Growth fuels Worthington Ag Parts expansion into Sioux Falls
WORTHINGTON -- What began as a small business to provide the region's farmers with spare parts for their broken down tractors, combines and ag machinery in the mid-1960s has today grown into a successful company that has branched into 12 U.S. locations, 10 of which are retail stores, and another six stores in Australia.
Worthington Ag Parts is growing once again with construction to begin in March on a 20,000-square-foot warehouse in Sioux Falls, S.D., but company president Michael Winter is quick to point out the facility on Worthington's south side will continue to operate just as it has.
"The business was founded there in July of 1964 and we have no intention of relocating it. We remain committed to the local farmers in and around the Worthington area, along with all of our domestic customers," said Winter, a Worthington native who has worked for the company for 21 years.
In 2010, Worthington Ag Parts exported used, re-manufactured and after-market new parts in all makes and models to more than 30 countries. Because of its extensive growth, the company's export division, housed in a leased facility in Renner, S.D., was no longer adequate.
In their search for space to expand, Churchill Industries, which has owned the company since December 1986, chose a 6-acre parcel in close proximity to two major interstate highways, I-90 and I-29, with easy access from the new Marion Street exit in Sioux Falls. Winter said the land was purchased from the Sioux Falls Development Foundation.
The parcel will be developed for both the company's Export and Capello Corn Head implement divisions. Winter said plans are to eventually relocate the corporate headquarters from Maple Grove to an 8,500-square-foot finished office space at the Sioux Falls site.
The corporate headquarters handles all administrative tasks for Worthington Ag Parts' worldwide operations, from accounting and finance to human resources, purchasing, business development and information systems.
"We lease the Maple Grove space through 2014," he said. "We are actively pursuing acquisitions of other businesses that will continue our growth, and with them could come revised strategic plans involving the corporate headquarters."
Construction is slated to be completed on the new warehouse in August, which is when the company's lease of the Renner facility expires. Winter anticipates the Sioux Falls facility will have 15 employees to start, with growth to 50 employees by the end of 2014 when the corporate headquarters relocates there.
Community's missed opportunity
Worthington was in consideration for the major expansion plans now under way for Worthington Ag Parts, but Minnesota Department of Transportation plans for the expanded highway in front of the company's business forced Winter to look elsewhere.
In its design of the four-lane expansion project for Minnesota 60, MnDOT took away all three of the existing highway entrances for Worthington Ag Parts. As plans are drawn today, the company's only highway access is on a frontage road that will dead-end at its property.
"The restricted environment prohibits further expansion," said Winter, who tried to plead his case for highway access with MnDOT for five years. The highway expansion, when it's constructed this summer, will include all four lanes and a narrow median, in front of the business. MnDOT is also taking an easement from Worthington Tractor Parts, which forced the company to move its front display area.
"We lose visibility," Winter said. "Our used whole goods were displayed for sale in front of our facility."
The biggest impact, however, will be the limitations for traffic movement. Tractor-trailers come and go from the business daily, picking up or delivering salvage, parts and freight.
In 2010, Winter said customers from 24 different states came to Worthington to do business with the company.
Worthington Ag Parts became the exclusive distributor of Capello Corn Heads in 2010, which is also helping to fuel the company's growth and need for expansion. The corn heads, manufactured in Italy, have been a "huge success," said Winter, and will continue to gather market share in the U.S.
"It became necessary for us to have a facility to handle hundreds of corn heads annually for distribution to our growing dealer base," he added.
Winter said with the amount of truck traffic anticipated at the Export Division and Capello Corn Head facility -- and with the lack of a highway entrance at its Worthington facility -- it was an easy decision to purchase land in Sioux Falls in close proximity to two major interstate highways.
"We bought six acres and we're designing it as we grow to be able to expand on the warehouse base," Winter said.
The Sioux Falls facility will also distribute after-market new parts to Worthington Ag Parts locations across the U.S. and Australia, where its six stores operate as Neil's Parts.
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