Custom injection molder PGM Plastics Inc. closed its doors quietly at the end of September and plans to auction its equipment Nov. 11.
``We're closing operations because of the downturn in the economy. We've been in business 12 years,'' Paul Muzyka, president of the Fitchburg, Mass.-based company, said in an Oct. 30 telephone interview.
He said operations peaked in 2006, in part thanks to work from toy maker Lego A/S.
``We started with no customer base and grew substantially between the years of 2003 to 2005. We expanded quite a bit with Lego,'' Muzyka said.
But then Billund, Denmark-based Lego shut down its Enfield, Conn., manufacturing and moved operations to Mexico. Attempts to find a broader customer base did not work out.
One area the company turned to was medical devices. It added clean room space as well as Milacron Roboshot electric presses. But the project took lots of time and money.
``A fair amount of money was needed and it just wasn't panning out,'' he said.
When PGM closed at the end of September, it occupied 80,000 square feet in two buildings. Muzyka said its customer mix was 15 percent medical, 30 percent industrial and 55 percent consumer.
``It was the combination of the economy and the impact of rising resin costs,'' he said, noting that the trends also are hurting retailers and consumers.
Muzyka said PGM employed 110 in 2004, but slumping sales had forced the company to run lean. It had 25 employees when it closed its doors.
Muzyka, 53, said: ``I've been in plastics since the early '80s and it has changed an awful lot. It's exciting to be in some of the newer projects where you have teams of people with the same focus and bring it to fruition.''
However, he said that the changing nature of the business means that a company ``needs to be involved at the development stages.''
Branford Group of Branford, Conn., will auction PGM's 19 presses, including nine 2003 Milacron Roboshots, as well as robots and other auxiliary equipment. The injection molding machines range in size from 75-1,000 tons. The auction will feature both on-site and Web-cast bidding and will take place at PGM's facilities in Fitchburg.
Muzyka said that the company's buildings also are for sale, but will not be part of the auction.
``[Molding for] Lego was a great experience. It taught us a lot about engineering design and they were great to work with. They had a great reputation in the industry, so if we told anyone we worked with them, any questions about quality and experience would be gone,'' he said.
Muzyka said he has not yet decided what he will do next.