2nd November 2026
For generations, charity shops have been a familiar feature of British high streets. They provide affordable clothing, books, furniture and household goods, while raising money for charities and giving thousands of volunteers an opportunity to contribute to their communities.
Yet some of Britain's biggest charities are now closing shops, reviewing their retail operations and questioning whether the traditional charity shop model can continue to deliver the income they need.
The British Heart Foundation (BHF) has announced plans to close around 150 shops over the next two financial years. Oxfam has been examining the future of its retail operations, while other charities, including Cancer Research UK and Scope, have also been reducing their high-street presence.
At first glance, this might suggest that charity shops are becoming another casualty of the changing British high street. But there is something rather puzzling about the situation.
The second-hand market is booming. More people are buying pre-owned clothing, household goods and other items than ever before. Online platforms such as Vinted, eBay and Depop have made buying and selling second-hand goods increasingly popular.
So why are charity shops struggling when the market for the very goods they sell appears to be expanding?
The British Heart Foundation's warning
The BHF's announcement is particularly significant because it is one of Britain's largest charity retailers.
In June 2026, it announced proposals to close around 150 shops over two years. Approximately 90 closures are planned by the end of March 2027, with the remainder expected by March 2028.
The charity said that rising operating costs and changing customer habits had made some locations financially unsustainable.
Its subsequent financial figures help explain the decision. In the year to March 2026, the BHF operated 651 shops, including clothing shops and larger furniture stores. Retail turnover reached £236 million, but retail costs rose to £240 million. The operation recorded a net loss of £3.3 million.
Costs increased by 5%, while turnover grew by only 1.5%.
These figures demonstrate the difficulty of running a large physical retail operation when expenses are rising faster than sales.
It is important to distinguish the performance of the shops from the financial position of the charity as a whole. The BHF continues to receive substantial income from fundraising and legacies and remains a major funder of cardiovascular research.
Closing shops is therefore an attempt to protect its wider charitable work rather than an indication that the organisation itself is in financial collapse.
Vinted and eBay are changing the rules
One of the biggest challenges facing charity shops is the growth of online resale platforms.
In the past, somebody clearing out a wardrobe might have donated unwanted clothes to a local charity shop. Today, they may photograph the items, upload them to Vinted and sell them directly to another consumer.
The attraction is obvious. A good-quality jacket, handbag or pair of shoes might raise a useful amount of money for the individual, whereas donating it would bring no direct financial return.
This creates a problem for charity retailers because the better-quality donations are often the most valuable.
Research commissioned by Rathbones and reported in 2026 found that nearly two in five charity executives surveyed believed the quality of donations had declined since the growth of online resale platforms. Around half of donors questioned said that online selling had affected what they gave to charity shops.
There is an important distinction between the quantity and quality of donations. Charity shops may still receive large volumes of clothing, but that does not necessarily mean they are receiving goods that can be sold at a worthwhile price.
Some shops are increasingly left with lower-value items that take just as much effort to sort, price and display as more desirable products.
The growth of fast fashion has added another complication. Cheap clothing is often purchased, worn for a relatively short period and then discarded. Some garments are of such poor quality that they have little resale value.
Charity shops are not simply dealing with a shortage of donations. They are dealing with a changing mixture of donations.
The economics of running a charity shop
It is easy to assume that charity shops have a major financial advantage over ordinary retailers because much of their stock is donated.
However, donated goods are not entirely free to sell.
They have to be collected, transported, sorted, checked, priced and displayed. Items that cannot be sold must be stored, recycled or disposed of. Larger furniture operations also need warehouses, vehicles and collection services.
There are property costs, electricity bills, insurance, maintenance, transport expenses and staffing costs.
Although volunteers provide an important contribution, charity shops still employ paid staff, particularly managers and people responsible for supervising larger operations.
The increases in employment costs, including the National Living Wage and employer National Insurance contributions, have added to the pressure.
For a shop with relatively low sales, even a modest increase in rent or staffing costs can make the difference between generating a useful contribution to the charity and losing money.
This also helps explain why some charities are reconsidering where they operate. A shop in a busy town centre may have considerably higher rent than one in an out-of-town location, but it does not necessarily generate enough additional sales to justify the difference.
The traditional assumption that every charity should have a presence on every high street may no longer make financial sense.
The second-hand market is booming, but charities are missing out
The contradiction becomes clearer when looking at the wider second-hand clothing market.
UK spending on second-hand clothing has reportedly reached around £8.8 billion annually, approximately four times the level recorded a decade ago.
The market has been transformed by online platforms, changing attitudes towards sustainability and the cost-of-living pressures facing households.
Younger consumers in particular have become increasingly comfortable buying pre-owned clothing.
This is not a dying market. It is a growing one, but much of the commercial activity is taking place outside traditional charity shops.
There is also a wider question about who benefits from the growth.
When someone sells a second-hand garment through Vinted, the original owner receives the money, the buyer obtains a cheaper item and the platform benefits from the transaction.
A charity receives nothing unless it is involved in the sale.
That does not mean online resale is necessarily bad for charity retail. In fact, it could offer charities opportunities to reach customers who would never visit their shops.
Some charities already sell selected goods online, particularly books, collectables, furniture and higher-value clothing.
The difficulty is developing the expertise and systems to do this efficiently.
Oxfam and the challenge facing established charities
Oxfam illustrates how widespread the problem has become.
In August 2026, the charity said it could not guarantee the future of all its shops as it reviewed its retail and warehouse operations.
By October, attention had turned to the financial performance of its retail business. Reports indicated that retail profits had fallen by 23% to £4.9 million in the year to March 2026.
There are also concerns about the declining financial contribution generated by shop sales.
Oxfam has been exploring different ways of generating income, including expanding online book sales, selling clothing at festivals and developing other retail opportunities.
This is an important point. The future of charity retail may not depend on maintaining the same number of conventional high-street shops.
A combination of physical stores, online sales, specialist outlets and temporary retail opportunities may prove more effective.
However, there is a danger in assuming that every charity can simply move its business online. Not all donated goods are suitable for internet sales, and handling individual orders, packaging and postage brings its own costs.
There is still a strong case for charity shops
Despite the difficulties, it would be a mistake to write off the sector.
The Charity Retail Association reports that Britain has more than 9,900 charity shops. Its figures indicate that charity retail contributed more than £300 million in profit to parent charities during 2024/25.
The sector also provides employment for more than 24,900 full-time-equivalent workers and opportunities for over 223,500 volunteers.
These are substantial figures.
Charity shops also provide something that online marketplaces cannot easily replace.
They offer affordable goods to people who may not have the money to buy new clothing and household items. They encourage reuse and help reduce waste. They provide volunteering opportunities and give many town centres a useful community presence.
For some people, particularly those who are older or less comfortable using online services, a charity shop is still an important part of everyday life.
There is also a financial benefit that is not always captured simply by looking at the profit made on individual sales. A local shop can help maintain relationships with donors, volunteers and supporters who may also contribute through other fundraising activities.
A charity shop is not necessarily just a retail outlet. It can be part of the charity's wider presence in a community.
What about smaller towns?
The implications are particularly important for smaller towns, where charity shops can make up a noticeable proportion of the remaining independent retail businesses.
In places such as Wick and Thurso, the closure of even one or two shops can have a visible effect on the town centre.
There is a difference between a charity deciding that a particular shop is no longer commercially viable and the wider community losing another reason to visit its high street.
Smaller towns may have lower property costs than major cities, potentially giving charity retailers an advantage. However, they also have smaller populations, fewer potential customers and a more limited supply of donated goods.
A charity shop that works well in a larger town may struggle to generate sufficient turnover in a smaller community.
There may be opportunities for shared premises, reduced opening hours, volunteer-led operations or cooperation between charities. But these arrangements still need to cover their costs.
The challenge is to find a model that recognises the value of having a shop in a community without expecting charities to subsidise uneconomic premises indefinitely.
Can charity shops adapt?
There are several possibilities.
Charities could make greater use of online marketplaces, selling valuable items nationally rather than relying entirely on local customers.
They could concentrate on larger shops with better storage and sorting facilities, rather than maintaining several small outlets with high overheads.
They could specialise in particular categories, such as books, furniture, vintage clothing and household goods, where there is an established customer base.
They could also develop better relationships with donors, explaining that clean, good-quality goods in saleable condition make a much greater contribution than bags of unwanted clothing that have to be discarded.
There is an opportunity for charities to work with the growing interest in sustainability and reuse rather than simply compete with online platforms.
The sector should also consider whether its traditional retail model is still the most effective way of raising money. In some locations, online sales and collection services may generate a better return than maintaining a physical shop.
But the answer will differ between charities and communities. A successful specialist furniture shop may have very different economics from a small clothing shop on a quiet high street.
A changing high street, not necessarily the end of charity retail
The British Heart Foundation's planned closures are a warning that charity shops are not immune to the pressures affecting ordinary retailers.
Rising costs, changing shopping habits, competition from online marketplaces and the declining quality of some donations are all contributing to the difficulties.
Yet the growth of second-hand shopping suggests that the underlying demand for affordable pre-owned goods remains strong.
The real question is whether charities can adapt quickly enough to capture more of that growing market.
It would be premature to declare the end of the charity shop. More likely, Britain will see fewer shops in some locations, larger and more specialised stores in others, and a greater emphasis on online selling.
There is also a wider lesson for Britain's high streets. Consumer demand has not necessarily disappeared. It has moved to different places and different ways of doing business.
Charity shops have served communities for generations, but goodwill alone cannot pay the rent, electricity bills and wages.
Their future will depend on combining the charitable purpose that made them successful with the commercial discipline needed to survive in a very different retail market.
BHF proposes 150 shop closures to maintain sustainable retail network
Research into the impact of online resale on charity donations