Introduction
Goodwill Industries is international non profit that is headquartered in the USA. It was founded by Methodist Pastor Reverend Edgar J. Helms in 1902 and incorporated in Boston, Massachusetts in 1910 as Goodwill Industries of America. Goodwill Industries of America changed its name to Goodwill Industries International, Inc. in 1994 and operates its corporate headquarters out of Rockville, Maryland. The Maryland Corporation changed its name from Goodwill Industries of America to Goodwill Industries International, Inc. in 1996 and was first incorporated in Maryland in 1968.
Goodwill owns the trademark Goodwill but it did not register its trademark until 2005 with the US Patent and Trademark Office. It's trademark was granted in 2006 it has the serial number 78579342 and the registration number 3070744. Goodwill also owns two other notable trademarks:
- Goodwill Industries
- Filing Year: 2002
- Registration Year: 2004
- Serial Number: 78105463
- Registration Number: 2811694
- The Goodwill Logo
- Filing Year: 2002
- Registration Year: 2004
- Serial Number: 78105466
- Registration Number: 2811695
All trademarks are registered to the Goodwill Industries International, Inc. of Rockville, Maryland.
The trademarks can be verified on the US Patent and Trademark Office Trademark Electronic Search System. http://tmsearch.uspto.gov/
Charity Navigator
Goodwill Industries International, Inc is a non rated charity on Charity Navigator despite Charity Navigator reporting that it has
Charity Navigator does rate Goodwill Southern California and gives it
- 3 out of 4 Stars
- 83.10 out of 100 for its Financials and Accountability & Transparency combined
Charity Navigator reports the following on Goodwill Southern California:
- CEO Pay: $624,000 per year
- Contributions: $97 million in 2018
- Revenues: $138 million in 2018
From its financial report, Goodwill Southern California had:
- $2.5 million in Fundraising Expenses
- $142,000 in Contributions from Fundraising Events
https://www.charitynavigator.org/index.cfm?bay=search.summary&orgid=3766
GuideStar
GuideStar provides the following information on Goodwill International Industries, Inc.
- First Tax Exempt Year: 1952
- BRIDGE Registry Number: 3884607738
- NTEE Code: P20 - Human Services
- 35 Million Participants across all North American Goodwill Industries.
- 238,000 people gaining jobs across all Goodwill Industries in the US and Canada.
- $4.8 Billion in wages for the 238,000 participants gaining employment through all Goodwill Industries in the US and Canada.
- $1.3 Billion in payroll taxes paid by the 238,000 people gaining employment through all Goodwill Industries in the US and Canada.
- $651 million in payroll taxes paid by employees across all Goodwill Industries in the US and Canada.
This averages out to the following per person financials:
- $20,000 yearly salary for Goodwill participants gaining employment.
- $5,400 in taxes for Goodwill participants gaining employment.
- $6,200 in taxes an average for each Goodwill Employee.
Wikipedia
Wikipedia reports some additional interesting data:
- 105,000 Employees.
- Goodwill Industries of Colombia Willamette (Portland, Oregon) collected 42,000 tons of donations in 1999. This is 84 million pounds.
- Goodwill found employment for 170,000 people in 2010.
- These 170,000 people made a collective $2.7 Billion in salaries and wages. About $15,000 per year each on average.
- In 2002, Goodwill set a goal of finding jobs for 20 million people by 2020 through its 21st Century Initiative. Even with an average employment rate of 250,000 per year, this would take Goodwill 80 years to complete.
- Goodwill Industries calls its branch offices Member Organizations and labels them independent social enterprises, meaning they run as a franchise.*
- Goodwill lobbies against donation box owners and wants donation boxes to clearly state whether they belong to a for profit or non profit.
- Goodwill pays 7,300 disabled employees less than minimum wage.
Evaluation
Goodwill Industries International, Inc. appears to be a reputable organization despite some of the problems that are apparent by examining its initial publicly available data. The main issues of concern brought up by the public are that Goodwill is not an efficient organization, that it creates a lot of waste, that it's not truthful with the public and that it is involved in a lot of controversy.
Similar concerns are brought up for nearly every organization on the face of the planet because people like to gossip, people like to nit pick at things they aren't involved in and people like to pretend they're running a major organization from their living room couch which is known as sideline executive coaching.
Goodwill does have some problems which happen in every major organization mostly due to size and complexity in organizing a massive amount of people to accomplish a shared goal.
Actual problems that exist at Goodwill
- People are under the impression Goodwill does textile recycling using materials science. It does not.
- People are under the impression that Goodwill donation boxes are a "leave something, take something" clothing and goods exchange. They are not.
- People are under the impression that Goodwill is trying to use donations for the personal gain of its employees and corporate officers but can't figure out how to siphon off ownership of a public benefit organization through its non-profit status.
This is beyond ridiculous. The reason Goodwill is setup the way it is, is because of constantly changing laws and tax codes. Goodwill was formed in 1910, did not receive its tax free status until 1952 and didn't even register its trademarks until after the year 2000.
Goodwill does not use the term Social Enterprise in any of its corporate documents, the use of the term is written in an unverified Wikipedia document and many Goodwill Documentaries are made by YouTube Employees trying to be funny.
- Some of the wages are low at Goodwill but it focuses on an employee training program so these are entry level positions.
- Regarding the over 7,000 disabled employees making less than minimum wage. Goodwill is providing a reasonable accommodation for them so that they have employment, somewhere to go and be with other people and so that they have a little bit more independence with a paycheck and a bank account that is separate from their disability payments, health insurance or vouchers that are often handled for them by a 3rd party. The wage certificate programs are obtained lawfully and under the guidance of the ADA. This is 7,300 employees out of a total of 105,000 so 97,700 are making minimum wage or more.
- Regarding Executive Compensation. The average entry level wage for a CEO at an major international company is $2 million dollars a year.
Concerns and Recommendations regarding actual problems at Goodwill based on their publicly available and self disclosed data are provided below.
Concerns
- Goodwill Southern California used $2.5 million for fundraising and only reported $142,000 in contributions received from fund raising events.
- The average participant earns only $15,000 to $20,000 in yearly wages or $1,200 to $1,600 per month. Under HUD Guidelines for Affordable Housing, this would only allow them to pay between $480 and $640 per month on rent at the most. Ideally, they would not have to pay more than $395 to $525 per month for rent of an 800 sq. ft. 1 bedroom apartment.
- The Federal Poverty Level in 2020 is currently set at $12,760 per year or $1,063 per month and eligibility for most social service programs terminates at around 125% of the poverty level. This is a $15,950 yearly salary or $1,329 per month. Realistically, people need to make $2,000 per month to live independently and save for retirement. This means a maximum rent between $660 and $800 per month for someone earning $2,000 per month.
- The term social enterprise denotes an ownership structure and should not be part of Goodwill Industries corporate vocabulary.
- The term Member Organization denotes an ownership structure which non-profits are not allowed to have.
- Goodwill Industries operates outside the US using partner non-profits. It's unclear if they operate using the Goodwill name.
- Goodwill Industries legal team appears to operate out of California and appears to only have $138,000 budget for 2018.
- Goodwill Industries e-commerce division appears to primarily operate out of California, a place that has a tremendous business burden and requires global reporting on all revenues.
- Goodwill Industries 21st Century Initiative was not realistic. The 21st Century initiative set a goal of 2,000,000 job placements per year.
- Goodwill collected at least 42,000 tons of donated goods from 1 "Member Organization".
- Over 200 pages are missing from Goodwill Industries 1910 Articles of Incorporation. This sets the founders vision of how the company should operate.
Recommendations
- Strive to place Goodwill Industries employment services participants in jobs that pay between $24,000 and $35,000 per year as a minimum. This is a monthly income of $2,000 to $2,900 per month or $11.50 to $16.00 per hour at 40 hours per week. This would allow a maximum affordable rent for an 800 sq. ft. apartment in the amount of $800 to $1,160 per month under HUD Guidelines and an ideal rent amount between $650 to $950.
- This level of wages would leave enough money for utilities, health care, retirement savings, modest entertainment and an emergency fund to be used when switching jobs or encountering financial difficulties.
- Stop fundraising as Goodwill Industries is a well known organization. Goodwill Southern California received $92 million dollars in contributions, gifts and grants and an additional $5 million dollars in government grants. It's $2.5 million dollars in fundraising expenses only generated $142,000 in additional gifts. That is a fundraising revenue of -$2.35 million.
- If Goodwill Industries would like to hold events for its platinum or premium donors, that is fine but it should be aware of the protocols for sending an invitation. It is appropriate to charge a small fee or hold an auction to cover the costs of the event (dinner and staff costs).
- Treat all regional or county level Goodwill Industries as a branch office that is accountable to the policies set at Corporate Headquarters in Maryland.
- Ensure Corporate Headquarters has access to all IT data, payroll data and participant statistics.
- Ensure Corporate Headquarters sets consistent HR Policies nationwide and documents State Level discrepancies to bring to the attention of Congress.
- Treat Regional Headquarters with respect but hold them accountable for violating or willfully ignoring corporate polices. Allow them to independently manage their regional locations based on corporate guidelines and policies and issue quarterly reports to corporate on their performance, problem areas or room for improvement and goals for further achievement if any is needed and funding is available.
- Fund the Goodwill Industries legal department with more than $138,000 per region. If possible, have corporate review the legal climate for each State and train executives on handling simple to moderate legal matters on their own. Executives are implied to hold a certain level of personal liability for their actions so this is almost a business requirement in 2020.
- Find the 1910 Articles of Incorporation from Massachusetts and make them available to executives and regional managers for review from time to time so they can get a grasp on the founders vision and comprehend how the organization has evolved.
- Set realistic goals regarding participant employment over each 10 year period. A realistic goal would be to maintain 300,000 job placements per year for a 10 year period or 3,000,000 job placements between now and 2030. A secondary goal would be to design an achievable plan to increase that number to 500,000 job placements per year for a 10 year period. The secondary goal would result in 5 million job placements for a 10 year period.
- Use the name Goodwill Industries, Inc. outside of the USA. In Spanish, that would be Industrias Buena Voluntad, S.A and the name would be recognized throughout all of Latin America and Spain. Obtain professional level translator services and translate the name into different South East Asian Dialects, Portuguese, Finish and Italian.
- Be aware of interstate tax treaties and international tax treaties. Even though Goodwill is a non-profit it still has reporting requirements and it may not be treated as a non-profit outside the US.
- Lobby Congress to remove California's Global Taxation policy as this will simplify reporting for Goodwill Industries and keep its financial records, including donor names and contribution amounts more confidential. Under the US Constitution, only the Federal Government has jurisdiction over interstate commerce and international trade so California's global taxation policy is unconstitutional for non-residents and out of state corporations.
- Lobby Congress to not allow for-profit organizations outside of health services to obtain social service contracts or do any human service work.
- Lobby Congress to only allow for-profit organizations to conduct business services or professional services for a non-profit (legal services, taxes, accounting services, computer services, security guard services, janitorial services,) but to not engage in any social services or human services work.
- Modernize the Retail and Digital Commerce division to act as a training center that pays minimum wage to trainees that will be eligible for employment at a major retailer, distribution or storage warehouse, customer service call center, e-commerce fulfillment center.
- Allow alumni of the Retail and Digital Commerce Training Centers to come back to the program after they've obtained 3-4 years experience to learn how to be a more effective manager, supervisor or team lead.
- Make training on Fair Market Pricing, Minimum Advertised Price, Resale Price Maintenance, Minimum Retail Price Restrictions, Manufacturer Suggested Retail price part of the program at the Retail and Digital Commerce Training Centers.
- Communicate to the public that Goodwill Industries accepts donations that are clean and wearable only and that donation of other items should be sanitary and in working order.
- Communicate to the public on clearly marking electronics as e-waste meaning they don't work at all or as a donation meaning it still works even if it may seem really old and outdated.
- Communicate to the public that their donations are used to provide merchandise for the Retail and Digital Commerce Training Centers.
- Communicate to the public that Goodwill can not donate items to an individual as donations are considered a property transfer, that donations are itemized and cataloged by Goodwill and that the donor optionally receives a tax receipt for their donation.
- Communicate to the public that high quality items are available for purchase inside the Retail and Digital Commerce Training Centers at a discounted fair market price and that Goodwill can not provide free items out of its donations.
- Establish a dedicated Recycling and Waste Management Division to work with existing large scale recycling and waste management firms. Goodwill Industries would work to fill in the gaps, use its existing job training processes to train people for waste management and recycling and use its existing collection, transportation and distribution resources to bring non-reusable items to the recycles.
- Evaluate the need for purchasing Bulk Carriers so that Goodwill Industries International can transport its own Goods and Products to its overseas branch offices and distribution centers.
- A 32,000 Tonne Bulk Carrier that is 10 years old costs around $8 million dollars and has a lifetime of 25 years so it can see an additional 15 years of service. The purchase cost would amortize to around 1/2 million dollars a year; less than what Goodwill Southern California spent on fundraising in 2018. The slip fee would be around $500 per month. It would cost approximately $290,000 in salary to operate year round plus fuel. So the yearly cost to operate would be $796,000 per year plus fuel.
This would allow Goodwill Industries to use the ship as a staging ground and to ship its own products overseas to its international locations.
- Goodwill's 990 is available through GuideStar but not Charity Navigator. Would be a good idea to provide data to both organizations so they can each provide data to the public on Goodwill's performance.
References and Sources
Basic Registry of Identified Global Entitites
https://bridge-registry.org/about-us/
National Center for Charitable Statistics
https://nccs.urban.org/project/national-taxonomy-exempt-entities-ntee-