By Samantha Erkkila, Entrepreneur Fund
What started as a side business making sauna stoves for Finnish immigrants near Embarrass, Minnesota, in the 1930s, has evolved today into a community-focused company with a strong drive to create the cleanest, most efficient wood burning furnace on the market.
Daryl Lamppa and his father, Herbert, developed the Kuuma (meaning “hot” in Finnish) technology in the 1970s and one of the first prototypes still sits in Daryl’s basement today, heating his home through the long Tower, Minnesota, winters.
“We’re known for our quality and our longevity over here. Our stuff just burns differently,” said Lamppa Manufacturing Inc. CEO Garrett Lamppa, Daryl’s son and the fourth generation to lead the family business.
For decades, Herbert, Daryl and their small team of 3-4 skilled employees were making an average of 100 sauna stoves and 40-50 furnaces a year. Today, Lamppa Manufacturing has 18 full-time employees and during the peak of the COVID-19 pandemic they sold around 650 sauna stoves and over 100 furnaces.
“So that is scaling up big time,” said Garrett.
Not only did production change dramatically, but so did the ways in which people received their product. When Daryl was overseeing the day-to-day operation, 75% of all orders were pick-up. Today, Garrett says that number has flipped to 75% shipping, including to far off places like Alaska and internationally to Finland and Australia, although sparingly.
“It just completely changed and it’s basically like a brand new business,” said Garrett. “Scaling is super challenging and that’s where becoming aware of and working with the resources that we have available in the area like the Entrepreneur Fund, the SBA (U.S. Small Business Association) and IRRR (Iron Range Resources and Rehabilitation) has been very helpful in navigating these changes.”
Investing in their employees, investing in their community
In early 2022, Garrett connected with the Entrepreneur Fund on its Quality Jobs Program. The program recognizes quality job creators in the region and partners with them to develop strategies that create and sustain jobs that provide a living wage, employee benefits, a fair and engaging workplace and offer career and wealth building opportunities.
“We have really deep family ties and roots in the community over here,” said Garrett, who grew up in Tower and who’s grandfather was mayor of the town. “We know what kind of things have happened in this community. And so, being able to provide quality jobs in our community is super important to us.”
Through the Quality Jobs program, Garrett received a $10,000 grant towards improved employee safety at their facility, adding benefit packages and offering competitive wages. Through this program, Garrett said he was able to provide the right kind of jobs, promote from within, add health insurance, and move to a four-day work week on the manufacturing floor. He said that while they initially sacrificed profit to invest in their employees, a year later they are seeing that investment pay off.
“Very few companies are operating like this,” said Garrett. “You have to make these jobs worth it. That’s what it takes in these smaller communities.”
Operations Manager Chad Reichensperger was looking to move back to his hometown of Tower after selling his businesses in Montana. When Garrett offered him a job, he said it made the move a bit easier knowing he could make a living while being closer to family.
“Having something where a person can have a quality job, get health care, and have a good work environment in a small town like this is huge,” said Chad. “It’s huge.”
For Morgen Carlon, administrative manager/safety coordinator/logistics coordinator, Lamppa is where she says she will retire. Her late husband was a shop foreman for the manufacturer but passed away prior to the opening of the new building in 2019. After his death, working at Lamppa was her next logical step.
“It was really important for me to carry that on because of his belief in Daryl and what a great business this is,” she said. “We’re such a cool little town and we thrived when mining was huge. So, to have small town manufacturing in Tower is something this town can be proud of again.”
Garrett says that while he may be an outlier in providing quality jobs to those who live in rural communities, he knows that it’s possible for other businesses to follow this model.
“This is not impossible,” he said. “When you commit to your employees, they commit to you and that changes the ballgame.”