April-June 2018 Quarterly Market Analysis review

Trading conditions are still challenging for the UK retail industry. Household budgets remain under pressure from weak wage growth, the strong rise in online activity and shoppers’ predisposition towards leisure and experience over retail products continue to drive down day time footfall, and a growing list of high street giants have announced major cutbacks and shop closures. Additional challenges faced by some of our charity members in April–June were staffing levels and the level and quality of donations. However, as results turned out to be less buoyant than hopped for commercial retailers, April–June was a remarkable quarter for charity retailers.

Over the three months to June, both customer sales and income excluding Gift Aid tax reclaims were up by 4.7 per cent on a like-for-like basis from April–June 2017, when they had increased by 1.2 per cent and 0.9 per cent respectively from the preceding year. Charity retailers were able to convert lower footfall into sales and the quarter ended up with overall results extremely positive in all sales categories.

Like-for-like income from donated goods was up by 4.6 per cent in April–June, from a positive base of 1.5 per cent for the same quarter last year. 85 per cent of respondents reported growth in this category against April–June 2017; with smaller and medium members seeing the strongest results. Like-for-like income from bought-in goods also rose, up by 4.9 per cent on a year ago from a weak base of -1.9 per cent in April–June 2017.

Revenue from goods sold on to recyclers remained healthy. The average rag price stood at 45 pence this quarter and rag sales increased by 9.8 per cent year-on-year, from a strong base of 12.9 per cent in April–June 2017.

After such a positive retail performance, in a trading environment where this is becoming increasingly difficult to achieve, the great majority of respondents to our survey approach the months ahead with optimism.

Olaia Alamos Castresana
Research Manager
Charity Retail Association

Our members can download the full Quarterly Market Analysis and Rag Price reports for April–June the members’ section of this website