Many hands | A Lewiston social enterprise produces jobs and profits
Photo/Amber Waterman
Scott Owings, business development manger for Outsource Works in Lewiston, stands on the work floor where employees assemble calendars and sketchbooks and do other piece work for regional businesses, including Geiger and International Paper
At the Hill Mill on Canal Street in Lewiston, there is no limit to space. Though occupied with a few commercial tenants, the old textile factory is still mostly empty, with 200-yard-long rooms, high ceilings and wide stairwells. On a recent weekday, about 25 workers with the organization Outsource Works were busy with assembly work at stations on the mill’s ground floor, but they looked small in the engulfing space.
But all this extra room is what allows Outsource Works to jump to action and quickly expand when needed. If an order comes in from a local business for thousands of items, whether it’s a calendar or notebook, Outsource Works can call in 100 to 150 workers and have them working throughout the big mill within a few days.
“We’re a production facility but we’re also a rescue operation,” Scott Owings says. Owings, the nonprofit’s business development manager, is in charge of bringing work to Outsource Works. This is critical both to maintain revenue streams and also to fulfill the organization’s social mission: The more orders Owings gets, the more people he can hire.
Outsource Works offers light manufacturing services to regional businesses, and can glue, tape, fold, stitch, staple, package, collate, shrink wrap, etc., just about any product for printing companies, manufacturers and marketing and design firms. It hires people who have trouble finding jobs elsewhere, whether because they’re single mothers who need flexible hours, or older people who can’t work more than three days a week because of health reasons. Sometimes workers have recently lost a job or are just out of jail or rehab. The organization does not discriminate.
“It doesn’t matter what reason, as long as you’re willing to work and keep up to standard,” Owings says.
Having a noble mission has not, though, saved Outsource Works from economic pressures. Last year, its major client, Geiger of Lewiston, a promotional products supplier, shipped a couple of products overseas to capitalize on cheaper production costs. In that move, Outsource Works lost $250,000 worth of work, Outsource Works Executive Director Bill Lundrigan says.
But Geiger — which is responsible for 70% of Outsource Works’ roughly $1.1 million annual revenue — according to Owings, did not abandon the nonprofit. Instead, a new product came along at just the right time. And in this way, Outsource Works itself was rescued.
Bound for business
Out on the mill floor, Owings holds up a bound book that is a candy-like green-blue, a color he refers to as “lagoon.”
“It’s 100% recycled, and 100% made in Maine,” he says, and then adds, “100% made in Lewiston.” The book is part of a series of colorful bound journals sold by Sterling Publishing in New York City. The journals are made by Geiger, which has contracted Outsource Works to glue on inside pockets, add the elastic ribbons, shrink wrap it and put the final cardboard band around it. The books, which are part of Sterlings’ “ecosystem” line, are sold in bookstores like Borders and Barnes & Noble, Owings says.
Since the summer of 2009, Outsource Works has put the finishing touches on 500,000 of these books and made a little less than $600,000. Every three to six months, Outsource Works receives an order to make anywhere from 50,000 to 150,000 ecosystem journals. Owings says that an order of 50,000 books roughly translates into 40 people working for two full weeks.
What saved Outsource Works was Sterling’s decision to keep the product domestic. “Ecosystem made a decision to do it in the USA,” Lundrigan says, adding that the work could have been done more cheaply in an overseas factory. He says, too, that they needed a quick turnaround time, without the lost days it would have taken to ship the books overseas. Locality and flexibility, beyond the social agenda, are Outsource Works’ strengths.
Social mission and work
Outsource Works was started in 1997 as Faithworks by a local priest, Rev. William Baxter of the Trinity Episcopal Church in Lewiston, to provide work for the poor and unemployed. Lundrigan was hired in 2005 as a chief financial officer.
Faithworks closed in 2007 due to financial hardship, but its staff bought the nonprofit at an auction and continued to run it under the name Alternative Advantage, doing business as Outsource Works.
These days, Outsource Works is able to cover about 90% of its budget through its business contracts. The remaining dollars come from grants, Lundrigan says.
Owings was hired in January 2008, leaving a job in sales for a defense contracting business out of Boston he was commuting to from Andover, Maine. He has an easygoing manner, and kids around with the workers as he walks around the mill. He also has a form of macular degeneration and is legally blind, he says. When he needs to read something, he holds the object close to his eyes and squints. Once he peered closely at a Christmas calendar Outsource Works was making, trying to figure out what the blurry object on it was. When he got near enough to see a bikini-clad woman, he jumped back with a, “Whoa, OK!” Other workers laughed at him, he recalls.
The major part of Owings’ job is to convince businesses that it makes sense for them to outsource their work to his organization rather than do it themselves. “The biggest thing I need to do to get a new customer is getting them in here and showing them what we can do,” he says. He can’t easily compete with factories overseas, though, so he must reinforce the advantages of being local.
Owings says Outsource Works helps companies by getting stuff — paper, ribbons, packaging, etc. — off a company’s floor. Plus, being just around the corner helps communication.
“We’re not some faceless entity on the other side of the planet. We’re in an old mill building in Maine,” he says. “Printers have their thumb on the product. If they’re in China, they have no oversight.”
Jeff Denbow, the production coordinator for Franklin Printing in Farmington, says his company has been contracting Outsource Works for a couple of years. “We don’t keep enough staff on hand to handle overflow work,” Denbow says. About 50 people work for Franklin Printing, and still the company typically has one or two products going at Outsource Works every week.
“The type of thing we do with Outsource Works is more about convenience than anything else,” Denbow continues. In the past few years, the “whole [printing] industry has sped up,” he says, and often the company will get a rush job to print a lot of product “yesterday.” Increasingly, Franklin needs an outfit like Outsource Works to help with these quick turnarounds, he says.
International Paper in Auburn uses Outsource Works to make its shipping boxes, which it previously sent to a plant in Michigan to assemble and glue. Having the boxes finished in Lewiston saves $6,000 in freight costs per months, according to International Paper Sales Representative Brian LaBelle. He says International Paper likes Outsource Works for its cost, proximity and capability.
“If they’ve never done it before, they’ll find a way because they work on piece work,” he says. He adds if he asked three companies to offer quotes on a job, Outsource Works would likely have the best price.
Denbow, too, says he wouldn’t work with Outsource Works if it didn’t make financial sense. “They are very price conscious and price competitive,” he says. “If it cost much more money to send out work than to do it in-house, we wouldn’t.”
The people
Outsource Works has nine full-time staff. Beyond that, it has a core group of dependable workers, perhaps a dozen to 20, who can be called on to do a variety of jobs well. A number have been with Outsource Works for more than a year.
Depending on how quickly an employee works, he or she can make as much as $10 or $12 per hour, although $9 is typical. The average workweek is 30 hours. If workers aren’t fast or competent enough, Outsource Works will pay them $7.50, and train them for another job. Last year, the organization paid $140,000 to cover such gaps between a worker’s productivity and minimum wage, according to Lundrigan. In total, about 85% to 90% of Outsource Works’ revenue goes to labor costs.
Every day between 3 p.m. and 4 p.m., anybody who wants to work must call the organization. From these, only a handful will be called in if there is not a lot of work. And in this case, those who are hired are usually the ones with a reliable work history already with Outsource Works.
“We still have deadlines, we still have to get the product out,” Owings says. Lundrigan adds, “The largest challenge of operating a social enterprise is matching the ability to stay afloat while maximizing the number of people working.”
Lundrigan says after a career in government and business, he loves Outsource Works. “It’s one of the few jobs where I feel as if I’m accomplishing something,” he says, by “putting people to work and making people’s lives better, hopefully.”
Rebecca Goldfine, Mainebiz staff writer, can be reached at rgoldfine@mainebiz.biz.
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