A spotlight on business at the Blue Earth Economic Development Authority board meeting on Thursday morning, July 8, highlighted the challenges of adapting a business to the 21st century.
This month’s commercial spotlight has been on Juba’s, a Blue Earth grocery store owned and operated by the Juba family for 50 years.
Tom Juba first shared the origins of the grocery store. “We bought the store in 1971 when I left the military”, he explained.
Juba added that there were three other grocery stores in Blue Earth at the time. All are currently occupied by other companies and organizations. A grocery store was located where the library is currently located, another was located in the Schwen’s building and another was located in the current Head Start building.
“The population of Faribault County was a little over 22,000 at the time, and now it is more than 13,000”, Juba noted. He has seen this and several other factors permanently change the way his business is operated.
“Things have changed in our company” admitted Juba. “For example, people don’t cook as much as they used to.
Lack of demand for groceries is not the only challenge Juba has faced as time passes towards new developments.
“People run to Mankato for entertainment and could do their shopping there”, he explained. “There are some big stores out there that are really aggressive. “
Juba has seen the most changes, however, related to the growing ubiquity of computers and technology.
“Computers have changed everything” he admitted. “If our Internet goes down, we are almost bankrupt.”
Juba added that credit cards have transformed the operations of many small businesses like his. Although they are very convenient for many customers, they create challenges when operating a small business.
“I think credit cards are used for almost 60% of the business. “Juba noted. “Credit card fees are probably between 1.2% and 1.3% of profits. A few years ago, if you made a percent profit, you were considered successful. “
As Juba’s explanation demonstrates, the fees that businesses have to pay to facilitate credit card transactions are actually higher than the regular profit margin they would have sought to achieve in years past.
Despite these drawbacks, Juba felt he needed to get into credit card transactions after Walmart’s debut in Blue Earth.
“By observing Walmart customers, we found that many people could only afford to shop for groceries if they used a credit card,”Juba explained.
He added, “It hurt us when Walmart left. It hurt the whole town. People would come to Walmart from surrounding areas and then come to our store and buy a pretty good supply of groceries; especially meat and products.
It was even more painful, Juba explained, when Fairmont built its own Walmart a few miles away.
“Some experts thought we would lose 50% of our business by building this. “admitted Juba.
Nevertheless, Juba’s is still here to celebrate its 50th anniversary. Although it employs fewer people now that it no longer has its own restaurant, it still provides work for around thirty employees, many of whom are young students from the neighborhood.
“We are delighted that you are here”offered to board member Ann Hanna, following Juba’s presentation to the board.
The board addressed other adaptability needs later in the meeting when reviewing the criteria businesses must meet to qualify for EDA business improvement loans. Loans are usually given to enable businesses to make exterior improvements to their buildings.
Economic development specialist Amy Schaefer addressed the board about this.
“I was contacted by a non-profit group to ask if they could apply for a business improvement loan”Schaefer explained. “How does the EDA want to clarify who is eligible for loans?” “
Schaefer added, “The group is a club. They don’t really generate any funds for the city, and you have to be a member to use the facility. “
She commented, “We need a firm position.
Hanna was the first to comment on the app.
“A members-only club is not really open to the public. I think non-profit organizations should not be eligible for our loans. “
Mayor Rick Scholtes countered Hanna’s comment.
“I was going the other way”he admitted. “They are the ones who need it the most. A larger company could afford the changes better than a nonprofit organization.
City administrator Mary Kennedy offered additional perspective.
“Many non-profit organizations do not have a building and would not be eligible for the program anyway”she noted. “But, they might be eligible for other programs.”
Schaefer responded, considering whether loans to nonprofits could be made by the board on a case-by-case basis. But she expressed concern about it.
“Will it open a box of worms if we start doing this?” “she asked the board.
Despite these concerns, after some discussion, Scholtes presented the following proposal to the board.
“I think going on a case-by-case basis is the best way to go. The association must be open to the public and it must have its own building.
Scholtes clarified that these stipulations make the non-profit organization currently interested in receiving a loan ineligible.
Acknowledging Schaefer’s request for clearer written criteria for awarding business improvement loans, Kennedy vowed to write a policy and report it to the next EDA meeting.
Other topics discussed at Thursday morning’s meeting included:
• Business improvement loans granted to several businesses around Blue Earth.
Dikken’s Furniture and Decorating, Inc. requested a loan to upgrade their awnings. Council approved a grant of $ 3,160.43 to Dikken’s to replace their awnings.
Pizza Hut has also applied for a loan, which they will use to finance the brand new signage they have already installed. The Board of Directors voted to award $ 5,000 in funds to Pizza Hut.
Finally, Jake’s Body Shop, LLC requested $ 5,000 in funds to shape and pave the parking lot for their facility, which the board of directors also voted to award to the company.
• Updates from the Chamber of Commerce. Shellie Poetter, Executive Director of the Chamber of Commerce, shared plans for the upcoming Giant Days celebration are going well. She did, however, express the need for more volunteers on Saturday night to ensure the celebration remains clean and safe.
Poetter also brought updates from the Giant Welcome Center. She shared that 556 visitors were documented between 11 a.m. and 3 p.m. on a Saturday, so the center remains popular. The council briefly discussed adding additional signage around the center, however, to make the center’s purpose clearer to potential visitors.