For an entrepreneur, there is nothing more fulfilling than watching the seed of an idea transform into a fully operational business. But the small business scene isn’t for the faint of heart. As any owner will tell you, opening the doors to a business is one thing; keeping them open is an entirely different feat.
While there isn’t a defined manual for running a successful company, there is one secret weapon at a budding entrepreneur’s disposal: experience and insight from those who have been there before. It’s the reason why more than 130 members of the Twin Cities business community gathered at the Metropolitan Ballroom & Clubroom on May 22 for the third-annual Small Business Strategies Roundtable. The event featured a panel of leaders behind three of Minnesota’s most renowned and successful small businesses, who eagerly dispensed advice and best practices for growth and profitability.
We co-sponsored this year’s event with Wipfli LLP, Twin Cities Business, Messerli & Kramer and the Opus College of Business at the University of St. Thomas. Patrick Brault, CPA, CTFA, principal and regional director, and Chuck Palmer, Wipfli’s Twin Cities market leader, moderated the discussion.
Though the businesses represented vastly different industries and customer demographics, each seemed to face similar opportunities and obstacles on the road to growth — including Kowalski’s Markets, the Twin Cities’ mainstay grocery-store chain. Since her parents opened the first Kowalski’s Market location in St. Paul in 1983, Chief Operating Officer Kris Kowalski Christiansen has seen the business evolve through many fundamental shifts in the larger grocery landscape — from the rise of supermarket giants like Target and Wal-Mart to the advent of meal-delivery services like Blue Apron. Through it all, Christiansen says Kowalski’s Markets has thrived by sticking to a simple mantra: stay true to the brand.
“We are proud to be a specialty, family-owned brand, and often partner with other local companies to make our product stronger — and we never deviate from that,” said Christiansen, who keeps operations humming in the company’s 11 stores, which generate about $200-$250 million annually. Kowalski’s Markets has continually adapted to accommodate customers’ preferences, most recently through its spin on the “grocerant” trend, which allows customers to enjoy their favorite Kowalski’s products in a unique, dine-in setting.
Typically, small and start-up businesses are already breeding grounds for this type of innovation, challenged to survive in the ever-changing marketplace. Take panelist Dan Stoltz, who spoke at length about rebuilding and growing his company, SPIRE Credit Union, through the worst of the Great Recession. “Our financials hit a low in 2010, and we realized that if we were going to survive, we had to get creative with our growth strategy,” said Stoltz, who serves as SPIRE’s president and chief executive officer (CEO).
For Stoltz and his team, this meant refocusing the bulk of their efforts toward other aspects of the business, such as marketing, brand awareness and more intensive training for team members.
The unconventional strategy paid off in a big way — since the recession, SPIRE has added six new branches and was rated the top-performing credit union in Minnesota and the fifteenth nationally in 2015. Within the next 12 months, Stoltz projects that SPIRE will top more than $1 billion in assets, a major milestone that seemed far off just a few years ago. Persistence seems to be rooted in the company DNA: “At SPIRE, there are three things we never say: ‘can’t’, ‘that isn’t my job’ and ‘we have never done that before,’” said Stoltz.
Venturing off the beaten path has also been a fruitful strategy for Luke Shimp, panelist and the driving force behind local eateries, Red Cow and Red Rabbit. The successful restauranteur always had an entrepreneurial spirit, but waited to make the leap until 2012, after cutting his teeth at the family business, Blue Plate Restaurant Company. Over the past five years, Shimp has expanded Red Cow to four locations and is the first two-time winner of the Minnesota Restaurant Association’s Restauranteur of the Year award.
His advice for small-business domination? Put your people first. “At Red Cow, we are very focused on getting the right people, instilling our culture and core values in them, and then developing them to be future leaders,” said Shimp. “[Turnover] is common in the restaurant industry; it’s not always easy to find people who will stay with the company and want to grow, but for us it’s crucial to creating the right service environment for our customers.”
Shimp devotes the same attention to detail to the community at large, particularly when scouting for new restaurant locations. “We use technology and research data to get a detailed picture of the local demographics and trends,” he said. “I’ll also walk the streets of the neighborhood, see what the foot traffic is like, where people get coffee — it’s a combination of data and guts.”
While the three panelists have helped their companies achieve unprecedented levels of success, they’re still completely committed to their roots, and spoke candidly about the importance of giving back to their respective communities and reinvesting in small businesses at the local level. It’s a legacy that Stoltz hopes lives on through SPIRE for generations to come. “It’s not just about seeing growth and building a big brand,” he said. “For us, it’s about taking the hassle and complexity out of banking, and ultimately improving the lives of our patrons for generations to come.”