with elected officials, they should tell and sell their story as if it’s their own. Because it is.
5. Don’t confuse the “wind at your back” with good times lasting forever.
Our latest SOM survey shows many leaders are concerned about a potential drop in revenue in the coming year. Whether facing an economy-wide downturn or an industry-specific slowdown, one of the best ways for manufacturers to strengthen their companies and ensure future growth is to expand and diversify.
Successful manufacturers develop and execute effective strategic and operating plans; when business slows down, they look for opportunities to expand their product lines, reach new customers, train employees, and improve processes.
It is not too late to reach into new markets to attract new customers, but manufacturers need to do so before it actually is too late. Companies that have a written strategy find it easier to diversify. They understand their strengths and weaknesses, and they
know their customers. They are better positioned to move into new markets that match their capabilities. They are also more likely to recognize the value of certifications such as ISO and prioritize the actions needed to earn those certifications.
These things all take time. Moving methodically toward those goals, during boom times and slowdowns, helps even out the cycles and leads to long-term success.
Even the smallest or most niche companies benefit from strategies that foster growth, improve productivity, and enhance employees’ skills. When business slows, take advantage of the extra time to embrace these opportunities.
Too many manufacturers adopt the posture that “we can’t do that” or “that doesn’t fit us.” Maybe they think their company is too small, or in the wrong type of manufacturing, to take advantage of certain solutions. This is particularly true of automation. Many small companies think automation won’t work for them, but we’ve seen companies with even a handful of employees use it very effectively to meet demand and expand their businesses.
6. Seek input from other manufacturers.
We created Enterprise Minnesota’s Peer Councils 21 years ago to give leaders a sounding board composed of fellow owners and leaders. We invited a group of non-competitive CEOs to meet in confidential monthly meetings to listen to relevant presentations and engage in openended conversations.
Many small companies think automation won’t work for them, but we’ve seen companies with even a handful of employees use it very effectively to meet demand and expand their businesses.
Mike Pennington, operations manager, Northwestern Glass Fab, and Bob Kill, president and CEO, Enterprise Minnesota
Facilitated by Enterprise Minnesota consultants, participants function as an advisory board for each other. Today, more than 58 manufacturing executives belong to our councils throughout Minnesota; we’ve expanded them to encompass operations and human resources. These groups often fill gaps and provide insight for smaller companies that might not have specific inhouse expertise, from human resources to operations to cybersecurity.
Drawn together by a desire to learn from others and continue to improve their companies, some peer council members are earlier in their careers while others are veterans. They have become an invaluable resource for each other, and many call on fellow members and get together between meetings to discuss problems and share successes.
7. Foster and maintain a strong relationship with your banker.
Manufacturers should always keep in mind that nothing lasts forever –– the good times or the bad. Keeping your banker apprised of your financials is the key to a long-term, decent, and trusted relationship.
During the pandemic, when companies were nervous about the future and their companies, those that had a solid relationship with their banker felt pretty good. The same thing happened in 2008-09.
That relationship requires two parts: information and conversation. In most cases, bankers aren’t needed until you really need them, and that usually happens when business is slow. I suspect over the next year
Keeping your banker apprised of your financials is the key to a long-term, decent, and trusted relationship.
we’re going to hear some of our clients grumbling about their bankers. One reason is that there are fewer community banks and smaller banks, where those relationships are easier to maintain. Also, if you are a growing company and you get to a certain size, you have to move up to a regional bank, or maybe even a national bank.
The requirements are different for these banks. You need to give them solid infor-
mation along the way so when the challenges come, you have a good relationship with the bank and the banker. Hopefully that’s a long-lasting relationship. If your business has a normal cycle with good years and some that are not so good, you’re going to have a long-term relationship.
Community banks were under pressure for years, but the concept of a community bank has returned a little bit because of consolidation at the upper levels. They’re often driven by people well-known in a community. But you never know when a new owner will come in and buy into a bank. If you don’t have a sound relationship, not only with a banker but the bank, there might be trouble on the horizon.
8. Small steps create momentum.
For any company, often the biggest hurdle to improvement is getting started. Beginning with manageable improvements that result in meaningful and immediate growth can really get the ball rolling.
One example of the impact of steady, incremental change is our Leading Daily for Results process. Our consultants developed this successful approach that combines lean thinking with leadership development principles to reach every employee in a company.
Combining data and measurements about productivity and goals with practical training in leadership skills helps all employees add value to the process and drives
their professional growth.
The results have been astounding. Improved productivity and boosted employee engagement lead to unmatched loyalty and enthusiasm.
Regular weekly meetings with executive leadership gives managers and leads an opportunity to share their progress, ask questions, and submit requests for additional support while promoting their professional growth. At the same time, executives develop a deeper awareness of the processes and issues in the production areas.
We’ve seen companies make huge improvements based on this model. Little changes really do add up.
9. Treat employees as your most valued customers ––growing successfully depends on engaging them at all levels.
The task of attracting, developing, and retaining quality employees is here to stay. Automation and AI offer great promise, but manufacturers with a satisfied and loyal workforce will thrive in the long run.
Market conditions typically help determine compensation packages, meaning most companies have to offer a similar range of pay and benefits. Manufacturers need to understand what those standards are and meet or exceed them just to remain competitive in the market for labor.
What sets manufacturers apart with respect to employee loyalty is how well
Left to right: Mike Pennington, operations manager, Northwestern Glass Fab; Priscilla Koeckeritz, president and CEO, Brin Glass Company; Bob Kill, president and CEO, Enterprise Minnesota
they engage their workforce. Companies that make it their mission to ensure their employees love working for them will win the workforce battle. In our SOM survey, companies consistently identify those aspects.
Manufacturers can enhance productivity and engage employees by adopting a leadership infrastructure that encourages those closest to the challenges to identify and try solutions. Companies that adopt this approach see satisfaction soar as employees become increasingly invested in the outcomes of their efforts.
Employers can also boost engagement and productivity by turning to technical and community colleges for skill-specific training for individuals or teams of employees. As employees acquire new skills and develop leadership traits that match a company’s needs, they should have the opportunity to change positions.
Many times, the best performers are kept in one position because they seem indispensable. What they really want to do is to learn and grow, and if they cannot do that with their current employer, they will look elsewhere.
10. Engage suppliers as key customers.
While it’s hard to imagine a return to the full-blown supply-chain chaos that accompanied the COVID pandemic, unpredictability and slowdowns will continue to affect supply chains. Wise manufacturers will build an infrastructure that minimizes the impact of inevitable future disruptions. Building a strong and loyal network of suppliers requires communicating with them and treating them with respect to ensure they can thrive.
Many manufacturers rely heavily on suppliers as they manufacture final products. Others supply larger companies. Some play both roles. The last few years hold lessons for all of them.
Manufacturers who have someone inside the company who follows dayto-day events and builds relationships with suppliers typically fare better during disruptions. My friend and supply chain expert Willy Shih, a professor at Harvard Business School, says those with connections can see trouble before it impacts them, and their relationships help them
work through crises.
Manufacturers who bring supply chains closer to home will face decisions about costs, particularly related to labor. Automation may alleviate some bottlenecks caused by worker shortages and make reining in far flung supply chains more cost effective.
Shih also recommends cultivating more strategic partnerships with suppliers. That means sharing more information on volume requirements and providing a product roadmap so suppliers have a better understanding of what is needed from them. He says it’s always useful to view suppliers as partners, giving them flexibility when necessary, and giving them the kind of quality contracts that will sustain investment and help them thrive into the future.
Despite today’s uncertain regulatory and business climate, I’m confident that Minnesota manufacturers can endure and thrive. Our manufacturers are bright, ambitious, and dedicated to their employees and communities. I know they will continue to seize the opportunities that allow them to grow profitably in the coming years.
bengelbrekt@tnma.com tnma.com
Micah Ricke, president and CEO
OPERATIONAL EXCELLENCE
Minnesota’s Best-Run Manufacturer?
Quite possibly. TEAM Industries uses four pillars of success to withstand and thrive in a cyclical market.
Bill Martinson has spent 35 years sharing his expertise with manufacturers, visiting their facilities, and identifying places where he can help them run better. A business development consultant for Enterprise Minnesota, Martinson brings deep know-how in the areas of engineering, operations, strategy, and
more. And as well as manufacturers perform, Martinson usually finds some areas of opportunity for companies to fine-tune.
Yet upon visiting TEAM Industries in Bagley, Minn., Martinson was as surprised as anyone that he couldn’t find one aspect of the company that needed improvement. The third-generation manufacturer of
BY SUZY FRISCH
drive-train technology for the power sports, lawn and garden, and light vehicle sectors, TEAM Industries hums under the leadership of president and CEO Micah Ricke.
During the late 2024 visit, Martinson was blown away by the company’s automation, quality systems, lean processes, leadership, and culture.
Martinson and Enterprise Minnesota’s president and CEO Bob Kill agree — TEAM Industries ranks as the best-run company they have seen, with a star leader at the top. Ricke is “the best CEO I’ve seen. I’m sure there are other good ones out there, but I haven’t seen them. I’m impressed with the way he manages the company,” Martinson says.
What is it about TEAM Industries that makes it so outstanding? There are many puzzle pieces that fit together to explain why this nearly 60-year-old business is a model manufacturer. It all starts with the premise of the company, founded by Ricke’s grandparents, Don and Beatrice Ricke, as Motek Engineering and Manufacturing. They aimed to expand the Cambridge, Minn., machine shop by opening locations in rural communities like their hometowns in northwestern Minnesota. That way, people could have high-quality, professional and manufacturing jobs paired with access to the small-town Minnesota lifestyle they loved.
Over the years, TEAM Industries has built an employee-oriented, family-focused culture. Micah Ricke learned the business from doing machining as a teenager, getting experience at other manufacturers before and during college, and from his grandfather and father, David, who preceded him as CEO. Their central teachings include uniting as a team to solve steep challenges — good or bad — and forging deep relationships with customers built on responsiveness and collaboration. TEAM Industries cultivates a loyal and engaged staff by promoting from within and providing a stake through its employee stock ownership plan (ESOP).
Since becoming president and CEO in 2023, Ricke has been building upon the foundation of success started and strengthened by his predecessors and hundreds of employees over the years. But he’s putting his own stamp on TEAM Industries by focusing on forecasting and goal planning, diversifying its business lines, and improving cross-company communication. Ricke is striving to set the company up for longevity by fostering a growth mentality across the board to steer it toward an even brighter future. “If you’re not growing, you’re dying. That saying used to rub a lot of people the wrong way, but I’m not just talking about sales. I’m talking about everything. Improving yourselves, improving your processes, growth in capabilities, expertise, culture –– you want everything headed in a growth direction,” he says. “To me, trying
to figure out how to take on more work is a good problem.”
Today, TEAM Industries has nearly 1,200 employees, including 800 in Minnesota. It operates five facilities in the North Star State, one in North Carolina, and two in Mexico. Combined, the company’s workforce is united behind a mission to serve as the manufacturer of choice for OEM customers in need of sophisticated, efficient power for their products. Its one-stop design, engineering, and manu-
“TEAM Industries as a company has a really great reputation in the world. It’s a great place to work in rural communities –– and that’s a reflection of the family,” Kill says. In meeting Ricke, “I was struck immediately by how thoughtful he is in his role as president and CEO. He’s bringing metrics and goals and planning to the organization to minimize the downs and better manage the ups.”
Sue O’Brien, director of supply chain who has been with TEAM Industries since
facturing services –– and commitment to anticipating and meeting customers’ needs –– have kept TEAM Industries at the top of the roster for companies in numerous industries, from power sports and marine to agriculture and construction.
Ricke has many assets to build upon, along with pillars that make TEAM Industries a successful manufacturer. Based on the observations of Ricke, four TEAM senior leaders, plus Martinson and Kill, here are the four key attributes that make the company stand out.
1) Starting at the top TEAM is off to the races with a strong new leader in Ricke. He’s adopted a fresh approach to running the manufacturing business, including using sophisticated forecasting and sales projection tools to guide decision-making, the likes Martinson hasn’t seen before. Kill is impressed with Ricke’s management style and focus on using outside data to set a course for the business.
“I’m impressed withtheway Ricke manages the company.”
–Bill Martinson, business development consultant, Enterprise Minnesota
2000, noticed a shift when Ricke took the helm. Previously, the leadership approach was more hands-off. Now with the third generation assuming more responsibility, O’Brien sees the company embracing a different style. She points to Ricke championing the Entrepreneurial Operating System (EOS). Aiming to concentrate more intentionally on planning and achieving goals, TEAM Industries launched EOS with its executive leadership group in 2024 and is rolling it out companywide this year.
It’s something Ricke wanted to do for years to increase accountability toward meeting objectives. He views EOS as an effective tool for involving employees in tackling big-picture challenges and communicating on a regular cadence with its staff companywide.
Ricke appreciates the EOS view of collaboration and teamwork. Instead of working in silos, employees work in sandboxes where they can pitch in when co-workers need help. “We’re creating a culture where we have a shared vision and passion for
that vision, and then you want to set clearly defined and attainable goals, and then communicate, communicate, communicate,” Ricke says. “EOS gives us the tools for that. We’re promoting a sense of entrepreneurship and really getting people to see that if you need help, there are lots of people here who are willing to help. Having a system like this helps employees feel like they are owners and know what’s going on.”
O’Brien finds the EOS focus on teamwork and planning refreshing, especially its emphasis on shared values, working together to meet common goals, and ramping up communication. She has been deploying the EOS process to her supply chain group. Even though it has added to her workload with some critical projects, “I am so excited about the future. My department is excited because they know these are the right things to do for the company,” O’Brien adds. “Everybody wants to help build us back up and have a great future. It’s really exciting to see and be a part of.”
people on the other end, and you know they have your back.”
CFO Chad Armstrong sees strength in Ricke as a leader who is guiding a company through the transition to its third generation — not always an easy feat. Coalescing employees around EOS initiatives, with its focus on empowering leaders and improving processes, will set both Ricke and TEAM Industries up for further success.
“The goal coming out of adopting the EOS system is having a company that has even more communication and more joint decision-making with all the facilities,” Armstrong adds. “It’s bringing the company up to the next level.”
2) Employee experience
Talk to a TEAM Industries employee and it’s highly likely that they have worked at the company for years. TEAM’s workforce is a key contributor to its longevity and success. Employees regularly start in entry-level positions and work their way up after showing initiative and a willingness to learn.
“My first and foremost core value is prioritizing employees –– happy employees will lead to happy customers,” Ricke says. Employees own 40% of the company through TEAM’s ESOP, helping to retain its workforce and giving employees a big stake in its success. “I want employees to feel like they are owners, too. In my opinion, they have just as much say in how
Since becoming president and CEO in 2023, Ricke has added to the operational foundation established by his predecessors by emphasizing forecasting and goal planning, diversifying the company’s business lines, and improving cross-company communication.
things go as the family does.”
Director of Manufacturing Mike Olson joined TEAM Industries in 1995 as a night shift operator at its Audubon plant. Over the years, he turned down outside opportunities because of TEAM’s culture and employee experience. He appreciates being able to continue living in the area where he grew up, with a great job at a private company. To Olson, that means leaders make decisions for the right reasons to benefit TEAM and its people, not necessarily the wishes of the stock market.
Employees also stay for the long haul because the company stresses providing training and promoting from within. “TEAM has many long-term employees, and when you work with people for 30 years, you feel like you are family,” Olson says. This sensibility leads to a propensity for collaboration and an ability to pick up the phone to make decisions. “You know the people on the other end, you trust the
Even though employees are spread across multiple locations, the company’s workforce is close-knit, says Ron Wendt, director of product development. It’s something he noticed from 17 years working at TEAM, with a four-year break at a Twin Cities manufacturer before returning in 2011. “I love the way our workforce pulls together and understands that times might be tough sometimes,” Wendt says. “We act like one big workforce, and the Ricke family takes a long-term approach to make sure TEAM is successful.”
Adding to the family feel is the workforce’s palpable excitement for TEAM’s products, Wendt says. It’s a crowd that uses the snowmobiles, ATVs, and side-by-sides made with TEAM’s drivetrains, axles, differentials and other components. Backing up that passion is employees’ willingness to roll up their sleeves and get their hands dirty in search of solutions.
“We understand what we want to see in the products because we use the products,” Wendt adds. “What separates us from the competition is that we understand the needs of the vehicle, and we’re looking deeper at how different decisions will affect the vehicle.”
3) Collaboration and risk-taking
When employees work together for decades, it builds up a base level of trust that fosters comfort with advocating for innovative ideas and teamwork, Olson observes. For example, there is a strong, cohesive working relationship between the design and manufacturing departments that he attributes to employees’ longevity.
“I think TEAM is very innovative with design and has been since day one. We are able to provide a product that has good cost out of the gate because everyone teams up on multiple iterations to eliminate costs before the start of production,” Olson says.
TEAM Industries also fosters and supports employees’ creativity. When employees have product or design ideas, managers will often provide seed funding and time to prove out their concepts, Wendt says. It serves as a way to keep employees productive during slower times and continue offering cutting-edge technology.
Wendt points to TEAM’s Smart Locker component, an intelligent front drive that locks or unlocks traction control based on terrain. An engineer sought an element for his own vehicle and started developing the technology. The team kept iterating and testing, ultimately leading to a customer incorporating Smart Locker into their product line. TEAM provided the time and seed funding over a decade until it became a highly successful offering for customers. Armstrong, a relatively new kid on the block who joined TEAM Industries just before COVID hit, brings experience from several other manufacturers. He’s noticed a distinctive culture of trust emanating from the top that empowers employees and unleashes their creativity. “They really believe in the people they hire. They pay close attention to who they hire, but if you make it through that gate, you’re in that circle of trust,” Armstrong says. “It takes the lid off for capacity and growth and leads to innovation. Believing in employees gives them an ownership mentality, too.”
4) Deepening diversification and efficiency
Other hallmarks of TEAM that help it thrive include its model of vertical integration, commitment to automation, and ability to serve multiple markets with a wide array of products and services. That’s the beauty of having eight plants with dif-
Talk to a TEAM Industries employee and it’s highly likely that they have worked at the company for years. Employees regularly start in entrylevel positions and work their way up after showing initiative and a willingness to learn.
ferent focus areas. Being situated in rural locations allows TEAM to attract highcaliber employees with expertise in various specialties, including engineering, highspeed machining of aluminum or castings, gearing, hydraulics, and assembly.
The plants put products in close reach of customers, who might have manufacturing facilities clustered in specific areas. For
example, TEAM’s two facilities near Monterrey, Mexico seamlessly supply OEMs that make products in the United States and Mexico with the same components. “We have the different plants for diversification,” Ricke says. “It gives you access to different regions and different concentrations of customers and suppliers.”
Having diversified services also provides opportunities for TEAM to apply its capabilities in new areas. This is a priority for Ricke, who has experienced several boomand-bust periods in TEAM’s power sports and recreation lines. That includes 2024’s 20-25% drop in sales after the pandemic boom, inflation, and high interest rates. Ricke and team are calling on the expertise of different plants to expand its business in sectors like aerospace, heavy trucking, green energy, and industries that are electrifying their products.
TEAM Industries stays efficient and highly productive by regularly championing automation, lean operations, and continuous improvement, Olson says. These aren’t one-off projects but work that is strategically planned for all of the company’s locations. Such efforts, combined with its vertical integration, help the company stay nimble and provide customers with a good value, Ricke says.
Wendt finds that product development especially benefits from TEAM’s vertical integration. “It allows us in product design to work hand-in-hand with the manufacturing staff and find the most efficient way to design something. We do that on the front-end to maximize cost, reliability, and durability –– you don’t find that in a lot of companies,” Wendt says. “Having all of that expertise in-house really allows us to focus on that.”
Automation has always played a big role at TEAM, from Olson’s early years at the company when he became the first operator to run a robot in the early 2000s. Staying on top of automation technology has helped the company stay efficient. He cites TEAM’s Audubon plant, where about 160 people today produce the same quantities as the 300 employees who worked there in the mid-2000s. Thanks to TEAM’s corporate automation group, robots load and unload 50 parts an hour, freeing up operators to oversee 20 machines instead of being stationed all day at one piece of equipment.
It’s all a testament to TEAM’s propensity to invest in the elements that will support its chief goals, Ricke says: providing customers with high-quality components, being nimble and responsive to their needs, and collaborating to solve the challenges they might have.
ROLLING WITH OPPORTUNITY
Choosing
BY ELIZABETH MILLARD
theNext Right Thing
Cornerstone Kitchen & Bath leans into new opportunities while staying true to its model of teamwork and civic engagement.
Mike Thorson, owner
Although Mike Thorson’s original career plan of becoming a social studies teacher didn’t work out the way he’d imagined, in many ways he ended up immersed in the field anyway.
According to the National Council for the Social Studies, the discipline centers around how individuals and communities interact in ways that move society forward — it’s all about applying knowledge while considering multiple perspectives and planning for a future based on civic engagement. That might not be what Thorson is talking about in a classroom, but it certainly applies to what he’s brought to Fergus Falls and the companies he leads: Cornerstone Kitchen & Bath, Midwest Bevel Edge, and Wayne Enterprises.
“The real story of the businesses here isn’t what I’ve done as an individual, it’s really about all the people and organizations who came together to create this level of economic development,” says Thorson. “All I’ve done is to see those opportunities and keep pivoting toward them, and doing the next right thing.”
As a reminder to keep going in that direction, he keeps a photo of President Theodore Roosevelt behind his desk, with a quote related to resolution: “In any moment of decision, the best thing you can do is the right thing, the next best thing is the wrong thing, and the worst thing you can do is nothing.”
Wanting to stay in the area as he and his wife raised a family, he undertook his first major pivot and did what many entrepreneurs have done before him. He cleared space in the garage.
“It sounds like a cliche, but I had the garage-based startup,” he says. Drawing on experience in construction — he still keeps a photo of himself with his dad on a building site for a project in Ensenada, Mexico — Thorson opened a residential contractor business, focusing on home additions and decking. When customers started asking about kitchen remodeling, including
split off into its own company still under Thorson’s LLC, Wayne Enterprises (and yes, it’s named after Bruce Wayne, since he couldn’t resist having some fun with it).
With both Cornerstone and Midwest Bevel attracting residential and commercial customers, growth was solid, but employees were feeling squeezed.
“Think of a chef having to cook in a kitchen where there’s only a few inches of space from the counter to the stove,” Thorson says. “That’s what it felt like. We knew we had to expand, and we figured 10,000 to 15,000 square feet was the next logical step up for us. But just because you can fill that space doesn’t mean it’s available.” For nearly four years, he scoured Fergus Falls for options, only to encounter a classic Goldilocks problem: Everything was too small or too big, with nothing that was just right.
For Thorson, as well as his companies, this plays out in a blend of entrepreneurship, civic engagement, customer growth, repurposed space, and a healthy amount of optimism mixed with gratitude. Plus, just a pinch of fearlessness for good measure.
“Multiple times in my story I wasn’t sure how we would get through some tough spots, but the support I’ve received along the way has kept me going,” he says. “I’m a hard worker, but it’s also important to acknowledge I didn’t do any of this on my own.”
Building a foundation
After attending Minnesota State University Moorhead where Thorson studied social studies, he thought he knew what was ahead: decades of educating high schoolers in his hometown of Fergus Falls. That might have happened, too, except that there were zero job openings for teachers.
“I’m a hard worker,” says Cornerstone’s Mike Thorson, “but it’s also important to acknowledge I didn’t do any of this on my own.”
countertops and cabinetry work, he added that to the list of services, and Cornerstone was launched.
As the business grew, so did his need for more space. From the garage, he moved into a 1,000-square-foot building, followed by shifting to 5,000 square feet, but that was quickly outgrown as well. The need for more space became even more acute when a client asked for counters and other items that had beveled edges. Although it’s possible to bevel by hand, it’s not realistic to do that in a way that’s scalable.
To grow that aspect of the construction firm, Thorson created a second business entity, Midwest Bevel Edge, that fit into Cornerstone at first but eventually got
That’s when the social studies mindset kicked in. If he couldn’t find the space on his own, why not bring in those multiple perspectives and civic engagement? Turns out, that made all the difference.
Connecting with community
To come up with fresh ideas for getting his employees out of their tightsqueeze manufacturing space and into a situation where they could create greater efficiency, Thorson turned to the Greater Fergus Falls Economic Development Board, and its director, Annie Deckert.
“In discussing my frustration over not finding a building in the size I wanted, she suggested another big pivot: Buy a much larger space and have other companies move into what we didn’t need,” says Thorson. At the time, there were five big-box stores that sat empty, including a former Target and a grocery store named Sun Mart. Thorson hadn’t considered the larger buildings since he didn’t think the zoning laws would allow Cornerstone to occupy one of them. And he was right.
“Technically, what we’re doing is not allowed if you only look at zoning,” he says. “But Annie worked with the city and they changed the city ordinances for big-box store space in particular, because those felt like an issue, to have these large buildings sitting empty. Because of that, we were able to move into the Sun Mart space,
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which is about 54,000 square feet.”
Thorson credits then sitting Mayor Ben Schierer and members of the city council for providing help when the company needed it. But having the board and the city in agreement that business growth is better than blight doesn’t mean it was easy.
“We had to work closely with Mike and many others to navigate the complexities of amending zoning regulations in order to revitalize commercial spaces, and specifically the building he invested in,” says Deckert. “The process required significant time, patience, and dedication. Fortunately, collaborating with Mike and the Cornerstone team was an incredibly rewarding experience. His sharp intellect, infectious personality, and unwavering entrepreneurial drive made it a true pleasure.”
The effort also served as an exploration into what was possible — with the understanding that other companies could follow Cornerstone’s example and also turn empty big-box stores into thriving businesses that bring jobs and economic resilience into Fergus Falls.
Deckert, realtor Ryan Hanson, and other local economic development advisors had put together a list of 15 prospective tenants, and five had already expressed enough interest for Thorson to feel like it would all go according to plan.
But as President Roosevelt also once said: Sometimes a proposed plan contains elements of folly as well as wisdom.
New pivot
While Cornerstone was building out its new space in May 2020, Thorson followed up on the seemingly robust leads for tenants. But this was a time of peak COVID, and not only did construction take twice as long and cost twice as much as expected, all of the potential renters backed out. That left Cornerstone with about 40,000 square feet of empty space — and it stayed that way for almost a year.
Just when Thorson began to worry that his efforts with community economic development weren’t as impactful as he hoped, he got a call from a Twin Citiesbased realtor who represented a client who didn’t want to be named. In fact, both Thorson and his own realtor had to sign NDAs just to be considered.
Despite the many pivots it’s taken to get to this point, Thorson takes all the changes, delays, disappearing
“This strategic acquisition of a former grocery store for business expansion marked a pivotal moment in our collaborative efforts to address vacant properties within the region,” Deckert says. The amended regulations have led to renovation of other abandoned big-box stores in Fergus Falls, giving other manufacturers and retailers more opportunities for expansion, similar to what Cornerstone experienced.
With much more room for manufacturing, both Cornerstone — which still manufactures its own cabinetry — and Midwest Bevel were able to optimize their workflows, says Thorson. That’s led to greater efficiency and certainly a higher level of employee happiness from not having to navigate around each other every day, he adds.
With Cornerstone and Midwest Bevel in place, the next step was simply to fill the rest of the building’s space, but that seemed like a snap. After all, Thorson,
After a whirlwind, 10-minute tour from the realtor, Thorson got a call from the secretive possible tenant, and it was Amazon. The company wanted to put a final-mile delivery center in west-central Minnesota, and Cornerstone’s available space was ideal and in the right location. After six months of negotiations, Amazon moved in during the fall of 2022, bringing about 150 new jobs along with the effort.
Today, a tour around the Cornerstone building shows that the Amazon addition has been a success. Unlike a sorting warehouse, a final-mile delivery center is similar to a postal operation but only for Amazon packages. Every day, Amazon trucks rumble to the back of the warehouse and contract drivers scurry inside the front to pick up loads of boxes and drive them to recipients.
Next to the Amazon space, a gym is slated to go in within the next year, and the end of the building has yet another boon for the community: a Veterans Affairs (VA) clinic that will come in at 11,000 square feet, with a waiting room that once used to house the Sun Mart deli area. The current Fergus Falls VA clinic is a fraction of the size, and yet provides primary care, mental health care, laboratory and pathology services, and more. With such an expanded space, the VA will be able to offer those options in a more meaningful way, and to more veterans.
As he walks around the VA space, Thorson points out the exam rooms that are only just being framed, and the way the construction company is making ample use of the space.
Despite the many pivots it’s taken to get to this point, Thorson takes all the changes, delays, disappearing potential tenants, and strategy shifts in stride. He split Midwest Bevel into its own business entity five years ago because its manufacturing process is very different from Cornerstone, he says.
“I feel like Midwest Bevel is worth more as a separate company, and because of that, it would be more likely to be bought by a competitor,” he adds. “If that happens, I wanted it to be tidy and packaged to streamline that sale.”
As for Cornerstone, Thorson believes that it occupies a unique spot in the local community — the high level of customer service and customization sets it apart from the warehouse style and inventory of Home Depot, while its price points make it more affordable than hiring high-end master woodworkers and craftsmen. Also, Cornerstone’s expanding offerings have increasingly gone well beyond just counters and cabinets. The showroom is filled with
sinks, tiles, and other parts of any kitchen or bathroom remodeling project.
In other words, Cornerstone is in the best type of Goldilocks situation: Not too big, not too small, and like so many of the company’s pivot points, it’s just right.
Value proposition
According to the American Historical Association, a good social studies teacher should possess qualities like strong communication skills, the ability to display empathy and sensitivity, and a passion for critical thinking, as well as curiosity and adaptability. Those also seem to match what’s necessary for a business leader who’s always looking for the next right thing and tapping into a team who helps harness those opportunities.
“Beyond his business acumen, Mike is a dedicated community leader, actively contributing to the betterment of Fergus Falls through his professional endeavors and charitable support,” says Deckert. “His commitment to excellence is evident in the quality of his products and services, his dedicated team, and his unwavering focus on client satisfaction.”
Thorson and his team at Cornerstone and
Midwest Bevel epitomize the spirit of civic engagement — their values encompass not just business growth for the sake of it, but as a way to raise the tide and lift all boats.
Even the part of the building housing the two manufacturing spaces and showroom is community-oriented: For a few months, an unused part of the office became a gallery for a local artist to showcase his work. Cornerstone also lets community groups use the space for events, and they invite food trucks to park nearby every Wednesday in the summer so people have a place to hang out at lunch and connect with one another.
Cornerstone acknowledges the past, too, by keeping a checkout light from the old Sun Mart store in a prominent spot inside the showroom, sparking nostalgia for everyone who grew up in the area and shopped there.
“All of us — me, the staff, and everyone working on local economic development — wanted this to be more than just another project, or a way for a company to expand,” says Thorson. “We wanted to show what could be done in a way that supports the community as well as these businesses. I think that by working together, we’re succeeding.”
PUBLIC/PRIVATE COLLABORATION
‘Made in Minnesota’
A new version of Minnesota’s astonishingly successful GAP program will help manufacturers continue to drive the state’s economy, especially in challenging times.
BY MARY LAHR SCHIER
It takes only 10 seconds to machine a board that will strengthen and beautify the floor of a custom-built home or a cozy apartment for decades. But getting that board engineered to exact specifications and ready for delivery is a much more complicated process. Just ask Kyle Anderson, co-owner and operations manager at The Tongue & Groove Store, a Duluth-based manufacturer and retailer of kiln dried wood for floors, walls, ceilings, and trim.
Founded in 2009 just as the Great Recession hit, the company employs 20 people working in 37,000 square feet of manufacturing space along with a retail store. Anderson had 12 years of experience in wood manufacturing when he started The Tongue & Groove Store with his wife, Ann, who manages sales and customer service. The company specializes in custom products, from unique wood ceilings and built-to-match historic trim pieces or railings to floors and trims for multifamily housing units. Each job is designed individually and custom made but fabricated according to strict
protocols in order to maintain the quality that The Tongue & Groove Store is known for.
“We have to have a process that’s onesize-fits-all, even though the products are so variable,” Kyle Anderson says.
To make that process more efficient, the Andersons turned to Enterprise Minnesota in 2019 for help with strategic planning and value-stream mapping, a lean manufacturing system for analyzing material and information flows. The company was able to afford the services because of the Growth Accel-
GAP, now Made in Minnesota, has helped nearly 500 Minnesota manufacturers create and retain more than 12,000 jobs and increase or retain company sales of over $1.46 billion.
another way to improve our process,” Anderson says.
The company worked with Greg Hunsaker, a business growth consultant with Enterprise Minnesota who specializes in lean manufacturing, to examine the company’s processes from the time a customer calls for information to the moment it gets paid. Called value-stream mapping, it showed that
stream mapping, Anderson did decide to invest in a plant expansion. While the training improved operations, it also reinforced that the company was on the right track to growth.
“As much as I think I’m doing all the right things, if you’re not improving, you’re not putting your business in its best long-term position,” Anderson says.
The improvements have paid off as the
eration Program (GAP), which offered dollar-for-dollar matching grants up to $25,000 for manufacturers to improve their business practices. Since 2008, the state investment has helped nearly 500 Minnesota manufacturers like The Tongue & Groove Store create and retain more than 12,000 jobs and increase or retain company sales of over $1.46 billion. The Minnesota Legislature may consider a similar program, now called Made in Minnesota, during the 2025 session.
For Anderson, the expert assistance provided by Enterprise Minnesota helped him make decisions on whether to expand the footprint of the manufacturing operation, ways to improve workflow, and how materials, defects, and reworked items were handled to reduce waste.
“At the time, we were deciding if we needed more floor space or if there was
processes were not being done the same way by all workers, which was increasing waste. Hunsaker recommended the company create standards for every part of its processes, with thorough guides to show how to do each step, who should be doing it, and how long it should take. Working with Anderson and his team, programs were developed to train and cross-train employees in key areas, such as running the rip saw or staining wood. “They wanted to have everyone up to speed,” Hunsaker says.
“The project helped us develop a more formalized process for doing the work,” Anderson says. “It helped our team understand why we were doing things the way we do.” After completing the value-
company has faced inflationary pressures and a downturn in the construction business over the past few years. Unlike most suppliers to builders and contractors, The Tongue & Groove Store has been able to maintain its revenue and profitability without huge price increases. “A lot of people we know have seen down numbers,” Anderson says. “We’re up –– not in every stream, but in enough.”
The company has gained a reputation as a supplier that has been able to hold prices steady in a difficult economy by focusing on controlling its own costs –– information developed through the strategic planning process. “We’ve been combating inflation at every level we can,” Anderson says. “The work we did
Kyle and Ann Anderson, owners of The Tongue & Groove Store in Duluth, leveraged GAP funds for help with strategic planning, value-stream mapping, and lean processes.
with Enterprise Minnesota made us better at managing those costs.”
Manufacturing:
An economic driver
State Rep. Jon Koznick (R-Lakeville) has seen the power of manufacturing firms like The Tongue & Groove Store in his district, which is home to the Airlake Industrial Park, one of the largest industrial parks in the state. “I’ve toured a lot of different businesses and recognize the number of jobs that small- and mid-sized manufacturers bring to Minnesota,” Koznick says, “and these are good jobs that help people provide for their families and drive local economies across the state.”
Koznick’s belief in the power of
legislators of both parties because it is one of the few state programs with numbers to back its effectiveness. According to Shelton, manufacturers estimate an average return of $25 for every $1 of state investment. “We’re hoping there will be an appetite for this kind of investment this year. It’s bipartisan and it’s evidence-based,” she says. “The program has been a hand-up for manufacturers. It’s skin in the game for the company and for the state. They have to have a business plan to be eligible, and we measure the results.”
Koznick hopes to convince his fellow legislators of the vital importance of manufacturing in the state. “Often these companies are located off the main drag in a community, so unless you work there, you
manufacturing led him to sign on as chief author of a legislative proposal to fund the Made in Minnesota program (formerly called GAP) during the 2026-27 biennium. As proposed, the bill would provide $4 million over two years to manufacturers with 250 employees or fewer to buy down the cost of vital business-building services provided by Enterprise Minnesota, such as lean manufacturing training, leadership and talent development, strategic planning, and ISO certification.
“The program allows companies to invest in their workers in ways they might not otherwise be able to,” says Lynn Shelton, vice president of marketing and organizational development for Enterprise Minnesota. GAP has enjoyed support from
don’t know the amount of economic impact they bring to a community,” Koznick says. Minnesota is home to 8,625 manufacturers, about half of which are located outside of the seven-county metro area. With about 326,000 employees, these companies provide 11% of the jobs in the state, but 14% of the wages paid. Manufacturing workers make on average $72,000 a year, well above the state median full-time salary of $52,500. In many communities, manufacturing positions are the best jobs in town. But what these companies offer goes well beyond salaries and benefits. Manufacturing companies supply more than a million direct and indirect jobs in Minnesota.
“For every job in manufacturing, there are two to three other jobs connected to
them –– jobs in trucking firms, accounting offices, law firms, and others,” says Bob Kill, president and CEO of Enterprise Minnesota. “Service jobs just don’t have that kind of multiplier effect.”
Why don’t Minnesotans hear more about manufacturing given what a crucial economic driver it is? Shelton says it’s because manufacturers are “not about showboating, they are humble, hard-working people.”
Other factors include the relatively small
In the past year, Minnesota has lost nearly 4,198 manufacturing jobs.
size of individual businesses as well as the diversity of location and industry among manufacturers in the state. Less than 3% of Minnesota manufacturers have more than 250 employees, and more than half have 10 or fewer.
They are also spread out among many industries. While Michigan is known for autos and Wisconsin manufacturers focus on agriculture, Minnesota’s manufacturing sector creates products and parts for dozens of industries, including agriculture, medical devices, food processing, wood and timber products, biotechnology, and recreation, to name just a few.
“I can go to Thief River Falls and find three companies that are really important suppliers to Marvin Windows or Polaris,” Kill says. “The same is true all over the state. These manufacturers are core to the supply chains of the 3Ms, the Toros, the General Mills –– all the major companies in the state.”
‘You made that?’
Products made in Minnesota are often in unexpected places. That blade on your lawn mower –– it was almost certainly made by Whirltronics, Inc., a Buffalo-based metal fabricator that provides blades to all of the top mower brands. On the Midway at the Minnesota State Fair, it’s possible the carriage of the ride you’re on was made at Carstens Industries in Melrose, a maker of boat hulls and other fiberglass products as well as Tilt-A-Whirl cars. If your child is wearing an ultra-thin metal retainer, it may have been manufactured at Dean 3Digital in Fosston, a maker of specialized dental parts. That bag of nuts you grabbed from a cardboard display case at your favorite
Enterprise Minnesota’s Lynn Shelton testified on behalf of GAP in 2023 alongside State Rep. Jon Koznick (R-Lakeville).
grocery store was likely packed by a robot on equipment designed and manufactured by Delkor Systems in Minneapolis.
Mike Jensen, president of Gauthier Industries in Rochester, loves to take local officials on tours of the company’s 100,000-square-foot plant. The metal fabrication company makes parts for everything from golf carts to combines to large compressor housings. In addition to fabrication, the company does screen printing, laser cutting, powder coating, and assembly for more than 200 clients. On almost every tour someone will say, “I’ve seen those before. I didn’t know you made them,” Jensen says.
“It’s a real eye-opener for them,” Jensen says.
Despite recessions, COVID, and other challenges, Gauthier has thrived by doing strategic planning, seeking out new customers, and investing in its workforce. Jensen belongs to one of Enterprise Minnesota’s Peer Councils, where he shares problems and advice with other CEOs. Gauthier also has sent 10 of its managers
and supervisors through the Leadership Essentials course from Enterprise Minnesota, partly thanks to GAP funding (now Made in Minnesota). The multi-part program helps front line managers understand their social and leadership styles and builds their skills in managing employees in a positive way, embracing accountability, and handling conflicts effectively. Services like this not only improve individual employees’ skills but they help the company retain top-notch employees, Jensen says.
“The service gets rave reviews,” Jensen says. “The employees come back and thank us for letting them take time out of their daily jobs to do this kind of learning. It really makes a difference in how they work.”
A time-tested approach for challenging times
Despite its positive impact on the state’s economy, the manufacturing sector is struggling due to inflation, excessive regulation, new mandates, and downturns in some sectors of the economy. In the past year, the state has lost nearly 4,198
manufacturing jobs, Kill says. Agriculture giant John Deere, for example, saw profits decline 42% in the past year, leading to cuts in payroll and production. In the annual State of Manufacturing® survey Enterprise Minnesota conducts, 56% of respondents rated the state’s economy worse than it was five years ago. Cost pressures from higher interest rates, insurance premiums, and health care costs threaten the profitability of many companies –– and the communities they support.
“These manufacturing jobs are critical to communities,” Kill says. The importance of manufacturing jobs to communities is one reason more than a dozen high schools in the state have built wings devoted to teaching students the skills needed for manufacturing jobs. Starting with Alexandria schools in 2014, local manufacturers have teamed with school districts to provide and update equipment for high-tech shop wings that prepare students for working in modern manufactur-
The Made in Minnesota program would revive a proven approach to helping strengthen a significant part of the state’s economy.
ing plants where robots and other automation are becoming more common.
The Made in Minnesota program would revive a proven approach to helping strengthen a significant part of the state’s economy, Shelton says. Because it is jointly funded by the state and the manufacturers who use Enterprise Minnesota’s services and administered by an organization with a long record of success, it’s able to offer a return on investment in terms of economic growth, job creation, and retention across communities in all regions of Minnesota.
For a small but vital manufacturing company, like the one Kyle Anderson coowns, funding assistance for improvement services was “a chance to take advantage of expert-level thinking” that set the company up for continued success.
Says Koznick: “Given our current budget situation, this is the type of program we should be funding. It’s time-tested; it has matching dollars. I’m optimistic that we’ll have strong bipartisan support, and I’m proud to support Made in Minnesota manufacturing.”
Mike Jensen, president, Gauthier Industries
Key Steps to Revenue Growth
Marketing expert
Amy Hubler helps clients diversify and build sales by understanding their own companies, knowing their clients, and targeting their messaging.
BY KATE PETERSON
As the post-COVID boom slows and some industries face outright contraction, many manufacturers recognize they need to step up their marketing to sustain and increase future sales. Enterprise Minnesota marketing expert Amy Hubler uses Enterprise Minnesota’s seven-part process to help manufacturers build an infrastructure for revenue growth.
The approach is built upon manufacturers gaining a deeper understanding of their own capabilities while developing a
Manufacturers that promote quality and on-time delivery aren’t thinking about what sets them apart. “What would you think of a restaurant that promotes the fact that it has salt and pepper?” Hubler asks.
clearer picture of their customers’ needs. The remaining five components of a marketing plan are developing messaging, connecting with customers, understanding the impact of these efforts, determining key learnings, and sustaining the effort.
Hubler says the urgency for developing a marketing strategy is a 10 on a scale of one to 10, regardless of a company’s current revenue. “You can’t wait until times are tough to try to quickly develop a marketing and sales strategy because these things take time,” she says. “You build up the infrastructure, you try a few things, see how they work, look at numbers, and
make adjustments. All that takes time.”
The urgency is even greater for companies with one or two customers comprising a big chunk of sales. “If a customer who accounts for 75 or 80% of your sales walks away, you could be in big trouble. Clients in that situation come to us because they realize they need to diversify their customer base,” Hubler says.
She adds that even companies that are humming along with revenues in line with projections need a strategy. “Even if you aren’t struggling, your goal is to grow, and that’s where a marketing strategy is helpful,” she says.
Identifying and understanding customers
The more manufacturers understand their customers, the better they can identify the ideal channels and messages to reach them and expand revenue. Beyond the basics such as location and size, they should also know the key decisionmakers and influencers within the company –– and what drives them. What are the factors that influence who they choose to do business with? Understanding these motivations is key.
The founder or leader of a company may have lots of information about each customer, but not everyone in the company has access to those details. “A lot of our clients know their customers, but it all lives in somebody’s head,” Hubler says.
It’s important to document that information and share it more widely across the organization, particularly with those who will be involved in the marketing effort. “The owner or leader’s intuition is really important; they really will know who’s making decisions and what drives their customers. Documenting the owner’s intuition will help build a great foundation for future revenue growth.”
to a survey can really be a good indicator of how engaged your customers are with you. If you get a good response quickly, that typically means your customers are engaged with you,” she says.
Hubler recalls one manufacturer survey that yielded a fast response and a very high participation rate. “There were a couple replies that were negative, but you could also tell in those negative responses that they were giving constructive feedback because they cared about this company,” she says.
“They wanted to help them improve; they weren’t just complaining for the sake of complaining.”
One piece of feedback the manufacturer received involved lead times. They had gone through a period when they were short-staffed and their lead times became really long, but they had corrected that. “When we sent out this survey a couple of years later, a lot of the responses came
Amy Hubler, business growth consultant
In addition to the intuition and institutional knowledge a company has about its customers, informal conversations with customers, vendors, and even competitors can enlighten manufacturers about potential clients. Hubler also recommends formal surveys as an avenue to understand customer needs. “The type of response you get
in complaining about their lead times,” Hubler says.
The manufacturer realized that they had not done a good job communicating to their customer base that their lead times had improved. That became an action item –– they put the current lead times on the website and sent out an email to clear up that misperception.
Another exercise Hubler strongly recom-
mends as manufacturers work to improve their understanding of clients is customer segmentation. She suggests separating customers into distinct groups and identifying and documenting key facts about them, including what drives them.
In her workshops, Hubler breaks participants into groups and asks them to do this exercise using Home Depot as an example. “That’s a really clear example, because they have do-it-yourselfers and they have contractors. Those different customer groups are motivated by different outcomes and the messaging for them –– both what it says and how it reaches them –– will be different,” she says.
For manufacturers, customer segmentation can be based on industries –– maybe a manufacturer serves aerospace, medical, and agriculture. Another way to segment is to distinguish between customers that are end users of the product and those that are OEMs or distributors. These segments
“We have customers we’ve been working with for years, but we haven’t necessarily shown them everything that we can do,” says Mark Finken, Galaxy’s COO. “We were able to let them know we can also help with other things. Since we have the customers already established, it’s nice if we can build off of that.”
matter when companies are working to drive sales because they will help shape message content and the best channels to reach them.
Knowing your company
Understanding your company is as important as understanding your customer, Hubler says. “It’s a key part of overall formal planning, both strategic and marketing, to understand mission and values, competencies and capabilities, and how you meet your customers’ needs.”
Hubler urges companies to think deeply about what makes them different. These qualities should go beyond what customers
expect. Manufacturers that promote quality and on-time delivery aren’t thinking about what sets them apart. “What would you think of a restaurant that promotes the fact that it has salt and pepper?” she asks.
She advises companies to focus on their unique value: What’s distinctive about how they meet customers’ needs, how they solve customers’ problems, and how they anticipate and prevent problems? “Those things matter to customers. They will drive them to do business with you,” she says.
Galaxy Precision, Inc. in Albany, Minn. began working with Hubler in the summer of 2024 because revenue had started to decline alongside the industries they typically served –– agriculture and off-road equipment. Galaxy Precision, which offers CNC turning, milling, Swiss machining, and parts manufacturing, developed a clearer picture of their strengths as they went through the marketing strategy process with Hubler, and then shared that with current customers.
“We have customers we’ve been working with for years, but we haven’t necessarily shown them everything that we can do,” says Mark Finken, Galaxy’s COO. “We were able to let them know we can also help with other things. Since we have the customers already established, it’s nice if we can build off of that.”
Messaging and connecting
Understanding their own capabilities and recognizing distinct buckets of customers helps manufacturers make decisions about which segments offer the most opportunity or value. The next two steps in Hubler’s strategy involve messaging and connecting with customers. “Knowing what to say –– and who we should say it to –– is our best link to drive sales. Moving on to the other steps in the marketing process depends on this.”
Developing messaging is a direct outgrowth of the customer segmentation
exercise. “With those different customers defined, we can talk through how this is going to resonate with segment A, whereas this other concept is going to resonate with segment B,” Hubler says. “For each segment, we also determine how we can reach them.”
Determining customer segmentation was important at Vistabule, a St. Paulbased manufacturer of teardrop campers that reached out to Hubler when sales began to slow after the COVID-era surge. Lily Taylor, Vistabule’s chief administrative officer, says the company didn’t really have a marketing strategy before working with Hubler.
“We weren’t really doing any advertising, maybe an obscure travel magazine that would reach out to us every once a year or something. We didn’t have a newsletter. We posted Google ads on social media here and there,” Taylor says. “It was very much word of mouth combined with a little bit of piecemeal advertising, but not a full-blown strategy.”
Initially Vistabule worked with Hubler to understand different potential groups of customers, which allowed the company to target its messaging efforts more effectively.
Hubler then helped Vistabule develop a new marketing strategy, including an updated website that targets potential campers with testimonials emphasizing the ease and fun of camping with its teardrop campers. It has a targeted newsletter that reaches owners and potential buyers, and it participates in RV shows and other events to reach likely customers.
Understanding different customer segments helps Vistabule target even more narrowly. Many customers are empty nesters, so Taylor says they try to reach them on Facebook instead of Instagram, which typically draws a younger demographic.
Another segment is those with specific hobbies. “We know that people who fly
Amy Hubler delivering her presentation in St. Cloud.
PHOTOGRAPH BY ROBERT LODGE
fish are usually in that empty nester target age category, and they like to spend a decent amount of money on fly fishing materials,” Taylor says. Knowing that, the company now attends fly fishing shows to promote its campers.
Vistabule also developed a nationwide ambassador program that connects camper owners with potential buyers, a critical avenue for personal outreach for customers who can’t visit the St. Paul showroom in person.
Like Vistabule, Galaxy Precision grew organically for years. Finken worked with customers and followed potential leads, essentially growing by word of mouth. Since the summer of 2024, Hubler has worked with Mark Finken and CEO/CFO Sharon Finken to develop a complete marketing strategy that can reach more customers in a
Crawl, Walk, Run
systematic way. “They have a lot to offer, but they weren’t reaching a big pool of potential customers,” Hubler says.
After completing a SWOT (strengths, weaknesses, opportunities, and threats) analysis and a customer segmentation exercise, Galaxy Precision has a more comprehensive approach to reaching customers. Working with Hubler and a marketing firm, the company has updated its website, improved search hits on Google, and identified new markets where it can submit responses to requests for quotes. “I can definitely tell that in the last four to six months RFQs have really gone up,” Mark Finken says.
Assessing, adjusting, sustaining
The ultimate goal of a marketing strat-
A step-by-step approach to marketing strategy
Understanding customers’ needs helps manufacturers determine where to focus their marketing efforts.
“I like to use the crawl, walk, run metaphor to think about marketing capabilities,” Hubler says. “If we are just getting started, we are crawling. If we’ve started and are effective, we’re walking. If we have robust strategies and consistent results, we are skilled — that’s running.”
Hubler uses a chart to outline how different marketing strategies fit within these different stages. A manufacturer in the “crawl” section might market primarily through word of mouth or a website, based on the owner’s intuition. A company in the “run” section might have a dedicated marketing team that uses CRM software and sophisticated market research to target potential customers.
“This can look different for every company,” Hubler says. “But understanding where you are on the continuum influences overall marketing efforts. It helps companies decide what to start, stop, and continue.”
Enterprise Minnesota’s Lynn Shelton says the motivation of the strategy has been clear from the beginning: “We wanted to elevate the visibility of what manufacturers think in this state.”
egy in a manufacturing company is to drive sales, but Hubler urges companies to look beyond revenue growth as they assess their efforts. A deep dive into results can help manufacturers understand which efforts bring value, guiding their adjustments in strategy and helping sustain their efforts over time.
Hubler calls it a “growth scorecard,” a way to track performance metrics over
“There’s a clear connection between success and having a formal marketing strategy in place,” Hubler says.
time, usually monthly. It could be the number of visits to the client’s website. It could be analyzing the win rates on the number of quotes or proposals they issue.
“It’s more than just the number of units sold,” she says. “If they do email marketing, we might look at the open rates over time. Are the click-throughs going up or down? If they’re doing paid advertising, what are the results of that?”
Manufacturers who analyze marketing data can make appropriate adjustments. She likes to use the acronym REAP to capture the steps: review, evaluate, adjust, and prioritize.
“You have to think through, with your limited budget, where you’ll prioritize your efforts, with both budget and time,” she says.
Finally, Hubler urges manufacturers to follow through with the final step of her approach: sustain. She works ongoing support into her marketing projects. “I have a lot of clients where, on a regular basis, we’re looking at all of this and we’re doing the monthly REAP session. Then quarterly we broaden it and think about the big picture: What are we trying to accomplish, what are our goals?”
She encourages clients to have action items or projects that are tied to achieving those larger goals. “If you’re not careful, the implementation is where it can fall apart,” Hubler says.
“Developing your company marketing strategy, growing your business, and driving revenue growth are the keys to moving forward. There’s a clear connection between success and having a formal marketing strategy in place,” she says.
OPERATIONS
Cutting Edge Growth
BY ROBB MURRAY
How Two Rivers Enterprises uses operational sophistication to become a premier manufacturer of food processing equipment.
Brian Warzecha, president, and Jessica Wells, general manager
At the time, the population of Holdingford — which sits 25 miles northwest of St. Cloud — had a modest population that hovered around 500 people. But it was big enough for a blacksmith shop, so Vince, Roy, and Frank Warzecha set up shop a few miles outside of town.
It was here where the Warzecha name became synonymous with metals in the Holdingford area. While the blacksmith shop may be long gone, the Warzecha name has remained important in Holdingford. Today, 80 years after the doors opened on that blacksmith shop, the Warzecha name remains at the head of one of the town’s most successful businesses.
Two Rivers Enterprises, a top manufacturer of food processing equipment, employs about 50 people at its facility, which sits 90 minutes northwest of the Twin Cities.
Two Rivers’ deep roots don’t mean it’s rooted in the ways of the past. While it leans into the history of hard work and rural Minnesota values, the company is planning for a cutting-edge future that emphasizes efficiency, productivity, and profitability. Doing so, company leaders say, will help them stick around another 80 years and more.
“When Jessica Wells and I started in the business five years ago, there wasn’t a plan in place, and there wasn’t a direction, the goals weren’t clear,” Two Rivers President Brian Warzecha says. “We wanted a plan that addressed not just where we want to go as a business in terms of revenue and dollars and profitability, but one that also addressed goals for our employees, expectations, culture — we had to tackle things that the business was missing.”
Enterprise Minnesota would help them hone and refine their strategic planning process poised for sustained growth.
Food
Today Two Rivers Enterprises is a custom stainless steel equipment fabricator for food processing, foodservice, restaurants, pharmacies, and medical practices. But it took a lengthy route to get there.
Frank’s sons Bob and Dan worked at Lake State Industries until 1999 when they came to Holdingford to set up a new business. While Two Rivers initially split its output at roughly 95% for restaurant equipment and 5% for food processing equipment, that
ratio today is exactly the opposite. This strategic shift represents a key driver of Two Rivers’ growth and transformation. Two Rivers tries to work with as many local companies as possible. Keeping things local — and domestic — is a source of pride for them.
Diversifying into custom food processing
Visitors who step inside Two Rivers’ bustling facility quickly see the sheer diversity of their product offerings; conveyors, custom food processing equipment, sous vide cook systems (which cook food at low temperatures), steam ovens, mezzanine platforms, conveyors — the list goes on.
“When our team goes into a food plant, it’s our goal to make our customers’ equipment needs a reality,” Warzecha says.
During a tour, General Manager Jessica Wells calls attention to the company’s newest showpiece, a state-of-the-art water jet cutter, installed just a week earlier. The machine can slice through metal with precision and speed. Unlike older models, the new machine submerges the workpiece in a tank of water about the size of a parking stall. With the old machine, Wells says the sound was loud enough to leave workers reaching for ear plugs. The new one creates a “remarkably quiet and clean” work environment.
The water jet represents a broader push toward automation that is transforming this manufacturer’s processes.
In another area of the plant, Wells shows off the Time Saver machine, a specialized piece of equipment that uses a vacuum bed and rotating sandpaper discs to deburr and smooth the edges of freshly cut parts. Cut steel parts usually retain a few shards that must be removed. Rather than tedious manual work, this automated system can process an entire batch in just a few hours.
“It’s kind of like sandpaper,” says Wells. When done manually, each part can take several minutes. The aptly named Time Saver can deburr dozens of parts at once.
On this machine, Two Rivers partnered with students in St. Cloud State University’s engineering department, who created an adjustable table with rollers that catch and flow the deburred parts.
A few feet away, a state-of-the-art CNC router handles plastic fabrication needs, replacing outdated tools and outsourced
Specialized conveyance systems and cutting equipment enables Two Rivers to serve a diverse array of clients.
work. And in the welding department, a custom-built seam welder ensures a consistent, high-quality finish on their stainless-steel sinks and countertops.
In 2023, the company invested in a CNC cutting laser. This investment took their daily cutting from 15-18 hours a day down to five hours daily. It allowed them to reposition employees to better support the needs of the business.
By embracing automation and innovation, Two Rivers aims to position itself for continued growth.
This custom approach is central to Two Rivers’ success. Rather than relying on offthe-shelf solutions, the company’s team of nine engineers works closely with customers to bring clients’ ideas to life.
“We take our customers’ ideas, and we try to make them a reality,” Warzecha says.
The company’s vast library of past projects provides a solid foundation, but each new solution requires a fresh approach.
“A conveyor is a conveyor, it has rollers, it has a drive, a gearbox, and it spins a belt. But the footprint is custom,” Warzecha says. “So that’s where you have to reinvent
The company develops the next generation of skilled workers through partnerships with local high schools and St. Cloud State University.
the wheel.”
This custom focus has enabled Two Rivers to serve a diverse array of clients, including producers of beef, poultry, pork, confectionary, and dairy products, by designing and building specialized conveyance systems and cutting equipment.
“There are many different aspects of what we can do,” Warzecha says. “It’s what keeps us busy.”
Strategic planning, continuous improvement
While Two Rivers’ custom capabilities have been a key strength, the company recognized it needed to take a more strate-
gic approach to unlock its potential. This realization led them to connect with experts who could help.
Working closely with business growth consultants at Enterprise Minnesota, the Two Rivers team embarked on a comprehensive strategic planning process that took nearly a year to complete. Warzecha says the results were transformative, as the company set clear goals and developed a roadmap to achieve them.
Warzecha says that, once they assembled a board of directors, they needed a strategic plan to help them progress from a company with steady growth to one with substantial growth. Now, a few years later, revenue is
nearly three times what it was prior to the strategic plan’s implementation.
“When our board of directors came together, we said, ‘Okay, now we’ve got to start focusing on this plan,’” Warzecha recalls.
Mapping out a plan for growth and sticking to it has paid off.
Wells says that, when she and Warzecha started, Two Rivers had developed core values and a mission statement, although they were not formally launched.
“So that was kind of perfect timing for us, to work with our strategic plan to figure out what our goals are for one year, three
combined $320,000 from the JCF and MIF programs.
“The Job Creation Fund is basically like a rebate after you create the job,” Wells says. “The Minnesota Investment Fund is for equipment. So based on the equipment — we put in the water jet — the state will loan the city money at a low interest rate that it can then loan to the manufacturer.”
Beyond the physical expansion, Two Rivers has also invested heavily in its workforce. The company has forged partnerships with local high schools and St. Cloud State University, creating apprenticeship and internship programs to develop the next generation of skilled workers.
Keeping things local — and domestic — is a source of pride for Two Rivers.
years, 10 years,” Wells says, “and then start working on those initiatives to start building the business.”
In addition to the strategic planning, Two Rivers has also leveraged Enterprise Minnesota’s expertise in lean manufacturing and continuous improvement. The company has invested in a range of automation and technology solutions, from that time-saving deburring machine to the water jet and laser cutter. Both have dramatically improved efficiency and throughput.
“We were cutting on two shifts 15 to 18 hours a day,” Wells says. “Now we’re cutting five, six hours a day with two people.”
Expansion
As Two Rivers has grown, the company has recognized the need to expand its physical footprint. The company is currently in the midst of an expansion project, adding 10,000 square feet to its existing facility. This expansion will enable the company to optimize its manufacturing flow, with raw materials flowing seamlessly from cutting to deburring, pressing, and welding.
The expansion will include additional workspace and new equipment layouts to improve efficiency and flow, Wells says. “We’re planning to add an additional five to six welders.”
Two Rivers financed the expansion through state-level support programs, including the Minnesota Investment Fund (MIF) and the Job Creation Fund (JCF). These initiatives have provided low-interest loans and rebates, helping the company offset the costs of its growth.
Two Rivers is potentially getting a
To further attract and retain top talent, Two Rivers offers a robust benefits package, including 100% coverage of employee health insurance, 401(k) matching, and competitive bonuses.
The company also shares its profits with employees through an annual profit-sharing program.
“We do a competitive bonus. We do
profit sharing. These are just other areas where we feel you’ve got to reward your team for the work that they’re doing,” Warzecha explains.
Industry insights
Two Rivers also recognizes the value of tapping into industry insights and networking opportunities. Through its participation in Enterprise Minnesota’s Peer Councils, company leaders say they have gained valuable perspectives on legislative changes, workforce policies, and best practices in areas such as AI and manufacturing.
Wells says she also gained insight into the ISO process, which validated Two Rivers’ decision to wait on pursuing an ISO registration.
“We were talking about this yesterday at my peer council,” says Wells. “If you are making any government, military type of stuff, then that’s where they’re looking to be ISO certified.”
Peer Council discussions have also informed the company’s approach to issues like employee bonuses, training, and continuous improvement.
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Powerful Data, Invaluable Connections
Our State of Manufacturing® survey events bring manufacturers and their supporters together even better than we dreamed they would.
What do a restaurateur, a school superintendent, and the president of a once-Ukrainian, now-Minnesota-based, robotic company have in common? They all attended our State of Manufacturing® (SOM) survey event in Duluth. Drawn by the promise of manufacturing in Minnesota, the eclectic group was among hundreds who attended this year’s SOM events. I would bet that before Enterprise Minnesota launched the survey –– and the events we hold each year across the state to share the data –– these three never would have connected.
We launched the SOM in 2008 to go beyond providing quality data about the challenges and opportunities manufacturers expect to face in the coming year. We aimed to provide an unparalleled opportunity to connect manufacturers to each other and their supporters across the state. Since its beginning, the survey has
regularly brought the manufacturing community together through both the regional focus groups we conduct to supplement the poll’s findings and the Greater Minnesota survey data rollouts, such as the one in Duluth. Before these rollouts became a permanent fixture on the manufacturing calendar, manufacturers tended to operate very independently in their facilities across the state, quietly working to improve and expand their businesses.
We certainly understand that manufacturers’ primary objective is to strive for growth, and our team of Enterprise Minnesota consultants supports them as they do. But we also suspected there was value
These events convene like-minded people with the common goal of helping manufacturing thrive.
in the way our SOM-related events could help manufacturers build connections with each other and increase visibility with the public at large.
The focus groups and rollout events create a synergy in the manufacturing community, allowing participants to share concerns and solutions, network with potential customers and suppliers, and forge relationships with those institutions and professionals that support manufacturing. When there are policy concerns, as there are this year, they can commiserate and strategize. When there are business cycle concerns — think supply chain bottlenecks and worker shortages — they can learn how others are approaching those challenges. When business is booming, they can celebrate together.
The rollout events have also helped convene manufacturers with policymakers, educators, other business professionals, economic development interests, granting organizations, and the media. In short, these events fulfill the goal of serving as the nexus for manufacturing by convening like-minded people with the common goal of helping manufacturing thrive.
Nowhere was that connection more evident than at the SOM data rollout in Duluth in January, where the three participants mentioned above crossed paths. Twenty years ago, there simply wasn’t a forum that promoted such connections. Though each had different motivations for attending the event, they all took advantage of the rich networking opportunities they found there.
• Eduardo Sandoval-Luna, owner of Oasis Del Norte, has expanded his food truck and catering business into a brick-and-mortar restaurant and is interested in learning about how he can manufacture and distribute his food for broader consumer sale.
• John Magas, superintendent of Duluth Public Schools, has support from key area companies to expand his district’s curriculum to include advanced manufacturing, and he enjoyed sharing his plans with our audience.
• Al Johnson, president of BotCrew, was eager to discuss how the company is faring in the wake of recently enacted paid leave requirements.
Each of these participants, and the 53 others who joined them, demonstrated the critical role of the SOM survey. It gives us an opportunity to showcase invaluable data, but more importantly, its related events give diverse individuals in the manufacturing ecosystem opportunities to connect with us and each other.
Lynn Shelton is vice president of marketing and organizational development.
GROWING COMPANIES ENHANCING COMMUNITIES
Granite Partners is a private investment and long-term holding company founded in 2002 in St. Cloud, Minnesota, with a mission to grow companies and create value for all stakeholders. We advance a culture of trust, innovation, and excellence as essential to 100-year sustainability, and we aspire to world-class wellbeing for everyone in the Granite community.
