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Goodwill Gets Into Boutiques

Donated books and records repurposed into a whimsical chair display and a funky dress on a store mannequin are proof of what good merchandising can do for Goodwill of Orange County—or any retailer, for that matter.

Better in-store visuals and an edited merchandise offering has helped the organization raise its profile as a retailer, and success at its Tustin OC Goodwill Boutique is expected to help pave the way for expansion in South Orange County.

Retail is Goodwill of Orange County’s largest single revenue stream, with 23 stores that together did about $48 million in sales last year, about half of its total revenue. The stores are stocked with donated items sorted at a facility attached to its Santa Ana headquarters.

The organization’s total 2013 revenue rose 7% over 2012 to $110 million, a funding stream that’s important to its purpose of providing training and jobs to people with disabilities.

Being “a nonprofit … doesn’t mean we can’t make a profit,” said Chief Financial Officer Donald Voska. “In fact, we have to make a profit to stay in business, because we have close to 2,000 employees on payroll, and a large number of those are people in training.”

Goodwill plans to open three stores this year as it expands its OC Goodwill Boutique concept and pushes further into South Orange County.

It will open a store each in Westminster and Anaheim in the summer. Those openings will be followed by a South Orange County location in the fall. They will be a mix of regular, Goodwill-branded stores and the boutique concept, which is focused on trendy and high-end brand names.

An additional two stores will likely open next year, and the organization has a longer-term target of 40 total.

New Life

It’s the 12,000-square-foot Tustin boutique concept, opened last May, that helped breathe new life into the organization’s retail business.

Buzz around the shop’s creative displays and curated merchandise selection—with labels ranging from Express and Ann Taylor to Michael Kors—helped attract more than 200 shoppers, plus city officials and press, to the grand opening.

The store has exceeded executives’ expectations, commanding the highest average receipt—about $23—among the organization’s stores, compared to $14 at a typical store.

Goodwill promoted Eric Smissen last year to visual specialist, a new position, to bring greater consistency to store displays. Executives took notice of Smissen after he joined the organization as Placentia store manager, following a more-than-20-year career in the retail industry, and gave the location’s appearance a big boost.

All Goodwills now feature mannequins, a first for the chain of stores. Managers receive monthly direction on their stores’ display themes. January focused on workout wear. February’s theme was Valentine’s Day.

“[It’s about] consistency and branding … and for a lot of people, this is their entire shopping experience,” said Vice President of Retail Operations Corrine Allen. “With the economy, a lot of people moved to Target, Walmart. Some of those people came to Goodwill and said, ‘We want to buy low-priced clothing,’ so it was important to us to have a really great shopping experience, and visuals on the mannequins are part of that.”

Executives are particularly proud of the organization’s focus on promoting from within.

OC Boutique Store Manager Antonio Rocha has been with the organization for five years, starting as an assistant manager.

“Our mission really inspires,” he said. “To know what we do gives me a lot of motivation.”

His assistant store manager, Amber Bill, has been with Goodwill for eight years, having worked at 10 stores. She came up with the idea for a skirt made of shoes that outfitted a mannequin at the front of the store last month, inspired by something similar she saw online. She said that ability to be creative has helped keep her around: “I’ve always gotten to be myself.”

Even Kenton Faust, payroll supervisor, conceived many of the OC Boutique displays, including a chair made from donated books and mannequins covered in crossword puzzles.

The boutique has inspired interior redos of other Goodwill of Orange County locations. The organization’s Keepers store in Lake Forest is set to unveil a refreshed look in early April that includes new fixtures, flooring and paint.

Now Goodwill would like to grow the boutique concept in Old Towne Orange and other retail districts.

Not Always Easy

But it’s not always easy to open a store, Allen said.

Goodwill had tried to get into Tustin for eight years before the boutique opened.

Larwin Square Center property manager Kimco Realty Corp. pushed the organization to step up its game if it wanted to be a tenant, Allen said.

Much of Goodwill’s challenges tend to be zoning limitations or neighbor opposition, she added.

“People think, ‘We don’t want a Goodwill,’ ” Allen said. “Property owners are under the impression that Goodwill will be a bad tenant, that we will attract the wrong sort of people, that the store would look terrible. … Once we have a good relationship with a real estate company or property manager, then they’re generally pro-Goodwill, but it’s that initial in-the-door.”

If the organization can sell itself as a retailer like any other, its executives believe it can make greater strides in South Orange County, where it currently has only one store.

“If you looked at a map of Orange County and where our retail footprint is, the one area that has great opportunity for expansion is South Orange County,” said Goodwill of Orange County President and Chief Executive Frank Talarico Jr. “And I think that [OC Goodwill Boutique] is a concept that would play well in South Orange County.”

The concept’s brand names and high attention to display details could be big selling points, and if the retail business can grow, then the organization is living up to its job, Talarico said.

“Obviously, this is cutting edge when it comes to thrift and what anyone would do, and it really is what puts the gas in the tank for the purpose of why we’re here,” he said. “It’s really funding something that’s very critical to the county, which is services to folks with barriers to work.”

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