mn valley business journal

Good medicineHealth care sector growing againAlso in this Issue:• Mark Deichman, custom home builder• Energy efficiencies in the workplace• Wiste’s Food Market

MNVB July p01.indd 1 6/22/2012 2:21:22 PM

COMMUNICATED WITH LEGAL EASE. ANOTHER DAY. ANOTHER VICTORY.

Becoming a patent attorney was the best decision David ever made. But signing up for Charter Business was a smart idea too. With Internet up to six times faster than standard DSL,† David now zips through thousands of Patent and Trademark Office records and transfers encrypted engineering plans in seconds. He even gets a phone line with unlimited long distance,‡ all for the same price he used to pay for just Internet. Protecting innovation is David’s business. No wonder he trusts Charter Business.

$99/mo

INTERNET + PHONE

INTERNET PHONE TV

©2012 Charter Communications. *$99 offer available to new customers only with 12-month term and includes Charter Business Essentials20 with custom hosting and three desktop security licenses, and Charter Business Phone with Unlimited Long Distance and Advanced feature pack. †Speed comparison as of 3/14/12. Internet speeds may vary. ‡Unlimited Long Distance available only to Charter local customers and applies only to direct-dial calls within the U.S., Puerto Rico, and Canada. Offer expires 7/29/12 and is subject to change. Restrictions apply. Call for details.

www.BusinessBundle.com877-BIZ-BUNDLEContact your dedicated Charter Business representative today.

*


We carry the brands you love:NYDJ • Tribal

Nic & Zoe • SpannerFrench DressingFenini • Born

Clarks

Trail Creek Center off Hwy 22 North120 N. Augusta Court, Ste. 101, Mankato

507-344-1656

Mon.Fri. 10:30 a.m. - 6:00 p.m.Sat 10:30 a.m. - 5:00 p.m.; Closed Sunday


MN Valley Business • July 2012 • 3

Features

■ 18 Special Focus: Energy efficiency

Geoff Roise, co-owner of lindsay Windows in North Mankato, says one of the easiest and cheapest ways to increase energy efficiencies in the workplace is to replace lighting systems.

■ 36 Wiste’s Food Market

Wiste’s Food Market in Janesville is celebrating 90 years in business this year. It’s still open in the building where it originated, at 208 North Main Street. That’s where Orville Wiste started his food market in 1922.

■ 22 Health care transformation

Dr. Greg Kutcher, President and CEO of Mayo Clinic Health System and Randy Farrow, CEO of Mankato Clinic are leading their organizations through major transformations in how health care is provided.

F E A T U R E Sjuly 2012 • Volume 4, Issue 11

■ 40 Deichman Construction

Mark Deichman knows you only get one chance to make a first impression and he incorporates this principle into every home he builds. He founded Deichman Construction, a design-build firm, in 1990.


4 • July 2012 • MN Valley Business

Dep

artm

ents

■ From the Editor ................................ 6Joe Spear: Health care is a booster shot

■ Business informer ............................ 8Vehicle, retail, construction trends in the area

■ Job trends ......................................10Regional, state unemployment information

■ Construction, real estate trends ....11Building permits, housing starts, home prices, interest rates

■ Retail trends ...................................12Auto sales, retail sales and hotel business

■ Agriculture Outlook ........................14Kent Thiesse: Insurance key to risk management

■ Agribusiness trends. ......................15Area commodity prices

■ Business updates ...........................16 PDP a Minnesota Cup semi-finalist, ethanol boom stalling, corn syrup can’t be called “corn sugar,” and more

■ Business Commentary ...................20 Paul Schumann, Minnesota State university

■ Greater Mankato Growth ...............30 Events bring in business and showcase the marketplace

■ Greater Mankato Growth Member Activities .........................32

Groundbreakings, new businesses, relocations and expansions

■ Greater Mankato Growth CVB ......35 Making Vikings fans feel welcome during training camp

■ Regional Outlook ............................34Jack M. Geller: Is Minnesota “nice” to small business?

■ All in the Family .............................42 Keeping it clean

■ Business memos/ Company news ...............................44 Allstate Peterbilt honored, Brunton adds architect, Jones & Magnus adds attorneys, and more

D E P A R T M E N T S

On the Cover:Dr. Phillip Benzmiller of the Mankato Clinic

Photo by Pat Christman


INTEGRITY

PAULSEN ARCHITECTS

When integrity is at the core of a company’s culture, it shows in the details. It steers their relationships, distinguishes their work and proves their value.

At Paulsen Architects, it begins with trust—a trust that is founded from thestrong character, skill and dedication of our staff and the relationships wehave formed with our clients. We are committed to long term partnershipswith clients like Mayo Health Clinic System and the integrity they exhibiteveryday by providing nurturing and healing environments for their patients.

507.388.9811 | WWW.PAULSENARCHITECTS.COM

ARCHITECTURE | ENGINEERING | INTERIORS | PLANNING

IT’S IN THE DETAILS



PUBLISHER

EXECUTIVEEDITOR

ASSOCIATE EDITOR

CONTRIBUTINGWRITERS

PHOTOGRAPHERS

COVER PHOTO

GRAPHIC DESIGNER

PAGE DESIGNER

ADVERTISINGMANAGER

ADVERTISINGSALES

ADVERTISINGASSISTANT

ADVERTISINGDESIGNERS

CIRCULATIONDIRECTOR

James P. Santori

Joe Spear

Tim Krohn

Jack M. GellerSara Gilbert-FrederickTim KrohnJean LundquistPaul SchumannKent ThiesseMarie Wood

Pat ChristmanJohn Cross

John Cross

Jenny Malmanger

Christina Sankey

David Habrat

Cheryl Olson

Barb Wass

Seth GlaserSue HammarChristina SankeyAaron Tish

Denise Zernechel

MN Valley Business is published 12 times a year at 418 South 2nd Street

Mankato, MN 56001.

JULy 2012 • VOLUME 4, ISSUE 11

For editorial inquiries, call Tim Krohn at 507-344-6383.

For advertising, callCheryl Olson at 507-344-6390Fr

om t

he E

dito

r

Health care is booster shot for local economy

MV

110 W Dukes St, Ste 4 507-388-4405

www.osdmankato.com

Congratulations to I&S Group on their new

La Crosse location

Furniture • Design • Installation

While the adage people will always get sick and need health care used to mean

there would always be demand for health care services, there’s at least a nuance in that thinking these days.

In Mankato’s case the adage still mostly holds true as our cover story indicates. But the recession of the past few years did slow the flow of health care services for a while in 2010, where business for both Mankato area’s medical providers Mayo Clinic Health System and Mankato Clinic were either down or slower in terms of volumes.

Dr. Greg Kutcher, president and CEO of Mayo Clinic Health System, suggests that during the recession people just put off non-critical health-care decisions and maybe faced higher deductibles and co-pays they weren’t willing to take on.

Still, both systems now are again seeing pretty strong growth in demand for their services. That’s no surprise. Health care has long been seen as one of the keys to growing Gross Domestic Product over the next decade or so as the Baby Boom generation retires and needs more health care.

So regional centers like Mankato certainly benefit from that trend as the providers expand regionally. Both are likely to do so over the next decade in terms of physical space and services.

The regional Mayo Clinic system has 3,500 employees. That’s a pretty hefty number for one employer and it may be the largest employer in the region.

More and more health care and education are driving the Mankato regional employment scene. Mayo’s integrated system supports high volume as people who live in St. James, for example, can come to Mankato to get specialty care, thereby keeping those health dollars closer to home.

The recession also has caused both systems to be more careful and cautious about adding to physical facilities. It sounds like some “wants” have been put off in place of “needs.”

Still these industries that will provide strong growth also face tremendous change. Kutcher notes the growing number of patients also includes a growing number who have the government pay for their health care. For years, Medicare and Medicaid reimbursements have not kept up with

the cost of care provided.There also are likely to be some

health care offshoot businesses that will benefit from these health care service trends. The Mankato region has seen an explosion in pharmacies and health product retailers in the last five years, with two CVS stores added and at least two Walgreens.

Market research from Claritas shows the health care product retailers like drug stores and pharmacies will have an average annual growth in Mankato of 7.5 percent in sales per year for the next five years.

Not bad. In fact, those retailers are projected to be the fastest growing retailers in the region. We tried to talk to both CVS and Walgreens for our story, but both never got back to us. When you’re doing well, you probably don’t need any press.

Of course by the time you read this column, the U.S. Supreme Court will have ruled on the health care reform act, and whatever way the ruling goes, health care will be significantly impacted for years to come.

Hopefully, it will be for the better. More people will be covered and providers will be able to cover their costs of care. With a greater pool of healthier people, insurance companies should do much better as well.

Health care will continue to impact Mankato area business, employment and general welfare of our region. It will be a story worth watching. MVJoe Spear is executive editor of Minnesota Valley Business. Contact him at 344-6382 or [email protected]

By Joe Spear


AUTOMOTIVEJerry's Body Shop, Inc.1671 Madison Ave, Mkto, MN 56001507-388-4895 www.asashop.org/member/jerrys

STAFFING AGENCYExpress Employment Professionals113 Monroe AvenueNorth Mankato, MN 56003507-387-5620www.expresspros.com

Professional resources to help

grow your business

For information on including your service to this directory, please contact

Cheryl Olson507-344-6390

110 W Dukes St, Ste 4 507-388-4405

www.osdmankato.com

Congratulations to I&S Group on their new

La Crosse location

Furniture • Design • Installation



Consumer spending Local spending jumps

Consumers opened their wallets more freely in Mankato in March and April, according to local sales tax information collected by the city. In March, dealers sold 1,180 vehicles — the highest monthly number in years. Dealers topped 1,000 vehicles sold in only two other months since the beginning of 2011.

Sales tax collections were also solid this spring in Mankato. In March nearly $339,000 was collected and April’s collection was $398,000. That compares with about $318,000 collected in those two months last year.

And people ate and drank out more as well. The city collected nearly $48,000 in food and beverage taxes in March and $61,500 in April — up from about $44,000 and $50,000 a year early.

■ ■ ■

AgricultureCommodity prices steady

While not at 2011 levels, corn prices in southern Minnesota stayed relatively strong at $6.19 per bushel in June. Prices were above $7 during the spring and summer of last year.

Soybean prices are slightly ahead of last year, at $13.45 per bushel in June.

Meanwhile, hog prices continue to hold strong, moving up to more than $91 in June, $2 ahead of last year in June.

Milk prices were at $17.65 per hundredweight in June, down from the $21.55 posted last June.

■ ■ ■

EnergyOil will average $95 a barrel

West Texas Intermediate crude oil spot prices averaged more than $100 per barrel over the first 4 months of 2012. The WTI spot price then fell from $106 per barrel on May 1 to $83 per barrel on June 1, reflecting market concerns about world economic and oil demand growth.

The federal Energy Information Agency projects the price of WTI crude oil to average about $95 per barrel over the second half of 2012. That projection is $11 per barrel lower than the agency projected last month.

Crude oil prices should remain relatively flat in 2013. That forecast rests on the assumption that U.S. real gross domestic product grows by 2.2 percent this year and 2.4 percent next year.

The recent economic and financial news that points towards weaker economic outlooks could lead to lower economic growth forecasts and further downward revisions to crude oil price forecasts.

U.S. oil production upU.S. total crude oil production should average 6.3 million

barrels per day in 2012, an increase of 0.6 million barrels per day over last year, and the highest level of production since 1997. Projected U.S domestic crude oil production will increases to 6.7 million bbl/d in 2013.

Natural gas up someEIA’s average 2012 Henry Hub natural gas spot price

forecast is $2.55 per million British thermal units, which is 10 cents higher than last month’s Outlook. The Henry Hub spot prices will average $3.23 in 2013.

U.S. fuel use downTotal liquid fuels consumption in the U.S. fell 340

thousand barrels per day (1.8 percent) last year. Motor gasoline consumption accounted for the bulk of that decline, shrinking by 2.9 percent.

In 2012, total consumption should fall further, by a more moderate 70 thousand barrels per day (0.4 percent).

In the first quarter, total consumption did fall by 700 barrels per day, but it was driven by high prices and record warm weather.

Electric use tapers downCooling-degree-days during the summer of 2011 were

nearly 22 percent higher than the 30-year normal. The National Oceanic and Atmospheric Administration projects temperatures this summer should again be above normal, but 14 percent lower than last year’s level.

This reduced need for summer cooling contributes to projections of a 3.7 percent decline in residential electricity sales in 2012. Electric consumption should then grow by 1.9 percent in 2013.

Renewables falling After growing by 14 percent in 2011, the total renewable

energy supply is projected to decline by 1.1 percent in 2012. This decrease is the result of hydropower resource levels beginning a return to the long-term average, with supply falling by 10 percent. The decline in hydropower from the 2011 level more than offsets growth in other renewable energy supplies.

C02 emissions fall again After declining by 2.4 percent in 2011, fossil fuel emissions

are projected to further decline by 2.5 percent in 2012, but increase by 1.3 percent in 2013

Petroleum emissions decline slightly in 2012 (0.4 percent) and then rise by 0.5 percent in 2013, while natural gas emissions rise by 4.6 percent and 2.4 percent in 2012 and 2013, respectively.

Coal emissions decline in 2012 by 10 percent, but rise by 1.6 percent in 2013.

■ Business Informer

Constructionxxxxxxx

xxxxxxxxxxxxxxxxxxxxxxxxxxxxxxxx

■ ■ ■

Agriculturexxxxxxxxxxxx

Employmentxxxxxxxxxxxx

■ ■ ■



Bus

ines

s B

arom

eter

s Major� May� Percent changeindustry� ’11 ’12� ’11-’12

Initial unemployment claimsNine-county Mankato region

Nine-county Mankato region

Nine-county Mankato region

*Categories don't equal total because some categories not listed.

Services consist of administration, educational, health care and socialassistance, food and other miscellaneous services.

Services consist of administration, educational, health care and socialassistance, food and other miscellaneous services.

Construction� 151� 158� +4.6%Manufacturing� 172� 208� +19.8%Retail� 53� 55� +3.8%Services� 331� 326� -1.5%Total*� 707� 747� +5.7%

(includes all of Blue Earth and Nicollet Counties)

Mankato/North Mankato Metropolitanstatistical area

By� March� Percent changeoccupation� ’09 ’10� ’09-’10

Minnesota initial unemployment claims

Management� 1,360� 876� -35.6%Adm. support� 2,611� 1,885� -27.8%Production work� 9,228� 4,097� -55.6%Sales� 3,219� 2,680� -16.7%Driving/moving� 2,139� 1,661� -22.3%

County/area� May 2011� May 2012Unemployment rates

Blue Earth� 5.0%� 4.4%Brown� 5.1%� 5.2%Faribault� 6.7%� 5.8%Le Sueur� 7.4%� 6.1%Martin� 5.6%� 5.1%Nicollet� 4.8%� 4.4%Sibley� 5.1%� 4.9%Waseca� 6.0%� 5.7%Watonwan� 6.5%� 5.7%Minneapolis/St. Paul� 6.1%� 5.2%Minnesota� 6.1%� 5.2%U.S.� 8.7%� 7.9%

Major� May� Percent changeindustry� ’11 ’12� ’11-’12

Minnesota initial unemployment claims

*Categories don't equal total because some categories not listed.

Construction� 3,347� 3,074� -8.2%Manufacturing� 2,504� 2,195� -12.3%Retail� 1,718� 1,553� -9.6%Services� 7,596� 6,954� -8.5%Total*� 15,165� 13,776� -9.2%

Local non-farm jobs

100,000

110,000

120,000

130,000

20122011

DNOSAJJMAMFJ

125,471125,183

(in thousands)Minnesota non-farm jobs

0

1,000

2,000

3,000

20122011

DNOSAJJMAMFJ

2,817.92,785.9

Local number of unemployed

0

2,000

4,000

6,000

8,000

10,000

20122011

DNOSAJJMAMFJ

6,5577,761

Minnesota number of unemployed

150,000

175,000

200,000

225,000

20122011

DNOSAJJMAMFJ

155,365189,042

Source: Minnesota Department of Employment and Economic Development J. Malmanger

Counties, state, nation

Unemployment rate� 5.0%� 4.4%

Number of non-farm jobs� 55,988� 55,997

Number of unemployed� 2,894� 2,587

May� 2011� 2012



Business B

arometersSource: City of Mankato

Source: City of Mankato

Source: Freddie Mac

Residential building permits Mankato

$0

$2,000

$4,000

$6,000

$8,000

$10,00020122011

DNOSAJJMAMFJ

$2,694.1$3,745.4

Source: City of North Mankato

Residential building permits North Mankato

$0

$1,000

$2,000

$3,00020122011

DNOSAJJMAMFJ

$1,146.0$2,649.3

Commercial building permits Mankato

$0

$3,000

$6,000

$9,00020122011

DNOSAJJMAMFJ

$974.7$3,833

Source: Realtors Association of Southern Minnesota

Mankato regionExisting home sales:

0

50

100

150

20020122011

DNOSAJJMAMFJ

Source: City of North Mankato

Commercial building permits North Mankato

$0

$3,000

$6,000

$9,000

$12,00020122011

DNOSAJJMAMFJ

$177.3$50

J. Malmanger

Information basedon Multiple ListingService and maynot reflect all sales

Source: Cities of Mankato/North Mankato

Mankato/North Mankato

30-year fixed-rate mortgage

Housing starts:

0

10

20

30

4020122011

DNOSAJJMAMFJ

Includes single familyhomes attached anddetached, and town-homes and condos

Interest rates:

3.0%

3.5%

4.0%

4.5%

5.0%

5.5%20122011

DNOSAJJMAMFJ

(in thousands)

(in thousands)

(in thousands)

(in thousands)

4116

130128

Source: Minnesota Foreclosure Partners Council

� � � �County� 2011� 2012� Percent change

Foreclosures:

Blue Earth� 37� 38� +3%Brown� 17� 9� -47%Faribault� 8� 12� +50%Le Sueur� 32� 29� -9%Martin� 8� 10� +25%Nicollet� 17� 15� -12%Sibley� 16� 12� -25%Waseca� 16� 15� -1%Watonwan� 6� 6� 0%

2012 first quarter

Yearly foreclosures counts

Blue Earth� 57� 101� 143� 153� 144� -6%Brown� 20� 35� 32� 40� 35� -13%Faribault� 19� 36� 39� 40� 42� +5%Le Sueur� 39� 70� 174� 167� 144� -14%Martin� 26� 44� 54� 52� 46� -25%Nicollet� n/a� n/a� 49� 60� 66� +10%Sibley� 25� 42� 54� 75� 49� -35%Waseca� 23� 44� 20� 57� 69� +21%Watonwan� 12� 26� 20� 33� 24� -27%Source: County reported sheriff’s sales

� � � � � � Percent changeCounty� 2005� 2006� 2007� 2008� 2009� ’08-’09

Foreclosures Third quarter 2010

� � � � State rankCounty� 2009� 2010� Percent change� Q3 2010

Blue Earth� 42� 56� +33%� 21Brown� 10� 16� +16%� 46Faribault� 9� 15� +67%� 47Le Sueur� 35� 41� +17%� 26Martin� 7� 14� +100%� 49Nicollet� 24� 13� -46%� 51Sibley� 11� 31� +182%� 37Waseca� 21� 26� +24%� 39Watonwan� 5� 13� +160%� 51

4.5%

3.1%


� � � �County� 2009� 2010� Percent change� 2010 rate

Foreclosures

Blue Earth� 144� 183� +27%� 0.98Brown� 35� 46� +31%� 0.46Faribault� 42� 51� +21%� 0.77Le Sueur� 144� 160� +11%� 1.50Martin� 46� 53� +15%� 0.60Nicollet� 66� 64� -3%� 0.64Sibley� 49� 81� +65%� 1.36Waseca� 69� 81� +17%� 1.19Watonwan� 24� 42� +75%� 0.95

2010


� � � �County� 2010� 2011� Percent change� State rank

Foreclosures:

Blue Earth� 46� 37� -20%� 23Brown� 12� 17� +42%� 41Faribault� 15� 8� -47%� 55Le Sueur� 39� 32� -18%� 28Martin� 11� 8� -27%� 55Nicollet� 19� 17� -11%� 41Sibley� 18� 16� -11%� 46Waseca� 20� 16� -20%� 46Watonwan� 13� 6� -54%� 61

First quarter



Bus

ines

s B

arom

eter

s

Mankato/North Mankato


Source: Sales tax figures, City of Mankato Source: Sales tax figures, City of Mankato

Lodging tax collections

$0

$15,000

$30,000

$45,00020122011

DNOSAJJMAMFJ

$32,026$31,751

Mankato — Number of vehicles soldVehicle sales

0

200

400

600

800

1,000

1,20020122011

DNOSAJJMAMFJ

814894

(In thousands)Mankato Includes restaurants, bars,

telecommunications and generalmerchandise store sales. Excludesmost clothing, grocery store sales.

Source: Minnesota Department of Employment and Economic Development

Nine-county Mankato region (in millions)Purchasing power

$225

$275

$325

$37520082007

DNOSAJJMAMFJ

$255.2 $354.9

Figures based on average weekly wages and number of people employed.Does not include self-employed individuals or students working for school.

Sales tax collections

$0

$100

$200

$300

$400

$500

20122011

DNOSAJJMAMFJ

$318.3


Mankato food and beverage tax

$0

$25,000

$50,000

$75,00020122011

DNOSAJJMAMFJ

$61,527$50,023

J. Malmanger

$397.9

Gas prices-Mankato

$0

$1.00

$2.00

$3.00

$4.0020122011

DNOSAJJMAMFJ

$3.65

$3.69 (2011)

J. Malmanger

$0

$1.00

$2.00

$3.00

$4.0020122011

DNOSAJJMAMFJ

Gas prices-Minnesota

Source: GasBuddy.com

$3.70

$3.63 (2011)

Stocks oflocal interest

J. Malmanger

� May 15� June 18� Percent change

Archer Daniels� $32.47� $31.29� -3.6%

Ameriprise� $49.18� $49.65� +1.0%

Best Buy� $19.12� $19.80� +3.6%

Crown Cork & Seal� $36.06� $34.34� -4.8%

Fastenal� $43.38� $39.69� -10.9%

General Growth� $17.64� $17.18� -2.6%

General Mills� $39.58� $38.65� -2.3%

HickoryTech� $9.81� $10.26� +4.6%

Hutchinson Technology� $2.42� $1.78� -26.4%

Itron� $38.89� $39.89� +2.6%

Johnson Outdoors� $17.86� $16.61� -7.0%

3M� $85.78� $87.31� +1.8%

Target� $55.08� $58.47� +6.2%

U.S. Bancorp� $31.30� $31.52� +0.7%

Wells Financial� $18.11� $18.00� -0.6%

Winland� $0.50� $0.70� +40.0%

Xcel� $27.17� $29.02� +6.8%


14 • JuNE 2012 • MN Valley Business

Agr

icul

tura

l Out

look

The Federal Crop Insurance program is the main risk management program that is utilized by crop

farmers across the U.S. In 2011, a toatal of 263.3 million acres were covered by some type of crop insurance policy. In Minnesota, about 94 percent of major crop acreage was covered by crop insurance, including 7.6 million acres of corn, 6.7 million acres of soybeans, and 1.5 million acres of wheat, as well as many acres fruits, vegetables, and other crops. As a new Farm Bill is being developed, many members of Congress and agricultural leaders are pushing for maintaining a strong crop insurance program as the centerpiece of a risk protection program.

The Federal Crop Insurance program allows farm operators to make individual decisions on crop insurance coverage for their various farm units. They can choose from a variety of types of insurance coverage and various coverage levels. The crop insurance program is administered through private crop insurance companies and local crop insurance agents.

Most corn and soybean producers in Minnesota buy revenue protection (RP) crop insurance policies, which protect against the combination of yield losses and price reductions during the growing season. A base revenue level is established on a farm unit using the historic average crop yield times the average crop price at the beginning of the crop insurance coverage period. For RP policies, the insurance coverage level purchased by farm operators is a percentage of that base revenue, ranging from 50 percent up to 85 percent. The final crop revenue on the insured farm unit is the actual crop yield times the crop price at harvest time. If the actual crop revenue is lower than the guaranteed insurance coverage, a crop insurance indemnity payment is made for that crop on that farm unit.

The premiums paid by farm operators for crop insurance coverage are subsidized by the federal government, with an average subsidization rate of 62 percent of the total premium amount in 2011. The percentage of premium subsidy is higher at the lower coverage levels; however the premium subsidy per acre increases at higher insurance coverage levels.

The Environmental Working Group (EWG) recently released results of a study conducted to analyze 2011 crop insurance subsidies paid. Their study found that 26 farm operations in the U.S. received over $1 million in crop insurance premium subsidies, including three operations based in Minnesota. The data showed that 10,152 farm operations nationwide received more than $100,000 in premium subsidies, which included 563 Minnesota farms. In 2011, the total U.S. crop insurance premiums were just under $11.9 billion, with farm operators paying

approximately $4.5 billion, and federal insurance subsidies making up about $7.4 billion.

The EWG data showed that a significant portion of farm operators receiving the total crop insurance subsidies over $1 million per year raised corn, soybeans, and wheat. However, there was also a substantial number of operations that raise potatoes, tomatoes, apples, onions, and grapes, which all tend to be higher valued specialty crops. Unlike other federal farm programs, crop insurance programs cover most crops that are raised in the U.S., including fruit and vegetable crops.

The EWG is public interest organization, which has a very strong political agenda, and is a very active political lobbying organization. For the past couple of decades, the EWG has been a strong proponent of significantly stricter payment limits to producers, and has called for significant changes and reductions in federal farm programs, including the elimination of direct payments. It now appears that direct payments and some other potential farm program payments will be eliminated in the next Farm Bill. It appears that the EWG (ewg.org) has now switched it’s farm program emphasis to crop insurance subsidy levels.

As the new Farm Bill is being developed, some members of Congress, the Government Accountability Office, the EWG, and other groups have called for changes and restrictions in crop insurance subsidy levels. One proposal calls for setting all crop insurance premium subsidy levels at 50 percent, as compared to the current average premium subsidy level of 62 percent. This would increase the farmer-paid average crop insurance premiums for most crops at all insurance coverage levels. Another proposal would restrict the total crop insurance premium subsidy to $40,000 per individual or farm operation. Other proposals, would restrict crop insurance premium subsidies to any individual or entity with an adjusted gross income over $750,000 per year. Some have even suggested reducing the gross income threshold as low as $250,000.

The higher value of most crops in recent years has greatly increased the total federal expenditures for the crop insurance premium subsidy, which has increased from $1.5 billion in 2002 to $7.4 billion in 2011. The higher crop value also means that a larger number of farm operations would reach the premium subsidy limit, if a $40,000 limit were imposed. A typical corn and soybean crop operation of 1,100-1,200 acres — not a large operation by today’s standards — could likely reach the $40,000 limit.

Using a means test, such as a $750,000 or $250,000 gross income limit for having subsidized crop insurance available would

set a precedence, since no other federally subsidized insurance programs have such a means test. Using a means test may also be quite complicated and expensive to administrate. Some farm operations may be forced to change farm business structures from family partnerships and corporations in order to stay eligible for crop insurance, if this type of approach is enacted.

Crop insurance only makes payments when losses occur due yield reductions or lower prices. In 2011, crop insurance indemnity payments for losses totaled 48 percent of the total insurance premiums. The premium subsidies help keep desirable levels of crop insurance affordable for producers of all sizes, and for a wide variety of crops. The availability of affordable crop insurance is also very important to ag lenders that are funding farm operations. Sharp crop insurance premium increases, or restrictions in access to insurance coverage, could affect availability of ag credit in the future, especially for younger farm operators with a high amount of rented crop land. MV

Kent Thiesse is a farm management analyst and vice president, MinnStar Bank, Lake Crystal. He can be reached at (507) 381-7960 or [email protected]

Federal crop insurance key to risk management

By Kent Thiesse

■ Premium subsidies help keep desirable levels of crop insurance affordable for producers of all sizes.”


Business B

arometers

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

Corn prices — southern Minnesota

Source: USDA

$0

$2.00

$4.00

$6.00

$8.0020122011

DNOSAJJMAMFJ

Iowa-Minnesota hog prices

Source: USDA

$50.00

$60.00

$70.00

$80.00

$90.00

$100.0020122011

DNOSAJJMAMFJ

(dollars per bushel)

185 pound carcass,negotiated price,weighted average

Milk prices

Source: USDA. Based on federal milk orders.

$14.00

$16.00

$18.00

$20.00

$22.00

$24.0020122011

DNOSAJJMAMFJ

Minimum prices, class I milkDollars per hundredweight

Soybean prices — southern Minnesota

Source: USDA

$8.00

$9.00

$10.00

$11.00

$12.00

$13.00

$14.0020122011

DNOSAJJMAMFJ

(dollars per bushel)$7.52

$6.19

$91.32

$89.24

$21.55

$17.65

$13.28

$13.45

Weichert WORKS!

FARM LAND SERVICES

Rich Draheim507.381.0808

Dale Guggisberg507.381.9292

Dan Hawkes507.380.1964

Jon Kietzer507.381.1773

Shawn H. Price507.384.7771

Christa Wolner507.3276300

300 St. Andrews Drive, Ste 110Mankato, MN • 507.345.1111

weichertcommunitygroup.com



Upd

ates

■ PDP a Minnesota Cup semi-finalistMankato-based People Driven Performance has been selected

as a semi-finalist in the Minnesota Cup Competition. PDP is one of 49 semi-finalists chosen from more than 1,000 applicants.

The Minnesota Cup seeks out the newest and most innovative business ideas.

Three finalists in each of six divisions will be announced on August 20.

Louise Dickmeyer is president of PDP.

■ Ethanol boom stalling Archer Daniels Midland closed an ethanol plant in North

Dakota, citing lackluster returns in the once booming ethanol industry. As ethanol stalls the effects are starting to spread across a Farm Belt that had grown accustomed to soaring growth. Annual U.S. production of ethanol more than tripled from 2005 to 2011, driving up crop prices and pumping money into rural communities.

Now, ethanol demand is topping out. The amount used in gasoline is near federal mandates, and gasoline consumption is declining. After 15 straight years of growth, ethanol production this year will fall slightly and will be roughly flat next year, according to the U.S. Energy Information Administration.

The ethanol industry expanded based partly on expectations that gas consumption would keep rising, and that ethanol’s share of that would continue to grow. Instead, gas demand this year is projected to be 6.7 percent below its peak in 2007, and efforts to expand ethanol’s share face challenges. U.S. plants now face excess capacity, producing less than 14 billion gallons of ethanol a year, compared to capacity of 14.7 billion gallons.

■ It can’t be “corn sugar”Archer Daniels Midland, Cargill and other makers of high-

fructose corn syrup can’t call their product “corn sugar” in advertisements, U.S. regulators said.

“Use of the term “sugar” to describe HFCS, a product that is a syrup, would not accurately identify or describe the basic nature of the food or its characterizing properties,” Michael Landa, director of the Food and Drug Administration’s Center for Food Safety and Applied Nutrition, said in a letter denying the industry’s petition. Regulations permit use of the term “sugar” only to describe “solid, dried and crystallized” foods, he said.

The Corn Refiners Association, which represents syrup producers, asked the FDA in September 2010 to approve “corn sugar” as a term for corn syrup. U.S. Sugar Corp. and other sugar processors sued the corn-syrup makers in federal court to stop an ad campaign saying “your body can’t tell the difference” between granular sugar, or sucrose, and corn syrup.

■ Best Buy founder resigns from boardBest Buy Co. founder and Chairman Richard Schulze

resigned from the board sooner than planned and will explore options for his 20 percent ownership stake in the electronics retailer.

Schulze, 71, had previously planned to step down as chairman after the 2012 annual meeting on June 21, and to remain as a director through the 2013 meeting.

While a private sale would be the most likely transaction for Schulze’s shares, his public announcement to seek options would imply little interest so far from private-equity buyers.

Schulze announced he would resign as chairman last month after an investigation found he failed to tell the board’s audit committee about allegations former Chief Executive Officer Brian Dunn was having an inappropriate relationship with an employee.

■ Xcel ending solar rewards programXcel Energy said it will phase out its Solar Rewards program

that gave rebates to Minnesota customers who installed solar electric systems.

The announcement comes a week after Minneapolis-based Xcel got the go-ahead by Colorado regulators to end its upfront cash incentives used to entice homeowners in that state to install solar panels.

Xcel said in a news release that the Solar Reward program had met its goals in Minnesota and it was time for the company to refocus plans on energy efficiency.

The Solar Rewards program started in February 2010 and has provided $15 million in subsidies to about 560 solar projects in Minnesota.

■ Target releases responsibility reportTarget Corp. released its Corporate Responsibility Report — a

report it began in 2011. The company measured how it has done on its previously

announced goals and launched four new corporate responsibility goals. The goals include:

• Increase sustainable seafood selection: As announced in 2011, Target commits to ensuring its fresh and frozen seafood offerings are 100 percent sustainable and traceable by the end of fiscal year 2015.

• Improve owned-brand packaging sustainability: Enhance at least 50 owned-brand packaging designs to be more sustainable by the end of fiscal year 2016.

• Increase diabetes HbA1c testing compliance: Increase the percentage of team members and their families enrolled in a Target health plan completing diabetes HbA1c testing to 87 percent by the end of fiscal year 2015.

• Providing $1.5 million in grants to more than 100 Target School Library Makeover alumni schools to increase reading achievement.

■ Updates: Business news, local relevance

Open House Sunday, July 8th • 1:00 - 5:00 p.m.

23541 3rd Avenue, Mankato • 507-625-1232www.railviewperuvians.com

Directions: 2 miles north of Hwy. 14 on 3rd Avenue (Cty. Rd. 5)

You’re invited to experience the grandeur and uniqueness of our Peruvian Horses. Defi ned by a smooth gait for riding comfort, Peruvians combine a willing temperament, strength and stamina with beauty and rarity. Th is breed off ers versatility for all types of riding.

Breed Demonstrations andDrill Team Performances

2:00 & 4:00 p.m.

Austin Family

RAILVIEW PERUVIAN HORSE

387-1151hickorytech.com

Follow us on


Open House Sunday, July 8th • 1:00 - 5:00 p.m.

23541 3rd Avenue, Mankato • 507-625-1232www.railviewperuvians.com

Directions: 2 miles north of Hwy. 14 on 3rd Avenue (Cty. Rd. 5)

You’re invited to experience the grandeur and uniqueness of our Peruvian Horses. Defi ned by a smooth gait for riding comfort, Peruvians combine a willing temperament, strength and stamina with beauty and rarity. Th is breed off ers versatility for all types of riding.

Breed Demonstrations andDrill Team Performances

2:00 & 4:00 p.m.

Austin Family

RAILVIEW PERUVIAN HORSE

387-1151hickorytech.com

Follow us on



MV

Geoff Roise, co-owner of Lindsay Windows in North Mankato, has led the effort to be an environmentally responsible manufacturer. Consuming less energy is one part of the equation.

About five years ago, Roise upgraded the lighting in production and warehouse areas to energy efficient T8 light bulbs. This type of upgrade can result in a 30-40 percent

r educ t i on of your energy use and brighter and better q u a l i t y lighting.

“It was just the right thing to do. We knew it would pay for itself eventually,” said Roise.

Recently, Roise added

m o t i o n detectors that turn off the lights when no motion is detected for 15 minutes. Roise offered this advice to business owners who want to reduce energy use.

“The first thing is to start looking at your utility bills and attack lighting,” said Roise.

The next step for many businesses is to upgrade equipment to energy-efficient models.

Roise converted the company computers to thin clients, which are PC’s that use less energy. Thin clients depend on a broader computer infrastructure where a server does the computing work for a number of computers or “clients.” With 25 to 30 computers, it took about a year to get all the units converted.

Lindsay Windows also upgraded its glass washer to a model that conserves up to 30,000 gallons of water per year.

When energy-efficient principles are put into practice, the savings continue to add up as consumption goes down. MV

■ Special Focus: Energy Efficiency

Lindsay Windows using multiple approaches

Geoff Roise, co-owner of Lindsay Windows in North Mankato.

A window washing system upgrade saves up to 30,000 gallons of water annually.

Lindsay has completely retrofitted lighting to be more efficient and brighter.

By Marie Wood


MN Valley Business • JuNE 2012 • 19

Visit mnenergysmart.com. This informative site is also a clearinghouse for financial incentives available to Minnesota businesses to pay for energy upgrades.

Energy Smart’s Rebate Finder can connect you with your utility company’s current rebate programs.

Many electric and gas utilities offer rebates to commercial customers for common energy improvements, such as installing energy-efficient lights, heating and cooling systems, and motors, as well as some custom improvements. The rebates can be worth 40 percent or more of the improvement project’s costs.

Plus you’ll find Tools & Calculators that can give you a rough estimate of cost savings from an energy efficiency upgrade. The Energy Analyzer determines energy usage for small to mid-size businesses.

Online Resources

As a business owner, you can upgrade your lighting, cash in on rebates from your utility company, and save money on your monthly bill. The payback on your investment can be as short as one to two years.

How do you get started? At no cost to you, the staff at Energy Smart helps Minnesota businesses find ways to save money on energy and connect to financial incentives. Energy Smart is funded by utility conservation programs and administered by Minnesota Waste Wise and the Minnesota Chamber of Commerce.

“We are a referral source for a lot of programs. We have a lot of information. We try to line businesses up with the best program for them,” said Sam Friesen, Energy Smart program coordinator.

Energy Smart staff specifically looks for energy-saving projects that have a payback of less than three years. Currently, lighting upgrades offer the shortest paybacks, because utility companies are offering rebates to help businesses become compliant with new lighting regulations, explained Friesen.

Energy Smart even assists business owners in completing the applications to secure rebates, grants and low-interest loans. MV

Energy Smart: your free business resourceBy Marie Wood

You can schedule a free consultation with an Energy Smart staff member, who will walk through your building to look at your equipment and identify opportunities to reduce energy usage. Energy Smart may record information, such as the number and type of lights, computers, motors, HVAC and more, in order to calculate your savings potential.

Here’s what you can expect in your energy consultation and assessment. Data collection and analysis. A physical walk-through of your facility is the most effective way to collect the needed information. Some utilities offer online assessments, and some will collect much but not all of the needed information from you over the phone.

A detailed report. An on-site energy assessment report typically includes a summary, facility description, list of energy expenses and consumption and energy conservation opportunities. An audit specifically designed for lighting typically includes details on your current lighting, energy cost savings opportunities, approximate cost for upgrades and estimated payback term.

Significant savings from upgrades. A lighting upgrade alone could save you 35 percent of your business’s lighting costs. Rebates, grants and low interest loans are often available for moving forward with energy efficient upgrades and may also help recoup the costs of an energy audit if fees apply.

Each business receives a summary of top energy-saving opportunities, next steps and a list of financial incentives that may help pay for an upgrade. Energy improvements are broken down by categories such as HVAC, lighting, hot water and building envelope, as well as the savings potential.

Energy Smart has visited more than 500 businesses. To schedule an on-site energy consultation, contact Sam Friesen at 651-292-4652 or e-mail [email protected]. MV

On-site energy consultation

If you are an Xcel Energy customer, you may be eligible for a bonus rebate of up to 50 percent to retrofit your lighting system to an energy efficient system in 2012. Other Xcel rebates are: lighting installations in a new building, custom applications, lighting redesign studies and special offers for small and mid-size businesses. Search

Xcel Energy one-stop efficiency shop or use the link on

mnenergysmart.com.

Xcel Energy Rebates



MV

Bus

ines

s C

omm

enta

ry

Some employers have begun asking job applicants for their Facebook user names and passwords. Is it an invasion of privacy?

Facebook is a social networking service and website. A Facebook user can create an online “profile” to share selected personal information (e.g., favorite sports teams) with everyone who visits the user’s public Facebook profile; the user can share selected additional private information (e.g., photos of a newborn son or daughter) limited to specified “friends.”

Some employers have been looking at the Facebook public profiles of job applicants as part of the hiring process. Employers could only see what anyone could see on the applicants’ public profiles, but not information that had been specified as being private, for friends only. However, if job applicants turn over their user names and passwords to employers, then the employers could see everything.

Critics of the practice have argued that it is little different from demanding applicants’ house keys and then searching the applicants’ drawers, closets, photo albums, and personal papers. Critics have also argued that job seekers cannot afford to say no, especially at times or places with few jobs.

Is it legal? Some have suggested that it might violate the Stored Communications Act and the Computer Fraud and Abuse Act, which together restrict access to electronic information. Anti-discrimination laws might also come into play because they restrict the ability of employers to make employment decisions on the basis of characteristics such as race, color, religion, sex, national origin, age, and disability, information that could be discovered on an applicant’s Facebook profile. It has also been suggested that the monitoring of employees’ Facebook profiles might violate labor laws that allow employees to discuss the terms and conditions of their employment with each other. State laws add to the legal complexities. New legislation is possible. The legality of employers demanding unrestricted access to applicants’ Facebook profiles is murky.

Is it ethical? On the one hand, each of us has a legitimate interest in our own privacy. Privacy protects our reputations and protects us from harm. It enables us to determine our self-identity by controlling what we reveal about ourselves. It helps us to build friendships, love, trust, and intimacy. Ethicists typically conclude that there is a moral right to privacy — that each of us has a moral right to determine how much information about ourselves we reveal to others, and to control to whom we reveal what information.

On the other hand, employers have a legitimate interest in hiring the best-qualified applicants. Ethicists typically conclude that employers’ have a moral right to appropriately use information on the essential job qualifications of applicants.

We need some guidelines to help us determine where to draw the line between a job applicant’s right to privacy and an employer’s right to information about the applicant. Ethicists have suggested using the following guidelines.

Relevance: How is the information being gathered relevant to the job? To be ethical, employers should only gather and use information that is directly relevant to the essential qualifications required by the job. If an employer is going to examine an applicant’s Facebook profile, exactly what specific information is being sought? How is that information directly

relevant to the job? For example, discovering an applicant’s political or religious beliefs may not be directly relevant to many jobs. An employer who goes on a fishing expedition of applicants’ Facebook profiles to find “whatever might turn up” is likely to be seen as crossing the ethical line.

Consent: Has the applicant given fully informed free consent to reveal the information? Free consent requires that the applicant have free choice whether or not to provide the information to the employer. Some argue that it is coercive for employers to make hiring contingent on providing user names and passwords, and that coercion interferes with free choice. Others disagree and argue that applicants are free to refuse to provide their user names and passwords, and to seek employment elsewhere; applicants who provide the requested information have freely consented. Fully Informed free consent also requires that the employer inform the applicant what information is being sought, why that information is relevant, how the information will be used, how it will be protected from inappropriate or unauthorized use, and how accidentally discovered irrelevant information will be protected. An employer who demands applicants’ Facebook user names and passwords without properly documented fully informed free consent is likely to be seen as crossing the ethical line.

Reasonable methods: Are the methods used to gather the information reasonable? Are they accurate? Do they avoid being unnecessarily intrusive into a person’s privacy? There are often multiple ways an employer can gather job-relevant information about applicants; some methods are more intrusive than others. To be ethical, employers should use the most accurate and least intrusive methods that are feasible. Demanding to see an applicant’s entire Facebook profile can be very intrusive because it reveals everything in Facebook about the person, some relevant, some not. An employer who demands applicants’ Facebook user names and passwords is likely to be seen as crossing the ethical line when there are there better, more accurate, more focused, and less intrusive methods available.

Ethics requires all three guidelines be satisfied. MV(Paul Schumann is a professor of management at Minnesota State University Mankato. He teaches and conducts research in the areas of business strategy, business ethics, and human resource management. He can be reached at [email protected].)

Ethical dilemmas abound in seeking Facebook access

507-625-4606121 E. Main St. Ste 311

Mankato, MN 56001

Jerry & GeralynnKottschade, Owners

Jerry’s Body Shop, Inc.1671 MADISON AVE.

MANKATO 507.388.4895Expect the Best...

Get the Best!www.jerrysbodyshop.com

BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB ddddddddddddddddddd SSSSSSSSSSSSSSSSSSSSSSSSSShhhhhhhhhhhhhhhhhhhhhhhhhhhh IIIIIIIIIIIIIIIIIIIIIIIIIIIIII

Family owned and operated since 1971.QUALITY DRIVEN & CUSTOMER FOCUSED

1601 Adams St., Mankato, MN 56001 • PO Box 310, 53 1st St. SW, Wells, MN 56097

800.944.5869 • www.wellsfederal.com

Pauline KrugerVice President, Mankato Location

Nate ZenderLoan Offi cer, Mankato Location

By Paul Schumann

■ “The legality of employers demanding unrestricted access to applicants’ Facebook profiles is murky.”


507-625-4606121 E. Main St. Ste 311

Mankato, MN 56001

Jerry & GeralynnKottschade, Owners

Jerry’s Body Shop, Inc.1671 MADISON AVE.

MANKATO 507.388.4895Expect the Best...

Get the Best!www.jerrysbodyshop.com

BBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBBB ddddddddddddddddddd SSSSSSSSSSSSSSSSSSSSSSSSSShhhhhhhhhhhhhhhhhhhhhhhhhhhh IIIIIIIIIIIIIIIIIIIIIIIIIIIIII

Family owned and operated since 1971.QUALITY DRIVEN & CUSTOMER FOCUSED

1601 Adams St., Mankato, MN 56001 • PO Box 310, 53 1st St. SW, Wells, MN 56097

800.944.5869 • www.wellsfederal.com

Pauline KrugerVice President, Mankato Location

Nate ZenderLoan Offi cer, Mankato Location


Corporate GraphicsYour Printing Solutions Company

1750 Northway DriveNorth Mankato, MN 56003

800-729-7575www.corpgraph.com

Printing morethan just your

everyday color!


The cardiac cath lab at Mayo Clinic Health System in Mankato.

VItAl sIgns

ImproVIng Local health care growing after a

couple of sluggish years

By Tim Krohn | Photos by John Cross and Pat Christman

Cov

er S

tory


The maxim that the health-care sector is recession proof may be mostly true. But the Great Recession, coupled with transformational changes in the industry, took a

toll. Mayo Clinic Health System and Mankato Clinic — the two

systems that dominate the area’s medical delivery — are continuing to see growth that began last year, following a year or two of declining business.

Randy Farrow, CEO of Mankato Clinic, said they have seen a surge in demand.

“2011 was a good rebound year. Like a lot of organizations, in 2010 we actually saw our overall volume decrease a little for the first time. Since 2011 we saw demand go up quite a bit, so we’ve been growing as an organization again.”

Dr. Greg Kutcher, president and CEO of Mayo Clinic

Health System in the Mankato region, said they too are seeing a new surge in demand.

“Our patient volumes have increased pretty steadily. It’s a striking difference this year compared to the past couple of years.

“I’m guessing part of it is, people who’d been putting things off longer than they would have in the past are coming in. And people have higher deductibles and co-pays than they used to, so they put things off,” Kutcher said.

While patient volume is up, the increase in patients doesn’t automatically correlate to a corresponding increase in revenues. “The percentage of patients with government payers — Medicare and Medicaid — have gone up too, but they don’t pay at the same levels as typical insurance,” Kutcher said.

Both systems benefit from covering a wide region and

Cover Story

Dr. Phillip Benzmiller reads a chest X-ray at the Mankato Clinic.



Cov

er S

tory

having an integrated system of family physicians and specialists.

The regional Mayo Clinic system with 3,500 employees, covers from Fairmont to New Prague — which joined Mayo last year — and from Springfield to Waseca. Mankato Clinic has locations in Mankato, St. Peter, Mapleton, Lake Crystal and North Mankato and has a management relationship with the Madelia hospital and clinic. Mankato Clinic is one of the largest physician-owned clinics in the state.

“The fact we’re an integrated system and serve a broad region, that leads to higher volume,” Kutcher said. “People can stay closer to home for specialty care.”

Transforming health careKutcher and Farrow have led their organizations as health

care is going through major transformations. Some trends — such as basing health-care payments more on outcomes than for the number of tests and services provided — are here to stay. Other changes — such as how health-care reform and future political changes will affect health care — are far more uncertain.

“What we know is that the way health care is practiced is not sustainable,” Kutcher said.

One big change that has been happening at both systems is a move to integrated health care in which patients with chronic illnesses are better tracked and cared for by a team of health professionals who share information.

Noting that 10 percent of the population uses up 70 percent of all health-care resources, Kutcher said it’s imperative that those with chronic problems are being treated in a way that keeps them from having more serious problems that land them in the hospital or require extensive and expensive treatments.

“We are doing our part through system improvements. We’ve been building an infrastructure to get at some of those pieces. Palliative care provides better care for people with complex serious diseases.”

Kutcher said the approach is being implemented in virtually all departments. “Mayo cancer and heart departments are largely integrated. Now we’re focusing more on neurology and emergency departments — we’re integrating those with Mayo,” he said. “Health care is not quiet right now.”

Makato Clinic has been doing the same integration for patient care.

“We’re doing a better job of coordinating their care, getting them in for regular checkups, working with them on setting goals, diets, exercising,” Farrow said.

Mankato Clinic already has two sites certified by the state as Patient Centered Medical Homes in which the coordinated care system is used. Farrow said that during the certification process, a woman with diabetes testified about how her life was improved.

“She talked about how her diabetes had gotten out of control and it was really impacting her life. She enrolled in the program and got counseling and education on diet and fitness and got on a new program where she eats differently and exercises,” Farrow said. “She testified how this team approach had a huge

impact on her and her life.”The clinic is looking for other ways to give patients a better

experience and reduce costs. They have been talking to a Twin Cities health care group that has patients stay in the Hilton hotel for a night to recover after knee and hip replacements, while still getting care from RNs.

“It’s nicer, obviously, than staying in a hospital. It’s good for people who are healthy enough to do that and the cost is 30 to 40 percent less than in a hospital,” Farrow said.

“The new (insurance) contracts coming down the pike are really shifting incentives away from fee for services and looking at the patient outcomes, their satisfaction with the services.”

Careful constructionBoth health systems have had physical expansions and

renovations the past couple of years, but Farrow and Kutcher say it’s careful, conservative expansion.

“2008 changed everything for capitalizing projects, including in health care,” Kutcher said. “Timeline horizons have been stretched.”

Mankato Clinic has steadily added facilities at Madison East Center, including a dermatologic pathology lab so they can

Randy Farrow, Mankato Clinic



Cover Story

perform and analyze skin biopsies in-house. The clinic also added the Skin Essentials business at Madison East, which offers a variety of cosmetic skin treatments and products.

“We’ve been doing some other renovations, too. We expanded our sleep program and added sleep study rooms. We hired another neurologist who studies sleep — there’s a growing need there,” Farrow said.

Mankato Clinic also has expanded its ophthalmology department on its Wickersham Campus and has added several physicians and physician assistants.

And the clinic expects to expand the surgery center it operates in conjunction with OFC at the Wickersham Campus from four to six surgery rooms.

Farrow said they are going through a master facility planning process that’s looking at needs for the next 15 years.

“We’re out of space at the main clinic and we can’t grow there. We may expand Wickersham and move some departments out of the main clinic to Wickersham — we’ve already moved a lot of support staff out of the clinic to Madison East,” Farrow said.

The clinic still has about 11 years left on its lease for the main clinic building, which is attached to the Mayo hospital and owned by Mayo.

He said the clinic’s North Mankato building is aging and also will need to be replaced.

“We’re just looking at how much we can bite off and when.”Mayo has completed several major construction projects in

recent years. “The big thing for us in a physical aspect is the Emergency

Department addition that also includes space for further expansion and improvement in the surgery area and central supply,” Kutcher said.

“We’re careful with expenses. We didn’t have the money to do it all at once, but to have the shell there and to come back and do it later will be more efficient,” he said of the future surgery center and central supply.

“Central supply is a big deal for us. Instead of having things spread out, there will be one location. You need a huge amount of supplies to do what we do and it will serve the whole region.”

Mayo also recently finished renovating space in the downtown Mankato City Center Place tower — attached to the Wells Fargo building — and close to 100 employees moved there from other locations. Most of them work in administrative jobs.

“It’s a way for us to help the downtown. We see that as an important location for the city and region. A year ago when we started that project, it was a leap of faith, but now our volume is higher and it’s working well,” Kutcher said.

The move frees up precious parking space on the Mankato hilltop campus as well as space in the hospital that can be used for direct patient care rather than offices.

While Mayo has considered parking ramps on the Mankato campus at some point, Kutcher said there are no near-future plans. “Parking ramps are just too expensive.”

Going digitalWhile virtually every business has moved much or all of its

records to an online electronic system, doing so at large health-care systems is exceptionally complex. It involves safeguarding patient privacy and integrating systems that provide insurance and billing information and allow doctors, nurses and others to share test results and other medical information.

“We’ve made a real investment on the IT side of things,” Farrow said. “You need to keep up with storage and new technology.” One big change has been the long-standing form of medical transcription.

“Instead of speaking into tape and having it transcribed, the physician just talks into a voice-recognition computer while they’re working. Then they can go into it and edit it,” Farrow said.

The clinic also rolled out a patient portal. “We’re securing more online data for patients so they can go in and look at their records, test results, their kids’ immunization history and things like that.”

Kutcher said it was decided early on that Mayo would create an electronic system that would be uniform across all Mayo systems across the country.

“It’s part of the whole Mayo system, which is huge. We chose to do it across the system, which makes it harder and slower to do, but in the end, it will be a better system,”

Dr. Greg Kutcher, Mayo Clinic Health System



Cov

er S

tory

Kutcher said.Much of the Mayo system is already up and working well,

Kutcher said. Other parts — such as a patient system where people can log into their account and check on test results, appointments and other information — will be rolled out soon.

Electronic upgrades also have tied in with efforts to consolidate support services such as health information records

and business offices.“All those things have been consolidated, which has improved

efficiencies,” Kutcher said. “It’s a big deal to do because people have to switch jobs, sometimes go to a different location, learn different things and there’s some turnover.

“We’re doing our job to improve efficiencies. We have a long way to go in health care, though.” MV

Sherry Sack (left) and CT manager Phil Hernandez at the Mankato Clinic.


Mankato Clinic Urgent Care @

Adams Street is your provider of

Occupational Medicine Services.

Our staff will collaborate with you to

help manage risk factors, keep your

employees healthy and happy and

get them back to work quickly and

safely after an injury.

No appointment is necessary for

most examinations. Just walk in for

prompt, professional service.

For additional information call507-385-4075 or visit www.mankatoclinic.com

Urgent Care Hours of Operation:Monday - Friday from 8 a.m. - 8 p.m.

Saturday from 8 a.m. - 5 p.m.Sunday 11 a.m. - 5 p.m.

keep themhealthy and happy.

occupationalmedicineservices


Gre

ater

Man

kato

Gro

wth

Chamber of Commerce and Economic Development

507.385.6640 • greatermankato.com

Advancing Business for a Stronger Community

Since its launch in 2009, the community-wide events calendar greatermankatoevents.com has had more than 200,000 visits, from more than 120,000 unique visitors.

The popularity of greatermankaotevents.com has impressed even those organizations who worked together to create the site – Greater Mankato Growth, Greater Mankato Convention & Visitors Bureau, Twin Rivers Council for the Arts, The Free Press and VoyageurWeb. “We knew there was a need for a community-wide events site, which the creators of the Envision 2020 community visioning plan made that clear. But even we were surprised by what a strong community asset the site has become,” said Jonathan Zierdt, president & CEO of Greater Mankato Growth. “The site is a fantastic venue for letting both current and potential residents and business people know what a vibrant, event-rich region Greater Mankato has become.”

One of the reasons for the site’s success is the broad range of categories from which to choose. “What is entertaining, is truly in the eye of the beholder,” said Jim Santori, publisher of The Free Press. “While one person may find a concert entertaining, another might get just as much enjoyment out of a professional workshop.”

Many businesses and organizations put links to the events calendar on their websites, utilizing a widget tool on greatermankatoevents.com. Twin Rivers Council for the Arts, one of the founders of the site, has links on their website to all the categories related to arts, including books & poetry, music, history, visual arts and theatre and dance. ”I think people appreciate being able to go to one spot for all types of entertainment options,” said Timothy Berry, executive director for Twin Rivers Council for the Arts.

In addition to letting both residents and visitors know what’s happening around Greater Mankato, greatermankatoevents.com also serves as a valuable tool for business. “Businesses can use the site to see when potential customers might be in their area for an event,” said Anna Thill, president of the Greater Mankato Convention & Visitor Bureau. Some businesses also use the site to plan employee and client outings, as well as promote their own

events that are open to the general public. It’s not only hospitality businesses with entertainment that find the site valuable; organizations that host professional workshops and speakers also find it useful in promoting their events.

The site is continually being enhanced to make it even easier to add events, but if the creators of greatermankatoevents.com had one wish, it would be that more photos and videos be added. “Adding a photo or video to your event listing takes it to the next level, said Yvonne Cariveau, president/owner of VoyageurWeb. “In addition to generating added interest and excitement, those events with visuals are eligible to be featured on the front page of the site.”

As the site continues to grow in popularity (61% of all visitors to the site in the past year were new users), greatermankatoevents.com will become an increasingly valuable asset for businesses and the Greater Mankato marketplace.

Events bring in business and showcase the marketplace

If your business or organization has an upcoming public event, enter it for free into greatermankatoevents.com. In addition to getting the word out about your event, you’ll

help build Greater Mankato’s reputation as a vibrant region with a wide variety of events for all.

MNVB July p02 .indd 28 6/22/2012 1:49:45 PM

Greater M

ankato Grow

th

MN Valley Business • march 2012 • 29

2011 in Pictures

* Photos By Sport Pix

NEw BusiNEss – Alliance insurance Agency895 Madison Avenue, Mankato

NEw BusiNEss – COP stop uniform & supply124 North Broad Street, Mankato

ExPANsiON – Mayo Clinic Health systemEmergency Department1025 Marsh Street, Mankato

NEw BusiNEss – North Mankato Animal Hospital 1765 Commerce Drive, North Mankato

ExPANsiON – Open Door Health Center-Dental Clinic 309 Holly Lane, Mankato

NEw BusiNEss – Rivendell Cafe1854 Madison Avenue, Mankato

ExPANsiON – starr Cycle 200 Pierce Avenue, North Mankato

NEw BusiNEss – Tandem Bagels 200 East Walnut Street, Mankato

growth in Greater Mankato


Gre

ater

Man

kato

Gro

wth


May Business After Hours at JBeal Real Estate Group in the Historic Graif Building

May Business Before Hours at Mayo Clinic Health System Emergency Department

Member Activities

upcoming Member Events

5:00 - 7:00 p.m.

July 10 Mankato MoonDogsAugust 7 Chankaska Creek Ranch & WinerySeptember 4 Charter Business

2012 Business After Hours sponsored by

For information on these and other member events visit greatermankato.com/events

7:30 - 9:00 a.m.

July 18 Abdo, Eick & Meyers, LLPAugust 15 Country Inn & Suites & Conference Center by CarlsonSeptember 19 HickoryTech

2012 Business Before Hours sponsored by



xxxxxxxxxxxxxxxxxxxxxxxxxxx

xxxxxxxxx

CHANkAskA CREEk RANCH & wiNERy 1179 East Pearl Street, Kasota

chankaskawines.com

CRAMBliT’s lANDsCAPiNG CREATiONs 904 Saint Andrews Drive, Mankato

landscapemankato.com

iNsPiRED AGiNG, llC20492 State Hwy 66, Mankato

inspiredaging.com

JERsEy MikE’s suBs1924 Adams Street, Mankato

jerseymikes.com

kOPP PluMBiNG & HEATiNG iNC22355 Lakewood Drive, Madison Lake

Cavalier Calls on the Newest Greater Mankato

Growth members

Greater M

ankato Grow

th

Not Your Traditional Chamber of Commerce

If the words “chamber of commerce” conjure images of first dollar presentations and business get togethers, you may not know all Greater Mankato Growth offers our members and the marketplace.

Oh sure, we still like to celebrate our businesses’ success – but now we’re also active participants in that success! And while we still like to provide opportunities for businesses to connect with one another, we connect them with so much more.

Today we are a combined chamber of commerce AND economic development organization – offering integrated programs and services for existing and new businesses of all sizes and types. With eight strategic areas of work, we can serve the individual needs of your business, while helping create an ideal environment for overall business success throughout the marketplace. And by advancing business, our members help create a stronger community.

To learn more about all Greater Mankato Growth can do to grow your business and the marketplace, visit greatermankatogrowth.com.

• Existing Business Support

• New Business Growth

• Business Promotion

• Talent Development

• Public Affairs

• Community Marketing

• Visitor Attraction & Servicing

• Civic Engagement

Advancing Business for a Stronger Community


Gre

ater

Man

kato

Gro

wth


2012 Brian Fazio Business Creation Project Recipient Announced

Congratulations to Zak Fick, winner of the 2012 Brian Fazio Business Creation Project, sponsored by Charter Business. Entrepreneurs applied for the competition this past spring, with finalists presenting their projects to an independent panel of judges from the business community in April.

Fick, a Bethany Lutheran College student, created an interactive website to match college students with area residents wanting short term jobs done. As this year’s recipient, Zak receives $5,000 in seed funding from Charter Business to help jump start his new endeavor. “Charter Business supports the Brian Fazio Business Creation Project because it aligns well with Charter Business’ mission; providing broadband solutions so businesses can meet their goals,” said Joni Brengman, Director of Charter Business Sales in Minnesota. “All of us at Charter congratulate this year’s winner, Zak. We commend him on his entrepreneurship and wish him success in the future.”

The Brian Fazio Business Creation Project, named for community economic development advocate Brian Fazio, is a program of the Greater Mankato Business Accelerator, which connects start-up and growing businesses with the resources they need to succeed. The Greater Mankato Business Accelerator is a program of the City of Mankato, Greater Mankato Growth and the Regional Economic Development Alliance. Zak will also be guided throughout the year by Business Accelerator staff and, if needed, have access to business space in the Greater Mankato Business Development Center compliments of the City of Mankato.

Visit greatermankato.com/business-fazio.php for photos and a video of this year’s recipient. For details on the wide variety of competitions for Entrepreneurs, visit greatermankato.com/business-competitions..

Discover your next new customer, employee, intern or volunteer at the Greater Mankato Campus & Community Fair on August 29 from 10 am – 1 pm at Minnesota State University, Mankato. Help welcome in new and returning college students to Greater Mankato and let them know about your business or organization. Hand out sample products, coupons and information on your business. Approximately 2,000 students are expected to attend this year’s event, so reserve your table to exhibit today. The Greater Mankato Campus & Community Fair is presented by Taylor and sponsored by Charter Business. For complete information visit greatermankato.com/gmg-campusfair.php.

2012 Brian Fazio Business Creation Project Recipient, Zak Fick (middle) with Greater Mankato Growth President & CEO, Jonathan Zierdt (left) and Laurie Folsom, Charter Business (right)

City Center SocialTuesday, July 175:00 – 7:00 pm

Sibley Park(Gazebo by the Gardens)

Enjoy refreshments, register for prizes and connect with businesses

in the City Center.

citycentermankato.com



For the past 46 years Greater Mankato has been flooded with thousands of guests donning purple, gold and perhaps horns during a few glorious weeks of summer.

Verizon Vikings Training Camp is coming back from July 26 to August 16 and calling Mankato its summer home for the 47th year. Last year fans came from 28 states, Canada, England, and over 100 different Minnesota cities to watch daily practices and take part in all the fun and fanfare in the Vikings Village.

As a community it is important we embrace these fans, jerseys and all, and make them feel welcome in Greater Mankato.

The camp and the fans it brings, has huge economic impact on Greater Mankato. Thousands of fans come and spend their money in our restaurants, hotels and retail shops. These fans spent more than $5 million dollars in Greater Mankato in 2010. The economic impact in 2011 was about half of that due to the shortened camp and the last minute announcement of camp. But 2012 forecasts to be another sunny summer for Vikings impact with three solid weeks of camp and plenty of time for fans to make their summer plans.

Aside from the obvious benefits listed above, there are several other reasons to extend a welcome to our Viking visitors.

There are immeasurable intangible benefits to Vikings Training Camp. Thousands of people experience Greater Mankato for the first time when they visit Training Camp. We are confident these initial visits result in many bounce back visits at another time. Once people get to know Greater Mankato, the possibility of a return visit is high. So dazzle them while we’ve got them and they just might come back and see us again.

Minnesota State University, Mankato plays host to the Vikings every year. With thousands of potential students visiting Vikings Training Camp each year, this can serve as a tremendous recruiting tool for the university.

Finally, Training Camp has attracted a great deal of media attention over the years, some years more so than others such as the 2011 NFL Lock-Out or the possibility of Favre making an appearance in 2010. All of the media attention has put Mankato on the national map. This exposure is immensely

valuable to the tourism industry. So come July and August, wear your Vikings garb with pride

and welcome the players, coaches and fans to our community. Their short stay has a huge impact on our community!

Make those Vikings fans feel welcome during Training Camp this yearBy Christine NesslerMarketing & Leisure Sales Director

The Greater Mankato Convention & Visitors Bureau (CVB) is an affiliate of Greater Mankato Growth (GMG), operated as anLLC under GMC. The CVB is dedicated to the important work of attracting and servicing visitors to Greater Mankato.

Greater M

ankato Grow

th



Reg

iona

l Out

look

The news that new job creation continues to slow is creating concerns among economists

and politicians alike. More and more of the evidence is suggesting that if you are truly concerned about job creation, you really need to focus on the needs of small businesses. Why? According to the Small Business Administration, small businesses employ nearly half of all private sector employment and accounted for approximately two-thirds of the net new jobs created between 1993 and 2009.

More importantly, in our effort to speed our economic recovery along, it is helpful to remember that between the “dot-com” recession at the beginning of the decade and 2007, small businesses added almost 7 million jobs, while larger businesses with 500 employees or more actually shed close to 1 million jobs. Lesson ... if job creation is the goal, focus on creating an environment that supports small business development.

So it was with this in mind that I reviewed the results of a new research report on the friendliness of the states toward small business development. The research, which surveyed more than 6,000 small businesses all across the U.S., was conducted by Thumbtack.com in partnership with the Ewing Marion Kauffman Foundation. The study actually examined 12 separate dimensions of “business friendliness” for small businesses; from ranking the friendliness of a state’s licensing regulations to the friendliness of its tax code.

Not surprisingly, the findings that made the headlines in the press release was that Texas, Idaho, Utah and Oklahoma were the most friendly states for small businesses, while California, Hawaii, Vermont and Rhode Island were the least friendly. In fact, California was home to the three least friendly cities to small businesses; Los Angeles, San Diego and Sacramento.

But aside from the rankings, what I found most interesting was the finding that small businesses in the study reported that licensing and regulatory requirements were nearly twice as important as tax-related regulations in determining overall business friendliness. This finding reminded me

of a study conducted last year by U.S. Bank Corp. where they also found that among the concerns of small businesses, only 8 percent reported that taxes were a primary concern. So why are small businesses more concerned about the regulatory environment than they are about taxes? Well I would suggest two reasons: first, most small businesses are just that — small. Most have few employees and modest sales revenues; therefore in most states taxes are not such a burden.

On the other hand according to the Small Business Administration, these same small firms with 20 or fewer employees actually spend 36 percent more per employee than larger firms trying to comply with federal regulations. Simply put, complying with environmental, health and licensing regulations are disproportionately more expensive for smaller firms. Therefore, when examining the friendliness of the business climate for small business, entrepreneurs focus more on the regulatory environment than taxes.

So how “friendly” is Minnesota to small businesses? Well overall, the report gave Minnesota a solid grade of “B” ranking 18th out of all the states. Minnesota seemed to rank higher on the cost of hiring new employees; ease of starting a small business; zoning regulations; and the availability of training programs. Conversely, Minnesota didn’t rank as well in licensing regulations and the friendliness of the tax code. The city of Minneapolis itself ranked 15th out of the 40 major

cities examined in the study, ranking high in the cost of hiring new employees and the ease of starting a new business. Clearly, while the state ranked reasonably well in this study, we certainly can strive to do better.

Political and civic leaders should be encouraged to take a moment to consider the implications of this and similar studies. While political leaders from both sides of the aisle may have difficulty agreeing on a variety of issues, both Republicans and Democrats alike want to improve the environment for small businesses. In fact, the study’s authors examined these rankings by the political orientation of the entrepreneurs and found that there was very little difference across the political spectrum (i.e., conservative, moderate or liberal) in terms of how respondents ranked the friendliness of their states.

I am reminded that early in the 2012 legislative session our Republican-led legislature and our Democratic Governor found common ground in passing a bill to expedite environmental permitting. With that in mind I might suggest that if our legislators are interested in finding bipartisan issues to work on in 2013, they may wish to start by focusing on improving the environment for small businesses throughout Minnesota. MV

Geller is professor & head of the Arts, Humanities & Social Sciences at the University of Minnesota Crookston. He also serves as director of the federally funded EDA University Center at UMC.He can be reached at [email protected]

Is Minnesota ‘nice’ to businesses?

By Jack M. Geller, Ph.D

■“Complying with environmental, health and licensing regulations are disproportionately more expensive for smaller firms.”



Carrying on a 90 year tradition Wiste’s stays true to meat

market history By Jean LundquistPhotos By John Cross

Wiste’s, from left to right, Jan Prail,

Ryan Landkammer, Tammy Foels,

Mitch Foels, Donna Wiebold

and Garrett Burgess

Up

and

Com

ing



Wiste’s Food Market in Janesville is celebrating 90 years in business this year. It’s still open in the building where it originated, at 208 North Main

Street. That’s where Orville Wiste started his food market in 1922.

But anyone walking into Wiste’s today will find it’s not the same store it was in 1922, or even just last December. That’s when Tammy Foels bought the store, and decided it needed a facelift.

With the help of her husband, two sons, daughter and her daughter’s boyfriend, the store has new floors, new ceilings, counters, and knotty pine woodwork and cabinetry. “We’re workers,” says Foels of the rapid makeover. “We worked a lot of nights, weekends and Sunday afternoons.”

The remodel also included closing up a stairway to the basement that had been right inside the front entrance.

But Foels didn’t put all her energy into remodeling the facility. The store stayed open the whole time, still offering the quality meats it has been known for offering for decades, and groceries needed in a growing community.

When Foels first thought about buying the building, erected in 1896, she thought about converting it into apartments. But as Foels tells it, the memories of coming to Wiste’s with her parents when she was a child and the comments from townspeople when she talked about apartments convinced her that Wiste’s is still needed in the

community.With her background in insurance and investments, Foels

calls Wiste’s her latest investment. As she discussed the idea with her banker, Foels says, “He asked me, ‘If this is such a good idea, why hasn’t somebody else done this?Õ I told him that I have the ambition, talent, and the drive to do it.”

In addition to being full time farmers, builders and truckers, the Foels family was about to learn to be grocers and custom meat processors. The decision to keep the name of the store Wiste’s was an easy one to make. “It’s the only downtown business that has been here for 90 years,” Foels says.

Orville’s son Bob Wiste was the second generation of Wistes to operate the store. The third generation was Ron. He owned the store until about a decade ago, Foels says, but he’s still available to offer advice, and he still stops in once in a while.

In addition to remodeling the building, Foels has also freshened up the line of groceries Wiste’s offers. On the grocery side of the store, items from fresh pineapples to canned beans are available.

The store also has vendors who provide bakery and deli items. Foels says complete graduation party foods were available through the store. Everything from custom cakes, buns, salads, cheese trays, and of course, meats.

Choices of six to eight deli salads plus bakery items are available in the store each day. While as yet there is no seating available for people to sit and eat, Foels hopes to have that

Up and C

oming

Wiste’s has been a downtown staple in Janesville for 90 years.



Up

and

Com

ing

available in the future.“This is a destination for people,” she says. “We’re only a

couple of blocks off the highway, and people want to come here. We want this to be a meeting place for folks to visit with each other.” A seating area will help with that goal.

Wiste’s reputation has drawn people from all over southern Minnesota, Foels says. People even stop in as they plan to visit relatives in other parts of the country to buy favorites to take along.

While staying true to what Wiste’s has always been in the greater Janesville community — a meat market — Foels is working to update that side of the business, as well.

Wiste’s currently offers 16 new varieties of brats. Without a doubt, the most unique recipe is the gummy bear brat. “It is surprisingly good,” Foels says. “When you cook the brat, it melts the gummy bears into the meat, and there’s just a little bit of sweetness that blends in. Sometimes, you can see just a little bit of the color in the brat.” She admits she was skeptical at first. “I told them to only make 35 pounds to start, but they were a hit. We’ve had others we didn’t like, and those didn’t make it into the case.”

While flirting with the novel, Foels is also tweaking the standards. At the Minnesota Meat Packers convention and competition in March, the Wiste’s Colorado Beef Jerky beat 630 contenders to take first place.

Foels says she and her husband weren’t able to stay to hear the winners announced. “When we got the call, we thought it was a joke. We’d only been in business for four months.” Wiste’s also finished in the top 10 with bacon and beef sticks.

That kind of success has led to an increasing number of employees at the store. In December there were five employees;

at the start of the summer, there were 11. Foels says she is close to needing a couple more.

Despite being known for its meats, Wiste’s is not a butcher shop. Rather, it is a custom processing shop. “Every day we get the boxes of meat in, and we cut it up and process it.” All the meat comes from within a 75 mile radius, Foels says, so the store supports other local businesses, too.

As a custom processor, Foels says they also process game animals, birds and fish. “We can process anything you want to bring in,” she says, “but we don’t butcher.”

Meanwhile, Foels hasn’t given up on the idea of apartments, except they’ll be on the second floor rather than on the main floor. MV

The market has been completely renovated.


Creati ve reti rement plans since 1984.

Call Travis to learn about the changes aff ecti ng your 401(k) or 403(b) plan in 2012.

11 Civic Center Plaza Suite 8

Mankato, MN 56001800-713-401k

NEWLYOPENED

BUSINESS BANKING

Member FDIC

Downtown Mankato507-625-6816

Lake Crystal 507-726-2137

Good Thunder507-278-3630

www.minnstarbank.com

there foryou

Many have trusted MinnStar Bank’s personalservice to help them build and grow theirbusinesses —and we can do the same for you.

DavidThompson

TomEvensvold

SteveOlson

MarkMonson



One of a kind, one at a time

Deichman uses a custom design-build process By Marie WoodPhotos By John Cross

Mark Deichman knows you only get one chance to make a first impression and he incorporates this principle into every home he builds. “How you feel

when you step over that threshold is fundamental in every design,” said Deichman of Mankato.

A curved staircase, stone archway, fireplace and a great room could meet the eye, but these features are often secondary to a view of the home’s backdrop — be it a lake, a wooded ravine or a hilltop vista.

Since founding Deichman Construction in 1990, Deichman has established a design-build firm known for custom homes built with quality, innovation, craftsmanship and enduring value. In every home, the No. 1 priority is the client.

“In the custom world, it’s not about being true to architecture; it’s about being true to the customer,” Deichman said.

For instance, Deichman built a state-of-the-art home in Mankato, which was designed by Bjella Architecture in Minneapolis. The exterior is Federalist style, but the interior is ultra contemporary with a 4,000-pound suspended curved concrete counter. # Deichman knew he wanted to build homes since he was a kid. After high school, he studied business at Rasmussen College. He also worked for mentor Bill Schindle, a longtime North Mankato City Council member, who built many of the homes in Northridge. # ÒHe was the kind of kid that wanted to go someplace,Ó Schindle said. ÒIÕm kind of proud to have helped Mark get started because heÕs come a long way.Ó # Design-build process # When Jason and Amy Hoehn built their family home in North Mankato, Deichman Construction was a good fit. The house was featured in the 2011 Minnesota River Builders Association Spring Tour of Homes. # ÒThey were very responsive to our needs and good listeners. They offered creative solutions,Ó said Jason, structural engineer/principal of I&S Group, Mankato. # After an initial meeting with

Pro

file

Since 1990, Mark Deichman has built custom single-family homes and has recently been working on a townhome subdivision with customized interior designs.


Profile

potential clients, Deichman assigns them “fun homework,” where the couple answers questions about things they don’t like in their current home.

“The reason why most people build a house is because what they want isn’t out there,” Deichman said.

Then Deichman works with draftsmen to create a set of drawings and determine pricing. This is called value engineering.

“Whether the budget is $200,000 or $2 million, it’s up to us to get as much as we can out of that budget. You have to be very effective with the value engineering piece,” he said.

Next Deichman converts the plans to a 3-D computer model. Clients can see their virtual home down to the real views out their windows. It has become an important tool in editing plans.

After the client approves the plans, construction begins and can take six months to a year depending on the complexity and size. A chronological selection process guides homeowners through the project.

During construction, Deichman depends on a team of carpenters, trusted subcontractors and seasoned project manager Drew Sprengeler, whose only focus is the construction of the home.

Value and qualityDeichman has mastered how to get the most value and

quality into every square foot. Since 2009, Deichman has developed the lots and built many of the homes on Mankato’Õs Trail Drive despite lows in new construction.

“Our passion is to build the highest quality project for the budget. My goal is to get as much as I can in that budget as possible,” Deichman said. “That’s why we were busy even during the recession.”

Deichman Construction’s financial system is an open book. In every home project, clients know the company’s profit margin right from the beginning.

“People want to know exactly where their money is going. There’s quite a bit of comfort in that” Deichman said.

He leverages relationships to get the best volume pricing on materials. Another cost buster is to reduce the materials’ route to market. For example, his cabinet maker purchases wood from the mill. From there, the wood goes directly to the job site.

Deichman has brought many innovations to the local housing market. Many ideas come from the National Association of Home Builders 20 Club, which is a network of builders from non-competing markets who share techniques to stay ahead of trends.

“We never want to build the same thing twice. We can always

make it better. It’s constant innovation,” Deichman said.Locally, he has been on the cutting edge of trends such as

maintenance-free materials, custom closets, home theaters and gyms, wine cellars, hidden lighting, wall recesses and floating ceilings that conceal cords and outlets.

“So often it’s the things we don’t see in a house that we really like,” Deichman said.

Green building with an emphasis on energy efficiency and reducing environmental impact is important to Deichman. His father, Le Roy Deichman, built the first ethanol plant in the country, so Deichman is not afraid to be a leader in energy efficiency. That’s why every home that Deichman Construction has built in recent years are made to meet the top Energy Star rating.

Deichman Construction also is spreading the word about its renovation and remodeling services.

Plus Deichman Construction is building a subdivision of town houses called Wellington Custom Townhomes. While the size and exterior architecture provide a cohesive look to the neighborhood, customers can completely customize the interior.

“In order to get the costs down, we purchased the whole subdivision so that we can get them to the market at a competitive price,” Deichman said.

Full houseDeichman and his team work out of a home office above

Deichman’s house. An aging Brittany dog named Baxter greets staff and clients. Deichman’s own home has an open and contemporary floor plan that blends the kitchen, dining and family room into one room. The most popular room is an unfinished playroom with a basketball net, where Deichman and his three sons play games with friends. Deichman does not measure success by money, saying he strives to be a good father, husband and provider.

Deichman is often asked to speak about his career to young people in high school, Boy Scouts, and Junior Achievement. “You’ve got to have a plan and you have to be passionate,” Deichman tells them. MV

Mark Deichman uses 3-D computer models that allow homeowners to visualize what their custom-built

home will look like.



All

in t

he F

amily

Josh and Becca Vanderberg with daughter Emma

Josh Vanderberg grew up cleaning. His grandparents owned a cleaning company in Mankato, and he joined the rest of the family

in helping them. “I worked in the business from the time I was yay high,” Vanderberg says. “You can empty trash cans at almost any age.”

His grandparents closed their business — Sharon Cleaning — when Vanderberg was 16. It had become too much, physically, for them, in part because they were still involved in the day-to-day cleaning. The rest of the family — Vanderberg’s mom and her three siblings were all involved Ñ was too burned out to take it over.

That’s a lesson that Vanderberg, who now owns Vanderberg Clean with his wife, Becca, is trying to learn early. “My grandparents cleaned full

time,” he says. “We’ve set it up so that we aren’t going to be doing that.”

Josh started the business in 2009; Becca joined him as the service coordinator in 2010, shortly before the couple got married. At that point, they had 12 employees; both of them were part of the cleaning crews that serviced their clients’ buildings. Now, as president, Josh focuses most on sales, customer relations and developing the vision of the business. Becca, the executive director of operations, handles the bookwork, payroll and hiring new employees, as well as taking care of their 1-year-old daughter, Emma.

Both occasionally have to help clean, too.“We still get out in the field, we still get dirty,”

Josh says.

Keeping it CleanJosh and Becca Vanderberg work hard to keep their family cleaning By Sara Gilbert FrederickPhotos By Pat Christman



All in the Fam

ily “Just not as

much as we used to,” Becca adds.

MN Valley Business: How has the business been growing? Josh Vanderberg: It’s been growing very rapidly — that’s why our office is in such disarray. We’ve had a very steady growth curve since we started; 2010 was steady, 2011 really geared up, and so far in 2012, it’s been just nuts.

MVB: How many employees do you have now? Becca

Vanderberg: We have 36 employees, and we’re still hiring. We just got some new accounts last week. We just hired six new people, and we need four more.JV: We’re very selective about our staff. We can’t just hire anybody. We have a stack of applications, but maybe only one out of 10 will we hire. For us, it’s one of those things where we would rather work shorthanded until we find the right person than hire the wrong person.

MVB: What do you look for in your employees?JV: We look at long-term work history, reliability and a clean background.BV: Loyalty, too. We have behavioral questions we ask that are helpful, but we know by now what we’re looking for.

MVB: What’s made the business so successful already?JV: We’ve been diligent in putting together the business, developing our training and developing our methods. Now we’re at a point where that work is paying off and we can grow quickly.

MVB: What distinguished you from other cleaning services? JV: We have a very systematic approach to how we clean. We have a method that tells you exactly how to clean a bathroom, how to dust, how to vacuum. That ensures consistent results, and it helps us make sure that we don’t miss anything. We have a whole training manual — it’s our formula — that tells our employees how to do what we do.

MVB: How did you establish the roles you would each play in the business?BV: The things that Josh isn’t great at, I am good at. The detail

work, the organization in the office, I can do that. I do the books, the HR, the office.JV: I do the sales and the vision — the fun stuff.BV: Well, I like what I do, too.

MVB: So you both found roles that you can enjoy?JV: It’s the perfect combination, really. I do the public part and the meetings with clients, which I love, and Becca focuses on the books.BV: And I would truly rather be in the office. Josh is more sales oriented, and I’m more service oriented.

MVB: But you both still get out to work with clients as well?JV: Oh yes. We’re still too small not to do that.BV: And we really want to know our accounts. We need to get out and see what’s happening with all of them.

MVB: Have you discovered any challenges of working together?BV: Only that we have QuickBooks on one computer, so figuring out who gets to use it when is the hardest part. We both need to use it.JV: Plus, when we go home, we’re still talking about work. Even when we go on vacation, it’s what we talk about.

MVB: With a baby at home and another on the way, have you had to change your hours at all? JV: I’m definitely still working more than full time, but Becca has been able to cut back.BV: This week has probably been 40 hours, but I try to keep it between 15 and 20. A lot of what I do I can do in the evening. I try to make it work so that I can spend more of my time with Emma.

MVB: Do you get to see Emma often, Josh?JV: I make a point to go home and see her for a couple hours every day. I go home for lunch and for dinner. When it’s busy it gets harder, but I try to spend time with her every day.

MVB: Have you found that running your own business gives you enough flexibility for your family?BV: What’s really nice is that Josh can come home for lunch and we can eat as a family. Emma and I can come visit Josh if we haven’t seen him for a while. We can see him pretty much whenever we want to.JV: It’s better than being someone else’s employee; we might have odd hours, but we can still get family time.

MVB: Can you imagine a time when Emma will be working with you as well? JV: I started this business to be a family business; that’s really important to me. So I hope that she will. I would really like to hand this business over to our kids someday.BV: I’d just like to have her file for me. Once she knows her alphabet, maybe she will! MV

Ken Schmidt works at the Landkamer Building in Mankato.



Bus

ines

s M

emos

/Com

pany

New

sBrunton adds architect

North Mankato-based Brunton Architects has hired architect Justin Johnson. Johnson comes from Mason City, Iowa, where he was involved in projects including historic preservation, education, civil planning, municipal facilities, religious and institutional design. Johnson holds a master’s degree in architecture from North Dakota State University

■■ ■

Schwickert’s safety programs recognized Schwickert’s, a division of the national construction

company Tecta America, has received a national award in recognition of their safety records and culture achievements. The Associated Builders and Contractors awarded Schwickert’s the platinum level STEP Award. It is the group’s highest safety award. Schwickert’s Tecta America is one of only three to receive the award in the Minnesota/North Dakota region.

More than 200 employees recently gathered at the company’s annual safety seminar at the Verizon Wireless Center in Mankato and learned about topics such as fall protection, asbestos, and general jobsite hazards. The company also recently created an interactive computer training program for employee safety orientation, which was accomplished by working with South Central College to secure a $50,000 grant through the state.

■■ ■

Allstate Peterbilt honoredThe Allstate Peterbilt Group, which operates 16 Peterbilt

dealerships throughout the upper Midwest, was awarded with the best new facility — in Mankato — for 2011 at the most recent Peterbilt dealer meetings. The Allstate Group was one of the first dealer groups to use the Paccar Parts prototype designed building.

“With our aggressive expansion last year, which included four new locations, it was an honor to win the best new facility award from Peterbilt for our new store in Mankato,” said President and CEO Jeff Vanthournout.

■■ ■

Depuydt joins The Paw Pet The Paw Pet Resort in Mankato has hired Kathy Depuydt as

their new marketing & sales manager She has 15 years experience in the field of marketing & sales.

Kasota Stone announces new officers

Mankato Kasota Stone, an affiliate of Coughlan Companies, has announced the appointment of Bob Altmann as new general manager and Dick Miller

as new sales manager. Altmann brings with him years of experience as the operations manager for Mankato Kasota Stone, as well as prior sales experience in the landscape products industry.

Miller is returning to Mankato Kasota Stone. He has over 40 years of sales experience in the architectural construction material industry.

■■ ■

Lurken named managing partner Jeremiah J. Lurken of Mankato has been

promoted to managing partner for Modern Woodmen of America.

The fraternal financial services organization offers financial products and fraternal member benefits to individuals and families throughout the United States.

■■ ■

Balster joins U.S. BankKeith Balster has joined U.S. Bank as vice president, private

banking in the bank’s private client group in Mankato.He was previously a branch manager for Wells Federal Bank

in Mankato.Balster has a degree in finance and management from

Minnesota State University and has been in the financial services industry for 23 years.

■■ ■

Microtel Hotel adds “by Wyndham” Mankato Motel Group announced that the Microtel Inn &

Suites hotel at 200 St. Andrews Drive has changed its name to Microtel Inn & Suites by Wyndham.

Part of a chain-wide effort by the Microtel brand, the rebranding is designed to leverage the well-known Wyndham name to drive more business to the more than 300 hotels in the Microtel portfolio.

Bob Altmann Dick Miller

Jerrmiah J. Lurken


Van Boening heads Edward Jones officeSue Van Boening has been named to take over the Mankato Edward Jones office

located at 201 North Broad St.. Van Boening will be working with Sander Ludeman to serve investors throughout the Mankato area.

Van Boening has five years of experience in the financial services industry.

■ ■ ■

Jones and Magnus adds attorneysJones and Magnus has added attorneys Marla M. Zack and Jennifer L. Thon.Zack graduated from William Mitchell College of Law. Thon practices in civil commitment, criminal law, real estate law, estate planning,

conservatorship/guardianship, probate , family law, and civil litigation.Thon graduated from the University of North Dakota School of Law.

■ ■ ■

Dickmeyer named president of PDPLouise Dickmeyer, past president and CEO of the Minneapolis

Regional Chamber of Commerce, has been appointed president of People Driven Performance, a performance focused employee engagement company with offices in Mankato and Seattle. Dickmeyer joined the company in 2008 as executive vice president.

Denny Dotson is PDP founder and chief executive officer. The company works with clients in the financial, health care

and manufacturing sectors to engage their frontline employees through timely communication delivered through PDP’s touch-screen technology

■ ■ ■

TBEI names VP TBEI Inc. announced the promotion of Tina Albright to the position of vice

president of human relations.She has been with the company for more than 17 years with roles

in production, sales, and human resources according to president and CEO Bob Fines.

Truck Bodies & Equipment International is a Lake Crystal-based corporation that encompasses five leading manufacturers of dump truck bodies, hoists and truck & trailer equipment.

■ ■ ■

To submit your company or employee news.e-mail to [email protected] “Business memo” in the subject line.

Call or e-mail Associate Editor Tim Krohnat [email protected] or 344-6383 for questions.

Tina Albright

Louise Dickmeyer


Growing with, and because, of you!

We are pleased to announce the opening of our new offi ce in La Crosse, Wisconsin. I&S Group is committed to serving our local and regional clients. This new offi ce location will allow us to provide an even higher level of service to our clients in this area.

Learn more about I&S Group and see our new offi ce location at www.is-grp.com.

GROUPOne firm - start to finish™

WWW.IS-GRP.COM


mn valley business journal

Documents

charter business phone

charter business essentials20

davids business

pmmn valley business

phone line

internet speeds

thousands of patent

patent attorney