Charity Shops Survey 2016

Charity Finance has recently published its annual Charity Shops survey (supported by Charity Retail Association).

In summary, the survey shows a significant fall in profitability as a result of low income growth and higher costs. However, there has been an increase in the number of shops opened by the respondent charities.

The sector is facing several challenges. Salary costs have increased which is, in part, due to the increase in the National Minimum wage. Staff and volunteer numbers are down but this could reflect the more buoyant work market. The survey also noted that rents appear to have increased steeply.

75 charities took part in the survey and these charities have 6,933 charity shops. The survey identifies a number of concerns, the top five being:

• Shortage of volunteers
• Level of rag price
• Increase in staff costs
• Poor quality donated stock
• Loss of rates relief

Interestingly, the area with the largest number of charity shops is the South East of England.

A fall in charity shop income is not necessarily a bad thing, as charity shops traditionally become less productive when fundraising and contract income pick up. In fact, charity shops generally perform best during a recession. As the report says, the Brexit vote is a bright spot on the horizon for charity shops as many commentators believe it may return the country to recession.

Charity shops continue to be an important element of a charity’s fundraising strategy but trustees need to monitor the resultant challenges and opportunities.

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