While Enterprise Minnesota is best known for offering cost-effective business consulting services to help manufacturing companies across the state grow profitably, the non-profit also advocates on behalf of those same companies in the public policy arena.
Enterprise Minnesota has used strong relationships with lawmakers to make significant strides in this year’s legislative session on behalf of manufacturers. Sen. Aric Putnam (DFL-St. Cloud) and Rep. Jon Koznick (R-Lakeville) introduced bills authorizing funding to help Minnesota’s small manufacturers and their employees.
The House Jobs and Economic Development Committee approved $1 million for the Growth Acceleration Program (GAP). In state statute since 2008, GAP is a direct investment for small manufacturers that need a boost to help them stay in business and keep growing.
The Senate passed $1 million for outreach efforts aimed at helping manufacturers with 35 or fewer employees. The approved funding measure is particularly valuable because it can be matched with federal dollars through the U.S. Manufacturing Extension Partnership.
A robust return on investment
“Investments in manufacturing are investments in our Minnesota communities,” Sen. Putnam said in support of the funding measure. “Manufacturing worker wages are 16% higher than the state’s average wage, and for every $1 spent in manufacturing, there is a total impact of $2.60 to the overall economy.”
Enterprise Minnesota coordinated a strong demonstration of support for the funding programs during committee consideration of the bills. Lynn Shelton, Enterprise Minnesota’s vice president of marketing & organizational development, was joined by several clients who testified before the relevant committees or submitted written statements describing the impact of the programs on their companies.
Kevin Delk is president of Delmar Company, a Lakeville-based plastics manufacturer that has grown from seven to 37 employees in the last two decades, in part with help from Enterprise Minnesota.
He told the committee that GAP funding assisted Delmar in becoming ISO certified, and later the company implemented a system for growing its revenue.
The Tongue and Groove Store, a wood products manufacturing company in Duluth, used GAP funding to implement strategic planning and value stream mapping that allowed the company to expand its business while maximizing flow throughout its plant, the company’s vice president, Ann Anderson, told the committee. The company has grown to 22 employees and plans to hire five to seven more in 2023.
The experiences Delmar and Anderson had with GAP are indicative of the program generally. “GAP has proven its return on the state’s investment by at least $25 for every dollar invested,” Shelton said. “When these funds are not available, as was the case last biennium, manufacturers repeatedly tell us that they are unable to invest in improving their companies and retaining employees.”
Reaching small manufacturers
Enterprise Minnesota has found that the state’s smallest manufacturers, specifically those with fewer than 35 employees, are often neglected, particularly in Greater Minnesota because they are too far away from affordable consulting resources. The separate outreach funding in the budget bills will make consulting services more affordable for those companies.
During consideration of the bill, Rep. Koznick explained the critical role those companies play in the state’s economy, now and in the future. “Very small manufacturers are often overlooked for assistance because of their size, but they have incredible potential to grow and positively impact their communities.”
Mike Jensen, president of Gauthier Industries in Rochester, Minn., a precision metal fabricator, and a former chair of the board for Enterprise Minnesota, testified in support of the legislation.
Gauthier has worked with Enterprise Minnesota for 20 years on projects from revenue growth and strategy to leadership training and upgrading its ISO business management system, Jensen explained. His company also participates in monthly peer council meetings with other manufacturing leaders.
Though Gauthier is a mid-sized manufacturer, with 82 employees and sales revenue of $17 million, Jensen strongly supports the legislation because it will strengthen the entire manufacturing sector by helping more companies access support.
Enterprise Minnesota “has a great opportunity to provide many more manufacturers with their advisory services, but they can only reach a limited number of companies without state resources,” Jensen testified.
Growing support in the legislature
Strong bipartisan support of the funding measures is the result of decades of outreach efforts undertaken by Enterprise Minnesota and manufacturers across the state.
Enterprise Minnesota works closely with manufacturers to build solid relationships with policymakers. Legislators have toured more than 400 manufacturing facilities around the state, and clients are always eager to offer testimony in support of manufacturing initiatives in the legislature.
The fruits of these efforts are seen in support for the bill. “The Minnesota legislature consistently recognizes manufacturing’s tremendous economic contribution, and that shows how effective these companies have been in demonstrating their value to their communities and the state,” Shelton says.
