Are charity shops a good things for town centres?

Are charity shops a good things for town centres?

A guide for BIDs, place managers, town centre managers and local authority.  

With over 10,500 charity shops trading on UK High Streets, Charity Retail is a core part of the High Street's makeup today in the UK.  Whilst many shoppers flock to them in search of branded bargains, others turn up their noses and, in part, blame them for the demise of High Streets and lack of branded stores featuring in their town centre.  We often hear phrases like "The town centre is nothing but charity shops and betting shops".

Whilst the number of charity shops in a town centre can vary enormously from one town to another, charity shops represent approx 5% of UK shops overall.  From the work we have done in UK towns, we know their impact and emotional response from local people can be much greater than their percentage representation.

The Negatives:

Spectators and competing retailers generally view charity shops through a negative lens.  IMG_1788

  • Filling units that could be occupied by desirable branded retail
  • HDH Vitality Index, classify charity shops as "Unfashionable Retail" meaning undesirable
  • Many retailers feel charity shops get an unfair advantage, gaining 80%-100% rate relief, often reduced rents, free stock (in terms of donations), free staff (in terms of volunteers), VAT exemption (on donated items), corporation tax exception and often competing directly with their wares.
  • Many retailers cite the new products some charity stores sell as being direct competition and therefore should not benefit from rent discounts and rate relief.
  • Charity shops are estimated to cost the UK economy £1bn in lost rates and VAT collections.
  • Charity shops are indicative of a town centre lacking in vibrancy
  • Charity shops are often scruffy and have a negative impact on the appearance of a town centre as a whole.

The Federation of Small Businesses lobbied recently for charity shops that sell more than 10% of 'new' goods, pay business rates, thus levelling the playing field with local independent businesses.

We would concur with many of these comments and observations.  In the interest of balance however, charity retail can have many positive impacts on a town centre, when viewed through a more positive lens.

The Positives:Good charity shop

  • Many local people would prefer to see a charity shop than a vacant unit.  In 2012 14.6% of town and city centre retail units were vacant,  that is 1:7 shops empty.  One might surmise that charity shops solved a problem around over supply of retail space, rather than take up desirable retail space.
  • On a similar thread, desirable branded retail abandoned the High Street first, not the other way round.  Our beloved High Street brands deserted town centres when things got tough, leaving them decimated.  Charity shops arguably came to the rescuer offering local people the chance to buy fashion, music and books. 
  • Charity retail can plug gaps in the retail mix.  In our studies of town centres, we often see high levels of comparison spend leakage (local residents getting in their cars or on public transport and leaving a town) when they want clothes or household items.  This is not good for the local economy.  Smart charity retailers can identify and plug retail mix gaps, focusing on books and music, fashion and kids clothes, shoes or home-wares.  This results in many local people staying local and the town centre retaining more of its comparison spend.
  • Charity retail can add uniqueness and excitement to our clone town centres.  A cluster of 'vintage clothing stores' can be a real pull for a town, particularly with younger adults.  
  • Charity retail can become part of the town centre offer.  A town with a strong reputation for branded donations (typically in more affluent areas) can attract shoppers from a wider catchment area to the town.  
  • Charity retail generates approximately £300m for worthy causes.
  • Volunteers can get valuable experience working in retail, thus increasing chances of full time paid retail employment elsewhere.
  • Charity retail reduced unnecessary waste, recycling items at ease for local people.    

Things to watch out for and how place managers can get the most from its charity retail offer. 

Appearance and Presentation: Poor charity shop appearanceMany charity shops take great pride in their offer and enhance the town centre with great displays and store presentation.  The air ambulance shop in Wellingborough had a great window display, putting it on par with the national retail brands that flanked it.  Save the Children in Chiswick and West Bridgford also create a store environment that compliment and enhance the town centre.  Nottinghamshire Hospice, in our view, are not repaying the gift of reduced rates and tax relief with a store presentation that lessens the presentation of the town centre – when all that is needed is a tin of paint.

Compliment the retail mix, not compete:  Fashion retail, children's fashion and shoes, books, quality home-wares and music are all sectors that UK town centres experience leakage for.  Where popular national retail brands cannot be courted and attracted to fill, look to charity retail to play a part and thus limit leakage from shoppers seeking this.     

Street Trading: Street trading charity shopElements of street trading can add dynamism and energy to a town centre.  Cafe culture, fruit and veg, florists typically make for a desirable town centre.  Trestle tables full of trinkets and racks of unwanted clothing does not.  We encourage place managers to seek support 'in the spirit' of a creating a desirable town centre first, then pursue any enforcement opportunities available to place managers afterwards.  Although a place manager may have limited legal powers to enforce removal of displays, this should not prevent a conversation being had in our opinion.Unnecessary street trading from charity shop

Donations: Affluent towns often attract high quality designer goods donations.  We have heard reports of these products being immediately shipped to other charity shop branches, rather than staying local.  A charity shop with a regular supply of branded and designer goods will be attractive to shoppers, charity shops should be encouraged to keep donations local in the interest of the town centre they trade in. 

We would advise getting charity retailers around the table and sharing your vision for the town, the opportunity for charity shops to play a key and intrinsic part in that and how we could all work together to achieve this.  Place managers have a card to play in persuasion, rate relief is now discretionary and we feel should be given in return for a charity shop playing its part in enhancing the town centre.

  • Limiting street trading
  • Working together to identify and fill comparison spend gaps
  • Improve presentation standards
  • Keep quality donations local, to drive footfall. 

UpskillingGood window display charity shop

A challenge for many charity retailers is the skill gaps within the store itself.  Principally operated by volunteers, visual merchandising, display and presentation skills can be very limited.  We help by training retail teams in the necessary skills and tools to create world class displays and presentations.  This can be done locally within a store or in a more cost effective workshop scenario where charity shops for the town are pulled together, with their volunteers and trained on mass.

Good charity shop window displayShould you wish to explore this or approaches to support charity retail in the town, please don't hesitate to contact us.  Corin 01455 203206.

To receive more articles like this in your inbox, please subscribe to our place managers news.

Charity Shop Facts:

  • Charity Shops raise £300m towards worthy causes
  • 10,500 charity shops are estimated to be operating in the UK
  • Oxfam opened what is believed to be the first charity shop, in terms of modern approaches, in 1947

Written by

Corin Birchall is a Retail Sales & Marketing Consultant and founder of “Kerching Retail - helping to make your till ring”. His consultancy works throughout the UK and Europe. Corin is an active writer, coach and public speaker, helping to develop and grow a wide range of businesses & business leaders from Leisure and Retail sectors

Popular Categories

Never miss a tip…