Charity shops post record profits hike

Charity shop chains that took part in this year’s Charity Shops Survey recorded an overall rise in profits of 14.3 per cent since last year – the highest profit increase ever recorded.

Income was up too, by 6.8 per cent to £716.4m.  In fact, the survey reveals that far from reeling in the recession, charity shops are going from strength to strength, and charities are opening new shops all the time to capitalise on the success.

Some 74 charities provided data to the 2012 survey, with a total of 6,233 shops, 226 more than last year. It is the ninth consecutive year that shop numbers have risen, and this growth shows little signs of slowing, as more than 70 per cent of shop managers expect to expand their shops chains in the coming year.

British Heart Foundation is still the biggest charity shop chain, with 709 stores, followed by Oxfam and Cancer Research UK with 685 and 554. But it was Barnardo’s and Sue Ryder that opened the most new stores, at 57 and 36 respectively.

The biggest issue worrying most shops managers this year is a shortage of donations, and the competition from commercial collectors for what stock is available.

Just over two-thirds of charities sell goods through eBay and a growing number (now 23 per cent) are considering using other platforms such as Amazon or ABE, too.

The proportion of charities claim gift aid on items sold continues to rise, with 81 per cent of chains now doing so.

However, this year’s survey also uncovered an emerging new threat to shops’ profitability.  Anecdotal evidence from some charities suggests that local authorities are becoming more likely to challenge charity shops’ mandatory rates relief when the lease is held by the organisation’s trading company. Similarly, some charities are losing their 20 per cent discretionary rates relief as local authorities seek to maximise their own incomes.  But charities can usually use the Localism Act to argue for this to be restored.

Click here for more on the rates relief issue, and click here to download the full Charity Shops Survey 2012.

This article was taken from www.civilsociety.co.uk – http://www.civilsociety.co.uk/fundraising/news/content/13479