Changing to Grow

Adjusting to the Market Has Enabled John S. Clark to Thrive

By Bea Quirk

By being willing to change its focus when the market shifted and by remaining flexible in the way it goes after business, John S. Clark Co. has grown from a local company building for the textile industry into a regional multifaceted contractor active in 24 states.

Last year, the company reported nearly $232 million in regional revenue, and ranked 34th among Southeast Construction's ranking of Top Contractors. That was roughly a 16 percent jump over its 2004 performance, when it earned nearly $200 million in revenue. In early 2006, Clark was working on about 70 different projects.

The 48-year old contractor, based in Mount Airy, N.C., is such a success story that last year it attracted the attention of Tokyo-based Obayashi Corp., which purchased it in November.

President Jim Walker, who has been with Clark since 1999 and who has a small ownership interest, said, "It looked like the right thing to do. We have monthly meetings with new owners, but otherwise they have left us here to do what we have always done."

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Clark has thrived at a time when textiles and manufacturing - long the foundation of the North Carolina economy - have been on the decline, as have many of the companies that serviced them. Clark did it by reinventing itself and moving into other areas, most notably retail.

Walker said it is now among the top 11 largest retail contractors in the U.S, with clients that include such national retailers as Wal-Mart, Target, Lowe's, Walgreen's and CVS, plus regional grocery chains Harris Teeter and Food Lion.

Although Clark didn't have to reduce its head count, making the move away from manufacturing was still a painful process. Before the 1990s, manufacturing facilities accounted for about its half its revenues, and by 2000, that had declined to 3-4 percent, Walker said.

"The transition was not easy," he added. "We had to concentrate on new markets and new business. We went after more retail, more local work and churches, plus opened an office in Wilmington (in 2002)."

Walker said it was important to "see where the market is and be flexible." For example, recognizing the ongoing growth in the health-care market, Clark has developed a long-range plan to move into that market segment.

For now, Clark's largest project is a $40 million, 1.2 million-sq.-ft. distribution center for Wal-Mart in Gainesville, Fla. It's the third such facility it has built for the retail giant. Clark is also currently building Wal-Mart stores in Conover and Greenville, N.C., and Greensburg, Pa.

Target is another major client, and Clark is now building stores for that retailer in Kernerville, Greensboro and Knightdale, N.C.

"We've been building for Wal-Mart for about 20 years and are on their approved-for bid list," Walker said. "And right now they're on a big expansion program." Clark still bids for each project.

Clark bids projects for Salisbury, N.C.-based Food Lion as well but is also one of five contractors that perform fee work for the grocery chain.

"They are one of our premier contractors," said Mike Eason, Food Lion's construction manager overseeing all its construction projects. "They do quality work, have competitive pricing, are able to work at an aggressive pace and are a good business partner in general."

Clark is building a new 35,000-sq.-ft. prototype store for Food Lion in Irmo, S.C., as well as stores in Winston-Salem and Clemmons, N.C., plus major renovations on five stores in Maryland, North Carolina and West Virginia.

But the broader industrial market is also looking up these days and it presently accounts for nearly a quarter of Clark's revenues. The company's biggest project last year was a $30 million plant for Unilin in Tomasville, N.C., and the company has just begun work on a 24,000-sq.-ft. expansion on a steel-wire products plant for Insteel Industries in Mount Airy.

"They've done about a dozen projects for us over the last 20 years - including my house," said Insteel President H.O. Woltz III. "We tell them what we want to do, they develop a concept and layouts, then estimate the costs and come up with a timeline. They compress the cycle, and their experience and resources significantly cut down on the time it takes to get a project done."

It is especially in the industrial market that Clark offers design/build services. For example, it is just finishing such a project on a $10 million textile plant for KordSa, a tire cord manufacturer, in Laurel Hill, N.C.. But Clark is also doing a design/build for a $3 million addition to a Mount Airy charter school.

Clark is now turning to the multifamily market. It recently won bids for two projects on the North Carolina coast - a high-rise in downtown Wilmington and a condominium complex at Carolina Beach.

It is by coordinating work among its four offices - the headquarters in Mount Airy, plus regional offices in Greensboro, Winston-Salem and Wilmington - that Clark is able to leverage its diverse expertise and maximize its ability to take on new projects.

Each office focuses on a particular kind of work, rather than on a geographic area. The Winston-Salem office concentrates on retail, Wilmington focuses on office and retail, Greensboro on multifamily and Mount Airy on industrial and distribution.

Each office makes its own decisions whether to go after a piece of business, but it communicates with the others. If more than one office is interested in a project, a decision is made internally who will go after it, based on each office's capabilities and scheduling.

"It sounds like a cliché, but we are like a family of vice presidents, managers, administrative staff and estimators," said Thurman Watts, executive vice president of Clark's Wilmington office. "And we all get support from the other offices."

Walker said the firm has "a flat organization, and the project management is the key. They are trained and guided on how the work is to be done, and the team has a real vision of what we expect to be accomplished. We have open communication - they tell us what's going on, and we support them."

Clark doesn't have offices in North Carolina's two largest cities, Raleigh and Charlotte, but does have a presence in these two growth centers. "With their growth, these cities became overrun with new contractors, and we didn't like the profit margins," Walker said.

But he added that in the last three to four years Clark has done about $50 million worth of projects in Raleigh, primarily shopping centers, and about $25 million in Charlotte through grocery stores, shopping centers and churches, including a major addition to Friendship Missionary Baptist Church.