08/04/2006

Source: Northern Colorado Business Report

Author: Kate Forgach

Every pin created by Designs by Lucinda is unique.
 

Every step in Lucinda Yates' life journey has been equally unique, taking her from homeless mother to multimillion-dollar entrepreneur. The talented artist and businesswoman was recognized as Entrepreneur of the Year for 2006 by the National Association for Female Executives.
 

Yates will share her story and inspirational wisdom on Sept. 13 at the Northern Colorado Business Report's Bixpo 2006.
 

Yates' story begins in the early 1980s, in Portland, Maine, where divorce and financial setbacks left Yates and her young daughter homeless.  Deciding it was time to yank up her bootstraps, she began creating inexpensive jewelry that she traded on the street for food.
 

By 1983, Yates had a home, with a jewelry studio in the cramped attic.
 

In 1988, she hit upon the concept that became Designs by Lucinda: pins shaped like houses that would serve as fund-raising vehicles for organizations dedicated to helping the homeless.
 

It was what she calls "a true eureka moment."
 

Without a bank loan, any formal marketing or a business plan, Designs by Lucinda exploded. Orders came in at 400 a batch and first year sales hit $89,000.
 

Nonprofit organizations or their sponsoring groups purchase the pins for $7.50 each and sell them for $15. To date, Designs by Lucinda has sold more than 3.5 million pins and helped raise $24 million for more than 7,400 nonprofits around the world.
 

Locally, Sister Mary Alice began selling Yates' pins in the early 1990s to raise money for Fort Collins nonprofit CARE Housing. Executive Director Chadrick Martinez said the $1,200 to $1,400 CARE raises annually through pin sales is used to support service programs, such as after school tutoring, computer labs and financial counseling. CARE also provides earnings-based rental housing to working families.
 

"Sister made selling those pins part of her crusade," said Martinez. "They served a twofold purpose for Sister. They raised awareness, but they also raised much-needed revenue when we were just starting out."
 

That fits exactly within Yates' philosophy for her business.
 

"My goal is that everybody wins," said Yates. "I love the idea of creating something that can change a person's life, and that's what the pins have done. It's my goal to change the world one pin at a time."
 

The company now boasts eight additional theme-based fund-raising designs, including peace, domestic violence, and breast and ovarian cancers, although the homeless pins remain the most popular.
 

With the company's exponential growth, Yates' faced several knotty problems. All 40 designers who assemble the pins worked from home and each handcrafted pin was a one-of-a-kind design.
 

The designers have a basic pattern that explains which elements are to be used, but the ultimate design is left up to each woman, meaning that no pin is exactly like another. This creativity made it particularly difficult to streamline the process to keep up with increasing orders.
 

"It was easy at first," said Yates. "They'd take pins home and bring them back. I was just happy at first not living on the streets and, all of a sudden, I'm going, 'Holy cow!'"
 

The move into an 8,000-square-foot building in Portland allowed Yates more latitude. She brought in a die cutter. Although the women still controlled the overall design of each pin, the individual pieces - little shutters, moons, trees - were now standardized.
 

The final step of pinproduction required the application of a two-part epoxy. This finishing coat took time to apply, then two hours to dry, backing up work throughout the building.
 

Yates called in a consulting firm, which recommended using ultraviolet curing in place of the epoxy. Designs by Lucinda put the process in place in early 2004, with funding from a Maine Technology Grant.
 

"What took 15 people to do now took two people and was twice as fast," said Yates. "Our pins already are touched 110 times before they leave the building. We didn't need that extra step."
 

Other improvements included adjustments in organizational processes and storage systems that allowed designers to focus on what they did best.
 

The changes earned Designs by Lucinda the first-ever Manufacturing Excellence Award for 2005 from the Maine Manufacturing Extension Partnership. The company also was voted Best Small Business Out of the Box by UPS.
 

The savings also allowed the company to hire its first-ever sales force and the bottom line began to improve.
 

After disappointing sales - down 15 percent in 2002 from 2001, and down another 9 percent in 2003 - 2004 saw Designs by Lucinda post 14 percent growth, with sales of $1.9 million.
 

Yates has yet to write a full business plan; she's never earned a college degree; and she's been thinking outside the box before the term came into vogue.
 

"One of the big struggles for me was that I got launched into this and immediately had to drive the bus," Yates said. "But you solve problems the best you can. It just turned out the decisions I made worked out great because everybody was winning all the time. Nobody could have written this business plan."

CARE's Executive Director, Chadrick Martinez showing CARE's House Pin display.