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But a Lancaster lighting company this week unveiled plans to invest up to $30 million to open 30 wholesale stores, build a new manufacturing plant and add up to 60 jobs in Lancaster this year.
Lancaster native Kenneth G. Gabron, president of 28-year-old Gabron & Gabron Inc., said he prepared years ago to position the company to take advantage of the bursting of the real estate bubble.
"Everyone asks if I'm crazy to expand at a time when the economy is poor," Gabron said. "I still say it's an excellent time — you can get good service, pricing and labor you need."
Gabron & Gabron Inc. and its four associated business are moving Feb. 1 to a leased, 25,000-square-foot building at 1421 Arcadia Road, just off West Roseville Road in Manheim Township.
The 20-employee company currently does "quick-ship" manufacturing of light fixtures and sells wholesale lighting and electrical products at a 9,000-square-foot location at 1266A Manheim Pike.
Gabron will expand its manufacturing arm, BronTECH Industries, which specializes in light fixtures and some commercial bulbs through a collaboration between the Manheim Pike shop and a facility in Philadelphia.
"We do our own designing, and they do a lot of the work for us," he said. "We do some of the finished products here in Lancaster, but we're going to make it from scratch, top to bottom."
The four divisions generate annual revenue of about $40 million, Gabron said. In 1991 the company had sales of about $2.2 million, 80 percent of which came from lightbulb sales.
His plan is to launch the production of 660 products through the BronTECH Industries division in May.
Lighting fixture production will begin first, and by November BronTECH will begin production of fluorescent lamps, metal halide halogen lamps and even CFL bulbs, the popular twisty, energy-efficient compact fluorescent lightbulbs.
Gabron made the decision to manufacture in Lancaster at a time when most U.S. bulb manufacturers are moving production overseas, he said.
A self-proclaimed risk-taker who said he lives for challenges, Gabron so far has invested about $500,000 in expanding the business. That will go substantially higher because the new manufacturing process will require funding of up to $30 million.
"There will be an investment of about $10 million for the fixtures side," Gabron said. "On the lamp side, that's probably going to be $10 million to $20 million."
Gabron said the company is hiring now and will add 40 to 60 employees in 2009.
The first of Gabron's 30 planned wholesale stores open in York on Feb. 4 and in Harrisburg in March.
"Our objective is to open a new store every 30 or 60 days," Gabron said.
Besides BronTECH, Gabron operates 1st Recycling Service of Pennsylvania, Gabron Lighting Services and NDS delivery service.
The vertical business model manufactures, sells, distributes, services and delivers lighting fixtures and lamps.
Gabron sells lighting and electrical products to a diverse customer base, including commercial and industrial businesses, small neighborhood companies, restaurants, banks, schools, hospitals, nursing homes, parking garages, national and regional wholesale chains and international corporations.
Gabron, 60, skipped college and began his career as a teller at a Fulton Bank branch in downtown Lancaster.
"I was held up three times," he said.
He saved his money, which he multiplied enough through investments and speculating in the local real estate market to launch the company in February 1980 from his truck.
Within two years he moved to a 2,100-square-foot building on Pershing Avenue. He later moved to a 20,000-square-foot facility on Steel Way before transferring operations the Manheim Pike shop and the 40,000-square-foot plant in Philadelphia.
During the past few years, Gabron said he divested all his investments and sold his real estate holdings — including a home he shared with his wife, Dorothy, at Bent Creek — in advance of the economic downturn.
"Cash is always king," he said. "That's even more so when times are tough."
He built the business by reinvesting profits and doing the opposite of others: amassing huge inventories of bulbs, ballasts and fixtures.
"We're successful because we keep it simple," Gabron said. "We keep costs down, we're bare-bones, there's no layers of management, and we give one-on-one service — we don't have voice mail. I won't allow it."
More importantly, Gabron said he removed a dependency on outside manufacturers, distribution services, franchisees and external customer service.
"It takes longer, it's harder to work, it's the most costly way of doing business, but in the long run, it's the best way of doing it," Gabron said.
BronTECH was started in the mid-1990s, partially out of frustration when a large lighting-fixture manufacturer told Gabron he could no longer sell the company's products.
"The big boys in the fixture business had their favorite sons. … I was determined to get around that," he said. "I said, 'That's it. I'll borrow money, do whatever I have to to start manufacturing,' " he said.
E-mail: pburns@lnpnews.com
