BY CHRIS COATES Staff Reporter Sandy Stein spent 34 years crisscrossing the nation as a flight attendant before she turned a simple hook-shaped wire into a multi-million dollar business. “It’s a little idea. Just a better mouse trap,” said Stein, 55, last month in her office above a Reseda strip mall, the world headquarters of Alexx Inc. Her company’s signature product, Finders Key Purse, is deceptively simple an uncomplicated silver hook with small emblem that hangs on the edge of a purse, gym bag, backpack or briefcase and allows quick access to keys. The clips feature a variety of designs from basketballs and baseballs to dolphins, flip flops and butterflies. “Not only does it make it easy to find your keys, it’s stylish and functional,” she said. While that simplicity is a major selling point, the secret to Stein’s success may be in her stripped-down business model. The company has just 10 full-time employees, two designers and two rented warehouses. There are no full-time sales people and until a few months ago, the company had no marketing or advertising. Yet in the 18 months since Stein founded Alexx, it has grown to include 45 varieties of Finders Key Purse and ever-growing new lines of cell phone organizers and keys. Today the key rings are sold only wholesale and can be picked up at stores including Marie Callender’s Restaurants and Hallmark gift shops, which accounts for 15 percent of business. Alexx also does a swift business through online merchants, selling units on a variety of novelty, jewelry and accessory websites. Added up, they sell about 80,000 units a month, giving Alexx a projected revenue of $5 million for 2006, Stein said. Jan Campos sells Finders Key Purse on a rack in her Delicious Bakery store she owns on Reseda Boulevard in Northridge. “They sell really, really well,” she said. “Everybody loves them.” In fact, they sell several dozen each week, bringing in extra income. “They appeal to everybody,” Campos reasoned. “They really took off.” Started with a dream The scheme for Finders Key Purse came to Stein in a dream a few years ago. At the time, Stein had worked for more than three decades as a Delta Air Lines flight attendant while her husband, Steve Klein, worked in the souvenir business designing, marketing and selling key chains, magnets and other items. In late 2004, however, circumstances arose that meant both husband and wife could lose their jobs, leaving no income for their family and 11-year-old son. One night during this time, Stein dreamt about her deceased father, who gave her the idea for Finders Key Purse, she said. It was just the spark she needed. “I woke up and knew what I dreamt. I went to my office, got a little piece of metal that had a little flower attached to it and bent it up. Then I got pliers and attached a clip,” said Stein, who until that moment had never considered herself an inventor. The little clip could have died there, but Stein showed it to her husband, who thought it was good idea. Klein helped his wife create a mock-up of her idea and, with the help of a $135,000 nest egg, they hired a product developer, lined up a manufacturer in China and created a company, Alexx Inc. named after her 12-year-old son and late father, who were both named Alex. Stein then recruited about 50 of her friends, told them about the product and sent them off to gift, jewelry, novelties and clothing stores to make a sale. The concept worked because most of the friends were airline attendants (a position Stein held until just last year), many of whom rarely worked for more than a few days and often lived out of hotel rooms on layovers. Stein said they made a perfect roving group of would-be sales people. “Between all these women I know, I can employ them and hire them as reps,” she recalled thinking. “I thought, how cool would it be to have everybody able to make a little extra money at the same time they’re working on their day off?” Alexx then incorporated elements of traditional sales and multilevel network marketing. Sales people received not only 30 percent commission, but also a percentage for referrals. The concept allowed Alexx to secure 2,000 sales reps in every state by 2005. “It’s amazing who knows who,” she said. “In our first year of business, we sold $4 million worth of these things. One friend who has been selling Finders Key Purse since its inception is Robin Camhi. Out of her West Hills home, the former educator and stay-at-home mom started selling Finders Key Purse to friends and family, but now works at boutiques, church festivals, country clubs and fairs. With the end of the school year approaching, lately she’s been selling units as teachers’ gifts. On a recent trip to Cooperstown, NY, with her son’s baseball team, Camhi sold 250 to people in the stands. “They sold themselves,” she said. “Everybody buys them.” Camhi gives all of the credit to Stein. “Sandy is one of those people who has an entrepreneur brain. She’s coming up with ideas all the time,” she said. “Nobody thought of it until Sandy did.” A thousand sales people Today, a single Finders Key Purse unit costs less than $1 to produce, with a suggested retail price of $6.95. The products are designed in the company’s Reseda offices, then relayed to factories in China. There, separate factories make the product’s three parts the emblem at one, the candy cane-like hook at another and the spring-loaded clasp at yet another. Then, the pieces are soldered together, attached to a cardboard display and shipped to warehouses Alexx leases in the Valley, which distributes the products. That separation of manufacturing is done partly to save money but also to discourage anyone from copying the Finders Key Purse design, which has a patent pending. While the name of the product is trademarked, Stein has been waiting about two years for the patent to receive approval, which should happen by this summer, she said. Still, Stein said there are already Finders Key Purse copycats. “Well, we stayed below the radar for a year,” she said with a smile. Stein said she hopes the business will continue to grow. The company is looking to expand into larger facilities, and is eyeing some in Chatsworth, all the while continuing to look at more products. So far, they have created customized units for In-N-Out Burger, the city of Santa Barbara and organizers of the Los Angeles Marathon. Last year, Alexx created a clip of a little red dress and clear gem to benefit the American Heart Association. Alexx has also created a Finders Key Purse for cellular phones, a new line of handbags and custom-printed keys and plans are also in the works for an expanding fan, slated to hit shelves this summer. Stein said there is still lots of room to expand. “The truth is we’ve barely touched the market,” she said. “I knew it would work, but I didn’t know it would work this well.” Alexx Inc. Year Founded: 2004 Core Business: Keychain accessories manufacturer Employees in 2005: 12 Employees in 2006: 15 Revenue in 2005: $4 million Projected Revenue in 2006: $5 million Driving Force: Demand for stylish and functional accessories.
