[SOLVED] 1. Who are Goodwill’s customers and

1. Who are Goodwillâ€™s customers and how have their demo-graphics changed over time? 2. How should the introduction of for-profit thrifts affect Goodwillâ€™s decisions about the role of customer service? 3. How can Goodwill differentiate itself from the competition? 4. Visit http://shopgoodwill.com/ where Goodwill auctions items of special interest and discuss why this online store has great profit potential. Goodwill Industries of Central Texas10 â€œEvery time you donate to Goodwill, you give someone the power to change his or her life by getting a job .Â .Â . Who knew the shirt you wore last year could turn into a job for someone?â€â€”Helping! Magazine, a publication of Goodwill Industries Inter-national Inc., winter 1998. COMPANY BACKGROUND Goodwill Industries of Central Texas (GICT) is a nonprofit organization that is independently run and operated, but is affiliated with Goodwill Industries International Inc. (GIII), an organization that helps individual Good wills with resource issues, national marketing campaigns, executive search information, and federal legislative lobbying. Currently, there are 164 Goodwills in North America and 13 Goodwill-affiliated organizations throughout other parts of the worldâ€”each focused on the same mission. DONATIONS TO DOLLARS Goodwill Industries operates primarily through the generosity of people and businesses in the local community. The Donated Goods department generates the greatest source of its revenue. The organization relies heavily on donations of used clothing, housewares, electronics, sporting goods, and any other sellable items in order to generate the revenue necessary to provide its services. Figure 10.4 displays actual 2009 revenue by source, a distribution typical of the past several years. Figure 10.4:

THE CHALLENGE AHEAD Executive management recognizes the emergence of an increasingly competitive marketplace in the thrift arena. This fact is forcing the organization to change the way it does business. Recently there has been increasing pressure for the stores to perform better and better each year despite much stiffer competition for employees and donations. As a result, some retail locations failed to meet store revenue goals. To compound the problem, Goodwill experienced periods of high employee turnover in the 1990s. The mission of Goodwill is to help people find meaningful employment, but when a person is hired as an employee of Retail Operations, the organization tries to retain that person to help create a stable and highly qualified workforce. THE COMPETITION Goodwill is faced with competition on two frontsâ€”competition for donations and competition for the sale of those donations. Until several years ago, Goodwill Industries had little competition for its primary raw materialâ€”donated used goods. People donated to Goodwill because there was no other outlet except the trash pile. The Salvation Army emerged as a competitor, but for a long time the Salvation Army and Goodwill were the only shows in town. That began to change, however, with the emergence and popularity of consignment stores and mom- and-pop thrift stores. People began to have more choices as to where to donate or sell their used items. These small operations not only eat up potential donations, but also they increase the competition for sales as well. The thrift dollar has become much more competitive in the 2010s. For example, for-profit thrift stores, such as Thrift Town, actively solicit used goods from the same population as Goodwill. Despite the increase in local competition, however, the retail operations of GICT has grown significantly since 2002. The organization had 22 retail stores, 8 bookstores with attended donation centers, and 3 attended donation drop-off sites in 2011. A newly purchased large building now serves as a resource center for the consolidation of two warehouses, offices, job-training classroom, meeting rooms for other non- profits and community activities, a conference room, and retail space. Three more stores were expected to open before the end of the year. The company has an explicit strategy to expand its operations by opening and operating new locations throughout the 15-county territory for which it is responsible. WHAT HAS SUSTAINED GROWTH? Goodwill has developed a unique strategy for competing in the broader local retail market. The company chooses not to compete head-to-head with other retailers for the traditional holiday (i.e., year-end holiday season) spending dollar. Instead, it creates a niche for itself by marketing Halloween costumes and decorations. Stores are decorated in Halloween themes and employees are encouraged to come to work in costumes. About 45 percent of the annual advertising budget is geared toward Halloween promotions. This strategy seems to be working, because October accounts for almost 30 percent of retail revenue for the year. On the other hand, this also means that a bad financial Halloween could mean a bad year for the organization. Goodwill Industries has relied on its ability to open stores in high-traffic locations that are close to the population that donates to their stores and shops in them. There is no formal process for searching for new locations. The decision is left up to the management of the retail operations after visiting potential locations. Goodwill even has built a store from the ground up in a new suburban community development. This was a significant shift from a long-standing philosophy of leasing or buying properties that had a history of being productive. Goodwill has stayed relatively healthy during the recent global, national, and local economic crises because it has diversified its operations. In addition to its long-standing resale and job training services, it now has Goodwill Staffing Services that provides employees for governmental agencies and private businesses, Goodwill Commercial Services to supply workers for jobs such as custodians and landscapers, Goodwill Computer Works that refurbishes and sells used computing-related equipment, and book and other specialty sales. Finally, Goodwill polished its image with the public by trying to look more like a department store than like a thrift shop. The stores purchased new fixtures and spruced up the exteriors with new signs and paint. Great care is taken to ensure that dressing rooms are cleaned regularly and that donation drop-off sites look appealing and clean. The transportation department at one time painted its trucks with the Goodwill logo and the phrase â€œthose jeans you donated just got someone a job.â€ CUSTOMER ISSUES A frequent criticism from the public is the difficulty they have in donating to the organization. At one time Goodwill offered a donation pickup service but stopped doing it because of too much difficulty coordinating pickups at homes. The organization also is concerned with the amount of â€œtrashâ€ that the home pickup workers had to deal with. Now donors must transport their items to the nearest donation site. Another area of customer concern is Goodwillâ€™s retail policy of â€œall sales are final.â€ Customers complain when they purchase an item that works during testing at a store but fails to operate at home. The â€œall sales finalâ€ policy means that it is impossible to get a refund, but the manager is empowered to offer a store exchange. These exchanges occur rarely. Part of the reason for the policy is that it is difficult to prove that the items being returned were previously purchased from Goodwill. The organization provides a 7-day return period for online purchases under specific circumstances such as items that have been substantially misrepresented or damaged during shipping.

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Environmental Business Services 6% Workforce Development 10% Commercial Services 10% Contributions 1% Goodwill Staffing Services Miscellaneous 2% Donated Goods 53%

Question: 1. Who are Goodwill’s customers and

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