[Social Enterprise Reporter] GoodStorm

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[Social Enterprise Reporter] GoodStorm

文章維尼 » 2007-03-14 16:36

GoodStorm: a new standard of social responsibility for e-commerce by Tome White

Yobie Benjamin, Founder and CEO of GoodStorm, was Senior Partner and Chief of Global Strategy for Ernst & Young for 5 years and is a minority owner of a 25-year old San Francisco-based manufacturing and merchandising business. He and GoodStorm Co-Founder, Andy Rappaport, are both technology venture capitalists who wanted to find a way to apply their financial capital, technological expertise and business savvy to redefine capitalism and reform e-commerce. SER spoke with Yobie about the January 2006 launch of GoodStorm’s online storefronts for nonprofits.

YB: You can’t just complain about how bad the world is. When you’ve been given so much, you need to give back. Andy and I have been active philanthropically, but I don’t believe that’s enough—we need to enable people to help themselves. I wanted to create a system wherein every barrier to entry was taken away and all that you need was drive and a little bit of self-motivation to make meaningful amounts of money, and in that process not only help your organization, but help others as well.

SER: Why did you choose to start a merchandising venture?

YB: We could create a business where a significant amount of the profits go directly to people that need it. The model has been tested and proven to be successful by other online storefronts like Café Press and Zazzle, but they only give you 10–15% of the retail price. $2–$3 on a $20 t-shirt is unattractive from an earned income perspective. We decided to change the model and give people 70% of the gross profits. Our printed shirts are $5 wholesale in a case and our lower MSRP is $15. The nonprofit gets $7, roughly double what they’d make elsewhere. One of the most well known progressive businesses, Working Assets’ GoodsforChange.com just moved their goods to us.

Most of us are guilty of being price shoppers. What we’re trying to do is move towards a values-based model--voting with your dollars. Is it truly possible to do this? In a bold experiment we worked with peace organizations, came up with the idea for a $0.39 anti-war postage stamp, and marketed it in time for tax day. With shipping and handling they were priced at $1.20 and we sold 60,000 of them. We proved that people are willing to buy on the basis of their values. We think we can build this model to exceed the scale of eBay!

SER: What types of products do you offer?

YB: We’re moving into music, books, movies and other media. We’re about to launch MeCommerce™, enabling anyone to sell single products or groups of products on their website or blog. Organizations can sell books or other media at full cover price and we’ll split the profits. For example, if we sell Thomas Friedman’s hardcover book The World is Flat for a nonprofit focused on economic issues, at the full cover price of $40, we make a 40% gross profit, and we would split that profit with the organization or individual 50/50. So they would make $9 on a $40 book. And we pick, pack and ship the book and other media.

In order to change economic conditions, you need to democratize the access to financial capital and the means to make money. On eBay you still have to carry your own inventory, pack it and carry it to the Post Office. Not to mention the worries with credit card processing. To democratize the access, we’re taking away every single barrier.

We’re very transparent about how we conduct our business—how much we pay for our product. If an organization wants to discount a product we tell them the bottom price so that we’ll cover our costs. We’re a for-profit company running a values-based business.

SER: What is your source of shirts?

YB: I’m minority owner of a manufacturing company that makes and sells t-shirts for over 150 big music bands, like the Ramones and Led Zeppelin, as well as sports teams like the SF Giants, and Google. I wanted to start a business that allows us to give the retail profits to others and still be able to sell it at low cost so that others can maximize the retail profits selling the items themselves. The key difference between us and other earned income strategies is there’s no barrier to entry. You’ve got to be motivated to promote your products, but you don’t have to worry about boxes of t-shirts in your office. The reason merchandising has failed for nonprofits is because they assume the cost of the goods. If the products don’t sell, they lose money on the dead inventory.

SER: Do your clients get access to customer names?

YB: We allow our clients to obtain sales information on their customers. List building is very important for nonprofits. We retain the information for fulfillment. It’s your client and you deserve to know who’s buying your products. You know not only how much money you make but who is buying what.

SER: What has been the range of sales at GoodStorm online stores?

Sales scale with the nonprofit’s membership, and the desire of the
organization to promote their products. Sales vary from $2,000 to up to $70,000 on a single campaign that lasted only two weeks. It depends on how large your mailing list is.

SER: What are your goals for GoodStorm?

YB: I want this to be a global enterprise. There is no limit to what we want to do for nonprofits, clubs, guilds, and schools--the need for earned income is so great. Our online stores include Mom’s
Rising, Craigslist, the UN World Food Programme and we expect to launch MoveOn.org very soon. I believe good works tend to propagate themselves, and as long as we focus on our core mission, we’ll continue to scale this.

Resources:
www.goodstorm.com
MBA Class of 2009, UCLA Anderson School of Management

With this faith, we will be able to work together, to pray together, to struggle together, to go to jail together, to stand up for freedom together, knowing that we will be free one day. -- "I Have a Dream", Martin Luther King, Jr.
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