Behind the scenes of Goodwill, the first name in secondhand stores

SEATTLE — It’s a Tuesday afternoon, and a steady stream of vehicles is pulling up to the donation station at the Goodwill in Renton, Washington. Employees in fluorescent vests dash back and forth, offloading the day’s haul: garbage bags bulging with clothes, a fishing net big enough for a 20-pound Chinook salmon, two plastic crates crammed with half-used bottles of hand lotion and shampoo, a small rototiller, a bathmat and DVD player in a paper sack, a black lacquered chest of drawers.

The pace of donations has been good this summer, averaging about 1,600 a week, says store manager Lisa Wojtech, who is watching her crew stack goods in blue bins, then shuttle them inside for sorting. It’s not overwhelming like last year, when millions of people stuck at home by the pandemic decided to weed out their possessions, and Goodwills across the country were swamped.

When stores and donation centers were shuttered in early 2020, many people just dumped their castoffs outside and drove away. “It was horrendous,” says Wojtech, who had to call in staff to clean up the mess. The real stampede in donations began the moment sites reopened. At Seattle’s flagship complex near the intersection of interstates 5 and 90 — the world’s largest Goodwill store by area — cars backed up almost to the stadiums in Sodo.

For a charitable organization that leverages society’s discards to provide free job training and education for some of Western Washington’s most disadvantaged residents, it wasn’t a bad problem to have. By packing warehouses to the rafters and renting storage space, Evergreen Goodwill of Northwest Washington — a regional affiliate with 24 stores from Bellingham to Ballard — was able to absorb the deluge.

If anything, the pent-up demand to drop off donations underscored how much we depend on Goodwill to help with the mind-boggling amount of stuff we dispose of every year. If Goodwill didn’t exist, communities would need to invent it, says Adam Minter, journalist and author of the 2019 book “Secondhand: Travels in the New Global Garage Sale.”

“It provides an essential service. And the proof of that is how it’s become the Kleenex of ‘secondhand.’ You don’t say: ‘I’m going to take things to the thrift store.’ You say: ‘I’m going to take this stuff to Goodwill.’ “

THE VENERABLE NONPROFIT’S retail stores are enjoying a surge in popularity driven partly by the economic toll of the pandemic and partly by a new consciousness among younger people, says Evergreen CEO Daryl Campbell.

“They’re very discerning about where they spend their money — and social values, environmental values, sustainability are increasingly important.”

Goodwill Industries International’s 156 North American affiliates and 3,300 stores collectively divert about 4.6 billion pounds of reusable goods from landfills every year. That’s more than any organization — but still only about 6% of the textiles, furniture and other durable goods Americans toss out annually. The average for Evergreen Goodwill (the name recently was changed from Seattle Goodwill) is about 120 million pounds a year sold or recycled.

Most people experience Goodwill only as a place to shop or drop off those boxes of goodies from Grandma’s basement. Behind the scenes, though, is a sophisticated operation designed to extract the maximum value from every donation. That includes using e-commerce for collectibles and other prime merchandise and tapping into global markets to sell goods that local shoppers spurn.

But the business model the charity has relied on since its founding in 1902 also faces challenges on multiple fronts.

The quality of new merchandise has been falling for decades — which Minter singles out as perhaps the greatest threat to the secondhand economy. China is now the fastest-growing exporter of used clothing and soon could dominate international markets. Online consignment sites such as thredUP and Poshmark are also exploding in popularity, diverting the “good stuff” that Goodwill covets.

The nonprofit’s biggest advantage lies in its ubiquity and expertise at finding markets for goods that others would toss in the trash, Minter says. “Goodwill can do that at a relatively low cost because they have so much volume, and they can do it in a way nobody else can.”

THE PROCESS STARTS at the curb, Wojtech, the store manager, explains.

Workers plug in televisions, computers, microwaves and other large electronics and separate the duds to be sold as scrap metal or to authorized recyclers for about 11 cents a pound.

Things that are clearly unusable, like moldy clothes, broken furniture, bags of actual garbage — yes, it happens — are shuttled straight to the dumpster.

When something especially cool is dropped off, staff members alert Wojtech and debate the price. “They get excited,” she says. “It’s like Christmas every day, and you never know what you’re going to get.” Recent thrills include an antique dresser ($79.99) and an electric bike ($350).

Wojtech steps inside the bay doors and into a scene of nonstop activity. One team sorts the loot by type: toys, small electronics, housewares, books, shoes, accessories and the category that accounts for the lion’s share of Goodwill’s revenue: clothing.

Then the specialists take over.

At stations devoted to one category, sorters with an eye for quality pick what they think will sell and set the prices.

Alicia Ross is at the shoes and accessories station, working her way through racks of overflowing blue bins. She’s been at Goodwill for seven years and knows a good pair of shoes when she sees it. If she doesn’t recognize a brand, she can refer to a list taped to her workbench that includes Keds on the low end and Gucci on the designer side. Prices range accordingly, from $2.99 to $49.99.

“You’re going on style, quality, condition,” Ross explains.

The bar is high for the retail sales floor. Anything broken, scuffed, torn, worn-looking or stained goes into a big cardboard box destined for Evergreen’s two outlet stores.

Ross fishes a brown leather purse out of the reject box and pulls out the lining to reveal a big blue blotch.

“People don’t want a purse with a huge ink stain inside,” she says, tossing it back.

Outlet-bound rejects at other stations include a Cuisinart coffee maker encrusted with years’ worth of residue, frayed shirts, a Mickey Mouse doll with stuffing bulging out of its back, a clear plastic platter with a crack through the middle and an endless array of three-ring binders.

Ross loads merchandise that makes the cut into what she calls her “shiny” cart and wheels it onto the sales floor, where it’s not uncommon for customers to start grabbing things before she can even unload.

ACROSS THE AISLE from Ross’ station is a pile of potential treasures for online sales. While it’s still possible to find gems at bauble prices on the store shelves, Goodwill has become much savvier about marketing vintage, collectible and high-end items.

Brent Frerichs, vice president of e-commerce, retail and donations strategy, is visiting the Renton store and pulls out his phone to check Evergreen’s listings on eBay, Amazon and shopgoodwill.com.

“We have over 14,000 items active online,” he says. And that doesn’t include nearly 120,000 books, DVDs and CDs.

Today’s Renton stash includes snakeskin cowboy boots, gold-rimmed demitasse cups, vintage Air Jordans, an etched glassybaby candle holder and a full set of antique Limoges china. In-house experts estimate values, post the offerings and track bidding.

The average online sale is about $35, but every manager hopes for the kind of hidden gem that was dropped off at a Portland Goodwill in 2006. That small watercolor by American impressionist Frank Weston Benson sold for a record-setting $165,000. That record was shattered in August, when a 1987 factory-sealed copy of the Nintendo game “The Legend of Zelda” donated in Connecticut sold for $411,278.

Wojtech’s best performers have been an oil painting and a blue mink coat that both went for around $5,000.

Like many at Goodwill, she’s a veteran of for-profit retail, including JCPenney. But she wanted work with more meaning. “You know what you’re doing here is making a difference,” she says, threading her way through carts and bins to the rear of the processing area.

About 4,000 new products are rolled out every day at the Renton store. Each gets a color-coded tag and a four-week life span on the floor. As the clock ticks down, the items are increasingly discounted. Customers purchase about 58% of the goods stocked in Evergreen stores, which is much higher than the 30% Minter estimates nationwide.

The rest, Wojtech explains, is “ragged off” — pulled and packed for the outlet. She points out stacks of appliance-size boxes on the loading dock awaiting pickup. What happens when those boxes arrive at the outlet is perhaps the most surprising — and least understood — part of Goodwill’s operations.

A LINE FORMS every morning outside Evergreen’s Sodo outlet store. Some customers sleep in their cars to be the first through the doors.

“A lot of them are regulars,” explains Hamilton Lardizabal, who started 17 years ago as a sorter and now manages the 106,000-square-foot facility. He was here when local rapper Macklemore filmed a video segment for his 2013 hit “Thrift Shop.”

On a recent afternoon, double rows of what look like elevated troughs are arrayed across the cavernous sales floor, each flanked by people picking through the contents. The 6-foot-long bins are heaped with “soft” goods, like clothing, blankets, purses and belts, or “hard” things, like baskets, cutlery, jigsaw puzzles and wooden bowls.

The commingled merchandise is sold by the pound: $1.79 for soft, $1.09 for hard. A pound of books goes for 49 cents.

Each batch sits on the floor for about an hour, then it’s wheeled away and replaced by another set of brimming bins.

The regulars are mostly resellers, Lardizabal says. Some have their own shops or online storefronts. Others send clothing back to their home countries or gather merchandise for consolidators.

But when the bins’ time on the outlet floor is up, they’re still far from empty. What remains is called salvage. It is Goodwill’s final opportunity to extract value, avoid the cost of disposal, and find a new life for millions and millions of reusable items.

“Pretty much everything is pennies on the pound,” Frerichs said. “But there’s still some revenue that can be made, as opposed to putting it in the landfill.”

Salvage is essentially a global commodities market, he explains, as workers begin picking through the bins for the items somebody will pay for: hard toys, soft toys, backpacks, luggage, accessories. Scrap metals currently fetch about 1.25 cents a pound. Five cents buys a pound of balls — basketball, football, soccer. But as in the retail store, the real money is in clothing.

In the middle of the warehouse, workers feed garments and other textiles into balers, which spit out 1,000-pound cubes of trussed-up bras, sleeping bags, jeans, pillows and T-shirts by the hundreds.

Dealers like Seattle-based Buffalo Export LLC pay roughly 27 cents a pound for the bales, which are loaded into shipping containers. The Sodo outlet usually fills five containers a week, bringing in about $55,000.

A fifth-generation family business, Buffalo Export buys from multiple thrift-store chains, shipping hundreds of containers a month, says Vice President Anthony Benezra. Most of the shipments are destined for Pakistan, Africa, and South and Central America.

For his book, Minter followed the trail of secondhand clothes, visiting dealers in Ontario, Pakistan and the West African nation of Benin who sort the contents of the bales for specific markets. Stylish clothes sell well in Africa, for example, but not winter coats. Up to a third of salvage textiles is turned into rags or furniture stuffing.

Americans might cringe at the idea of their castoffs being peddled in impoverished villages around the world, because secondhand clothing from wealthy countries has been blamed for the collapse of Africa’s textile industries. But suggest the major factors were privatization of government-owned textile companies and trade policies that opened African nations to the type of Asian competition that undermined the United States’ own textile manufacturers.

Minter’s travels and research convinced him the global trade in secondhand goods is something to celebrate. Reusing products benefits both the environment and people who can’t afford to buy new, he says.

Today in Africa, imported used clothing from Goodwill and other thrift stores mainly competes with imported new clothing from China. And many Africans prefer the secondhand garments because they are often higher-quality, Minter found.

“When activists in the West complain about secondhand clothing going into Africa, they’re essentially asking people in Africa to pay more for their clothing and generally have lower quality,” he says. “It’s a very odd argument.”

AFTER THE BINS at the outlet have been picked clean of salvage materials, what’s left is trash. Among the thousands of items at the end of the line this afternoon are a vacuum cleaner hose, a single flip-flop, dozens of photo albums, a paint-by-numbers scene of Venice, a dog collar and a clown face-painting kit.

In 2019, Evergreen received about 143 million pounds of donated goods. Of that, only about 15% wound up at the landfill — but the costs are significant. As dumping fees and donations increased over the past decade, the organization’s annual garbage bill has nearly doubled to almost $3 million.

Goodwill’s leadership would much prefer to spend that money on its programs, which operate on about $12 million a year. But they are reluctant to discourage donations of any kind.

“What I would say to potential donors is: ‘Bring us everything, because no one is going to get more value out of it than Goodwill,’ “ says Campbell, the CEO.

With its focus on jobs programs, the organization has rarely touted its environmental impact, but that’s something Campbell is working to change. “It’s important, and it’s a story we haven’t told as well as we could.”

He and his colleagues are also thinking about the nonprofit’s next century as the 100th anniversary of Seattle’s first store, which opened in 1923, approaches.

One top priority is to counter the competition from online thrift stores. Among the options they’re exploring in collaboration with other affiliates is a new Goodwill website with set prices, rather than an auction format.

What can Goodwill offer that thredUP and Poshmark can’t?

The opportunity to do good with your purchases.

“I think the pandemic has caused a lot of us to take stock of what’s really important, what’s really valuable to us,” Campbell says. “If a business is clearly contributing to the community, I think that’s going to be the distinguishing factor.”