A bastion of cheap clothing, bric-a-brac and old novelty records, the Great British charity shop is one of the more reliable sights on any local shopping parade, from Cardiff to Carlisle. Responsible for raising an estimated £290 million for their respective charities every year, these stores have been high street fixtures since the tail end of the 19th century.

Yet last year, a report conducted by the True And Fair Foundation (TFF)—founded by Gina and Alan Miller—showed that around 40% of the nation’s charity shops are turning a profit below 17p to the pound. The report, entitled “Lifting the Lid”, claims that many charities spent under a tenth of their income on directly charitable causes, one of many statements which have been roundly criticised by third sector commentators for being “deliberately misleading.”

But what has brought on this criticism? Does the sector need to adapt in order to keep up with current retail trends, or is that the whole charm of charity shops to begin with?

Local councils (and local stores) aren’t quite so keen…

The TFF report was not specifically targeting charity shops, but the third sector as a whole. Its main recommendations around charity retail were effecting considerable changes to “the efficiency, role and positioning” of stores on the high street. The report’s reasoning behind this is in order to “reduce the unfair playing field for other high street operators”—that is to say, major (and independent) commercial retailers.

Part of the reason charity shops have managed to survive, despite a decrease in foot traffic, is the 80% relief in their rates provided to them by the government; this makes charity shops one of a select group of buildings to receive this dispensation. This is one specific area targeted by the TFF report, which suggests a 10% annual reduction of these rates, leaving the overall relief at 50% by the end of the decade.

Many local councils, such as that of Medway, are already reducing these relief efforts, with exceptions for specific types of charity, such as those who work with children and the elderly. While this may save councils two thirds of their charity annual relief budget, but the overall £1.56bn of savings are going to be near-impossible for the sector to pay by themselves.

If this relief effort is removed across the board for charity shops, the death of the charity shop is unfortunately assured. So how can charities continue to raise money through retail?

…but the British public will always love a bargain

As inflammatory as the TFF’s report is, it seems to fly against the public’s perception of charity shops on the whole. One survey found that charity shops were more likely to be where people sourced all of their second hand goods in comparison with the likes of eBay. This would explain the growth of chains like Cancer Research UK, who are branching out into launching “superstores”, boosting their profits through selling furniture in larger spaces.

This growth does have its downside, one rooted in the darker days of the recession a decade ago. Finding expensive clothes at bargain prices during the economic downturn led to a severe case of supply and demand; consequently, more upscale, rare and vintage items have started to be sold at closer to their market value.

Oxfam’s press spokesperson has been quoted as saying “We need to respect the donation; if we get a Chanel bag, for example, we are not going to price it at £300 but we are not going to price it at 99p either.” This fair pricing may be logical, but it does go somewhat against the public perception of charity shops, where you’re as likely to find a book once owned by Radiohead’s Thom Yorke as you are fifty copies of Fifty Shades.

Charity begins…online?

Perhaps the charity retail sector has already started preparing for a post-high street life. This September will mark the tenth anniversary of Oxfam becoming the first charity shop to begin operating online. Critics saw this as a removal of the “rummaging [and] wandering” which makes the charity shopping experience so widely-loved to begin with, but as with online stores in general, charity e-commerce sites are becoming increasingly widespread.

By 2014, 80% of charity shop branches were selling their wares online, predominantly via eBay; the online auction platform began integrating charity into its site in 2003, first under the guise of eBay Giving Works, then as eBay For Charity, and this integration seems to have worked. Last Christmas saw Oxfam’s online sales increase by 43%, while charities are also taking advantage of online sales trends such as Black Friday, in a bid to improve their online takings, as well as in-store.

The rebate on charity shop business rates is not up for revaluation for a few years, particularly after the recent delays. However, if charity shops do end up being hit hard, it’s encouraging to know their fallback option of online retail is becoming a more sustainable solution.

Running a small business isn’t easy. There are unexpected costs and problems at every turn, so it makes sense to ensure you’re saving money wherever possible. Here we’ve taken a look at some ways you can encourage growth in the future, by saving time and money now…

Hire the right employees

This may seem obvious but some small changes to your recruitment policy could result in you saving time and money in the long run. When hiring, rather than thinking about what you will be able to get out of an employee, why not think about what they can get out of working at your business? People who feel they’ll be challenged and learn new skills at a company are far more likely to stay motivated while they’re there. Motivated members of staff will help ensure your business gets tasks done on time and to a high standard, which ensures no time or money is wasted. To help ensure your staff stay motivated, if possible you could look at offering learning opportunities. You should also place a focus on work culture – that way you’ll have happier employees and a lower staff turnover rate.

One tip you could take on board for hiring is to have your employees do the headhunting. Not only does it save money, but it will attract people to your organisation who are similar to the ones that already fit in. It helps you to build an effective and cohesive team, whilst making your current employees feel as if they’re helping to shape the business and their workplace too.

Put a parcel delivery system in place

One easy way to cut down costs is on parcel delivery. Huge amounts of small companies underestimate the costs involved when it comes to sending out packages. Whether you send a few dozen packages a week or a few hundred, you could significantly cut down your costs simply by finding the cheapest courier available. At parceldelivery.com, we group together customer orders in large volumes before booking them through a single account. Due to the volume of orders, we’re in a position to negotiate prices with our trusted couriers and then pass the savings onto you. Those savings could make a huge difference to your bottom line, giving you extra funds available to invest in the growth of your business.

The right clients

When you’re just starting out it can be tempting to take on every client that comes your way. Sometimes, however, it’s best to exercise caution as the wrong type of customers could end up negatively impacting your business. It’s a good idea to spend time researching the type of client that would benefit most from the products or services you have to offer. Different departments can provide you with data which you can then use to create customer ‘personas’. With this information, you’ll know who to target your marketing efforts towards and you’ll know who the right customers for your business are.

The right customers, managed well, can lead to new business. So if you’re looking to save time and money, focus on getting the right clients, because their word of mouth recommendations will save you a lot of marketing efforts.

If you think of a company losing value in the stock market, you immediately imagine a company straddling bankruptcy and nailing the coffin of their business venture. If you think of Kodak, the image that pops to mind is that of the illustrious camera and film manufacturer which redefined photography and whose name grew to become synonymous with a perfect moment saved in a photograph. Indeed, the Kodak Moment campaign solidified the company in most people’s minds. But quite often both thoughts – the company losing stock market value, and Kodak’s immense success – will collide, leaving one wondering how Kodak’s value on the stock market depleted. While that may have been true at one time, it was only true for a moment, as Kodak did the unthinkable – it brought itself back from the brink. But how?

Kodak’s success came predominately from camera film. However, due to oversights in the adaptation to the digital world, the consumer need for film fell in favour of digital microchips, and Kodak dropped from the trading board. In 2012, the company filed for bankruptcy and had to go back to the drawing board. In business terms, Kodak still had a lot of factors for growth – its name, reputation, manufacturing ability, and technological knowledge – keeping it afloat. Thus began the story of the Kodak comeback.

Kodak’s issue may have been born from availability bias – a type of confirmation bias which describes individuals only considering what information is readily available to them when looking at an issue, rather than any anomalous and/or additional factors. Kodak were focused on how they always did business and how successful they had been, while neglecting to move with the times and notice the consumer’s growing lack of interest with traditional film. Indeed, behavioural finance, of which availability bias is a factor, is increasingly important in helping keep a company on the stock market.

It is no easy feat to return to the stock market and the difficulties continue once they have settled there. As can be seen through IG’s financial indices that ebb and flow, reflecting the movements of the stock market, a company’s position can become tenuous, especially in financial hardship, which only works to exacerbate the declining market capitalization. Kodak was saved in part by its tangible assets, a factor that the FTSE 100 can take into account when attempting to make trades of stocks and shares on the market. It can also help to investigate trends, which indicate whether a market is moving upwards or downwards. Perhaps if Kodak had been able to identify the moment the trend started to move downwards, they could have rectified things earlier. Kodak relisted on the stock exchange in 2013 following the filing of the Chapter 11 that forced them off the board. The company, with a change in focus, came back at around $26 per share. But what did Kodak do to forge their comeback?

Kodak’s comeback to a positive market capitalization worked two-fold. Firstly, the Hollywood clamour for old-school glamour allowed Super 8 to become a mode of making film. Kodak were responsible for the Super 8 boom back in the 80s and 90s and many of the highest grossing films were shot on Kodak film. More recently, filmmakers have switched out the digital in order to capture the look of nostalgia. For instance, 2016 Oscars favourite La La Land evoked the golden age through the film it was shot on. Reversing the move away from traditional film allowed Kodak’s film to be used again and to secure a deal with various film studios in 2014.

Kodak also used their name and knowledge to shift focus. Instead of marketing to consumers, they marketed to businesses. Specifically, Kodak began to create inkjet printing devices to sell commercially. The technology – something Kodak were familiar with – allowed them to continue trading with a brand-new strategy.

The legal issues surrounding its Chapter 11 are almost fully ironed out. The New York Stock Exchange and the Nasdaq both have rules and regulations in order to remain a listed, trading company, and Kodak fell short of these rules – but much like the market trends can go up and down, Kodak managed to bring itself back from the brink and remains a household name across the world.