The expansion of our supply warehouse in Moorhead, MN, began in late May as work crews commenced the initial phases of construction.
Scheduled for completion in November, the expansion will provide an additional 15,000 square feet of storage space, allowing RESCO to house more material in a controlled environment, while at the same time improve overall operational productivity.
Once completed, the total storage space of the Moorhead warehouse will be almost 34,300 square feet.
RESCO’s Moorhead warehouse has played a vital role in the distribution of high-voltage materials, supplies, and equipment to rural electric cooperatives, municipalities, and utility companies throughout Minnesota and the Dakotas.
Great aerial footage taken on May 23, 2023, of the construction site of our new warehouse facility in Stanley, WI! Once completed (which we anticipate will be in early 2024), the facility will provide RESCO with 40,000 square feet of inventory space—along with substantial outside fenced-in space—enabling us to better serve our members and customers in Wisconsin, Minnesota, and Michigan. Sitting on 15-acres, the site also provides us with ample room to expand our operations, when needed. Thank you, Market & Johnson, Inc., for sharing the video!
To view the video, click here.
Interested in viewing the progress of construction at our new warehouse facility in Stanley, WI?
We’ll be sharing timelapse videos taken from a camera situated at the 15-acre site periodically until construction of the 40,000-square-foot warehouse is complete, which we anticipate will occur in early 2024.
To access the on-site camera footage for May 3-21, 2023, click here.
RESCO President and CEO Matt Brandrup was a recent guest on author Robert Bryce’s ‘Power Hungry’ podcast, where he shared his insights on industry topics such as the challenges of inflationary pressure and labor shortages; the impact of new regulatory guidelines and proposals; and the advantages of the RESCO co-op model. Conducted weekly, the podcast features top thinkers, writers, and influencers within the energy and power space.
Click here to view the podcast.
The impact of unstable supply chains and rising inflation over the past two years has affected the operations of RESCO and our members and customers. From long (and sometimes uncertain) lead times to higher pricing due to inflationary factors like increased pricing on raw materials, labor shortages, and transportation challenges, we’ve been weathering the storm while continuing to provide top-notch and reliable service and product inventory to utilities through the Upper Midwest.
While supply chain conditions and inflation have yet to return to “normal” conditions within the utility material sector, we are happy to report that we’re seeing positive improvement, both in terms of lead times and product pricing.
Here are a few updates we’re happy to share with you:
- Stabilizing manufacturer pricing. Over the past two years, we’ve experienced significant cost increases in the products we distribute, due to inflationary pressures. In 2021, the average inflation rate on all products we provide was approximately 14%; in 2022, that number rose to 18%. However, while prices continue to rise, we are now seeing a slow down on the velocity of price increase. And while it’s difficult to predict economic conditions for the remainder of 2023 and into 2024, we expect the utility-product-cost inflation rate to moderate this year and fall back into the 4% to 8% range.
The operating budgets of our members and customers have always been a top priority for RESCO, and we will continue to work with our manufacturer partners to help deliver the most competitive pricing within the industry. RESCO’s not-for-profit cooperative business model helps us accomplish this!
- Continued growth of RESCO product inventory. As stated in previous posts, RESCO continues to focus on maintaining high inventory levels to ensure our members and customers have access to the products they need, when they need them. To that point, our record inventory levels continue to grow: as of this edition of Plugged in With RESCO, we’re currently maintaining $45 million in inventory housed in our seven warehouses.
And as our inventory continues to grow, so does our warehouses capacity. In addition to the opening of a new office and warehouse last spring in Elkhart, IA—which provides us with 30,000 square feet of indoor space and 35,000 square feet of outdoor space—we also expanded our storage capacities in Mt. Pleasant, MI, late last year, providing us with an additional 8,000 square feet of indoor storage. In 2023, we’ll be adding 15,000 square feet of indoor storage space at our Moorhead, MN, location, as well as breaking ground on a new 40,000-square-foot warehouse in Stanley, WI. (Located on 15 acres, the new Wisconsin facility will provide us with expansive outside storage as well, enabling us to deliver even more exceptional service to our members and customers in Wisconsin, Minnesota, and northern Michigan.)
With spring and summer utility projects and construction starting soon, our goal is to help ensure that you have the necessary materials, supplies, and equipment. Our Purchasing Department has been busy placing product orders to keep our inventory levels very robust for most items.
Faced with continued long lead times and higher cost of supplies, equipment, and materials, utilities can lessen the impact of current supply chain disruptions by focusing on multi-year planning of projects and construction. RESCO is also helping members and customers combat these challenges by carrying $42 million in product inventory in its warehouses. President and CEO Matt Brandrup discussed this topic in a recent article published by the National Rural Electric Cooperative Association (NRECA). To read the article, click here.
‘Supply chain’ and ‘inflation’. The two words all of us have probably heard enough over the past year. Both have greatly impacted the operations of utilities and the everyday lives of their members and customers, with seemingly no short-term end in sight.
In terms of supply chain disruptions, more than half of supply chain executives don’t expect a “return to normal” until the first half of 2024 or beyond, according to survey results reported by SupplyChainBrain.
And with inflation at its highest level since November 1981, fears of an impending recession–which some experts believe has already begun–are on the minds of businesses and consumers alike.
While it’s difficult for organizations to pivot their operations during unstable market conditions without skipping a beat, recognizing potential operational concerns early on and taking a proactive approach to address them can help weather the storm.
That’s the approach RESCO has taken, increasing our utility product inventory by over 70% in the past 12 months alone. We’re pleased to report that, as of the writing of this article, our inventory stands at over $42 million — an all-time record high for RESCO.
And thanks to our strong relationships with our manufacturer partners and our dynamic Purchasing Department, we’re also able to pivot quickly and obtain additional quantities of specific products when needed, such as when severe weather impacts your service area.
This record amount of inventory is much more than just a number. It’s an assurance that your utility has access to the materials, supplies, and equipment that you need, when you need it. Utility operations–whether it’s regular maintenance, storm-related repairs, or ongoing projects–cannot wait for better market conditions to develop or for the supply chain to normalize. That’s why we take pride in our ability to provide reliable availability and prompt delivery of products you need.
We thank you for your partnership with RESCO and look forward to continued growth of our relationship with your utility.
A huge ‘thank you’ to our warehouse team in Williston, ND, who continue to work tirelessly following the powerful blizzard that struck western North Dakota, northwestern South Dakota, and eastern Montana April 22-24, resulting in downed utility poles and power lines.
The Williston team—Skye Velenchenko and Chad Six—along with help from John Larson and Greg Schaefer from our Moorhead location—has moved 370,000 pieces of material (thus far) out of the warehouse and are playing an important role in helping our members restore power to their customers.
A big shout-out also goes to our Purchasing Department—Lori Knoebel, Dillon Marchese, and Kevin Salmon—who have done an incredible job of keeping up with material for the warehouse, expediting orders, tracking down shipments, and placing warehouse transfers. Great job, everyone!
Chris Pederson, regional vice president, spoke with KX News in Bismarck/Minot, ND, about RESCO’s response to the storm. Watch the video here.