Charity shops face challenges as secondhand market evolves

The British Heart Foundation (BHF), with a substantial high street presence, plans to close 150 stores following a £3.3 million loss in the last financial year. Cancer Research UK and Scope have also announced shop closures.

This downturn occurs despite a surge in secondhand clothing spending, which has quadrupled over the past decade to reach £8.8 billion annually, according to GlobalData. The rise of online platforms like Vinted and Depop is contributing to the change, as individuals increasingly sell their clothes directly to consumers rather than donating them to charity shops.

Increased clothing sales by Chinese companies in developing countries, particularly in Africa, are also impacting the market for secondhand clothing. Lorna Fallon, head of Oxfam’s retail operation, stated, “It has been challenging … and it is going to be painful for the sector.”

Oxfam’s filings indicate that only £6 of every £100 spent in its shops now goes towards the charity’s global poverty alleviation work, down from £22 in 2022. However, the organization intends to maintain its shop network due to a focus on books and music.

The BHF conducted a review of its retail arm, which employs nearly 3,700 staff, after profits plummeted from £18.8 million in 2024 to £3.6 million by March 31, 2025. The charity aims to close 90 stores by March 2027 and another 60 by the following March, citing a “challenging trading environment.”

Experts highlight that charity shops face limitations compared to online platforms due to factors like high street rents, storage costs, and inefficiencies in handling donations. Tansy Hoskins, author of Charity Shop World, notes a decline in the quality of donated clothing, describing it as an “avalanche” of poor-quality items.

Robin Osterley, chief executive of the Charity Retail Association, acknowledges the impact of fast fashion on donation quality but suggests that online platforms are not the primary issue. He emphasizes that these platforms normalize secondhand shopping and provide a source of income for some charity shops. Osterley points to the November 2024 budget, with national insurance increases and a lowered threshold, as a more significant factor impacting charity shops, alongside broader inflationary pressures.

Richard Hawkes, Oxfam GB’s chief executive, remains optimistic about the future, stating, “Whilst there is no getting away from the fact that the charity retail sector has been impacted by the cost-of-living crisis… there is still much to be hopeful and positive about.” He highlights the value of charity shops in community engagement and volunteer opportunities.