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George Cottom of George’s Fine Steaks.

So you want to run a restaurant?

Risks, benefits abound

Also in this issue Kevins Market in Lake Crystal D&K Tire of Amboy & Lake Crystal Farm rental rates stay high

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Mankato Magazine


Professional resources to help grow your business AUTOMOTIVE Jerry’s Body Shop, Inc. 1671 Madison Avenue Mankato, MN 56001 507-388-4895 www.asashop.org/member/jerrys

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2 • november 2013 • MN Valley Business


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Gaylord 507.237.5521 MN Valley Business • november 2013 • 3


Mother Nature is not the only one who can produce great color!

Best of Mankato Best Auto Repair

Best Auto Mechanic Lynn Austin

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GENERAL CONTRACTORS

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4 • november 2013 • MN Valley Business

St. James - 507.375.5464 Mankato - 507.345.6653 www.Wilcon-Construction.com

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F E A T U R E S November 2013 • Volume 6, Issue 2

12

Restaurant operators say hard work and a sharp business plan needed to be successful.

20

D & K Tire of Amboy and Lake Crystal traces its roots back to 1956.

22

Kevin and Patrice Gaulrapp of Kevin’s Market & On the Rocks in Lake Crystal.

MN Valley Business • november 2013 • 5


■ November 2013 • VOLUME 6, ISSUE 2 PUBLISHER James P. Santori EXECUTIVE EDITOR Joe Spear ASSOCIATE EDITOR Tim Krohn CONTRIBUTING Tim Krohn WRITERS Pete Steiner Kent Thiesse Heidi Sampson

PHOTOGRAPHERS Pat Christman John Cross COVER PHOTO John Cross PAGE DESIGNER Christina Sankey ADVERTISING Ginny Bergerson MANAGER ADVERTISING sales Danny Creel ADVERTISING Barb Wass ASSISTANT ADVERTISING Sue Hammar DESIGNERS Christina Sankey CIRCULATION Denise Zernechel DIRECTOR

For editorial inquiries, call Tim Krohn at 507-344-6383. For advertising, call 344-6336, or e-mail mankatomag@mankatofreepress.com. MN Valley Business is published by The Free Press Media monthly at 418 South 2nd Street., Mankato MN 56001.

■ Local Business memos/ Company news................................7 ■ Business and Industry trends.........9 ■ Minnesota Business updates....... 10 ■ Construction, real estate trends.. 25 ■ Agriculture Outlook...................... 26 ■ Agribusiness trends..................... 27 ■ Job trends..................................... 28 ■ Retail trends................................. 29 ■ Greater Mankato Growth.............. 30 ■ Greater Mankato Growth Member Activities ....................... 31

From the editor

By Joe Spear

Tasting the American dream

A

nyone dreaming to one day own and operate their own restaurant should read the sobering tales of those who have been there and done that, or been there and not done that - not succeeded. Operating a successful restaurant appears to be one of the toughest challenges in all of business, say successful restaurant owners we talked to for this month’s cover feature. It takes a great deal of work, multiple business skills beyond knowing how to make good food, and lots of miles logged on duespaying roads. It’s a romantic notion -- operating and owning and establishing a restaurant. It’s long been part of the American dream. But as several experts note, you will likely fail if you think you can visit your restaurant, hang out with your friends and greet guests. Running a successful restaurant takes a lot of hands on work and long hours for owners. And then the challenges remain significant. Food prices increase, customers cut back during a recession or when gas prices spike – which is always. Still, the long hours and struggles are worth it to people like George Cottom, owner of George’s Fine Steaks in New Ulm, who says “Nobody said this business is easy. But I love it. Everything is good.” Maybe the appeal of owning a restaurant stems from the fact that restaurants and bars have been romanticized for years across cultures, nations and class. Their images have been amplified in movies, TV and books. We can all see the neon sign of “Rick’s Café Americain” in the movie Casablanca. We can describe the lettering style on the sign over the bar “Cheers” from the long-running TV show of the same name. Restaurants owners are servants. And the servant business sometimes seems tied into the Christian and Hindu traditions, where offering a humble service with a great deal of personal sacrifice and much less monetary reward is the basis of existence. Restaurants are inherently family businesses. Generations work

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together as they grow and family recipes are preserved as they make their way onto the menu that serves as recorded family history. But the sobering realities suggest failure is more likely than success. Some 60 percent of all new restaurants fail within a year and possibly as many as 75 percent fail in the first three years. A lot of people can make good food, say the experts. But successful restaurants have a good business plan and create a personality that will draw people. “People feel good about going there. There’s a little magic,” says Dan McElroy executive director of the Minnesota Hospitality Association which includes the Minnesota Restaurant Association. “Chains do it with marketing and concept. Individual ones do it with the owner’s or staff’s personality or some niche.” To that end, Ray and Ann Hager might have struck the right mix. They’ve beaten the first year and third year odds as they complete their fourth year in business. They took over the longstanding Hilltop Tavern with its signature burgers and are working to keep the tradition alive with their Gunther’s Café. “We wanted to bring back a lot of the things you could no longer find in Mankato, like the Hilltop Tavern burgers. We make them the same way as they did,” says Ann They also brought back famous onion rings people remember from the old Junction Inn, where Ray had worked. They resurrected “Butter Browns” -- deep-fried chunks of cooked potatoes once featured at the old Kit Kat Inn, a Mankato establishment located next to Hilltop Tavern. Being served food and drink has been a service in demand from the beginning of time. It’s not likely to go away soon, despite the hardships faced by owners. We can all be glad for that. MV Joe Spear is executive editor of Minnesota Valley Business. Contact him at 344-6382 or jspear@mankatofreepress.com


Local Business People/Company News

Dr. Mark Yamaguchi

Yamaguchi joins Advance Pain Mgmt. Dr. Mark Yamaguchi has joined Advanced Pain Management on Madison Avenue in Mankato. Following his anesthesiology training at the University of Illinois, Chicago, Yamaguchi became an assistant professor of anesthesiology at Indiana University, where he would complete his pain fellowship. He is board certified in pain management and anesthesiology with fellowship training in pain management. ■■■

Primrose honored Primrose Retirement Community of Mankato recently received the Excellence in Action award from My InnerView by National Research Corp. The honor recognizes long term care and senior living organizations that achieve the highest levels of satisfaction excellence, as demonstrated by overall resident or employee satisfaction scores that fall within the top 10 percent of the My InnerView product database. Qualifying nursing homes, in addition to assisted living and independent living communities (over 8,500), must have completed a customer satisfaction survey in 2012. Winners must have also achieved a minimum of 10 responses with a minimum 30 percent response rate and scored in the top 10 percent of qualifying facilities on the question “What is your recommendation of this facility to others” in terms of the percentage of respondents rating the facility as “excellent.”

tumor and has been in remission ever since. In conjunction with Abdo, Eick & Meyers’ 50th anniversary, Jay Abdo made it a personal mission to raise $50,000 for the hospital. ■■■ I&S purchases Paulsen Architects I&S Group has acquired Paulsen Architects. The operations of Paulsen Architects has been merged into I&S with Bryan Paulsen, founder and principal of Paulsen Architects, directing the architecture service line. Paulsen Architects has a staff of 17. Paulsen was founded in 1995 and has received national recognition and numerous design awards for high-profile projects such as the Spam Museum, Minnesota State University Centennial Student Union, Blue Earth County Justice Center, Rosa Parks Elementary School and Mayo Clinic Health System Eastridge Clinic. I&S, established in 1973, has a staff of nearly 150 and is led by President Chad Surprenant. ■■■ Abels joins First National Cory Abels has joined First National Bank Minnesota in St. Peter as vice president, commercial/ag lender. He brings 10 years of banking and lending experience. First National Bank Minnesota is a $200 million community bank headquartered in St. Peter that serves the communities of St. Peter, Mankato and Gaylord. ■■■

■■■ Jacobson joins Eide Bailly CPA Julie Jacobson has joined Eide Bailly. Jacobson serves as a Cost Segregation Manager. She has “Big 4” experience as well as significant expertise in capitalization and repair and maintenance, which includes in-depth knowledge of the new tangible property regulations as well as significant experience in blue print analysis. She has managed transaction cost analyses, research and development credit studies and has assisted in 704(c) studies and depreciation calculations. ■■■ Abodo gives to St. Jude’s Jay Abdo, senior partner of Abdo, Eick & Meyers raised over $82,000 for St. Jude Children’s Research Hospital. A check for $55,000 was presented at the St. Jude’s Fall Festival of Hope. In addition to the check, family and guests pledged an additional $25,350 worth of donations during the event itself. Abdo has a personal connection with St. Jude, his son Joe was diagnosed with aggressive brain tumors at age 12. Through the help of St. Jude, Joe was able to beat the

Mona Ceniceros

Ceniceros named Minnesota Master Minneapolis Yoga Conference has announced the selection of Mona Ceniceros as one of designated Minnesota Masters who will present at the April 2014 conference. She has taught yoga in the Mankato area for decades in diverse ways including: District 77 Community Education, Blue Earth County Jail female inmates, and several MSU athletic teams. She opened Sun Moon Yoga Studios on South Front Street 14

years ago. It is the regional yoga community for Sun Moon Yoga Teacher Training. This training was the first Yoga Alliance approved training for Registered Yoga Teachers in the five-state area. ■■■

Work starts on retail, office center Wilcon Construction broke ground on a 7,765-squarefoot project designed by Langemeier Architects. The new retail/office commercial development is located along North Victory Drive in Mankato’s home improvement district near DeGroods.

MN Valley Business • november 2013 • 7


Local Business People/Company News

Eide Bailly gives to symphony Mankato Symphony Orchestra is the recipient of the Eide Bailly Non-Profit Resourcefullness Award and the accompanying $10,000 check. The award honors outstanding efforts in revenue generation. Mankato Symphony Orchestra won the award for its Music & Brews initiative, which was an education event for adults. The Symphony brought in attendees to the Mankato Brewery for beer samples and to try out orchestral instruments. ■■■ Hinz earns banking diploma Nick Hinz, vice president of Frandsen Bank & Trust, graduated from the Graduate School of Banking at the University of Wisconsin in Madison. The Graduate School of Banking is a three-year program that develops banking leaders through a program of advanced management education, which includes six weeks of on-campus studies along with intersession projects. Nick Hinz Hinz joined Frandsen in 2006 and his office is located at the Belgrade Avenue office in North Mankato. ■■■ Laraway Roofing honored Firestone Building Products Co. presented Laraway Roofing of New Ulm with the 2013 Partner in Quality award for roofing excellence. The company is one of only 207 Firestone Red Shield licensed contractors throughout North America that were honored with this industry distinction. Firestone presents the annual award to contractors throughout the United States, Canada and Mexico that meet its high building standards, which includes the installation of a minimum of four warranted Firestone roofs in each of the past five years; maintaining at least one million square feet of Firestone roofs under warranty; and achieving an annual Quality Incidence Rating of 2.0 or less. ■■■ Pietka joins Eide Bailly Artur Pietka has joined Eide Bailly as a Senior Associate in the tax department. He has both public accounting and private industry experience.

To submit your company or employee news. e-mail to tkrohn@mankatofreepress.com Put “Business memo” in the subject line. Call or e-mail Associate Editor Tim Krohn at tkrohn@mankatofreepress.com or 344-6383 for questions.

8 • november 2013 • MN Valley Business

Thoen joins Ameriprise Greg Thoen has become an Ameriprise Financial Private Wealth Advisor. Thoen, with an office in Mankato, is one of approximately 6 percent of the nearly 10,000 Ameriprise financial advisors to achieve this status. Thoen is part of Davis, Thoen, Kramer & Associates, a financial advisory practice of Ameriprise Financial Services. ■■■ Brekke passes CPA Eide Bailly announced that Jenna Brekke has passed the Certified Public Accounting exam. Brekke joined the Eide Bailly team in April as an Audit Associate. She graduated in May from the University of Wisconsin, LaCrosse with her bachelor’s degree in Accounting. ■■■ Heilman retires after 34 years with Thrivent Ross Heilman, a financial representative with Thrivent Financial for Lutherans in Mankato, is retiring after serving 34 years with the financial services organization. “It was very satisfying to connect with people, understand their life’s priorities and then develop financial strategies to help them achieve their Ross Heilman goals,” Heilman said. Thrivent Financial is a not-for-profit financial services organization. ■■■ Leonard, Street and Deinard merges Leonard, Street and Deinard, which has offices in Minneapolis, Mankato, and St. Cloud, will merge with Stinson Morrison Hecker. They will combine to become the 75th largest law firm in the nation with more than 525 attorneys and offices in 14 cities. The combined firm will operate as Stinson Leonard Street beginning Jan. 1. Mark Hinderks and Lowell Stortz will serve as co-managing partners and Allison Murdock will be the deputy managing partner. ■■■ Keller named VP at U.S. Bank U.S. Bank in Mankato has named Terry Keller a vice president and commercial banking relationship manager. In his role, Keller is responsible for managing and building on a portfolio of commercial banking relationships in the Mankato region. Keller has more than 20 years of banking experience. He graduated from Minnesota State University.


Business and Industry Trends

Employment

A closer look at state unemployment

The Minnesota unemployment rate and job figures get a lot of attention when they are announced on the third Thursday of every month. While there are plenty of other ways to look at our economic performance, the monthly unemployment rate and job figures are arguably the most closely watched barometer in Minnesota. A story in the latest issue of Trends magazine takes an even closer look at those numbers, breaking down the Minnesota unemployment rate by race, gender, education and other characteristics not found in the monthly figures. The story, “Unemployment Under a Microscope,” looks at the 2012 “Geographic Profile of Employment and Unemployment,” a federal report that comes out every August with an in-depth breakdown of the labor force in each state and in major metropolitan areas. While stark differences remain in Minnesota unemployment rates by race and ethnicity, the 2012 figures show that joblessness for all groups declined last year. According to the story, the average unemployment rate in Minnesota last year was 5.8 percent. A further breakdown of those numbers showed the following: • Average unemployment rate for men: 6.2 percent. • Average unemployment rate for women: 5.3 percent. • Average unemployment rate for whites: 5.2 percent. • Average unemployment rate for Hispanics or Latinos: 8.5 percent. • Average unemployment rate for Asians: 5.8 percent. • Average unemployment rate for African Americans: 13.8 percent. While unemployment rates for some minority groups, particularly African Americans, remain high, the numbers are a marked improvement from just a few years earlier. The African American unemployment rate hit 22.5 percent in the state during the height of the recession in 2009, but it has since declined significantly. The Hispanic or Latino unemployment rate topped out at 15.5 percent in 2009, declining by almost half since then.

■■■

Energy

Heating cost predictions

About one-half of U.S. households use natural gas as their primary heating fuel. Households heating with natural gas are expected to spend an average of $80 (13 percent) more this winter than last winter. The increase in natural gas expenditures represents a 14 percent increase in the average U.S. residential price from last winter, with consumption that is slightly lower than last winter nationally. The projected changes in residential natural gas prices this winter range from a 10 percent increase in the West to

a 15 percent increase in the Northeast. Several factors contribute to this regional variation, including differences in weather patterns, regional changes in production and pipeline capacity, and differences in regulatory constraints in passing price changes through to customers. Households heating primarily with heating oil will spend an average of about $46 (2 percent) less this winter than last winter, reflecting a 5 percent decrease in prices and a 3 percent increase in consumption. Although winter temperatures are expected to be similar to last winter nationally, weather in the Northeast is expected to be 3 percent colder than last winter. Reliance on heating oil is highest in the Northeast, where about 25 percent of households depend on heating oil for space heating, compared with 6 percent of households nationally. Households heating primarily with electricity can expect to spend an average of $18 (2 percent) more this winter with 2% higher prices but consumption slightly lower than last winter. About 39 percent of all U.S. households rely on electricity as their primary heating source, ranging from 14 percent in the Northeast to 63 percent in the South. The use of cord wood and wood pellets as the primary residential space heating fuel has increased by 39 percent since 2004, to about 2.5 million households in 2012. About 8 percent of U.S. Liquid Fuels Consumption.

Oil prices lower

Brent crude oil spot prices fell from a recent peak of $117 per barrel in early September to $108 per barrel as some crude oil production restarted in Libya and concerns over the conflict in Syria moderated. The Brent crude oil price should continue to weaken, averaging $107 per barrel during the fourth quarter of 2013 and $102 per barrel in 2014. Projected West Texas Intermediate (WTI) crude oil prices average $101 per barrel during the fourth quarter of 2013 and $96 per barrel during 2014.

Natural gas inventories lower

Natural gas working inventories ended September at an estimated 3.52 trillion cubic feet, 0.17 Tcf below the level at the same time a year ago and 0.04 Tcf above the previous five-year average (2008-12). The government expects that the Henry Hub natural gas spot price, which averaged $2.75 per million British thermal units (MMBtu) in 2012, will average $3.71 per MMBtu in 2013 and $4.00 per MMBtu in 2014.

Coal makes modest gains

Despite a rise in natural gas prices from their 2012 level, stable coal prices and an increase in electricity generation from coal contribute to only modest increases in retail electricity prices. Residential electricity prices are expected to increase by 2 percent in 2013 and 1 percent in 2014.

MN Valley Business • november 2013 • 9


Minnesota Business Updates

■ ADM considers headquarters move

■ Cargill accused of land grab

Archer Daniels Midland, the world’s largest grain processor, is considering relocating its Decatur, Illinois, headquarters to reflect its evolution into a more global company. ADM said it is currently having discussions with public officials and advisors to determine where it will relocate. It only plans to about 100 workers at the new global headquarters center, according to the Chicago Tribune. ADM is considering locations in Minneapolis, Dallas, Atlanta and Chicago. ADM’s preferred site is Chicago, according to a knowledgeable source. The company declined to offer specifics. O’Hare International Airport is a draw, the source said. The office of Mayor Rahm Emanuel said it will work with the company to ensure its corporate headquarters remains in the state. “Our company is growing and becoming more global and more customer-centric,” Patricia Woertz, ADM chairman and chief executive officer, said in a statement. “To continue to succeed, we need a global center in a location that allows us to travel and work efficiently with customers and employees throughout the world. We also need an environment where we can attract and retain employees with diverse skills, and where family members can find ample career opportunities.” ADM was founded in 1902 in Minneapolis.

Minnesota-based Cargill bought a large area of farm land in Colombia many times bigger than the legal limit by setting up dozens of “shell companies”, violating the spirit of agrarian reform laws, social justice group Oxfam said. Oxfam says that Cargill’s purchase of at least 130,000 acres through companies registered from 2010 and 2012, all listing the same agricultural activity and address, may have broken the law. Cargill spokeswoman Lori Johnson told Reuters the land in question was “not suitable for growing crops on any scale without significant investment,” for example to correct acidic soils and build infrastructure to transport crops. “Where we disagree with Oxfam is on what are the policies that really lead to stability, poverty reduction and increased food security. And, in this particular instance we clearly disagree with their interpretation of the law,” Johnson said. Colombia has one of the highest rates of land concentration in the world, Oxfam says, with 80 percent of the land owned by 14 percent of landowners. Legal limits on land purchases are a key part of Colombia’s land-reform effort. Individuals and companies are only able to buy much smaller areas of land up to 4,262 acres.

■ Cargill closing feedlot The lingering Texas drought has led Minneapolis-based Cargill to anounce plans to close a cattle feedlot. The Plainview Daily Herald reported Tuesday that the Cargill yard in Lockney will shut down next summer. Cargill spokesman Mike Martin cited dwindling numbers in the region’s cattle supply for the planned closure of the feedlot, about 45 miles northeast of Lubbock. He also says the cost of feed has risen during the Texas drought going back to 2011. Cargill Cattle Feeders Lockney opened in 1985. The site employs about 45 workers and can handle about 6,200 cattle.

■ Target lays off 150 Target let 150 employees go from its corporate headquarters in Minneapolis in October. The company said the cuts were necessary to “eliminate duplications” and because of shifting roles to focus on its top priorities. Target said its goal is meeting its increasing number of digitally savvy customers. Target also said it will be aggressively seeking e-commerce and technology workers to help in areas like mobile sales, site merchandising and user experience.

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■ Fastenal misses estimates Fastenal Company reported that its third-quarter net income increased to $119.35 million or $0.40 per share, from $109.32 million or $0.37 per share, last year. On average, 12 analysts polled by Thomson Reuters expected the company to report profit per share of $0.41 for the quarter. Analysts’ estimates typically exclude special items. Net sales rose year-over-year to $858.42 million, from $802.58 million, a year ago. The company said its sales growth of 7 percent was impacted by the gain of one business day versus the prior year. Analysts expected revenue of $862.54 million for the quarter.

■ General Growth buys JCP office Mall owner General Growth Properties bought retailer JC Penney’s office building in New York City, from Jared Kushner Group for about $150 million in an all-cash deal, the New York Post reported, citing unnamed sources. The deal was signed by GGP to get ahead of the sales process being started by real estate-focused investment bank Eastdil Secured, the Post reported. GGP owns 128 million square feet in 123 malls in the United States, including River Hills Mall in Mankato.


Minnesota Business Updates

■ HickoryTech becomes Enventis HickoryTech has changed its brand to Enventis across the company’s service area. The company will also seek shareholder approval to change its corporate name to Enventis at its shareholder meeting in May 2014. “We are very excited to announce Enventis as our unified brand representing the wide range of business and residential services and products we offer throughout our service area,” said John Finke, president and chief executive officer of HickoryTech. “We will continue to be the local communications solution partner you can trust. Moving to a unified name enables us to leverage our strengths, expertise, solutions and investments to best serve all our customers and be recognized as a leading, regional communications provider.” HickoryTech had operated under the Enventis brand in the Twin Cities, northern Minnesota, Rochester, Minn., Fargo, North Dakota and Des Moines, Iowa areas where the company has offices and local employees. Enventis will keep its headquarters in downtown Mankato and employees and customers are unaffected by the name change.

■ Johnson restructures debt Johnson Outdoors announced a new streamlined structure of the company’s debt. The new loan agreement replaces the current revolving credit and is expected to reduce annual borrowing costs. The new financing has fewer covenants and a simplified reporting requirement. A revolving credit provides financing up to $90 million, which matures in five years. The revolving credit bears a floating interest rate. The company’s existing term debt facility, arranged by Ridgestone Bank of Brookfield, Wisconsin, remains in effect.

■ Xcel offers new solar option Xcel Energy customers would have the option of purchasing solar energy from a central source under a new proposal. If approved, Xcel Energy’s new program could more than double the use of solar power by the company’s customers in Minnesota during the next two years. The program would provide for development of “solar gardens,” or groupings of solar panels at a centralized location. Xcel Energy customers would have the option to subscribe to a garden and receive credits on their electricity bills for their portion of the energy produced. “Our customers want the option to purchase additional

renewable energy, and this program will deliver,” Dave Sparby, president and CEO of Northern States Power Co.Minnesota, an Xcel Energy company, said in a statement. “Solar gardens should offer a straightforward and more affordable approach to solar power for our customers and system.” Xcel Energy proposes to accept applications from solar developers to construct the gardens. To ensure timely and well-executed development, the company would seek up to 2.5 megawatts of solar power per quarter during the next two years, for a total of up to 20 megawatts. Currently there are approximately 14 megawatts of solar power on Xcel Energy’s system in Minnesota. For reference, one megawatt of solar power provides enough energy to serve about 250 homes. Customers would be able to subscribe to the solar garden for a portion or all of their electricity needs. Xcel Energy proposes to set the bill credit rate for the initial rollout at about 10 cents per kilowatt-hour for residential customers and 6 cents per kilowatt-hour for typical commercial customers.

■ Wells Fargo profits up 13% Third-quarter profit for Wells Fargo & Co., the biggest U.S. mortgage lender, jumped 13 percent as a decline in revenue from mortgage lending was offset by reduced expenses and fewer soured loans. Net income increased to $5.6 billion in the JulySeptember period from $4.9 billion a year earlier. On a per-share basis, earnings were 99 cents, beating the 97 cents forecast by Wall Street. Third-quarter revenue dipped to $20.5 billion from $21.2 billion, coming in below the analysis of $21.1 billion.

■ St. Jude has wireless pacemaker

St. Jude Medical received European approval to market the first pacemaker that does not require wires to attach to the heart. The first-of-a-kind device was developed by Californiabased startup, Nanostim, with funding from St. Jude. The Minnesota-based device giant also said it would acquire of the smaller company for $123 million, under a previously negotiated option agreement between the two companies, according to CBS. Pacemakers are battery-powered medical implants that help the heart maintain a steady heartbeat. The devices have traditionally been implanted through a surgical procedure that creates a small pocket in the chest for the device and its wires, called leads, which attach to the heart. The new Nanostim pacemaker is implanted directly into the heart using catheter-based procedure, which St. Jude says is less intensive than traditional surgery.

MN Valley Business • november 2013 • 11


George Cottom opened George’s Fine Steaks in New Ulm in 2006.

The restaurateurs Success takes long hours and business savvy By Tim Krohn | Photos by John Cross & Pat Christman

I

t’s what one national restaurant consultant called “perhaps the worst investment you can make.” Still, the dream of running a restaurant runs strong in many entrepreneurs. For many, the endeavor ends in despair. It’s estimated some 60 percent of all restaurants fail within the year and the number may be as high as 75 percent after three years of opening. Despite those odds, many succeed with a combination of hard work, attention to details, a sharp eye on expenses and, of course, food and service people return for. George Cottom, owner of George’s Fine Steaks in New Ulm, said those who start a restaurant without a lot of experience in the business face a tough road.

“People who haven’t done it before don’t realize the tremendous amount of work it takes to make it happen. You have to know how to cook and be a waiter and bartend and you have to know how to teach all those things.” Dan McElroy, president of Hospitality Minnesota, which includes the Minnesota Restaurant Association, said a common downfall for many failed restaurants – and other businesses – comes down to money. “They just don’t have enough operating capital to begin with,” McElroy said. And he said, it’s a business that takes more attention than most. “It’s a business of 1,000 details. If you think you’re just going to sit by the bar and greet customers, it’s

Cover Story

12 • november 2013 • MN Valley Business


George’s Fine Steaks draws customers from a 50-mile radius. not going to work.” When Ray and Ann Hager opened Gunther’s Café in the tiny location long occupied by Hilltop Tavern, they immediately realized they’d underestimated their staffing needs. “We’re so small, we thought we could run it ourselves,” Ann said. “But they were standing in line waiting to get in and we ran out of dishes and used paper plates because we didn’t have time to do dishes. We had to take things off the menu because we couldn’t keep up.” Be ready to work. Hard The restaurant experiences that has helped make Cottom’s steakhouse successful stretch back to 1978 when he worked for Happy Chef. He then spent years with the Marriott Corp. working in different states, worked for Red Robin and for Outback. He learned more about running a restaurant when he and two partners opened one in California. He also learned some harsh realities after being in a serious auto accident that left him hospitalized for a long time. “When I got out of the hospital, my partners had absconded with a good amount of my money,” Cottom said. Looking for a fresh start he and his wife, Karen, returned to her hometown of New Ulm where he rented a small former bar and opened George’s Fine Steaks in early 2006.

“I literally had a few hundred bucks when I started.” He later bought and renovated the building and has maintained a loyal following. “We do a lot of private parties,” he said. “I pull from a 50 mile radius and get regular customers from the Cities. Not too many places do what I do any longer so that helps.” One of the biggest challenges for Cottom and other restaurant operators has been a significant increase in food costs. “Six months ago I changed menu prices. I hadn’t done it for a long time and I was probably being hurt. I probably should have done it sooner,” Cottom said. “The cost of everything has just gone up dramatically. It was $12 for a case of head lettuce not long ago, now it’s in the $24 to $30 range. Walleye is 12 bucks a pound.” He said he’s been able to keep his menu prices a bit lower than they should be because he, his wife and kitchen manager do a lot of the work of preparing cuts of meat and preparing food items that some other restaurants have pre-done. “The fun of it is we’ve been able to serve the same quality product even though the price of food has doubled since I started. Food costs are going to stay high – people want get what they pay for. Once I get them in the door, I can show them what I can do.” Cottom said watching overhead and working with a bank that understands the restaurant business is important. He’s been working with United Prairie Bank.

MN Valley Business • november 2013 • 13


Ray and Ann Hager keep the history of Hilltop Tavern alive at Gunther’s Café in Mankato. “I’m leveraged deeply. Remodels and things over the years take a lot of money and you need a bank that understands the business.” Cottom has a few tips for would-be restaurant owners, starting with what won’t work. “If you haven’t done all the jobs involved in a restaurant and bar before you’re probably going to fail,” he said. “People open a restaurant and want to be an absentee owner or just hang out with their friends there, and then they wonder why it failed.” Mostly, he said, be prepared to work hard. “It’s going to take seven days a week and all your attention. You need to know how to maintain your equipment and fix things. There’s more regulations and inspections all the time,” Cottom said. “And you have to have a great staff. That’s key long term.” “Nobody said this business is easy. But I love it. Everything is good.” A piece of (hamburger) heaven Beginning in 1949, one of the iconic eateries in Mankato was a little hole-in-the-wall restaurant on Madison Avenue called Hilltop Tavern with the “Hamburger Heaven” logo. When the business shuttered its doors in 2003, generations of customers figured the simple, tasty hamburgers and cozy atmosphere was lost. Today, Ray and Ann Hager are keeping the location alive

14 • november 2013 • MN Valley Business

with Gunther’s Café, serving the same classic burgers, along with other revived local favorites. “We wanted to bring back a lot of the things you could no longer find in Mankato, like the Hilltop Tavern burgers. We make them the same way as they did.” Ray had worked at the old Junction Inn between Mankato and Lake Crystal, and brought their well-known onion rings. They also have hand-dipped shakes and brought back a staple of the former Kit Kat Inn, which had its heyday in the ’70s and was located next door to Gunther’s in what is now Patterson Diamonds. “They had the Butter Browns and we brought them back. Chunks of cooked potatoes, deep fried with butter on top,” Ann said. They’ve owned Gunther’s for four years but have long backgrounds in the business. “When we first met in the ’70s he was cooking in restaurants and I was a waitress,” she said. “We worked in some of the same restaurants together so we knew we could work together.” Ray was also working for Midwest Wireless but was laid off when they were sold. “We saw the ‘for sale’ sign at Hilltop Tavern and thought we could do this, so we made it happen.” “Our biggest awakening was when we very first opened,” she said of the onslaught of customers who overwhelmed


the couple trying to run the business alone. “By the third week we hired people. Now we have a great crew of six and they actually give us a day off now and then,” she said. “It’s going very well. We have a lot of people who’ve been in Mankato who remember the Hilltop Tavern and they’re bringing their families in and the other generations are learning about us.” College homecomings always bring a crush of customers who went to college in Mankato and remember Hilltop Tavern. “We still get quite a few college kids. Sports team members come in. And we get a big turnout from the hospitals and clinics.” She, too, said the rising price of food has been a challenge. “It’s always hard to keep your prices down and pay people a good wage.” But, she said, offering good food and paying attention to customers looking for Gunther’s close-knit experience have been keys to success. “If we’re packed, people will share their tables with people they don’t know. That’s just the atmosphere. We’re thankful we have such a great bunch of customers. A lot of regulars.” Sticking with it Few restaurateurs have the business in their blood more than Jay C. Pappas, owner of Pappageorge Restaurant and Bar in Mankato. For 50 years, a Pappas has had a restaurant in southern

Minnesota. Since 2007, he and his wife, Layla, have offered fine steaks, seafood, homemade breads and other fare at their intimate, somewhat out-of-the-way location on north Riverfront Drive, just north of Madison Avenue. Growing up in restaurants, Pappas knew the work involved and it hasn’t let up. “Sometimes I wish I didn’t have to works so much, but that’s part of our success. I do a lot of the work myself and so does my wife. Six days a week, 10 hours a day,” he said. “And if you take time off something goes wrong, not by anyone’s fault, something just happens.” He said anyone starting a restaurant needs to be prepared to stay with it through a difficult, sometimes long startup time. “We didn’t start out of the gates real strong and then the recession hit and we weren’t making money and it was frustrating. But it turned around and we have a strong customer base and they support us and that’s been great.” “I see places close after a few months and I say, ‘why did you start it?’ ” He said his banker’s advice early on was also on target. “When we started, the bank wanted us to have extra money and we said we don’t need that much. But we did.” He said rising food prices forced him to raise some lunch prices slightly to keep pace. “But there’s not much you can do about food prices going up.” And he must be aware of what the local market’s price point is. “A $25 steak you’d get here would be $45 in the Twin Cities in a finer restaurant. You have to know your market.” He said there’s recently been an issue getting highquality shrimp as prices have gone up 15 percent due to large die-offs at Asian shrimp farms. He’s always tried to get his shrimp from the Gulf, but said higher demand has limited them.” Pappas said many people believe most local bars and restaurants are always bustling. “They say, ‘it’s always busy, it must be like picking money up off the ground.’ But they’re out on Friday or Saturday night when it is busy. You go out on Monday or Tuesday night and it’s different.” The Pappas family restaurant history began with Michael Pappageorge (great-grandfather of Jay C. Pappas), who came to America from Greece as an 11-year-old at the turn of the last century. He lived in Chicago, changed his name to Michael Pappas, then opened restaurants in Worthington and Northfield before moving to Rochester. In 1952, his four sons opened Michaels restaurant in downtown Rochester. The restaurant, a huge business that now takes up seven storefronts, is still run by several Pappas families, including the one surviving son of Michael. The Pappas family bought the Hubbell House in Mantorville in 1946, a historic restaurant the family also still operates. The family opened Michaels in Mankato in 1962 in the South Second Street building that now contains the Sugar Room bar and a law office. Jay T. Pappas, (father of Jay C. Pappas) operated Michaels in Mankato until 1975. He opened Maggie’s near the university in 1982, where Jay C. Pappas joined his father in the business. They sold Maggie’s in 2006. Jay C. Pappas drove a delivery truck and worked at

MN Valley Business • november 2013 • 15


Jay C. and Layla Paapas of Pappageorge’s in Mankato. Boomtown after Maggie’s was sold but, at the urging of Layla, began looking for a restaurant of his own to open. They found the space in the back of the former Elks Club. The building is owned by Mike Miller, who has his real estate and auctioneer offices in front. “The space was great because the kitchen and bar were already in.” Known for his steaks, Pappas buys only Choice beef or better and is one of the few who cuts his own steaks. “You just get better consistency when you do your own cuts.” Hit by the recession While most all businesses felt the effects of the economic downturn, restaurants were particularly vulnerable. “Eating out is a discretionary consumer dollar. When their 401K goes down, or they work fewer hours, people eat out less,” said McElroy, head of the Minnesota Hospitality Association, which includes the Minnesota Restaurant Association. “We’re seeing guest counts come back, but the average checks have not come up as much. Restaurants still feel the need for coupons, mid-week specials. That’s an indication that guests are value conscious.” He said many restaurants and restaurant chains have been trying to keep a lid on overhead in the face of higher food costs, by reducing table service. Chains such as Chipotle and many famous Dave’s locations, for example, have customers order at a counter and then either get their food immediately or go to a table until it’s ready. “Table service restaurants haven’t grown as fast as that casual food segment,” said McElroy, who served as

16 • november 2013 • MN Valley Business

commissioner of DEED under the Gov. Pawlenty administration before going to the hospitality group. McElroy said successful restaurant operators go in with a good business plan and create a personality. “People feel good about going there. There’s a little magic. Chains do it with marketing and concept. Individual ones do it with the owner’s or staff’s personality or some niche.” He said operators who are good at watching what makes a difference to the guest experience and pay close attention to the bottom line are most likely to succeed. “Those who think it’s easy and can sit at the bar and greet guests probably aren’t going to make it,” McElroy said. He said social media and review sites like Yelp create instantaneous word of mouth for a business. “That’s good, but it always takes attention to the details.” McElroy’s top job is to lobby on behalf of restaurants and he has a list of things concerning to members. Right now, they are busy giving members the information they need as the Affordable Care Act rolls out. “In 2015 restaurants with 50 full-time equivalents will have to offer health insurance to their employees so there’s concern about that,” he said. His group will also be keeping a close eye on any minimum wage legislation that comes before the next Legislature. “We are the first job for many Minnesotans - one-third to half of all first-time jobs away from home are in the restaurant business.” He opposes proposals to link the minimum wage to the


consumer price index and said the group also wants to see state legislation that would prohibit local governments from setting a local minimum wage, which has happened in some states. He said businesses must pay the federal minimum wage of $7.25, but says restaurants in Minnesota are hampered because it’s one of the few states where restaurants can’t apply some of the tips wait staff make toward their federal minimum wage calculations. That’s something his organization would like to change. McElroy said they are also keeping their eyes on an issue that has received Tanya Butson pours a drink at Pappageorge’s. little attention in the state. confusing and burdensome.” The Minnesota Pollution He said a broad container deposit would put curbside Control Agency is considering a proposal that would recycling at risk and bars and restaurants would have to create a container deposit fee on any container of a gallon have locked trash bins for bottles, cans and containers or less. because the containers would have a value. MV “It would cover containers made of anything, even juice boxes. We’re already good recyclers so a deposit is just

MN Valley Business • november 2013 • 17


Top reasons new restaurants fail

M

ost restaurant fail. According to Cornell University and the National Restaurant Association, 60 percent of restaurants fail within the first three years of operation. After five years, the number might be as high as 75 percent. According to Brandon O’Dell of the O’Dell Restaurant Consulting Group (bodellconsulting. com), these are the top reasons why new restaurants fail:

No unique selling point Customers need a reason to come to you instead of your competition. While good, even great food and service is important, it’s not a unique selling point. What you need is something original to sell. Something other than the best food or the best service: Sonic offers “nostalgia” with their 50’s style drive-in and car hops. Burger King offers accommodation. “Have it your way!” Applebees markets themselves as “Your favorite neighbor”. They put up local memorabilia when possible, and build in smaller towns. Hooter’s sells sex. A truly unique selling point is an emotion you offer to customers. Too large of a menu This is a very common killer of independent restaurants. As an independent operator, you’ll get pressure from customers to have certain items on your menu. You’ll also have pressure to keep certain items when you make a menu change. You’ll get requests. You’ll get complaints when you change things. Large menus lack focus, take longer to order from, require more inventory, more equipment and personnel. Keep your menu focused. All talent, no brains So you can cook. Your food is fantastic, and everyone you cook for confirms it. Not to burst your bubble, but a lot of people are excellent cooks. Many of them have original ideas and fantastic food that no one has ever offered in a restaurant before. That doesn’t make them, or you, a good candidate to open a restaurant. Owning a restaurant isn’t about cooking. It’s not about having good food. While those things are components of a good restaurant, they are not the reason for its success. Once you have the perfect menu for your market, knowledgeable staff to serve your market, a trained line to reproduce your food, and plenty of booze to ply your guests with, you’re 1/3 of the way there. The other 2/3rds include marketing and managing. You need to know how to collect

18 • november 2013 • MN Valley Business

data and analyze your business to make sure you have the necessary information to run a profitable business. That includes everything from gross profit from each item sold to what profit and loss is each week.

Poor pricing strategy You can’t just look at what everyone else is charging, and charge the same. The financial picture of your business is different than every other business out there, and you need to have a pricing strategy that takes your unique financial situation into account. The predominant method to pricing menus in the food service industry is to use a budgeted cost percentage to formulate prices that will yield that budgeted percentage when the sale of all your different items is taken into account. This method assumes that if you sell X dollars of food, and Y percentage of those dollars go to pay for the food, then you will get Z profit. The major problem with this pricing method is that most operating expenses within a restaurant do not fluctuate as a percentage of sales. The rent of a restaurant is not always 5 percent of sales. If sales are down, the percentage goes up, if sales are up, the percentage goes down. The common sense alternative to pricing by a target percentage is pricing according to the markup you need to cover the expense of doing business, leaving you with a profit you find acceptable. This method is called pricing by gross profit dollars. The basic principle of this method states that you can assume, through calculation, how much every person that walks through your door will cost you to serve, and that with this number you can price your menu to yield an average gross profit greater than the cost necessary to serve every person who walks through your door, in addition to your needed profit. No marketing skill This may be the biggest restaurant killer of them all. No matter how great your food is, if no one know, it won’t sell. Many new restaurant owner believe they can market through “word of mouth.” Word of mouth marketing is fantastic, but you can’t depend on it until you’re established. The best marketing tactic you can employ in any retail business or restaurant, is to gather contact information from every person that comes through your door, and market to them. Marketing to existing customers represents an exponentially greater opportunity for increased sales than spending dollars trying to reach new customers. Bad negotiation skills Most new restaurant owners don’t know what they should be paying for the services necessary to successfully operate a restaurant. Every vendor out there has clients who get great deals, and clients who get taken advantage of. Normally, the difference between a vendor giving you a good purchase rate, and taking advantage of you, is your knowledge of the goods you’re buying, and what other people are paying for them.


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MN Valley Business • november 2013 • 19


Doug and Kim Schiefelbein have owned D & K since 1998.

Keeping the rubber on the road D & K Tire Service roots go to 1956 By Heidi Sampson | Photos by John Cross

D

oug Schiefelbein began his thirty-four year career in the tire service industry working Saturday mornings and after school for Paul Larson, owner of Paul’s Tire Service, of Amboy. Paul started his business, in 1956. His emphasis was on car, truck and farm tractor tire repair as well as tire sales. Paul also ran a farm truck service out of his shop, in which he brought tractor tire repair directly to the field or farm site. After graduation from high school, Doug began assisting Paul with all aspects of his business, as a full-time employee. After 42 years as owner of Paul’s Tire Service, Paul sold his business to Doug and his wife Kim, Paul’s daughter. The two would change the name from Paul’s Tire Service to D & K Tire Service.

“I bought out Paul’s business because I could see an opportunity for growth within the services we offered, at that time,” Doug said. “For instance, after we purchased the business we added automotive repair and alignments to our list of services we could offer our customers.” Kim joined Doug full-time within a year after their business opened. Prior to that, Kim ran a daycare business out of their home, for many years. Once the two purchased the business, Kim would come by the shop to assist Doug by answering the telephone, completing payroll and various paper work needs, on a regular basis. As the business grew, there was a strong demand for Kim to become a full-time employee, which she embraced as she

Profile

20 • november 2013 • MN Valley Business


Doug Schiefelbein: Attended Firestone University Good Year and Titan Tire Schools Certified Hunter Wheel Alignment Technician Jordan Klein heads out on a service call. was eager be an active part in the growth of D & K Tire Service. “Dad had built a strong business with loyal customers,” Kim said. “When we became more diversified in the services we could offer the community, D & K Tire Service quickly expanded as well.” Since the purchase of Paul’s Tire Service in 1998, Doug and Kim were given the opportunity to expand their business operations to Lake Crystal when Crystal Valley Cooperative contacted them during the summer of 2008. What was known at that time as The Crystal Valley Service Station, which also offered tires for retail, was disbanding. Crystal Valley offered D & K Tire Service the chance to lease their store not only as an opportunity for expansion but also as a way to keep a tire business in Lake Crystal, even though they themselves would no longer be providing the service to the community. In September of 2008, D & K Tire Service officially began providing the Lake Crystal community with a full service tire shop, as well as an automotive repair base. The new location would become known as D & K Tire Service Lake Crystal. Built-in variety D & K Tire Service’s daily operation differs depending upon the season and the particular jobs acquired between the two locations. The two facilities communicate with each other on a regular basis to ensure that each site runs at optimal performance specific to each of their needs. “Every day really is different for each of our businesses, which is good,” Kim said. “There’s a sense of built-in variety that comes with the changing demands whether it be from seasonal needs or simply the daily fluctuations in particular customer needs. Fall and spring are our busiest times as farmers take to the fields. We do our best to communicate between the two facilities to ensure there’s enough help at each site so that we are best meeting the needs of our customers especially during our peak seasonal periods but also throughout the year.” A particularly unique aspect of the services offered by D & K Tire Service, which is also a continuation from the days of Paul’s Tire Service, is the farm and highway tire service, dispatched from the Amboy location. Doug and Kim’s farm truck service offers a 50-mile plus radius of assistance for farmers in need of tractor tire repairs whether the help is needed while they are in their fields, on their farm sites, or even for commuters, who find themselves stranded alongside the highway. Both locations also offer many different brands of tires, a four point computerized wheel alignment, automotive repair, wheel balancing, brakes, shocks and struts, oil changes and computer diagnostics. “All of our services wouldn’t be possible without the

help of our employees,” Doug said. “We have a tremendous team and none of our accomplishments would have been possible without them. We’ve been extremely blessed in that area.” Currently, D & K Tire Service employs four full-time and two part-time employees, not counting the owners. Their growth over the past 15 years in employees alone displays a huge difference from the days in which, only Paul and Doug worked side-by-side with the help of a parttimer. In Lake Crystal, Randy Doyen manages the site with the help of Alex Duffey, both of whom also assisted Doug and Kim with the startup of the D & K Tire Service Lake Crystal location, in 2008. While Jordan Klein, the newest member of the team, and Scott Pahl, who’s been with D & K Tire Service since shortly after its inception, assist Doug in the day-to-day operations of the Amboy Location. Tate Doyen and Cory, Doug and Kim’s son, also help out on a regular part-time basis. D & K Tire Service’s future plans consist of possibly expanding the Lake Crystal location to a facility that would accommodate more growth. “I’m open to the possibilities of what D & K Tire Service could become,” Doug said. “Maybe one day, one of my employees or even my son, will take over the business and expand it that much more.” Connections to community Doug and Kim have strong community ties to the Amboy area, as both were graduates of the Amboy-Good Thunder high school class, in 1981. They also believe in the necessity of giving back to the communities and school districts, which have embraced their businesses. Often times, this is done through sponsorship of local school events, fundraisers and other activities of this nature. D & K Tire Service is an active sponsor of athletic events within both the Maple River and Lake Crystal Wellcome Memorial school districts. “Over the years, we’ve provided assistance to many different kinds of fundraisers, for both of our communities,” Kim said. “Our involvement with local fundraisers and our support of the school districts has been a way for us to give back to the local communities that have been so generous in supporting us over the years.” On a more personal level, Doug and Kim have also been involved with the Snowbirds of Amboy, for the past 25 years. The Snowbirds is a club of community volunteers who maintain and continue to grow the Minnesota snowmobile trail system within their local area. Two years ago, Doug retired from the Amboy Fire Department after 25 years of service to the Amboy community. MV

MN Valley Business • november 2013 • 21


Kevin and Patrice Gaulrapp bought the old Red Owl in Lake Crystal in 1986

The Three Prong Approach Kevin’s Market grew into three businesses By Heidi Sampson Photos by John Cross

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hile growing up, Kevin Gaulrapp gathered first-hand experience of the grocery business from his father, who owned a few stores of his own, in South Dakota. As one of six children, the majority of Kevin’s family was also involved in his father’s businesses, which led to the realization that his father’s grocery stores couldn’t support all of them. In 1986, Kevin and his wife, Patrice, decided it

was time to branch out on their own, purchasing the old Red Owl grocery store, in Lake Crystal. The two would change the grocery store’s name to Kevin’s Market. “This is what I love to do, plus you just can’t purchase a grocery store anywhere,” said Kevin. “You kind of have to go where one is available and Lake Crystal was just a really good fit for us. We liked the community from

All In The Family

22 • November 2013 • MN Valley Business


Kevin’s Market/On the Rocks opened in 2006. the start.” Once Kevin and Patrice’s two girls started school, Patrice joined her husband at Kevin’s Market during the day. Prior to this, she had been a stay-at-home mom. Owning their own business allowed Patrice the flexibility to work her schedule in a way that she would allow her to be at home when the girls arrived, after a day at school. When the Municipal Liquor Store became available for purchase in 1996, Kevin and Patrice jumped at the chance to expand, changing the liquor store’s name to On the Rocks. In 2002, the couple would purchase a grocery store in Winthrop. The decision to place both of their Lake Crystal locations under one roof and in a new location, happened in 2006. It was at this time that the current, Kevin’s Market/On the Rocks building, was constructed along Highway 60. “When we built this store we decided to go with a three prong approach,” said Kevin. “We wanted to offer our customers fuel, groceries and liquor, all in one convenient location.” MVB: Describe how the duties are divided amongst the three businesses? Kevin: I handle the grocery store side of things and Patrice runs the liquor store. She also pays our bills and does the accounts receivable for all three businesses. We tend to put in long days. I work from 6 a.m. to 6 p.m., five to six days a week. Really our hours depend upon what’s going on in each of the businesses but we do tend to put in longer days. MVB: How many employees do you have? Kevin: Currently, we have nine full time and thirty part

time employees between all three of our businesses. MVB: How do you approach customer service? Kevin: We know we are in a bedroom community. We try to deliver a fresh product at a reasonable price. As our customers come through the door, we try to have the products they want and not be out of stock. I think our carry-out service makes us stand out from Mankato, where one has to generally bag their own groceries and then carry the items to the car. MVB: What are some of the benefits to purchasing locally? Kevin: We will buy directly from our local farmers when the opportunity arises. We try to purchase more seasonal items like, pumpkins, sweet corn, gourds and our apples are also Minnesota grown. We try to keep our costs low so that we can return that price back to our customers. MVB: What are some of the challenges to owning your own business? Kevin: The greatest challenge as an independent operator over the past26 years has been in dealing effectively with the pressure from corporations like, Target, Wal-Mart, Dollar Generals and stores of that nature. They can squash you pretty quickly. It’s really important to stay nimble. The good news is we can compete. One of the things that keep us competitive is that we belong to a Co-op called, Affiliated Foods Midwest. In a nut shell, what that does for us is that it gives us the same buying power as a store they supply that may be the same size as a Hy-Vee or a Cub Foods. This means our buying power is good because we, as a group, batch our buying power as we own our own warehouse, so all of our purchases are treated the

MN Valley Business • November 2013 • 23


Kevin’s tries to buy as much as it can from local farmers and growers. same. Since we all purchase at the same price, we can stay competitive. The reason why we can stay so competitive, is that compared to a Supervalu, who is on the stock market, their profits have to go back to their investors. Those of us who belong to the co-op are the owners of our companies. All of our profits come back to us which allows us to keep our cost low and our cost-to-goods low. The bottom line is that the money comes back to our businesses and we can in turn pass that on to our customers. MVB: What are some of the rewards to owning your own business? Kevin: Our biggest reward is in being able to see what our hard work has accomplished. Since we moved to Lake Crystal, we’ve added the liquor business, we’ve added another grocery store in Winthrop and we’ve built this

24 • November 2013 • MN Valley Business

store. It’s been a lot of long hours but we did it together. MVB: What community activities are you involved in? Kevin: I’m more economical development driven. I’ve been on the Economic Development Authority (EDA) board since Lake Crystal became part of the Star City program, about twenty years ago. I’m presently the president of the EDA. Basically, I try to help bring people and businesses to town. This has been my main focus because it is what I enjoy doing. I’m also involved with Chamber and the downtown businesses. Myself and three other guys built the Times Bar and Restaurant which is now known as The Lakes. At one time, I was on the board for the beginning of the Lake Crystal Area Recreation Center, which is simply another form of economic development. MV


Construction/Real Estate Residential building permits Mankato

(in thousands)

- 2012 - 2013

8000

- 2012 - 2013 (in thousands) $1,427.9 $1,458

3000

$4,023 $2,603

6000

Residential building permits North Mankato

2000

4000

1000

2000 0

J

F

M

A

M

J

J

A

S

O

N

D

Source: City of Mankato Information based on Multiple Listing Service and may not reflect all sales

- 2012 - 2013 250

M

A

M

J

J

A

S

O

N

D

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

Housing starts: Mankato/North Mankato - 2012 - 2013

30

170

150

7 16

20

100

10

50 J

F

M

A

M

J

J

A

S

O

N

D

Source: Realtors Association of Southern Minnesota

0

J

F

M

A

M

J

J

A

S

(in thousands)

- 2012 - 2013

$1,865.2

$140

A

M

J

J

A

S

O

N

500

D

Source: City of Mankato

— 2012 — 2013

5.5 5.0

4.3%

4.5 4.0

3.4%

3.5 F

M

Source: Freddie Mac

0

J

F

M

A

M

J

J

A

S

O

N

D

Source: City of North Mankato

Interest Rates: 30-year fixed-rate mortgage

J

$782.2

1000

$2,440.3

M

D

- 2012 - 2013 (in thousands)

1500

F

N

Commercial building permits North Mankato 2000

J

O

Source: Cities of Mankato/North Mankato

Commercial building permits Mankato

3.0

F

40

144

200

20000 18000 16000 14000 12000 10000 8000 6000 4000 2000 0

J

Source: City of North Mankato

Existing home sales: Mankato region

0

0

A

M

J

J

A

S

O

N

D

Foreclosures: First Quarter of 2013 County Blue Earth Brown Faribault Le Sueur Martin Nicollet Sibley Waseca Watonwan

2012

2013

Percent change

47 2 6 23 7 6 11 14 6

38 9 12 29 10 15 12 15 6

+24% -78% -50% -21% -30% -60% -8% -7% 0%

Source: Minnesota Foreclosure Partners Council C. Sankey

MN Valley Business • November 2013 • 25


Agricultural Outlook

By Kent Thiesse

Crop prices down, but not land rental rates

T

he very strong corn and about 20-25 percent from 2011 to soybean commodity prices in 2013, primarily due to increases in the past couple of years, and seed and fertilizer costs. the resulting increases in crop Landlords are also put in a difficult income per acre, led to significant position when another farm operator increases in cash rental rates on farm offers them a substantial increase in land in recent years. Many crop rental rates, as compared to the producers are now concerned that current payment they’re receiving the lower projected crop prices for from a long-term farm operator. In 2014, and reduced estimates for most cases, this requires some gross income per acre, may not be negotiation between a landlord and a high enough to justify the higher farm operator to arrive at an cash rental rates that are currently equitable rental rate that is acceptable being charged, and are being to both parties. proposed for the 2014. There has Local cash prices for the fall of been no indication of any reduction 2014 are currently projected to be in land rental rates in south central near $4.35 per bushel for corn and Minnesota for 2014, as compared to below $11 per bushel for soybeans. current levels. At normal yields and cost of Some landlords asked for production, with an average land substantial increases in year-to-year rental rate of $250 per acre, many land rental rates for both the 2012 producers will be looking at breakand 2013 growing seasons, and are even market prices for 2014 of near now considering holding those rates $4.50 per bushel for corn and $11 steady for the 2014 crop year, and in per bushel for soybeans. If the land some cases increasing those rental rental rate is increased to $300 per rates even more. Also, some larger acre, the break-even market prices producers have been going into new under average costs of production areas in recent years and offering increase to near $5 per bushel for much higher land rental rates than corn and $12 per bushel for soybeans existing cash rental rates, based on We are still waiting for a new Farm the higher grain prices and gross Bill to be passed by Congress. Once income per acre. a new Farm Bill is in place, it is likely Farm operators are put in a difficult that the guaranteed direct payments position when landlords demand that farm operators have received for higher cash rental rates than can be the past couple of decades will likely justified by projected returns, be eliminated. The direct payments because they do not want to lose the amount to an average of about $25 crop acres. They may have also per acre for corn and soybean already prepaid AVERAGE RENTAL some of the crop COUNTY expenses for seed, 2008 2009 2010 fertilizer and chemicals for the Blue Earth County $163 $171 $174 2014 growing season. Total cash Brown County $133 $148 $154 expenses for corn $152 $168 $173 production are Faribault County expected to Le Sueur County $149 $153 $169 decrease slightly for 2014, due to a Martin County $158 $177 $181 decrease in $150 $161 $169 expected fertilizer Nicollet County costs for the $136 $145 $160 coming year. Crop Waseca County p r o d u c t i o n Watonwan County $148 $146 $165 expenses have risen

26 • November 2013 • MN Valley Business

producers in most South Central Minnesota counties. Most landlords have factored the direct payment amount into the land rental rates that have been charged in recent years; however, there will not likely be a reduction in land rental rates when direct payments are eliminated. University of Minnesota Extension puts out an updated summary of rental rates, with the latest released in July. (See related chart.) It should be noted that these land rental rates in the chart were for the 2012 crop year, and most cash rental rates for 2013 were probably 10-15 percent higher than 2012. The land rental rates in the U of M summary include both rental agreements between family members, as well as non-family members. Rental rates on agreements between family members tend to be somewhat lower than the average rental rates. The data also includes some cash rental leases that are longer than one year, which may also be slightly lower the average rental rate that is listed. However, the data also verifies that the average land rental rates being paid in a given area are not nearly as high as the “coffee shop rental rates” that are often quoted as the going cash rental rates in an area. The U of M data and other actual rental data helps provide a good starting point for negotiating equitable land rental rates. An alternative to the proposed

RATE Per Acre % Increase 2011 2012 2008 – 2012 $194 $173

$222 $207

36% 56%

$194 $179 $210

$221 $233 $254

45% 56% 61%

$197

$223

49%

$175 $177

$216 $218

59% 47%


Agriculture/Agribusiness Corn prices — southern Minnesota

(dollars per bushel)

— 2012 — 2013

Soybean prices — southern Minnesota

(dollars per bushel)

— 2012 — 2013

$7.42

8

20

$14.97

16

6

12

4 2

$12.63

8

$4.15

4

0

J

F

M

A

M

J

J

A

S

O

N

0

D

Source: USDA

Iowa-Minnesota hog prices

100

M

J

J

A

S

O

N

D

70

16

$83.32 M

A

M

J

J

A

S

O

N

Minimum prices, class 1 milk Dollars per hundredweight

D

$20.68

20 18

F

A

22

80

J

M

— 2012 — 2013 24

$86.08

90

Source: USDA

F

Milk prices

185 pound carcass, negotiated price, weighted average

— 2012 — 2013 110

60

J

Source: USDA

14

$18.35 J

F

M

A

M

J

J

Source: USDA. Based on federal milk orders.

A

Corn and soybean prices are for rail delivery points in Southern Minnesota. Milk prices are for Upper Midwest points.

high cash rental rates for 2014, or potentially even higher rental rates in the future, may be for producers and landlords to consider a “flexible cash lease” rental agreement, which allows the final cash rental rate to vary as crop yields and market prices vary, or as gross revenue per acre exceeds established targets. The use of a flexible cash rental lease is potentially fairer to both the landlord and the farm operator, depending on how the flexible lease is set up. The key is that both the landlord and tenant fully understand the rental agreement, and the calculations that are used to determine the final rental rate. MV Kent Thiesse is farm management analyst and vice president, MinnStar Bank, Lake Crystal. 507- 381-7960; kent.thiesse@minnstarbank.com

S

O

N

D

C. Sankey

• Appraisals • Agricultural Property Management • Agricultural Real Estate Sales • Commercial Property Management • Commercial Leasing

Faribault Minnesota (866) 332-8211

Jamestown Ohio (866) 247-6092

New Hope Minnesota (877) 535-4914

Olivia Minnesota (800) 545-6227

New Ulm Minnesota (507) 359-2004

MN Valley Business • November 2013 • 27


Employment/Unemployment Initial unemployment claims

Minnesota initial unemployment claims

Nine-county Mankato region Major September Industry ‘12 ‘13 Construction Manufacturing Retail Services Total*

78 203 42 148 471

Percent change ‘12-’13

74 141 45 165 425

-5.1% -30.5% +7.1% +11.5% -9.8%

Major Industry

September ‘12 ‘13

Construction Manufacturing Retail Services Total*

2,695 2,340 1,112 4,642 10,786

Percent change ‘12-’13

2,289 1,964 1,141 4,758 10,149

-15.1% -16.1% +2.6% +2.5% -6%

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

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

Local non-farm jobs

Minnesota Local non-farm jobs

- 2012 - 2013

Nine-county Mankato region

126,284 126,429

30000

2000

10000

1000

J

F

M

A

M

J

J

A

S

Local number of unemployed

O

N

D

- 2012 - 2013

Nine-county Mankato region

7,051 5,872

0000

0

J

F

M

A

M

J

J

A

Minnesota number of unemployed

S

O

N

D

- 2012 - 2013 168,343 152,473

200000

8000

150000

6000

100000

4000

50000

2000 0

2,823.0 2,818.3

3000

20000

00000

- 2012 - 2013

(in thousands)

J

F

M

A

M

J

J

A

S

O

N

D

Mankato/North Mankato Metropolitan statistical area

Unemployment rate Number of non-farm jobs Number of unemployed

J

F

M

A

M

J

J

A

S

O

N

D

Unemployment rates Counties, state, nation

(includes all of Blue Earth and Nicollet Counties) August

0

2012

2013

5.4% 54,622 3,120

4.5% 54,786 2,565

Source: Minnesota Department of Employment and Economic Development

28 • November 2013 • MN Valley Business

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

August 2012 5.5% 5.4% 6.1% 6.6% 5.6% 5.3% 4.6% 5.7% 7.1% 5.8% 5.8% 8.6%

August 2013 4.7% 4.6% 5.0% 5.8% 4.9% 4.0% 4.3% 5.3% 6.5% 4.9% 5.1% 7.7% C. Sankey


Retail/Consumer Spending Vehicle Sales Mankato — Number of vehicles sold 820

- 2012 - 2013 1,075

1200

(In thousands)

400

800

300

600

- 2012 - 2013

500

1000

$461.7

$342.1

200

400

100

200 0

Includes restaurants, bars, telecommunications and general merchandise store sales. Excludes most clothing, grocery store sales.

Sales tax collections Mankato

J

F

M

A

M

J

Source: Sales tax figures, City of Mankato

J

A

S

O

N

D

Lodging tax collections Mankato/North Mankato

J

F

M

A

M

J

J

A

S

O

N

D

Source: Sales tax figures, City of Mankato

Mankato food and beverage tax

- 2012 - 2013 $56,816

$40,320

60000

0

- 2012 - 2013

75000

$48,860

$58,043

50000 50000

40000 30000

25000

20000 10000 0

J

F

M

A

M

J

J

A

S

O

N

Source: City of Mankato

— 2012 — 2013 $3.49

4 3 2

$3.34

1 0

J

F

M

A

M

J

J

A

S

O

N

D

Gas prices-Minnesota — 2012 — 2013

5

$3.47

4 3 2

$3.21

1 0

J

F

M

A

J

F

M

A

M

J

J

A

S

O

N

D

Source: City of Mankato

Gas prices-Mankato 5

0

D

M

J

J

A

S

O

N

D

Stocks of local interest

Sept. 17

Oct. 16

Percent change

Archer Daniels

$36.72

$37.63

+2.5

Ameriprise

$93.06

$96.46

+3.7

Best Buy

$38.68

$42.63

+10.2

Crown Cork & Seal

$43.82

$40.12

-8.4

Fastenal

$50.33

$48.30

-4

General Growth

$19.54

$20.79

+6.4

General Mills

$49.36

$45.92

-7

HickoryTech

$10.83

$11.50

+6.2

Hutchinson Technology

$3.36

$3.87

+15.2

Itron

$41.44

$44.24

+6.8

Johnson Outdoors

$26.89

$26.86

-0.1

3M

$120.04

$121.69

+1.4

Target

$64.59

$64.22

-0.6

U.S. Bancorp

$37.57

$37.41

-0.4

Wells Financial

$22.45

$21.85

-2.7

$.60

$.65

+8.3

$27.00

$28.05

+3.9

Winland Xcel

Source: GasBuddy.com C. Sankey

MN Valley Business • November 2013 • 29


Advancing Business for a Stronger Community

Greater Mankato Growth

Cost of Doing Business: Lower in Greater Mankato Cost of Doing Business may mean different things to different businesses. But in evaluating a community, region or state’s Cost of Doing Business, it is important to consider all factors. A community’s high costs in one area, may be offset by other factors with lower costs. In other words, in most cases, it is the Overall Cost of Doing Business that truly matters. It was with this in mind that Greater Mankato Growth and the Regional Economic Development Alliance sought to determine our region’s Overall Cost of Doing Business. The result is a report that reveals the Mankato-North Mankato MSA (which includes all of Blue Earth and Nicollet counties) has a lower Cost of Doing Business than the national average and is competitive with other MSAs in the Upper Midwest. In Moody’s Analytics 2012 North American Business Cost Review, the national average is represented by an index value of 100. The Mankato-North Mankato Metropolitan Statistical Area (MSA), has an overall Cost of Doing Business index of 81, which means it is 81% of the national average (or 19% below the national average). This gives the Mankato-North Mankato MSA the 64th Lowest Overall Cost of Doing Business among all 384 MSAs in the U.S., putting it in the Top 17% nationally for Low Cost of Doing Business. The Mankato-North Mankato MSA also has the 5th Lowest Overall Cost of Doing Business among the 29 MSAs in the Upper Midwest states of Minnesota, Wisconsin, Iowa, North Dakota and South Dakota. In Moody’s analysis, four factors contribute to the Overall Cost of Doing Business - Cost of Office Rent, Energy Costs, State & Local Taxes and Unit Labor Cost (which received the highest weighting). The Mankato-North Mankato MSA ranks in the top 50% or higher for all four factors among the 29 other Upper Midwest MSAs: Moody’s Analytics Cost of Doing Business Factors

Upper Midwest Rank

A major motivation for compiling the data, was being able to communicate to businesses the value of locating in the Greater Mankato region. “When businesses look at Cost of Doing Business, they sometimes look at isolated factors” explained Greater Mankato Growth President & CEO Jonathan Zierdt. “However, Moody’s comprehensive approach, provides a more complete picture of the actual Cost of Doing Business and its positive contribution to the success of businesses here.” More information, including complete data for all 29 MSAs is available at greatermankato.com/cost-doing-business.

According to Forbes 2013 Best Small Metros for Doing Business, the Mankato-North Mankato MSA ranked in the top 25% nationally for Low Cost of Doing Business among the 164 MSAs in the U.S. with populations less than 250,000.

National Average Index*

Cost of Office Rent 1 Energy Costs 7 Unit Labor Cost 13 State and Local Taxes 14 *national average represented by an index of 100

45 86 99 104

Chamber of Commerce and Economic Development

507.385.6640 • greatermankato.com 30 1 •• JANUARY November 2013 2013 • MN • MN Valley Valley Business Business


growth in Greater Mankato New Business Las Brazas 500 South Riverfront Drive, Mankato

New Location Minnesota Valley Action Council 706 North Victory Drive, Mankato

Groundbreaking MRCI WorkSource 1750 Energy Drive, Mankato

New President Dr. Annette Parker South Central College, 1920 Lee Boulevard, North Mankato

GR E

O AT

ER MANK AT

Branching into the Future BUSINESS AWARDS & HALL OF FAME

For sizes under 2” use the small version with adjusted TM.

Presented by:

TUESDAY, NOVEMBER 19 AT THE VERIZON WIRELESS CENTER Join us in celebrating the businesses, organizations and professionals who have and will continue to grow a vibrant Greater Mankato.

Visit Mankato Awards Bring It Home Award | Kiwanis Holiday Lights Hospitality Award | Vetter Stone Amphitheater

Distinguished Business Award | Jones and Magnus, Attorneys at Law Entrepreneurial Business Award | Oleson+Hobbie Architects LLC Brian Fazio Business Education Partnership Award | Mankato Area Public Schools, Bolton & Menk, Inc., Ecumen Pathstone Living and The Thro Company Hap Halligan Leadership Award | Kate Loging Young Professional of the Year | Matt Norland

City Center Partnership Award CityDesign Award of Excellence | Chopps Bar CityArt “People’s Choice” Award | To be revealed at event

R.S.V.P. by November 13 at greatermankato.com/business-awards-hall-fame Thank you to our sponsors: Charter Business, United Prairie Bank, Wells Fargo Bank, Brunton Architects & Engineers and KEYC News 12

MN Valley Business • November 2013 • 31

Greater Mankato Growth

Greater Mankato Growth Awards Business Hall of Fame | Lidstrom Commercial Realtors and Drummer Companies For sizes above 2” use the regular version with normal TM.


Member Events Business After & Before Hours

5:00 - 7:00 p.m.

Greater Mankato Growth

November 5 Bethany Lutheran College December 3 ECS-Your Wiring Pros

7:30 - 9:00 a.m. November 20 J. Longs for Men December 18 Pioneer Bank

2013 Business After Hours Sponsored by

2013 Business Before Hours Sponsored by

September Business After Hours at Courtyard by Marriott Hotel & Event Center

September Business Before Hours at South Central College

Look for the 2014 Schedules coming out in December! Business After and Business Before Hours gives representatives from GMG member businesses an opportunity to get together with one another to exchange ideas and learn about each other’s businesses. For more information on these and other member events visit greatermankato.com/events.

32 1 •• JANUARY November 2013 2013 • MN • MN Valley Valley Business Business


Cavalier Calls on our

Newest Members

10K Lettering 10klettering.com

Word is spreading: Lunch & Learn is a great way to learn over the lunch hour. The most recent session in October drew more than 50 participants. Greater Mankato and the Center for Business & Industry (a division of South Central College) designed the series to meet the needs of busy professionals. The series, which began last year, offers short, timely professional training sessions. In addition to learning new skills, participants can connect with other business professionals, while enjoying lunch from Buffalo Wild Wings. Here are details on the next two sessions: November 14 – Change the Way You Do Business Discover how to eliminate time loss caused by: • Searching or waiting for information • Clarifying incomplete and unusable information • Waiting for approval or a signature • Making copies that are not used or required • Inconsistent processes and procedures

Principal Financial – Scott Nelsen facebook.com/ScottNelsenPFG

December 12 – OSHA Top Ten List Uncover what businesses were caught doing last year: • Discover the quickest/easiest way to get a snapshot of your company’s compliance • Use the MnOSHA top ten list as a guide for your future • Learn MnOSHA vs. Federal Law differences • Explore how to be ready for an audit. To learn more and register for either of these sessions, visit greatermankato.com/lunch-learn.

Shoreland Country Club 43781 Golf Course Road, Saint Peter shorelandcc.com

MN Valley Business • November 2013 • 33

Greater Mankato Growth

Profinium, Inc. 124 East Walnut Street, Suite 320, Mankato profinium.com

Pathfinder Nominations Sought The Martin Luther King Pathfinder Committee, along with Greater Mankato Growth, is again seeking nominations for the Business Pathfinder Award, which recognizes area businesses who strive for equal treatment, human rights and nonviolence in the workplace. The Martin Luther King Pathfinder Committee will also be awarding a Pathfinder Award, which goes to individuals or organizations and a Young Pathfinder Award for students. Nomination forms for all of these awards are available at greatermankato. com/award-opportunities and are due November 25. Recipients will be honored at the 30th Annual Martin Luther King, Jr. Community Celebration, which will be held on Monday, January 20, 2014.


Greater Mankato Growth

‘Tis the Season to…..

Support Each Other’s Businesses with Buy & Build

Enjoy some Holiday Cheer at Kiwanis Holiday Lights

Each year hundreds of businesses large and small make the commitment to help build our community with their buying power as Buy & Build Greater Mankato partners. These businesses pledge to take a look at what goods and services they are purchasing from outside the marketplace that might be available here today. As Greater Mankato has continued to grow, so has the availability of goods and services available from businesses here. All businesses are encouraged to participate, whether they are locally owned, national or international – make products, provide services or sell goods. Because regardless of their type, all businesses contribute to the collective assets and vibrancy of our marketplace.

The Kiwanis Holiday Lights Kick-off Parade presented by the Greater Mankato Young Professionals will be held at 6 p.m. on Friday, November 29. This year’s parade will feature up to 50 lighted floats and an expanded parade route that will travel down Hubbell Avenue, pass in front of Ecumen Pathstone Living and end in the Holiday Lights display area where Santa will arrive in his sleigh in time to turn on the lights for the season. Automobile traffic will be allowed to drive through the displays starting at 8 p.m. on opening night. Visit kiwanisholidaylights.com for a parade map and parking directions. Kiwanis Holiday Lights will run from November 29 - December 31, Sunday – Thursday from 5 - 9 p.m. and Friday/Saturday from 5 - 10 p.m. Kids of all ages are invited to join in on this new Greater Mankato holiday tradition.

There are two ways to make the pledge: 1) Commit to shift 5% of your previous year’s out-of-market purchases for items available here into Greater Mankato. For example, if in 2013 your business spent $100,000 outside of the market for goods and services that are available here in Greater Mankato, you would agree to shift $5,000 in 2014. 2) Commit to continue purchasing at least 65% of the goods and services you need that are currently available in Greater Mankato, from regional businesses. For example, if in 2013 you spent $200,000 on goods and services inside the market, and that constituted 65% (or more) of what you could have purchased in the marketplace, you would vow to continue that in 2014. Through this commitment, businesses are supporting their fellow businesses in the region and the overall vitality of Greater Mankato. And you can support these Buy & Build partners in turn through your business and consumer purchases. A complete list of participating businesses is available at greatermankato.com/buy-build. This is also where you can sign up your business to be a Buy & Build partner. Taking the pledge is simple - there is no detailed accounting involved and you are not required to give specific amounts of how much you shift. Sign up today and make it known you are helping build Greater Mankato with your buying power.

34 1 •• JANUARY November 2013 2013 • MN • MN Valley Valley Business Business

For more information on the Greater Mankato Young Professionals, visit greatermankato.com/young-professionals or call Shannon Gullickson at (507) 385.6656.


Running for a Cause – Mankato Marathon Charities Raise $17,000 In 2013, the Mankato Marathon organizers wanted to give back to the community that has so generously supported its races. This year three charities including Girls on the Run, BackPack Food Program and Project for Teens were chosen to benefit from the new Mankato Marathon Charity Program. Each organization chose three Champion Runners to raise money for them. The combined total raised through the Mankato Marathon Charity Program for 2013 was approximately $17,000. The three organizations were chosen by a committee of community members and Mankato Marathon staff on the basis of the merits of their application pertaining to their mission, good standing in the community and activities to improve the health of their participants: Girls on the Run is a nonprofit prevention program for girls in third to eighth grade. The program is meant to inspire girls to be joyful, healthy and confident using a fun, experiencedbased curriculum that creatively integrates running. Girls on the Run includes training for a non-competitive 5k run/walk event and healthy living education. The program instills selfesteem through health education, life skills development, mentoring relationships and physical training- all of which are accomplished through an active collaboration with girls and their parents, schools, volunteers, staff and the community. Champion Runners: Sheri Sander-Silva, Kelli Damlo, Nik Proehl

Champion Runners received various incentives from the Mankato Marathon to encourage their fundraising. Each runner who raised at least $500 received free race registrations for either the half or full marathon. Champion runners who raised at least $1,000 received a Champion Runner jacket and a 2013 Mankato Marathon print in addition to their race entry. In addition to having Champion Runners raising funds, the three programs had potential to raise additional dollars through registrations. Runners were able to elect to donate to any or all of the charities when they registered for any Mankato Marathon race. Congratulations to all of the Charity Programs. Find out more about the Champion Runners and view Champion Runner videos at mankatomarathon.com. Charities interested in participating in the 2014 Mankato Marathon Charity Program can apply on the Mankato Marathon website.

Visit Mankato is a Limited Liability Corporations (LLCs) of Greater Mankato Growth, Inc. Visit Mankato(visitmankatomn.com) leads the development of the visitor economy in Mankato by actively promoting Mankato as a premier destination.

MN Valley Business • November 2013 • 35

Greater Mankato Growth

The BackPack Food Program discreetly provides lowincome students in kindergarten through sixth grade with packs of nutritious, child-friendly food items to take home on weekends and school breaks, so they can return on Monday ready to learn. Current enrollment in the program exceeds 500 students in four Mankato elementary schools—Franklin, Kennedy, Washington and Rosa Parks. As funds become available, additional schools will be added to the program, offering help to K-6 students in the Greater Mankato area who are enrolled in the free or reduced lunch program and would benefit from consistent, nutrious food on the weekends. Champion Runners: Becky Brudwick, Tom Weigt, Scott Stevens

Project for Teens (P4T) is a volunteer peer education and service learning program involving high school students from Mankato. Each year, students are trained as peer leaders and are provided with information and tools to address audiences in sixth and eighth grades with messages that promote healthy decision-making around youth risk behaviors. P4T Peer Leaders also provide learning experiences for youth audiences Kate Cox, Champion Runner for Project for from a range of Teens, proudly displays her Mankato Marathon southern Minnesota Charities t-shirt communities that attend the annual Youth Health Conference sponsored by the University of Minnesota Extension Service. Champion Runners: Mary Nelson, Kate Cox, Jessica Kirschner


occupational medicine on-site services

Mankato Clinic Urgent Care @ Adams Street is your provider of on-site and in-clinic Occupational Medicine Services. Our staff is committed to keeping your workers healthy and getting them back to work quickly and safely after an injury or illness. Services provided by our Occupational Health Nurse at your site: • Designated contact person for companies • Ergonomic worksite evaluations • Vaccines • Health and Wellness fairs • Educational seminars • Company site visits To schedule an on-site appointment, call 507-625-7684. For more information on additional occupational medicine services visit, www.mankatoclinic.com.

Put 120 Years of Legal Expertise to Work for You Reaching 120 years in business is a significant accomplishment. For Farrish Johnson Law Office, it’s a result of hard work, along with a dedication to providing innovative legal solutions with professional reliability and the highest ethical standards. It’s what makes Farrish Johnson Law Office the premier, full service, legal resource for Greater Mankato and Southern Minnesota. Put 120 years of legal expertise to work for you. Contact Farrish Johnson Law Office today.

AREAS OF PRACTICE UÊPersonal Injury UÊWrongful Death UÊConstruction Law UÊCommercial Litigation UÊTraumatic Brain Injury UÊElectrical Accidents UÊTruck Accidents UÊAppeals

Scott V. Kelly, Randall G. Knutson & William S. Partidge

2013 Rising Stars Daniel J. Bellig Aaron J. Glade

UÊBusiness Law UÊEstate Planning & Probate UÊCriminal Defense UÊDivorce & Family Law UÊReal Estate Law UÊConsumer Bankruptcy UÊEmployment (Employer) UÊArbitration & Mediation

Mankato Office: 507.625.2525 | Madelia Office: 507.642.3141

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