In the fall of 2017, Henry Hackett, Drew Kaneps, Steven Richter, Stephen Trella and Jon Yeh were five guys who happened to be in the same Professional MBA cohort. By the spring of 2019, they were a tight-knit crew presenting their final project to executives with arc Thrift Stores and The Arc of Colorado.
Arc is the largest national community-based organization advocating for and serving people with intellectual and developmental disabilities and their families. Arc Thrift Stores is the largest social enterprise in Colorado with 1,700 employees and nearing $100 million in annual revenue. The revenue supports children and adults with intellectual/developmental disabilities, helping them find housing, jobs, medical assistance and services in school.
The five MBA students were tasked with assessing the economic impact arc Thrift Stores has on Colorado.
“We had worked on a team together numerous times in the past two years, but never on an economic impact assessment,” said Richter, who works as a special technology consultant for construction companies. “We had a lot of quick learning to do.”
The team turned to Professor and Miller Chair of Applied Economics Jack Strauss.
“I worked with the team to evaluate the economic multiplier effect of arc Thrift Stores on Colorado,” Strauss said. “The multiplier effect determines the direct and indirect effect of a business on the community; they showed that Arc had a significant positive impact in Colorado by generating hundreds of jobs and substantial income.”
As Hackett explained, the group had to first understand all the components of the nonprofit before they could assess its impact.
“In addition to their clothing stores, they have a food donation program, a car donation program, a recycling program and much more,” Hackett said. “They have extensive business lines throughout Colorado.”
After weeks of research and combing through Colorado economic multiplier data, the team concluded that arc Thrift Stores has a $2.3 billion impact on the state of Colorado.
“I’m very pleased,” said Lloyd Lewis, CEO of arc Thrift Stores. “I didn’t know we’d hit that kind of number. I was thinking maybe a billion or 1.2 billion. It gives me comfort that they were being conservative.”
Christiano Sosa, executive director of Arc of Colorado, indicated the study would be useful for Arc’s foundation and chapters.
“I’ve looked at thousands of grants in the last 12 years,” he said. “It’s rare to find a proposal that really describes the impact of the organization.”
Arc was just one of eight nonprofit clients that the MBA students completed projects for this quarter. Other organizations included Energy Outreach, Cooking Matters, TOSA, Bella Boutique, the National Sports Center for the Disabled and the Lowry Foundation.
“With most of the projects, students used what they learned in the program, including strategy, marketing and analytics,” said Bud Bilanich, the teaching faculty for this capstone course. “This was a great learning experience for them; if they go into consulting or work for a company that opens a new facility, they now know how to go about putting together a study like this.”
In addition to getting an A on the assignment, all five guys graduated June 14 with their MBAs.
“The project pushed us to learn and grow,” Yeh said. “It was a great partnership, we learned and had fun together doing it.”