Even in these economic times it is not doom and gloom for all high street retailers. Charity shops are one sector achieving success in the downturn.
Charity shops have seen a six per cent rise from last year in like-for-like income during the first quarter of 2011, according to the Charity Retail Association (CRA). Charities like Barnardo’s are opening 60 more stores. By contrast, overall UK retail like-for-like sales changed by -3.5 per cent and many multiples have gone into administration. So why have charities succeeded while others struggle?
A key factor is that in a downturn more people want cheaper items. “Given the state of the economy, people are looking for value for money,” said Mike Lucas, retail director of the British Heart Foundation (BHF).
Importantly, some charities ensure they provide cheap items that are still desirable. Barnardo’s retail and trading, marketing and media manager Laura Grant said: “We have worked hard to abolish the view that charity shops smell and have horrible products. We check that every item in our shop is of a high quality.” Meanwhile, Lucas confirmed that BHF will open more specialist furniture and electrical stores after finding increased customer demand for cheap high-ticket items.
The recession has also benefitted charities because landlords prefer them as tenants. “We are a good bet for landlords because we have good governance so we stay the course of the let” said Lucas. “We are in sites we were not considered for previously, such as former Woolworths’ shops.”
Charities have also learned that outlets which specialise in particular products are profitable as they expand their customer base. CRA projects and policy officer Isabelle Adam said: “Niche shops bring in a different type of person than usual – they can attract collectors.” Barnardo’s has shops specialising in bridal-wear, vintage clothing and children’s items. “They capture a different market each time,” said Grant.
A unique shopping experience is another draw for customers to some stores. The Teeside Hospice Shop won the 2011 CRA award for innovation because it sells produce from an in-shop allotment tended by local offenders which was a hit with locals. “Unusual shops give people a story they can tell,” explained Adam.
Improved shop interiors are also helping sales. The BHF continually looks over its shop layouts according to Lucas. “Charity shops are brighter and people come in because they are impressed,” said Adam.
Tactical shop locations play their part in retail success too. Barnardo’s shops are in easily accessible areas for shoppers or those donating items. “If you pick the right location, people will come in,” said Grant. “We look at areas to see if there are good parking facilities.”
However, the downturn is not entirely good news for charities. People also want to hang on to items. The BHF are “marketing hard” to rectify this by using social media and leaflets.
Despite this, charities are having a profitable time. “Generally, charity shops on the high street are doing well,” said Jayne Cartwright, founder of The Charity Retail Consultancy.