Season 2 Episode 6: Innovating for impact in the circular economy

More than a thrift store

Evergreen Goodwill of Northwest Washington is at the forefront of the circular economy, an approach that keeps goods in use for as long as possible to reduce waste. This commitment is central to every part of their operation, from donation to resale.

"Every dollar that we can save in our operations is a dollar that we can spend on that free job training and education," says Libby Johnson McKee, CEO and president of Evergreen Goodwill of Northwest Washington.

Evergreen Goodwill is modernizing its operations by integrating technology like AI and automation, scaling through the new Georgetown hub, and simplifying procurement processes. These efforts support their sustainability goals while ensuring that more resources are channeled back into job training and community programs.

Libby focuses on three key areas:

• Streamlining operations with digital tools and centralized logistics to boost efficiency
• Promoting digital equity and job training to equip people for the future of work
• Simplifying procurement processes to reduce costs and increase community impact

As Libby states, “We are all about helping people have the access they need to digital equity and being part of this AI transformation.”

Transcript:

This has been lightly edited for clarity.

[0:00:07 - 00:00:55]
Brit:
Hi there. Welcome to the Smart Business Buying Podcast. I'm your host, Brit Moorer. On today's Inside Scoop, we're excited to be joined by Libby Johnson McKee, CEO and President of Evergreen Goodwill of Northwest Washington. We'll explore how Evergreen Goodwill is leading the way in the circular economy, keeping millions of pounds of items out of landfills. Close to 75% of all donations, with proceeds fueling job training and education programs that support communities across Washington.

Whoo! That's a lot. We'll also learn how they're scaling their impact through their new Georgetown logistics hub and making purchasing more efficient across locations with Amazon Business and Business Prime. Libby, I'm so excited to chat with you. Thank you for being with us here today.

[00:00:55 - 00:00:57]
Libby:
Thanks, Brit. It's great to be here.

[00:00:57 - 00:01:09]
Brit:
When most people hear Goodwill, they think thrift store. Right. But there's a much larger story there. How would you describe the true mission of what you all are doing?

[00:01:09 - 00:01:51]
Libby:
Well, the first thing, let me just give some context. Goodwill is absolutely a thrift store. And there's 155 goodwill's across the nation, and they're all independently operated. So the one that we have here in western Washington, Evergreen Goodwill, is one that covers five counties from the Canadian border all the way down to the bottom of King County and then over to Kitsap County. We have about 2000 employees, And we're also, as you were talking about, we provide a service to the community about taking donations in.

People wonder, like, what do you do with those? We actually sell them in our store, and we use the proceeds of that to provide free job training and education.

We've actually trained over 6000 people last year on the skills that they need to be able to get the jobs they want.

[00:01:51 - 00:02:12]
Brit:
That's a lot of things happening. On top of the operations making, things are moving, smoothly and then also making sure you're providing support to the community. Sounds like at the core of what you do, a lot of it is tied to innovation, right? So it's been a part of the story for over 100 years now.

Can you explain to me a little bit about what that looks like in action?

[00:02:12 - 00:03:59]
Libby:
Yes. Our organization, we started here, in Seattle. We had our first store in 1923, so we just crossed our 100 year anniversary. Now, along that path, it's all been about providing a hand up, not a handout.

And that's really around this job skilling and job training. How we've been doing innovation over that time period is we were probably one of the first organizations that provided free computer classes in the 80s when the personal computer first came out, we could see that that was going to be transformative for jobs and for people being able to be ready for those jobs. And so we were training people on, personal computing way back then. And we've taken that forward in our organization today, really focusing on digital equity. So in order to be part of the, job economy today, you have to be comfortable with technology, email. So the tools that are across that purchasing, which happens in a technical technological way, the workflows that happen around it, and you don't want to be left behind.

And so we do a lot today with both computer skilling. And we're moving into teaching people more about AI. We see that as a transformational tool that people are going to need to be able to keep track and have great jobs going forward. There's human in the loop. Activity is where we're going with our job training.

Let me say one more thing about innovation. Some of our processes have been the same for years. When the cost of actually doing something with labor was very low, we could put a lot of manual processes in place for people today. We need to modernize what we're doing, and we're looking to AI tools to help us do things in a whole new way.

[00:03:59:13 - 00:04:25:15]
Brit:
That kind of blows my mind a bit, because I'm sure a lot of people who may be listening will think, okay, Goodwill. I didn't think about evolution and innovation. You know, don't normally associate that brand with, you know, what's happening now in terms of AI and all of the other innovative tools. I'm curious to know, when did you make that switch towards sustainability and systems change and having this mindset?

[00:04:25 - 00:05:51]
Libby:
Well, let me talk about myself a little bit here. You know, as we were talking before the show started, I grew up in the tech world, and I was a long time Amazonian prior to this. So I come to this job with some technology skills and some background and seeing what technology can do for individuals. My own personal journey. I was running a nonprofit in Spain that was teaching kids about the importance of clean marine water, and it was about the time that, Inconvenient Truth came out. The book by Al Gore. And it made me realize that, business could really be the, catalyst for change within the world. And I wanted to be part of that. And I saw business as that, changing the world for good and leading sustainability.

So I went back to school. I got my MBA in sustainability, and that was actually when I came back to Amazon and started running some of the businesses there. All right. With this idea of people, planet and profit.

So for me, that also led into the work that I did at my last, role at Amazon was being the director of Worldwide Returns, transportation sustainability and e-commerce, which is all about the circular economy and keeping products out of landfill.

I'm just taking that skills that I learned here at Amazon and applying them in the nonprofit world so that we can use those profits for free job training and education.

[00:05:51 - 00:05:57]
Brit:
Wow. First of all, what a resume. What a journey to get here.

[00:05:57 - 00:06:01]

Libby:

You know, so lucky at the time. I grew up. And having these opportunities. It's been great.

[00:06:01 - 00:06:17]

Brit:

Yeah. And then you talked about also being in Washington, having that technology kind of realm surrounding you and then blending that with sustainability, which I think is amazing and kind of lends to the circular economy that you brought up. Can you kind of explain what that is exactly?

[00:06:17 - 00:08:38]
Libby:
It's a term that has, probably blossomed in the last say, I don't know, ten years or so. And commerce is another term that's, in that same realm around circularity. But previously, when people were thinking about products that would be, available for customers to use, it was taken out of the typically out of the plant, out of the earth, manufactured into something you could use, like a shirt or, you know, microphone, whatever it is.

And then there was no thought about what was going to happen to it at the end of life. It was just thrown away. That was kind of called the linear economy.

Make it, use it, throw it away. Right. And circularity is really talking about the circle of how we think about things and designing for end of life. So if I'm going to make something, use it.

How do we create more cycles of reuse and use that that product for as long as it possibly can be used? Getting extracting the most value out of it for people. And then at its end of life, what do we do with it? Do we recycle it? Do we put it back in the technology circle, or do we find a way to put it back into the earth?

So many of your listeners, when in their businesses, in their homes, they have recycling compost and then the garbage.

Right? You're trying to keep as little in the garbage as you can and put them in the other places so that those items can be reused in either a different form or in a different way. So the way that Goodwill fits into that is that we're helping customers.

I'm sure you've gone through and cleaned out your closet. And when you come and donate those products to us, we're looking through figuring out what we can sell. What can we be recycled? And we're working to find the highest and best use for each of those items through the the process that we go through and then putting them out for sale and then keeping as much out of landfill as possible.

So, as you said, 75% of what comes through, we are currently keeping out of landfill. Now, just to put some context around that, Washington state has about 50% of landfill diversion, either through recycling or composting. And nationally, it's only 35%.

So your local Goodwill’s that are able to put 75% back into circulation and keep it out of landfill is doing a great service there.

[00:08:38 - 00:08:49]
Brit:
And that number, I mean, it struck me when I was reading that and just kind of doing some research and I'm like 75% that's a high number. How in the world are you able to make that happen?

[00:08:49 - 00:09:52]
Libby:
We're not satisfied with the 75. So you know., it's a great number. And it's tracking to where we want to go, but we have big plans.

We have really big plans. We're looking for other recycling options, for sorting and transporting so that we can find smaller ways to keep more things out of landfill. One of our biggest challenges is glass. No one in the world should ever buy another coffee mug because there are so many of them, or a set of plates.

We have all that for you, and many different patterns and styles come down and get that stuff from us because when we don't sell it, we don't have a great outlet for that. We are too much volume for the recyclers that do glass recycling, you know, on a local level, and then not enough for those that do it on a national level.

So we're really kind of in that middle zone, and we're working with other ways to figure out how to divert even more. But I will say one of the things we are very proud of is 98% of our textiles that come through. When you donate those old clothes, 98% of those are resold or reused.

[00:09:52 - 00:10:01]
Brit:
Okay, so we can feel good knowing that the clothes that we drop off are going back into this circular economy and doing good.

[00:10:01 - 00:10:23]
Libby:
Right. We also are like, is anybody out there who's listening? Small business to this. If you have, a recycling option, you want to talk to us about it. We are really looking for local entrepreneurs that are coming up with great technology that would help us capture that last 25% so that we can get to zero waste.

Definitely one of our goals.

[00:10:23 - 00:10:35]
Brit:
Amazing. You mentioned the journey. The donation journey. I think many of us are curious. You know what happens when something is donated and then, you know, how do you determine where it goes next? And then so on. What does that process look like?

[00:10:35 - 00:12:31]
Libby:
The process hasn't changed a whole lot, I'll say.

When we started the business and most goodwill's do this across the nation is that it makes the most sense that when you donate something to your local goodwill store, that we will process that item there, say, can we sell it or not sell it? What price should it be? Does it need some small amount of repair?

And then we'll put it out on the floor and sell it right there in that store. So we reduce the carbon from transporting it, and then we're making the best use of it in that community. But that is a very manual process. It has not changed in the last since the 60s, you know.

And this is where we're starting to innovate with AI.

There is this catalog in the sky. If you're looking for any item, you can find a lot of them on Amazon. Yes, a lot on Poshmark, you can find a lot on Depop or ThredUp or any other kind of used site. And we're now trying to use that catalog to help us identify items or put a price on them, understand the right channel and location to sell them.

A lot of the innovations that I was able to experience here at Amazon and then previously at Microsoft, we're starting to put in place and goodwill and hopefully bring us into an AI assisted grading process. Once we've decided where that product should go and what price it should be at, then that product ends up out on the floor.

If it doesn't sell there, we give it another opportunity to sell either to a liquidator on the secondary market or in our outlet bins, it's just been a destination for Gen Z. Oh, they love a bean to go. So that is another opportunity.

And then at the end of that, is where we will end up figuring out if that is the right place for that is in the landfill.

And again, we're not satisfied, and we won't be satisfied until we're able to get to zero waste.

[00:12:31 - 00:12:44]
Brit:
I'm really excited to hear about the AI, tools and how you're using that identification process, or will roll that out. Are there any other technology tools that are being used to help streamline this process?

[00:12:44 - 00:14:51]
Libby:
Every dollar that we can save in our operations is a dollar that we can spend on that free job training and education. We are laser focused on that every single day.

It's been really helpful to us, to use Amazon Business, particularly when we do bulk buying.

And then we're able to move the distribution of those products to our 21 locations across western Washington. We used to get it all in one place, and then we would do the shipping and movement ourselves, which is costly for us. It creates carbon emissions. We get things lost. We don't know where they came in. Amazon Business and Business Prime has really helped us save money and time.

We're using innovations not only from our vendors and the people that we use from our purchasing, but also, in our own technology around, being able to identify what selling an individual stores and moving our inventory in the right places so that we're able to meet customers where they want and give them the products that they're looking for.

The other thing you mentioned is our Georgetown location. This is a big move for Evergreen Goodwill. I've just been the CEO now for, 18 months. I've been on the board prior to this. We're right in that moment where we're starting to move from a distributed, model of how we do product production and selling and those kinds of things, and moving it more centrally as we move it more centrally.

The Georgetown operations has enabled us to put our e-commerce business all in one place, where we'll be able to add some automation, maybe some robotics.

Oh, I know you don't really often think about robotics and automation. Here we are leaning in. And one of the reasons we do that is, like I said before, every dollar we can save by using tools and machines to take, you know, some to assist our, employees is a dollar that we can put into job training.

And the more we get comfortable with that technology ourselves as an employer, the better able we are to teach people to use it so that they can go out into the job market and get jobs with other companies.

[00:14:51 - 00:14:57]
Brit:
Yeah, you mentioned the Georgetown hub. I want to talk about that a little bit more. What exactly?


[00:14:58 - 00:15:02]
Brit:
I mean, this is a huge initiative. It's a game changer in terms of the expansion that you have planned there.

What does that mean for the community exactly?

[00:15:05 - 00:15:45]
Libby:
We'll be a very large player in Georgetown, which is exciting. Yeah. A lot of great things that are going on in Georgetown. And so we're an employer there as well. I think what that means for us is, and our current site, is where our transportation and a lot of our production is and some of that is going to move down to the Georgetown site, which frees up the property that we own at the corner of Rainier Avenue South in Dearborn, to be available for development around what the community needs. So we have some needs around it, like having our store there.

I don't know if you knew this, but that's the largest goodwill in the nation.

[00:15:45 - 00:15:47]
Brit:
Stop. No.

[00:15:47 - 00:16:46]
Libby:
Yes it is.

From a revenue perspective, it's a huge store. It has everything from, again, workout weights. I bought some yoga blocks there the other day and some iced tea glasses because I wanted to have a little iced tea party.

So everything from, you know, electronics, furniture, workout gear and that and that and of course, clothing and shoes.

In that store, when we develop that property, it really will be a gift back to the community of Howie and a community engagement project that will be thinking about how can we do some things that will support the community in that area.

So think playgrounds, if that something needs, think, restaurants, grocery stores, pharmacy if that's needed. We're super excited about the potential there. And we're just beginning on this development project as we move our transportation and some of our other operations down to Georgetown frees up that space for a whole reimagining.

[00:16:46 - 00:17:08]
Brit:
I'm really excited about this. You talked about this a little bit, but the importance of partnerships and tools to help you as you grow and you're trying to run things smoother.

Curious to know just how has Amazon Business really been a partner for you all? You talked about it a little bit, but I'm just let's dive into that a little bit more and how you're able to use some of the solutions and helping you all grow.

[00:17:08:06 - 00:18:14]
Libby:
The drop ship option is really big for us.

Our purchasing, we basically centralize most of our purchasing around Amazon business for the things that we need in an ongoing basis. I'm like a very impatient person. I would say, what do they call impatient optimist? You know, what we're doing? And so, the shipping speed, the delivery, the tracking that Amazon Business Prime gives us is really helpful.

Like I said, we don't lose as much stuff. We have better pricing. The bulk purchasing is super helpful. We're actually starting to explore to one of your other, services around liquidations. So being able to buy, each is from the liquidation site through your, services on the, on a P.O. is product that we would use to augment the donations that are already in our site.

They've come through the Amazon circle, and flowed down through that. And as part of the liquidation, is that you, that Amazon provides and we can then buy those by the pallet load so that if we're missing, say, some headphones or some electronics or those kinds of things, we can buy those from Amazon business at a liquidation price and then put them out on our floor.

[00:18:14 - 00:18:28]
Brit:
Wow, logistics is a huge piece to this, when it comes to the people, I'm curious to know the literacy programs, the digital equity, all of that. How do the programs connect to what's happening on the operations side?

[00:18:28 - 00:23:14]
Libby:
I was on the board, and it wasn't really until I became the CEO that I understood the depth of what logistics means to this organization.

We are moving product from the Canadian border down to our, outlet in Everett. We are moving product from our Seattle location out to the Kitsap Peninsula. We have a warehouse and fulfillment system and, the Kitsap Peninsula down in Seattle and in Everett, and there's trucks going back and forth. We are moving tens of thousands of boxes of product every day.

And, so knowing and, you know, thinking about how many miles traveled and the fill rates, of those trucks and where are they going and optimizing, routing and figuring out are we putting product in the right places for customers is something that we've been starting to be really focused on.

And so some of the other tools, as you asked about, digital equity, a small number of people that we put through the training that come to us for that free job training and education, whether that's English as a second language or if that's computer skills or customer service skills, retail skills, we have some pathways to like facilities maintenance, some of those things. It's only a small number of those students end up working directly for us. It is one of those big myths that we are training people for only work now. We trained 6000 people last year. We employ 2000. You know, we haven't turned over the entire, you know, thing three times to be able to employ all those people.

We're readying them for other jobs which is big. That's huge.

Yeah. So those foundational pieces helps people get the skills that they need. We also do wraparound services, meaning we try to remove barriers so people can get the skills that they need, meaning things like, if you need help with transportation or if you need help with housing, childcare, resume writing interview skills would give you some help with getting clothing for that interview, prepping you so that you can get the job that you want, whether that's in our organization or somewhere else.

Now, we don't have any programs today. They're specifically focused on logistics, but we do start people in those jobs within our organization and have them grow up through our organization.

Okay. So they're already they're getting that hands on experience that can help them. Yeah, okay. I love that you have a great story that I'd like to share.

Yeah. Somebody who is in our organization, who is in our organization today, that we are super, proud of and who is a fantastic leader. And she leads every day.

Her name is Kahina. She came from Algeria. She spoke no English. Had $1,000 in her pocket.

She'd won she'd gotten a green card opportunity to move here. She left her mechanical engineering degree, and she was running her own business to come here on the promise of what this country could offer.

But she arrived, and she didn't know anyone. She didn't know where to go. She landed in her community here in Seattle, and they said, go to Goodwill. They'll help you.

She came to Goodwill, started working on her English as a second language. We gave her a job as a material handler. We talked a little bit about the donation process. Yeah.

So that's the material. Handlers are the people that take your donations when you drive up.

She started there, as, you know, working her shift out in the stores, taking donations quickly, could see that she was a leader, became a supervisor. From there, she moved inside the store as a production associate, moved up to production manager, and now she's running the production, which is in the back of that largest store that we have in the country down there.

And she's running the production for four different stores across our network during this time period. She got a job offer to go to another large employer that is a home goods offering. So like, like Home Depot or okay, large employer that everyone would know.

And she, got an offer to be part of their warehouse management team. She went there she worked there for a couple of years. That was a good job for her. I mean, she'd come up through the ranks, and her English was good, her skills were available. And then she decided, hey, I want to go back to the place where I got all these skills, and I want to help other people get them to.

So she's come back into our organization. She's one of the leaders we're investing in. With this moved to Georgetown and our centralization of production and our AI tools and she's really leaning in and we are just super lucky to have her.

[00:22:52 - 00:22:57]
Brit:
That says a lot about what you all have built, though, in terms of the programing, the people, the community.

For someone to leave, get the skill set, leave and then come back because they want to continue growing and building with you. I mean, that has to feel like.

[00:23:07 - 00:23:14]
Libby:
I love this story and like, it's all her. She just wants to pay it forward. and she's looking to do the same for other people.

[00:23:14 - 00:23:35]
Brit:
I'm sure there's so many more stories like that which is really inspiring to hear. I know I was feeling that too, because that's really beautiful.

And at the end of the day, that's what it's about. That's the mission. That's what you all are trying to do. Right? I know you say jobs change lives, right?

[00:23:35 - 00:24:31]
Libby:
Absolutely. Yeah, I know that has been my experience. You know, I come from, you know, not Kahina's background in any shape or form, but it was really one of the reasons that, my whole career has really been around how to use technology to empower people and how to use work and jobs to make my community better, make the world a better place through circular economy, through accelerating sustainability and thinking about that.

And, you know, this moment for me, coming to being the CEO and President at Goodwill, is really the culmination of that career where all these things are coming together in a social enterprise. And every time I hear a story like that, I just think like, we're in the right place. Business is an agent for good, and we can just do it all together and do the right thing for people, planet and our communities.

[00:24:31 - 00:24:35]
Brit:
How has Amazon Business impacted just your operations as you've continued to grow.

[00:24:35 - 00:25:18]
Libby:
One of our goals again is to really help our students, the people who come to us to have that job training and education, to be able to have the tools that they need to do that.

And so in our job training and education, we have a tech lending library. So we're purchasing laptops through grants that we have from others. And the lower the prices on that, the more laptops we can purchase, the more students we can help. So through Amazon Business, in the bulk purchasing, we've been able to actually save 50% on the laptops that we have purchased through these grants.

So it's actually doubled the impact of the number of students that we can serve.

[00:25:18 - 00:25:34]

Brit:
The impact is wild because, you know, you're this is really showing how the community is benefiting just from stretching your resources in a way that maybe hasn't been available before. But because of Amazon Business, you've been able to do that.

[00:25:34- 00:25:55]

Libby:

When we shifted all of our purchasing over to Amazon Business for things like this. Like I said before, every dollar we save is a dollar that we can put towards mission. So this is a great example of like doubling our impact and being able to give twice the number of laptops and hotspots, to students who need them so that they can be part of this digital transformation.

[00:25:55 - 00:26:07]
Brit:
What excites you most now as you look towards the future of Evergreen Goodwill, what is really just like, ooh?

[00:26:07 - 00:27:25]
Libby:
You guys got great questions, really great questions, because I'm super excited about our the organization and the transformation we're going through. We are swinging big. We are thinking about, a new possibilities with the technology that's coming.

And just like, let's be clear, like this is a really transformative, pivotal moment in everyone's lives around technology, the planet. Like there's a lot of different forces that are at play. And evergreen good will will be a factor and a decider and a driver in that pivotal moment for people who don't have access, we are all about helping them have the access they need to this digital equity and being part of this AI transformation is going to happen whether you're in it or you're not.

And we want to bring more, and help more people along the way. So our Georgetown move, our transformation to AI, are thinking about what people really need to embrace and lean into this moment and be successful is really probably the thing I'm most excited about is that, like, we are on the cutting edge and we're just we're going to be there for people and we're going to help them and help us be that factor in the future for the next hundred years.

[00:27:25 - 00:27:55]
Brit:
Exactly right. We got to keep going. Yeah, we're just getting started right away. Yeah, absolutely. I love that you said lean in. I think it is a moment of leaning in.

Sometimes I can feel uncomfortable, but when it sounds like Goodwill, Evergreen Goodwill, you are kind of at the forefront of that lean in moment. And that's something exciting to hear.

For the leaders listening for procurement professionals, anybody in sourcing, what's one thing you hope they take away from your story, your experiences?

[00:27:55 - 00:29:24]
Libby:
I think the one of the things I've learned from my experience and I see in my organization and the organizations I've been in in the past, is that, everyone has an opportunity to lead. Leadership is not sometimes people think it's like, oh, it's about power.

It's about authority, it's about hierarchy. And I don't believe that. I believe that everyone is a leader. And when you talk about, you know, procurement professionals, they have an incredible amount of opportunity to lead in that space and make strong decisions about the future that they see for their organizations asking to put a sustainability lens on every purchase that you make, asking to put a people lens on everything that you're choosing.

Are we purchasing from the right types of organizations that match our values, like asking those questions and then putting that lens through? There is one of the things I think those professionals can really lead in and bring to the forefront, which other people might not be thinking. They're thinking, can I get the lowest price? Can I get it the fastest?

Right? Perhaps. And you're saying, hey, wait, wait, like there's more to think about that in this process. It's actually a number of different factors, particularly in the complex and ever changing world that we are in today. Those professionals have an opportunity to lead.

Well, that's that sounds like the call to action lead. You know, we all have an opportunity, to amplify impact within our communities by the decisions that we're making.

[00:29:24 - 00:29:43]
Brit:
Libby, thank you. This was amazing. Great to chat with you. Really appreciate it. Thank you. It's been fun.

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