Charity shop
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A charity shop, thrift shop, thrift store, hospice shop (U.S., Canada), resale shop (when not meaning consignment shop (U.S.)), or op shop (Australia/N.Z.) (from "opportunity shop") is a retail establishment operated by a charitable organization for the purpose of fundraising.
Charity shops are a type of social enterprise. They usually sell mainly second-hand goods donated by members of the public, and are often staffed by volunteers. Because the items for sale were obtained for free, and business costs are low, the items can be sold at very low prices. After costs are paid, all remaining income from the sales is used in accord with the organization's stated charitable purpose. Costs include purchase and/or depreciation of fixtures (clothing racks, bookshelves, counters, etc.), operating costs (maintenance, municipal service fees, electricity, telephone, limited advertising) and the building lease or mortgage.
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[edit] Thrift Stores
"Thrift Stores" are more often called "for profit" businesses. These are the stores in which the charity realizes it is in their best interest to sell their donations to the highest bidder of a "for profit" business professional who is able to make the charity more money, at no cost or risk to the charity. The money then can be used for the beneficiaries instead of the donations. In all "for profit" U.S. "Thrift Stores" and "Outlets" the items were NOT for free, but instead bought from the charity upfront, before the business owner makes a profit at all. All risk goes to the business owner, and the majority of the proceeds from the donations are still received by the charity. They usually sell mainly second-hand goods donated by members of the public, and are never staffed by volunteers. No merchandise is obtained for "free", instead the "for profit" stores buy their merchandise, usually from a well known and supported 501(c)3 charity in the U.S. Donations to the charity are tax deductible, including those that go to the "for profit" stores because they either are the highest bidders for their charities merchandise, or in some cases, like "Savers" and "Value Village" they pay a small percentage of the profit to the charity. The "for profit" Thrift stores that benefit the charity most also provide all labor and materials to get the merchandise into the store. BEFORE costs are paid, all merchandise is purchased from the charity affiliation in accord with the organization's contract that is most beneficial to the charity that the store works side by side with. Costs include purchase and/or depreciation of fixtures, (clothing racks, bookshelves, hangers, signs, display cases, counters, shopping carts, cash registers etc.), operating costs (building rent, building maintenance, parking spaces, property taxes, municipal service fees, electricity, telephone, advertising including mailing, and the building lease or mortgage, payroll, payroll taxes,vehicle, building, and company insurance, unemployment, health insurance for employees who are paid well above minum wage, and employee benefits, trucks and other vehicles, fuel and vehicle maintenance, contract, and attorney fees plus the charity itself is always paid FIRST based on the contract for their merchandise, whether the store actually makes a profit or not (except in the case of stores like Savers and Value Village that pay the charity based on a percentage of the profit).
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Often the "for profit" Thrift store owner makes little or no profit, while making a great profit for both the charity and the average 40 or more employees with salaries, benefits, and health insurance available to them. Though these are called "for profit" businesses, it is often difficult, or near impossible to make a profit based upon the contract the "for profit" store has with the charity, and the dedication the owner has to his or her employees, along with all of the other costs every other small business incurs. These stores, ironically, though called "for profit" end up making the charity the most profit, by not requiring the charity to be encumbered by all of the costs of doing business listed, and omitted above. Next the profit goes to the employees keeping the store running, and anything left after these costs is left as profit - or loss by the Thrift Store owner.
Paradoxically, it is the store run by the charity itself that gets it's merchandise for free, and uses "volunteers" for their operation, usually making much less of a profit for the charity itself. The charity operated stores rarely make any money for the charity, and often go out of business because charities are not run by business owners, but usually a board of directors, or trustees, who have made an unsound business decision in letting the charity be run by "volunteers" who are in need of the services of the "charity" but are not paid at all for working in the stores. Often these "volunteers" are not there by choice, but out of debt to the charity, (or society as in the case of community service court sentencing) and are often "paid" in merchandise if at all, leaving little for the customers to choose from. Charities like those listed under the different country headings below, often do themselves, and their beneficiaries a great disservice by trying to run a business without having business professionals involved. This is partly because of the urban myth that "for profit" stores are solely "for profit" and do not contribute to the charity, and partly due to greed on behalf of the people operating the charity from behind the scenes that think it would be more profitable to them to use free labor, and not have to sell their goods to a business owner with experience in running Thrift Stores.
[edit] Popularity of charity shops
Charity shops are often popular with people who are frugal, people who live on a limited or fixed income, collectors, and people with unusual tastes. This last group includes members of various subcultures. For example, clothing from charity stores was often modified by early punk rockers. In the United States shopping at a thrift store has become popular enough to earn a slang term, thrifting.
Environmentalists may prefer buying second hand goods as this uses fewer resources and may do less damage to the environment than by buying new goods. In addition, reusing second hand items is another form of recycling, and thus reduces the amount of waste going to landfill sites.
Also, people who oppose sweat shops often purchase second hand clothing as an alternative to supporting clothing companies which have dubious ethical practices.
Thrift stores are also popular with eBay sellers who buy collectible items and hope to resell them for a profit.
[edit] New goods sold at charity shops
Some charity shops also sell a limited range of new goods which may be branded to the charity, or have some connection with the cause the charity supports. Oxfam stores, for example, sell fair trade food and crafts. Other stores may sell new Halloween supplies and decorations where old vintage clothes are popular for use as costumes. Some stores specialise in selling books, music, or bridalwear. Charity shops may receive overstock or obsolete goods from local for-profit businesses; the for-profit businesses benefit by taking a tax write-off and clearing unwanted goods from their store instead of throwing the goods out, which is costly.
[edit] History of charity shops
The first Oxfam charity shop in the United Kingdom was established in Broad Street, Oxford, and began trading in December 1947 (although the shop itself did not open until February 1948). Oxfam opened some of the first charity shops.
However, predating this, one of the first Red Cross shops was opened at 17 Old Bond Street, London, as early as 1941. In total over two hundred “permanent” (for the duration of the war) Red Cross gift shops and about 150 temporary Red Cross shops were opened during the war years. A condition of the shop licence issued by the Board of Trade was that all goods offered for sale were gifts. Purchase for re-sale was forbidden. The entire proceeds from sales had to be passed to the Duke of Gloucester’s Red Cross and St John Fund. Most premises were lent free of rent and in some cases owners also met the costs of heating and lighting.
During World War I similar fundraising activities occurred such as a bazaar in Shepherd’s Market, London which made £50,000 for the Red Cross.
[edit] United Kingdom
Oxfam has the largest number of charity shops in the UK with over 700 stores. Many Oxfam shops also sell books, and the organization now operate over 70 specialist Oxfam Bookshops, making them the largest retailer of second-hand books in Britain. Other Oxfam affiliates also have stores - Jersey, Germany, Ireland (45 shops in NI/ROI), the Netherlands and Hong Kong.
Other charities with a strong presence on high streets in the UK include British Heart Foundation, Cancer Research UK, Age Concern, Help the Aged, Save the Children, Scope and Sue Ryder Care. Many local hospices also operate charity shops to raise funds.
British charity shops are mainly staffed by unpaid volunteers. Goods for sale are predominantly from donations - 93% according to the official estimate. [1] Donations are not always made in the approved manner. It is common[citation needed] to see piles of black plastic bags left in a charity shop doorway. In expensive areas, donations include a proportion of good quality designer clothing and charity shops in these areas are sought out for cut-price fashions[citation needed].
Gift Aid is a UK tax incentive for individual donors where, subject to a signed declaration being held by the charity, income tax paid on donations can be reclaimed by the charity. Although initially intended only for cash donations, the scheme now (since 2006) allows tax on the income earned by charity shops acting as agent for the donor to be reclaimed. [2]
Charity shops in the UK get 80% relief on business rates on their premises, and can apply for discretionary relief on the remaining 20%, which is an occasional source of criticism from retailers which have to pay in full.[3]
[edit] United States & Canada
In the United States, major national thrift shop operators include Goodwill Industries, Salvation Army, St. Vincent de Paul, and ReStore (see Habitat for Humanity International). Regional operators include Deseret Industries and those run by the Bethesda Lutheran Home in the Upper Midwest. Many local charitable organizations, both religious and secular, operate thrift shops. Common among these are missions, children's homes and homeless shelters, and animal shelters. In addition, some charity shops are operated by churches, and are fundraising venues that support activities including in some cases, missionary activities in other countries.
[edit] Australia
In Australia, major national opportunity shop chains include the Society of Saint Vincent de Paul (trading as Vinnies), the Salvation Army (trading as Salvos), the Red Cross, and the Brotherhood of St. Laurence. Many local charitable organisations, both religious and secular, run opportunity shops. Common among these are missions and animal shelters.
[edit] See also
[edit] References
- ^ http://www.charityshops.org.uk/faqs.html#When%201st%20shop Association of Charity Shops FAQ
- ^ HMRC Gift Aid
- ^ Call to cut charity shops in town
[edit] External links
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