110 S 2nd St - A-M Systems

Business Development - Consulting / Products / Services - since 1986
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110 S 2nd St

Projects > DJR
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1/19/20 ?
In the few opportunities that we have been in direct contact, I have used the meeting time to attempt to better understand you and more directly, your local business plan. Meaning no disrespect for any comments and/or suggestions herein, nor such before or after this period of time. Having said that, I am inclined to document my thoughts and suggestions related to the Murphy Building – for whatever the worth or value. I have no ulterior motives beyond imparting my comments and suggestions that are based on my personal business experience. My interest would be for your economic benefit, as well as any economic benefit to the Area Community. I know not much of your background and experience, nor am I aware of any communications and conversations that you may have had with any local Community Leaders. I would guess that many, if not most of what I will be offering may be in conflict with many of our thoughts, as well as most likely being in conflict with suggestions from our Local Community Leaders. I do not present myself as any type of “expert”, and only make suggestions based on my personal business experience.

The often used phrase, “No Man is an Island” may best focus my message, although it is not without the possibility that you may be very financial able to accomplish a successful plan with regard to the property in question. If I “assume” that this may not be the case, then among my early suggestions would be to consider integrating financial investors into the overall and primary business plan. This is often referred to as “OPM” (Other Peoples Money).

First – have you given thought to “parking”? This facility once housed several hundred employees and required substantial parking accommodations for their employee convenience. Any usage of the building most likely will require some such facilities. In operating days of the business, the large lot across the street from the building served as the employee parking area. That area is now being used by a landscaping company and is currently not available for any other usage. This topic should be given serious thought prior to any further business planning that may be undertaken. This issue COULD be a “show stopper”. By far, this is the first major hurdle to confront, and until this issue is satisfied, there may not be a reason for any further investment in Time and Monies. Certainly until it is satisfied, it is not likely that any Grants, Funding, Government Aid, outside investors, etc. would be possible.

Second – Before you have even the remotest chance to entice investors, you would be advised to give serious thought to the usages and applications for the facility. Basically there are three options, with combinations thereof: a.) Residential, b.) Commercial, and c.) Industrial with potentially combinations of these usages, e.g. Combining Residential and Commercial, and Commercial and Industrial.

Again, I make no claims to be a Real Estate Market Research specialist, but I would give very little, if any, consideration to Residential (Apartments). Any such usage would most likely only be of interest to local folks and would do little to attract potential renters/buyers from other communities. Apartments and Living Quarters only tend to “shuffle” the Community Residents, but does little to attract potential residents from outside the Local Community. With an area Community of 10,000 more/less and a city of 6,000 more/less, I would not see this offering a significant financial success. Likewise with Retail Commercial, there simply are not the numbers of people within the Community to attract profitable retail businesses whose financial success is based on “traffic”, i.e. prospective buyers of the products to be offered. It should be noted that 2 major retail outlets (K-Mart & Shopco) have since closed their Red Oak facilities.

This leads me to suggest to you explore the Industrial option. I include in this option, manufacturing, processing and distribution. This is the only one of the three potential usages that has the potential of attracting people and business from outside the Local Community, and without expecting the growth to come exclusively from only the Local Community.

Within the big picture of Manufacturing and Distribution are hard goods, much having to do with plastics, metals, etc. The other form of Manufacturing and Distribution involves Food Industry, including meat, poultry, fruit and vegetables, etc. This would be my suggestion on which to focus for a number of reasons, including the fact that everyone needs food, and our geographic location conforms to being able to supply food stuffs. It is my experience feeling that until the usage of this facility is determined, locating funding and investors will be difficult, at best.

Third – My suggestion as best usage is “Industrial” that would include Manufacturing, Processing and Distribution in some combination with Commercial. The facility was built for manufacturing and the local zoning should not be a concern. The interior is basically open space, which should allow for flexible layout design. “Business Condominium” is key description of facility usage, although that does not preclude rental and lease areas. Some monies spent on a Consulting Company that could perform Market Research, plus perhaps designing a flexible layout for such a usage should be considered.

Potential Usage – Food, Meat and Poultry Processing and Products Outlet Mall:
           Food, Meat & Poultry Processing and Further Processing
           Food - Commercial/Retail  Condominium rental/lease areas/zones
          Food – Canning / Preserving
           Food Hubs & Commercial Kitchen Area(s)
           Distribution & Warehouse, Coolers/Freezers/Lockers
          Food related Sales Offices and Services
                      Manufacture Reps & Brokers – offices and distribution/warehouse storage, etc.
          Food & Processing related Education Accommodations, e.g. ISU Extension

Soliciting Potential  Tenants   
          Solicit Companies in high cost states that may want a Midwest presence – states such as California, and a number of East Coast state.
           Solicit existing Meat/Food Processing companies that may have expansion plans for a portion of their current product line, or may have an interest in adding production capacity, and/or a new product to offer
          Solicit Local / Area Growers/Producers that would like to have processing capability – a number of Metro areas have “Kitchen Council” facilities for individual and small operations.

Marketing and Potential  Sources for Information, Finances and Economic Development
          Local/State/Federal Economic Development Agencies:
                       * Iowa Rural Development Council - https://iowardc.org/
                      IEDA – Iowa Economic Development Agency -
                      IADG – Iowa Economic Development Group - https://www.iadg.com/
                      Iowa Economic Development Incentive Programs - https://blsstrategies.com/iowa
                      MCDC – Montgomery County Development Corp.
                      USDA – US Department of Agriculture
                      Golden Hills - Southwest Iowa Food and Farm Initiative (SWIFFI) -
                      Southwest Iowa Planning Council - http://www.swipco.org/about-us/
                      Iowa Western Small Business Council - https://www.iowawesternsbdc.com/
                      USDA Rural Development - https://www.rd.usda.gov/
                      USDA Food Hub (multiple organizations)
                      USDA Grants & Loans - https://www.fns.usda.gov/cfs/other-federal-grants-available

Why a Food, Meat and Poultry Processing and Outlet Mall? There is no such facility in Southwest Iowa, and indeed there may not be such a facility anywhere in Iowa, or perhaps the entire Midwest. It should go without saying that Southwest Iowa is often ignored for Economic Development opportunities within the State of Iowa, and with the Community getting involved, it should be much easier to attract a great deal of attention for such a project as this.

Local Producers
There are numerous local and area producers that may have potential products, but lack the facilities and outlets. Perhaps it could be viewed as a permanent and ongoing Farmers Market Facility, such as many Metro areas have.
The Cost of Sales and the Overhead should be significantly less than large Metro areas and high cost states, such as those mentioned previously.
To design and build a structure even closely resembling the Murphy Building would be Mega-Millions. The updating and rehabbing of this facility may be costly but would likely be a fraction of starting from scratch on such a facility with similar square footage.

Further Analysis and Review
Whatever the course you may select for the usage of this facility, it should be understood to be considered a long term project spanning years, not months.

From 2012 Analysis:
Murphy Building
Could this be the facility to accommodate an Education and Training Center?.. Possibly. It is my understanding that at one time there were talks, albeit limited, with a university to consider a education satellite center in this facility. That effort should be pursued and explored in detail. It may be that this idea has long since been abandoned, but the reality is that some level of education/training should be the primary consideration for this facility. The reality is that the cost of a four (4) year college education is beyond the means of many high school graduates. Trade Schools and Specialty Training Schools (Continuing Education) are even now on the rise. As King, I would direct my Education Lieutenant to explore the interest of such institutions to an existing facility, or even to develop our own Training Center. How about “Thomas D Murphy” or “Charles Wilson “ Training Center? (editorial: ...both have already donated a considerable amount to this community)
Education and Training Center
As college cost increases, the economic reality is that fewer individuals will be able to extend their formal education beyond high school, particularly for those that do not want to assume a large liability in their beginning employment years.
If we recognize that the future of education can be significantly different, then our Community could be a leader in non-college training and education that would separate us from other communities of our size. Indeed, this could be a major contribution to our community. It certainly would be worth serious review and analysis involving “niche” level of education to offer. Online education has grown significantly the past few years, but the missing ingredient of this level of education is the “personal contact”. Yes  there  are methods for supplemental help, but what if… integrate online classes with periodic classroom attendance? This warrants a serious investigation.
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A-M Systems
204 S Broadway St - Box 459
Red Oak IA, 51566-0459

402-305-2575 cell
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