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The store on Alum Rock Avenue was fully-engulfed by the time crews arrived just before 3:00 a.m. Monday. A section of the roof also collapsed, making it too dangerous for firefighters to fight the flames from inside.
The store employs at least 20 people who will be placed at other stores.
"We're committed to keeping them employed, but unfortunately it won't be in the area that they are. So, it's going to be difficult that they'll have to transfer to other locations," Goodwill spokesman Michael Fox told ABC7.
The store does about $110,000 in sales every month and about $80,000 worth of donations was lost in the fire.
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