Federal funding cuts and the threat of future cuts have hit the customers of the Association for the Blind and Visually Impaired of Greater Rochester and the non-profit itself.
The Rochester-based non-profit organization gets much of its funding through federal contracts. Deficit-reduction efforts have forced cuts that are trickling down to ABVI.
"We're down about 50 percent right now," said Gidget Hopf, CEO of ABVI.
"As the government reduces its number of employees, it really affects our product," said Hopf, who this week was named chairwoman of Goodwill Industries International.
Sequestration has been particularly hard on the organization. ABVI pulls in revenue from its manufacturing businesses, which include office supplies and uniforms. As the government furloughs workers and the military continues to draw down troops, these and other products are in lower demand.
The situation has ramifications beyond ABVI, she said. The organization partners with local businesses in its manufacturing functions, creating a ripple effect of close to $2 million in the area economy.
The organization planned for some federal cuts, Hopf said, but did not anticipate their extent.
"We don't know if this is the new normal or if we can expect to see even further cuts, but we've been pretty realistic and have set up a good business in terms of how we run it," she said. "But we anticipated a 25 percent reduction in orders, and we ended up seeing a 50 percent reduction."
As a result, the organization has looked to new places for revenue and adopted an aggressive strategy for growth.
The non-profit has built a strong network of revenue-producing services, which Hopf said hedges it against cuts in any particular area. There are retail locations for goods and thrift items, an online store where donated items of greater value are sold, manufacturing enterprises and a contact center that combines call functions, email answering and live chat functions for clients.
Throughout the cuts, ABVI has worked hard to maintain its workforce. The many blind and visually impaired people who work in the retail and manufacturing enterprises rely on the jobs, and the organization needs to maintain its workforce for when orders begin to increase, Hopf said.
"We do not want to lay off our employees," she said. "We have contracts with the Department of Defense to sell uniforms for the Coast Guard and Air Force, so if we lay off employees, those people will find new jobs, and when those contracts come back, we won't have enough."
The organization has grown because of a hiring increase in its Goodwill stores. In 2012 it had 550 total employees, and at the end of July this year it had 653.
Under its former structure, the Association for the Blind and Visually Impaired-Goodwill Industries of Greater Rochester reported $35.5 million in total revenue for fiscal year 2011.
To maintain the workforce, ABVI has gotten creative. Some manufacturing employees have been shifted to jobs in the organization's retail locations or the contact center, and as employees leave through attrition, the positions are left open.
The organization's leaders also have chipped away at the budget in other areas, such as cutting back on travel and conferences.
Even as the organization contends with federal budget cuts, it is looking for opportunities to grow. Hopf said it has sought more partnerships with commercial businesses, offering to use the organization's manufacturing resources in new contracts.
ABVI has a bio-based laundry detergent manufacturing business, for example, that could open new opportunities, Hopf said. The filling equipment used in this operation could be used by other businesses that need to fill bulk products.
"The message for us is to stop relying on government sales," Hopf said. "We don't get subsidies, so we have to move our eggs around into more baskets."
Donated goods and retail locations will play an important part in growth plans. The organization is looking at adding more stores throughout its network, which has recently expanded because of a change in the non-profit's structure.
Once known as ABVI-Goodwill, the non-profit reorganized into ABVI and Goodwill of the Finger Lakes. The two segments share a board, and Hopf serves as CEO for both.
"Our Goodwill of the Finger Lakes area covers 20 counties, from the Pennsylvania border to the North Country and the Thousand Islands," Hopf said. "Our territory is so untapped right now. We have stores in five counties, but there are 15 to go and even more opportunities in Rochester."
The retail stores serve many functions for ABVI and Goodwill of the Finger Lakes, Hopf said. They employ and provide service to many people throughout the region, give a new life to the donated items and provide low-cost goods to people who shop at the locations.
ABVI also has grown within its main campus in Rochester. Two years ago, as the organization celebrated its 100th anniversary, it added 30,000 square feet of space for its contact center. ABVI also has moved some functions into a building down the street from its main offices and within three years has filled that space.
The organization also is making use of its national contacts, entering a partnership with Purdue University for a program that helps farmers who have disabilities.
"Many of our Iraq and Afghanistan veterans are coming back to rural communities with disabilities, and this contract helps us reach beyond our region to help them," Hopf said.
That national network of contacts could soon be expanding with Hopf ascending to leadership of Goodwill Industries International's board of directors.
"Her outstanding management abilities and accomplishments as well as her passion for the Goodwill mission will be invaluable to Goodwill in the year ahead," said Jim Gibbons, president and CEO of Goodwill Industries International.
The efforts to expand have allowed ABVI and Goodwill of the Finger Lakes to avoid the deep cuts facing other organizations working with the blind. Hopf noted that close to 60 percent of these agencies have had to lay off workers in the past few years.
"We're just using the approach we've taken for the last 102 years, using social entrepreneurship to mitigate these devastating conditions," she said. "Because of that approach, we've been able to weather the storm while others are struggling."
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