041411-SLT-goodwill
Goodwill Shines in Recession
April 14, 2011
BY SAM TURLEY
THE PARTHENON
It's 2009, the recession is in full swing and John Stevens just lost his retirement money.
He walks into a Goodwill store for new jeans. He buys two pairs, tags from JCPenney still attached.
His total cost at checkout was $6.
Stevens has shopped at local Goodwill stores for more than a decade, he said, but in the past two years his visits have been more frequent.
“What would I do without Goodwill? Well, I’d have to wear more clothes with patches on them,” Stevens said.
“Sometimes an economic downturn will actually work to our benefit,” said Carter Seaton, marketing director for Goodwill Industries of
KYOWVA Area, Inc. “People will come here to shop when they can no longer afford somewhere else.”
Seaton said financial struggles during the recession have driven people to think differently about how and where they shop, and that change in shopping habits has driven more people to Goodwill.
“I can’t afford the name-brand things like I used to,” said Daniel
Benda, who said he has been shopping at Goodwill over other stores since the recession began.
Retail stores part of Goodwill Industries of KYOWVA saw a 5 percent increase in retail sales in 2010 – a new high for the organization.
Goodwill stores differs from other stores in the way they operate, because they resell items that have been donated. Profits from sales go to fund programs and services the organization provides, such as job training.
According to its 2009 IRS 990 form, Goodwill Industries of KYOWVA earns more than half of their overall revenue from their retail stores.
According to Guidestar,org, a website that specializes in nonprofits, a majority of charities saw a decrease in donations in 2010. The decrease first spiked in late 2008, when 52 percent of charities reported a decrease in donations, compared to 19 percent in early 2007. Charities cited ewer individuals giving and individuals giving as major factors.
In contrast, Goodwill Industries of KYOWVA saw an increase in both categories. In 2010, donations increased by 10 percent, and the number of donors grew by 22 percent, Seaton said.
The local increase is part of a national trend. According to a brochure on Goodwill.org, total retail sales for Goodwill nationwide increased 10.8 percent between December 2009 and December 2010. The organization also opened more than 100 new stores across the country.
In 2009, Goodwill Industries of KYOWVA made $6.9 million in revenue, according to their IRS 990 form. Gifts, grants and contributions to
Goodwill Industries of KYOWVA increased by $300,000 to $1.4 million in
2009, compared to $1.1 million in both of the previous two years.
The organization received $91,797 in funding from United Way of the River Cities, Inc. in 2009 – the second-largest amount of any organization funded by United Way that year. The funding was more than twice as much as the previous year’s funding of $41,297.
Seaton said the money came as part of grants for specific projects and partnerships with the United Way on services such as free tax preparation.
“We’ve been very supported by them,” Seaton said of United Way.
Their biggest revenue came from donated goods, which accounted for $3.8 million dollars in revenue, or half of their overall revenue.
The organization spent 82 percent of their total disbursements on program expenses.
“We’re not recession-proof, but we survive a lot better than most non-profits,” Seaton said.
Seaton said the only negative impact the recession has had on Goodwill Industries of KYOWVA is a difference in the goods being donated.
“Sometimes the donation pool isn’t quite as good as it could be,” Seaton said.
She said people hold onto things longer during the recession, which means the items aren’t in as good of shape, and people also shop at stores such as Walmart rather than Macy’s, so the quality of the items is lower.
However, Seaton said the quality of the items for sale hasn’t changed, but the amount of time required to sort through items has increased.
“We’re doing more culling,” she said. “In the stores, we still put the best quality out there.”
Benda said he if he didn’t have access to Goodwill, he isn’t sure how he would make ends meet.
“It’d be tough,” Benda said. “I’d have to learn to do without.”
