How Does Goodwill Make Money? Simple Answer for Everyone
When you notice a Goodwill store in your city, you probably ask yourself: How does Goodwill make money? It is not just a normal business, and most of the items there are donated by people. Where then does the money come in? We will simplify this by explaining it easily.
What Is Goodwill?
Goodwill is a nonprofit organization that assists individuals to get jobs, acquire new skills, and lead better lives. It operates thousands of thrift stores where individuals donate used clothes, electronics, furniture, and so on. Goodwill then sells such items in its stores to earn a profit. But that money is not to make a profit; it is returned to programs to assist people.
How Does Goodwill Make Money?
Here’s a breakdown of the main ways Goodwill earns income:
1. Selling Donated Items
The biggest way Goodwill makes money is by selling donated goods. People drop off items like:
Goodwill staff sort, price, and place them in stores. Customers buy them at low prices. Since Goodwill gets the items for free, most of the sale is pure revenue.
2. Online Sales
Goodwill also sells some items online. Expensive, rare, or unique items go on Goodwill’s auction site. These can include:
This online store helps raise even more money.
3. Recycling and Salvage
Not all donations can be sold in stores. Some are too worn out or broken. But Goodwill still makes money from these by recycling or selling them in bulk. For example:
This helps reduce waste and adds to Goodwill’s income.
4. Government and Community Grants
Goodwill receives grants from the government or other nonprofit groups. These grants help fund its services, like:
These grants are not earned like sales, but they still count as income.
5. Contracts and Partnerships
Goodwill may work with local businesses or government offices. For example, they may be paid to:
These jobs provide work for people Goodwill helps and also bring in money.
Where Does the Money Go?
Now that we’ve answered “How does Goodwill make money?”, the next question is: What happens to the money?
Goodwill uses the money to support its mission. That includes:
Over 85% of the revenue is spent on programs and services. The rest goes to keeping stores open and paying staff.
Is Goodwill a Business?
Goodwill works like a business in many ways:
But it’s not a for-profit business. The goal isn’t to make money for owners. In fact, Goodwill has no owner. It is a nonprofit charity that uses its money to help people, not to earn profit.
How Is Goodwill Different from Other Stores?
| Feature | Goodwill | Regular Store |
| Items for sale | Donated goods | New, purchased items |
| Business type | Nonprofit | For-profit business |
| Goal | Help people | Make money for profit |
| Staff payment | Paid employees | Paid employees |
| Where money goes | To programs and services | To owners or shareholders |
Goodwill may look like a business, but it’s much more than that.
Why Is It Okay for a Nonprofit to Make Money?
Some people are confused when they see a nonprofit making money. But it’s totally okay! Nonprofits can:
What matters is how the money is used. In Goodwill’s case, the money goes back into the community.
Final Thoughts: How Does Goodwill Make Money?
Goodwill generates its profit by selling donated goods, recycling, grant awards, and collaborations with local agencies. The biggest distinction is that the money is used in good causes as opposed to generating profits.
By shopping or donating to Goodwill, you are, thus, investing in training, employment, and the hope of others. This is what is unique about Goodwill.
