Regional Reports: The Turning Tides of Red Wing

Regional Reports: The Turning Tides of Red Wing

The old, established river city is crafting a future while maintaining historic traditions.

It’s easy to think of Red Wing as little more than a picturesque town on the Mississippi downriver from St. Paul.

And that picture isn’t exactly wrong. Red Wing’s downtown has charm. There are shops, restaurants, and the venerable St. James Hotel.

But there’s much more to Red Wing than historic charm. The city of 16,572 is also home to a remarkable diversity of businesses. About 21 percent of all jobs in Red Wing are in manufacturing, a sector that includes famed “craft manufacturers” Red Wing Shoes and Red Wing Stoneware & Pottery. Three of Minnesota’s largest companies—Xcel Energy, 3M, and Cargill—have facilities in the city. There are also numerous smaller, growing companies with distinctive products and services.

City residents, businesses, and organizations are actively working together to maintain and build on the vitality. Sean Dowse, Red Wing’s mayor since 2017, cites as evidence recent capital investments in infrastructure, as well as the Red Wing 2040 Community Plan, officially adopted by the City Council in February, which is helping establish long-term goals for sustainability, health, equity, and economic and community resilience. “None of us who worked on it—and there were hundreds of people involved—want this to just stay on the shelf,” Dowse says. “We have to have this be an active, living document.”

Red Wing community development director Dan Rogness says his city is ready to build something new on its old but well-maintained foundations. “In the past five years, there has been an infrastructure created for entrepreneurial growth in the community,” he says.

Craft manufacturing traditions

Red Wing’s history as a manufacturing hub goes back more than a century and a half, when clay pits were discovered in the area. That clay became the source of the famed Red Wing commercial stoneware industry. Red Wing Stoneware & Pottery no longer crafts its products in the historic Red Wing Union Stoneware factory—that has been converted into Pottery Place, which houses restaurants, small shops, and apartments. Instead, Red Wing Stoneware operates out of a more contemporary factory, still crafting sturdy products with classic designs. The operation’s been modernized, though, with new products like stoneware travel mugs, and an e-commerce operation—all thanks to Bruce and Irene Johnson, who bought the company in 2013. An even older manufacturer that bears its hometown’s name is, of course, Red Wing Shoes. Founded in 1905, its work boots and trail footwear are globally known and, in recent years, have acquired a certain amount of hip cred. Much of their appeal is due to the fact that the company’s headquarters, tannery, and main production facility are all still in Red Wing. With about 1,100 employees locally, Red Wing Shoes is the city’s second-largest employer, behind Treasure Island Resort & Casino.

Why the durability? CEO Mark Urdahl gives much of the credit to the fact that the company is privately held and can thus focus on the long term. Plus, Urdahl says, “we know what we’re good at. But we also look to the consumer.” And while not all consumers value U.S.-made products, it’s still “good internally,” Urdahl says. “It shortens our lead time. We can manage our inventory better.”

Producing Red Wing boots in Red Wing undeniably gives the brand cachet in an intensely competitive industry.

Making waves

Manufacturing isn’t the only traditional industry in Red Wing, either. As one of four active waterway ports in Minnesota, Red Wing has long transported grain by barge. One of the companies maintaining that tradition is Red Wing Grain.

While the types of grains have changed with the times—wheat has been replaced by corn and soybeans—Red Wing Grain loads between 500 and 600 barges with roughly 30 million bushels of the stuff each year and sends it to the Gulf of Mexico. From there, Cargill ships the grain worldwide. (Cargill is half-owner of Red Wing Grain; a local consortium owns the other half.)

This fall, Red Wing Grain will expand its second facility on the west side of town, boosting storage capacity from 2.3 million to 3.6 million bushels. That will mean more grain trucks rolling through town.

The city also has installed new dock walls that allow the river to rise three feet higher than previously, making a shutdown during flood season less likely. “Working with the city has been a win-win for both of us,” Red Wing Grain general manager Jim Larson says. “We do bring a lot of revenue to town along with all the traffic.”

Redwing Shoes

New kids on the block

Also rooted in Red Wing are numerous other distinctive businesses serving national and global markets. While many of the companies started elsewhere, they saw Red Wing as a market for growth.

Robley Cook launched SCS Elevator Products in the Twin Cities in the mid-1970s to produce elevator signage in Braille. Later, encouraged by the state’s JOBZ tax-incentive program, SCS moved to a newly built facility in Red Wing in 2005.

Now employing 80 people, SCS has expanded into buttons, barricades, and other elevator-related components. The company supplied components to U.S. Bank Stadium and Children’s Hospital in Minneapolis, as well as the new World Trade Center in New York. It ships globally, though most of its business is in North America.

SCS president Dave Muelken credits the company’s growth, in part, to its in-house manufacturing capabilities—the company mills its own buttons. This allows SCS to easily create custom designs and work faster—crucial selling points for a client list that includes major elevator manufacturers ThyssenKrupp and Otis.

Another business launched elsewhere that found a new home and success in Red Wing is Food Service Specialties, a producer of Italian sauces for restaurants, specialty food companies, and restaurant suppliers.

While the company was founded in Wisconsin in 1985, it needed a larger facility by the late 1990s. Red Wing met all of its criteria, so in 1997, Food Service Specialties built a 40,000-square-foot plant in town, designed with its production, and its future, in mind. “We expanded into 80,000 square feet in 2007,” Mike Jacobson, vice president of operations, says. “And we have room for another 40,000 square feet, which we’re now contemplating.”

Why the growth? This is a company that knows its niche. “We don’t deal with multinationals or the big CPG [Consumer Packed Goods] companies,” Jacobson says. “We deal with the mom-and-pops. In today’s environment, they are flourishing, and we’re growing with them.”

Susan Langer & Neela Mollgaard at Red Wing Ignite. Photo by Craig Bares

All those customers want a distinctive product, so everything that Food Service Specialties produces is custom. And clients don’t have to buy in large volumes. “If you can buy 36,000 pounds of finished sauce from us in a year, we’ll make a custom formula for you,” he says.

For most of its history, Food Service Specialties focused solely on tomato sauces, particularly for pizza parlors, but about a decade ago, it added dairy-based products, such as alfredo sauces and cheese dips. That category now makes up 30 percent of its business. Being a “one-stop shop opens up a lot of doors for us,” Jacobson says.

Likewise, Red Wing also proved to be a prime production location for 3M’s fall protection equipment business. Making body harnesses, shock-absorbing lanyards, self-retracting lifelines, and more, the company serves the construction, utilities, oil and gas, mining, wind energy, and telecommunications industries—“any application involving work at height,” plant manager Janice Neitzel says. 3M Red Wing currently employs about 525; demand required the addition of a third production shift last year, which added 26 jobs.

Nanocore Corp., which produces wearable cooling products for medical applications, is a much smaller company, employing 10. But it’s positioning itself to get much bigger. In May, the company hired Tammy Lee, former president and CEO of St. Paul–based med-tech firm Recombinetics, as its first CEO. She’s spending most of her time on the road, raising capital and adding new hospital systems and clinics, including Mayo, to its client base.

Five years ago, Nanocore moved from the Twin Cities to Red Wing, where one of the co-founders grew up. Red Wing is “an area that has a lot of expertise” in higher-value manufacturing, Lee says. Additional funding would allow Nanocore “to scale really quickly,” she says. Lee would like to double the current headcount by the end of 2019 and boost production from “a relatively small number of units to a couple hundred thousand in short order.”

Tammy Lee, CEO of Nanocore Corp. Photo by Craig Bares

A connected community

In developing its growth strategy, Nanocore has found plenty of support in Red Wing. The city “is really aggressive about attracting new companies and growing the companies that are there,” Lee says. She discovered that on her first day as CEO, when a representative from the Red Wing Port Authority stopped by to say hello—and to ask what help the organization might provide.

The Port Authority oversees the city’s riverfront commerce, which includes Red Wing Grain, and is also Red Wing’s chief economic development entity. Tax increment financing and tax abatements are some financial tools at its disposal, along with grant and loan programs available through the state. In addition, the Port Authority administers its own $3 million revolving loan fund—which Nanocore hopes to tap—and markets industrial land that’s for sale in Red Wing.

Another source of connectivity for local businesses is the Red Wing Area Chamber of Commerce. “We really are the information source for the town,” executive director Patty Brown says. In addition to networking events, the chamber provides connections and answers for businesses seeking information on building repair, licensing, insurance requirements, and other needs.

Plus, there’s Red Wing Ignite, which launched in 2013 with the goal of creating “an innovative ecosystem for students, entrepreneurs, and businesses to compete in the 21st century,” executive director Neela Mollgaard says.

Red Wing Ignite connects entrepreneurs with mentors, technical expertise, potential investors, and business partners, and offers a co-working space.

One entrepreneur fired up by Red Wing Ignite is Susan Langer, founder and CEO of Live.Give.Save, a financial technology startup. When Langer moved from the Twin Cities metro to Red Wing to be closer to her parents four years ago, she was developing an app to help people save money and give to charity each time they make a purchase.

“I figured I would have to commute to the Twin Cities,” Langer says. Then Langer met Mollgaard, who connected her with local sources of funding, affordable office space, and business plan development. As a result, Langer was able to roll out the beta of her app in Red Wing, with Red Wing Shoes, the local YMCA, and the Red Wing Credit Union as participants.

“It was a perfect alignment of the brand that we’re trying to reflect: to help people and companies create community,” Langer says.

In October, Ignite organized the creation of a makers’ space on the Red Wing campus of Minnesota State College Southeast. The college provides CNC, welding, and woodworking equipment courses alongside higher-tech classes in subjects like robotics. The space is used by high school students, community groups, businesses, and entrepreneurs seeking to develop a craft skill or to train employees.

Outside of Redwing Grain. Photo by Craig Bares

Facing challenges

Red Wing businesses have access to plenty of support, but they also acknowledge their challenges.

Like most smaller communities, Red Wing has struggled with a lack of workforce housing. In some cases, new hires have had to turn down jobs in Red Wing because they couldn’t find an affordable place to live; a new apartment building with 71 units opened last year but was filled up immediately, according to Brown. Another project, with 108 units, is on the drawing board.

Then there’s the need for employees, something most Minnesota communities face. Red Wing’s job-to-population ratio is 75 percent, compared to 52 percent for the entire state. And while Minnesota’s total population grew 5.1 percent from 2010 to 2017, Red Wing’s grew just 0.7 percent. Various city organizations are working to attract people to Red Wing and to develop locally grown talent.

And people do want to move there. They’re attracted not only to the job opportunities, but to the community and what it offers.

Ryan West and his wife, Jacqueline, had lived all over Wisconsin as they pursued their educations and careers. In 2009, Ryan was working as a web designer for a medical company; Jacqueline was teaching school. Then Jacqueline received a contract for her first novel, the first of The Books of Elsewhere series for kids.

“We were untethered at that point in terms of where we wanted to live,” Ryan West says. Both could do their jobs remotely. They wanted to live close to the Twin Cities “but not in the thick of it … Red Wing checked all the boxes,” he says.

After the move in 2009, West continued to work for the Wisconsin company until it was acquired by a German pharmaceutical firm, which put his job in jeopardy. Very happily, he discovered a web design job posting for Red Wing Shoes. He was hired in 2010 and has been working there ever since.

The next generation

Red Wing is home to a campus of Minnesota State College Southeast (MSCS)—a third of the college’s total 2,800 students attend the campus location. It offers highly distinctive programs that reflect the craft and manufacturing cultures of Red Wing—and the ways they intersect.

“The biggest programs by far are our music programs,” says Katie Hardyman, director of business relations for the Red Wing campus. Her campus has become nationally known for its courses on band and string instrument repair, as well as guitar making. “There are guitar shops in Nashville that will hire only our students,” she says.

The Red Wing campus also offers a program in bicycle fabrication and design—“the first of its kind in the world,” according to Hardyman. She hopes the bicycle-building curriculum will build a coterie of “well-rounded manufacturing employees,” since students are learning in-demand skills like welding and blueprint reading. The campus has also developed a “manufacturing 101” program for people curious about the career option.

More to come

“One of the key things about Red Wing is that it continues to invest in itself,” the Port Authority’s business development manager Shari Chorney says. Besides the city’s picturesque downtown, there is what has been renamed “the West End District,” home to Red Wing Brewery, several restaurants, and Pottery Place. The city now plans to erect a pedestrian bridge from the park and marina over the railroad tracks, making it easier for riverboat passengers to visit the district. There are also plans to invest $1 million in recreational improvements to Barn Bluff.

All this, Mayor Dowse says, will maintain Red Wing as “a great place to do business as well as to live and to visit. The future here is bright, and people should take a look.”

Gene Rebeck is TCB's northern correspondent.