Jim Pankow is closing his construction company before he tarnishes what he says is a perfect, 33-year record of meeting payroll and paying off subcontractors.
“I want to go out on top, I guess, on top of a small heap,” said Pankow, who founded Jim Pankow Inc. on June 28, 1977. “It is my own decision and not a forced one.”
The Plymouth design/build firm, which for the past six years has focused on private jobs, will close in mid-September after finishing its final projects. Pankow, the company president, said the private market has left him with only two options: fail to win projects or lose money by winning work for less than the cost of construction.
Preferring neither option and approaching retirement age, the 63-year-old Pankow said he decided to cash in before he follows in the footsteps of contractors forced to close because they have too many unpaid bills.
“I don’t have a crystal ball any more than anyone else does,” he said, “but my experience and my best estimate is we have several more years of a similar experience that we have seen for the past two years.”
Losing one company in the Plymouth-area market will do little to offset the imbalance between builders and available work, said Charles Rohde, board chairman of Rohde Brothers Inc., a mechanical contractor in Plymouth. He said he is focusing on niche projects for manufacturers and food processors, and the company made money last year and will turn a profit this year.
“His leaving the scene doesn’t affect us,” Rohde said of Pankow, “because there is excess contactor capacity, probably up to 50 percent excess.”
Such situations demand the industry shrink by shedding employees or companies, said Larry Michael, surety bond producer for The Brehmer Agency, Butler.
“It will do that one way or another,” he said, “either managed well by a contractor or not managed well, and the company gets into financial difficulties.”
It helps the entire industry when contractors such as Pankow see the writing on the wall and scale back or close before they wind up in debt to other contractors or suppliers, Michael said.
“Everyone benefits from a well-managed construction industry,” he said, “whether we are expanding or contracting.”
Pankow said that when his company was at its peak two or three years ago, Jim Pankow Inc. had 45 employees and did more than $16 million of work a year. He has since pared down to about 15 employees, he said.
He said he has not decided whether to sell off the company’s equipment and property or hang onto everything. He said he will honor the warranties on any of the buildings his company constructed.
The hardest part of closing the firm, Pankow said, is letting go of the crews he has built up over the past 33 years of doing business. However, he said, it must be done before he does any harm to an industry that, up to this point, has treated him well.
“When I founded it in ’77, it was just basically myself,” Pankow said, “and I hired an employee and went from there. It’s been good.
“The construction industry and businesses have been good to me and my family, and I’ve enjoyed it.”