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Business & Technology

Kirkland stepping down at Goodwill; Miller to take helm

February 10th, 2007 11:00 pm by SHARON CASKEY HAYES

KINGSPORT - In less than a decade as president and chief executive officer of the local Goodwill Industries, Doug Kirkland has grown the organization's operating budget by more than threefold, doubled the number of its retail stores, and increased the number of people it serves by more than sevenfold - all while eliminating debt and turning its bottom line from red to black.

Now, Kirkland says it's time to move on.

Kirkland, 65, is retiring from Goodwill in March, and turning the helm over to Bob Miller, who starts his new duties Feb. 19.

"It's a tough act to follow but I think we've got some things we can do," said Miller.

Doug Kirkland was a veteran in industrial manufacturing who had been president of AFG Industries, and served as president of the Canadian operations of Guardian Industries. When he joined Goodwill Industries of Tenneva Area in November 1997, the not-for-profit organization operated six small retail stores on a $1 million budget, and was struggling under mounting debt.

"We created a vision for what we could be," Kirkland said. "I just felt we could do better and expand, and I think we realized that financially, we had to put ourselves in shape to do that, because it takes money to grow."

Goodwill's mission is to train and provide job opportunities for people with barriers to employment. It gets the majority of its revenue stream from its retail store sales. So Kirkland set his sights on strengthening those business operations. He expanded Goodwill's retail locations from six stores to 12 and increased their size from an average 1,200 square feet to 6,000 square feet.

He increased the stores' retail offerings by buying new merchandise to mix with donations. And he introduced credit card acceptance policies, which helped increase store purchases.

"And as we started doing that, we were able to start serving more people," Kirkland said.

In November 2004, Kirkland decided to expand Goodwill's contract services. He purchased two buildings off John B. Dennis Highway to house the work, and secured four in-house contracts and one offsite contract.

Today, Goodwill holds a contract to inspect and package coat hangars for an Atlanta company. Goodwill employees pack about 10 million coat hangars a year as part of the contract.

The organization is also contracted with the Home Shopping Network to package, inspect, barcode, "or whatever they need us to do," Kirkland said.

Goodwill also holds a contract to sew and stuff pillows for a Hawkins County company.

And it packages nails and screws for another firm.

Work for those four contracts is performed at the two buildings off John B. Dennis Highway.

Kirkland said Goodwill also has a contract to perform janitorial services for Wellmont Health System.

"I think there's certainly an opportunity to expand that with additional contracts. The problem Bob is going to face is - there's not enough room. We've already outgrown our space," said Kirkland, noting the two buildings off John B. Dennis Highway are filled to capacity.

Kirkland also delved into another business opportunity - salvage recycling. He said Goodwill had always done some salvage work, but he expanded that scope about six months ago to include recycling of nine different materials, including plastic, newspaper, aluminum, clothing, and cardboard. The salvaged material comes from individuals, employees and businesses, and is sold to brokers across the country.

Kirkland said income from the salvage and recycling operations has so far amounted to about $350,000. "And it's got potential to grow to half a million because we didn't start the recycling until July," he said.

The additional revenue sources pumped up Goodwill's income last year to $3.358 million, while expenses came in at $3.148 million for a profit of $210,000.

In all, Goodwill generated 96.5 percent of its budget from its business operations. Retail sales remain the largest chunk of that income - at about $2.6 million last year.

And while Goodwill posted record monetary contributions from the public last year, the organization typically takes in 1 percent of its budget from such donations, Kirkland said.

Goodwill's funding from government sources represents about 2.5 percent of its budget. Kirkland said that number was 17 percent when he joined the organization in 1997. He said he'd rather rely on Goodwill's own sources for revenue, than on the taxpayer's dime.

"Personally I feel more comfortable working with private industry," he said.

The bigger bottom line has helped the organization grow its employee base. In 1997, Goodwill employed just 15 people. Today that number has jumped to 110.

And Goodwill has been able to help more people through training and employment opportunities. In 1997, it helped about 50 people a year train for new opportunities or find work. Today, that number stands at 350 people. And anybody with barriers to employment can get help, Kirkland said.

"One thing that has changed with Goodwill over the years since I've been here - it used to be they pretty much only served the disabled. Now they've changed it to people with barriers to employment. So that could mean someone who doesn't have a high school education, someone who doesn't speak English, people on food stamps, senior citizens - anybody that would have a problem getting hired," Kirkland said.

"We can train those people and hire them in our own internal organization, and for some of them, we can find jobs out in the community," he said.

Some companies that have hired folks that were trained and recommended by Goodwill include Wal-Mart, Food City and Wellmont.

"We are basically an employment agency for people with barriers to employment," Kirkland said. "We offer a hand up, not a hand out."

He said he's enjoyed his time at Goodwill - especially the people with whom he's worked side-by-side to turn the organization into what it is today.

"We just took the approach that we could do better, be bigger, and we could serve our mission more fully, but in order to do that, we had to get our business in order," Kirkland said.

"We made significant profit this past year. We've got no debt and cash in the bank. I feel like the company is poised to go further under Bob's leadership and I think it will," he said.

Most recently, Bob Miller worked in the commercial insurance business for the last five years with Kingsport Development Co.

From 1990 to 1999, he headed the Kingsport Area Chamber of Commerce, and then went to work for the state in Nashville, becoming assistant commissioner of the Tennessee Department of Labor, and serving as administrator for workforce development from November 1999 to mid 2001. In that role, Miller established career centers throughout the state - a job that helped prepare him for the work ahead at Goodwill.

He said that making people more aware of Goodwill and its mission will be at the forefront of his agenda.

"I bet if you go out and ask 10 people - ‘What does Goodwill do?' They'll tell you it's a good place to take your old clothes. Well that's really not what we're here for. What we're here for is to provide jobs for people who can't get jobs anywhere else - those who have barriers to employment," Miller said.

"So one of the main things that I'm going to be working on is making the public aware of what we do."

In his first few days on the job, Miller plans to travel with Kirkland to visit all the Goodwill locations in the region and meet with employees.

Miller said Kirkland has provided a "springboard" for the organization to experience further growth. Specifically, he said Goodwill will most likely open another store in Southwest Virginia within the next year to continue its retail sales growth.

And he said he hopes to expand Goodwill's contract services.

"We feel like there are opportunities with employers in the area that may be sending work overseas that we can do right here," Miller said. "We haven't even started targeting those kinds of things yet. That's a real opportunity."

Goodwill's corporate office on Brookside Drive includes a computer laboratory which was once used to train people through grant money. Those grant funds have since dried up, but Miller said there could be other grant opportunities to resume computer training, or Goodwill could use the computer lab to test potential employees for area employers.

"That would be a source of revenue for us that we could put right back into hiring people with barriers," Miller said.

"I'm coming into a situation where I'm on the end of a springboard because Doug has just put things in place.

"This is a wonderful organization and I'm as happy and proud as I can be to be working for it," Miller said.

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