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9.1. EDSR 11-20-2023
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9.1. EDSR 11-20-2023
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11/17/2023 10:52:55 AM
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Shoot Steel, INC <br />17565 Tyler St NW <br />Suite A <br />Elk River, MN 55330 <br />763-205-2109 <br />ShootSteel.com <br /> <br /> <br /> <br />TIF amendment for Moyer Properties LLC <br /> <br />Background <br />Shoot Steel, INC committed to moving its operations to Elk River and growing its number of <br />employees in exchange for TIF. About 1 year after the TIF application was submitted Shoot Steel, INC <br />was faced with crippling supply chain issues. The price of hot rolled steel rose by roughly 4x and the <br />price of abrasion resistant plate rose by roughly 2.5x. Additionally lead times and minimum orders <br />increased. We tried increasing advertising to increase revenue, but it was not enough to cover the <br />increase in material cost. When we raised our prices, sales dropped by roughly 50%. The company <br />was losing money faster than we could react. In the spring of 2022, I was forced to take out a personal <br />loan to make payroll. This was after exhausting my personal bank account and all business assets. To <br />save the company layoffs were the only option. After reducing the company from 10 employees to 5 <br />we were still losing money every month. It took a complete restructuring of the company to turn things <br />around. This took roughly 6 months of hard work and creativity. Overall, the company is profitable <br />again, but steel prices remain high. The best option is for the company to run lean, pay off debt and <br />focus on small incremental growth. There is no indication that the abrasion resistant plate market will <br />go down this year. If anything, I anticipate it going up due to the conflicts in Ukraine and Israel. The <br />steel used to make targets is the same steel used for military armor in many cases. Any increase in <br />demand would raise prices, as the mills are currently working at capacity. <br /> <br /> In an effort to cut costs Shoot Steel, INC began subleasing out half of the warehouse. The new <br />tenant does not currently have a physical location in Minnesota. They plan to hire 5 employees this <br />winter and grow as time goes on. This tenant also works closely with another business in Elk River <br />and are a critical supplier of components. The jobs created by the tenant will benefit the Elk River <br />community and Minnesota as a whole. <br /> <br /> Shoot Steel, INC would like to amend the original TIF agreement to include the employees <br />from the tenant side of the building. Amending the TIF agreement would help Shoot Steel, INC <br />navigate these difficult times and stay in Elk River. <br /> <br />Financial Burden to Shoot Steel <br /> Shoot Steel, INC was forced to take on a considerable amount of debt to keep the company in <br />operation. This debt is now reducing the company’s cash flow and increasing its risk. The company is <br />working hard to increase revenue in any way possible and has finally been able to cash flow two
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