Goodwill Industries International Inc., better known as simply Goodwill, is an American nonprofit 501(c)(3) company that provides job training and employment for individuals who face employment challenges. The Goodwill retail stores that we are so used to seeing operate as nonprofits as well. The company that we know so well has recently run into some financial trouble with Goodwill Industries of Toronto, Easter, Central, and Northern Ontario closing all its stores and declaring bankruptcy. Additionally, it was also reported this week that Goodwill Industries of Southern Nevada Inc. has also filed for Chapter 11 bankruptcy. The Goodwill of Southern Nevada runs 15 retails stores throughout the Greater Las Vegas Area.
In a statement from Southern Nevada’s Goodwill, “the recent expansion, the retail downturn, and increased operating costs to run our retail stores have all led us to make the difficult decision to file for Chapter 11 reorganization”. The recent expansion of the company refers to the strategic expansion of their store footprint in the area. The organization will use the Chapter 11 protection bankruptcy to implement operational and financial changes in an effort to become more efficient and reduce costs.
Further North in the hemisphere, Toronto and Ontario’s Goodwill is doing even worse. The company lost its CEO to a resignation and closed down 16 stores, 10 donation centers, and two offices in early 2016 citing $6 million in debt. Of that large amount, nearly $4.2 million of it was owed to former employees in vacation entitlement and severance. This Chapter 11 bankruptcy resulted in laying off more than 430 workers.
While these two incidents of bankruptcy appear to be isolated incidents, we’ll watch Goodwill closely to see if the American retail downturn will affect more North American Goodwill retail locations in the same fashion it has been affecting the large, major retail chains.