Twin Cities small-business advocate reports across-the-board growth

Business is good at expanding Seward Community Co-op.

The member-owned food retailer has invested something approaching $15 million since 2014 to expand to a new store on 38th Street just east of Interstate 35W, in a neighborhood previously unserved by a grocery store. And it refurbished space for food processing and a restaurant near its flagship store on E. Franklin Avenue.

The 38th Street store has hired nearly 100 employees, about two-thirds of whom are minorities, who make a minimum of $12.82 per hour plus benefits after vesting. Seward had fiscal 2015 revenue of $34 million, before the additional businesses came on line. And, with nearly 400 employees, it is one of the larger members of the Twin Cities Metro Independent Business Alliance.

Metro IBA (www.buylocaltwincities.com) is a driver behind locally owned businesses. Dues-paying membership has grown from 40 in 2009 to 360, said Executive Director Mary Hamel, who took over in 2009.

"The Twin Cities has a great independent business community," Hamel said. "There has been a lot of awareness raised about the importance of locally owned businesses, keeping profits in the community. And I hear nothing but positive things about business last year among our members."

The membership ranges from the larger likes of Seward and charter member Warners' Stellian, to St. Paul-based Summit Beer, to smaller operations such as Wet Paint, the St. Paul art-supply retailer Buttery Bakery and Café, Field Outdoor Spaces and Bargain Upholstery.

A recent survey among 3,200 independent businesses nationally by the Minneapolis-based Institute for Local Self-Reliance and Advocates for Independent Businesses found that average sales rose by 6.6 percent last year, including 4.7 percent for retailers. Employment rose by nearly 6 percent among those surveyed. That dovetails with the economic thinking that small business is driving economic growth and hiring.

The survey also found that 70 percent of small-business respondents find Internet-only and big-box competitors, some of whom get tax breaks for opening stores, significant challenges. Finally, one in three independent businesses said they could not secure bank credit for expansion.

Minnesota's surging technology industry added 5,500 jobs last year to 141,900, according to last week's Cyberstates 2015 industry report.

A recent article on tech-news website CNET.com praised Minnesota as a great place to start a business, quoting veteran technology executives, and citing a skilled-employee environment that is more collaborative and lower cost than Silicon Valley or the East Coast.

Local tech companies have raised hundreds of millions in capital in recent years.

In January polling firm Gallup ranked Minnesota first in a national job-creation index. And CNBC late last year ranked Minnesota the best state in the nation for business.

Said Dan Carr, president of the Collaborative who convenes peer groups of growth company executives: "Minnesota is still, and pretty much always has been, a great place to innovate, start and grow companies.

"Several years back it was Compellent, SPS Commerce and Proto Labs getting much of the attention in articles … Then it was Code 42, Jamf and SportNgin. The [most recent] 'darlings' seem to be LeadPages, When I Work, Vidku and Astropad. Any press is good press when it comes to fostering innovation in a specific geographic area. Especially in recruiting employees. Minnesota's in a great spot with varied, strong, proven clusters and a great overall economy."

Carr also noted that the Twin Cities has successfully diversified beyond medical-technology to data analytics, storage and security.

Neal St. Anthony has been a Star Tribune business columnist and reporter since 1984. He can be contacted at nstanthony@startribune.com.