Shopfitting and display
The layout of your shop is dictated by security, aesthetics and stock:
- goods should be attractively displayed, with the biggest sellers – typically clothing – gaining the most space on the shopfloor. Two-tier rails will help maximise space.
- smart window displays will help attract shoppers, as well as potential donors and volunteers. They should be uncluttered, clearly priced, and suitable for the time of year.
- the counter should be positioned somewhere with a good view of all parts of the shop and not too near the main entrance, for security reasons.
- high-value goods, such as jewellery, should be kept in a locked cabinet.
- providing fitting rooms can help to sell more clothing: these should be in clear view of the counter and be of sufficient size to allow a wheelchair entry, but should not provide opportunities for theft.
Setting the cost of goods in a charity shop should be the responsibility of one person, typically the shop manager, so as to ensure consistency. There are several factors which they will need to consider in choosing a price, including:
- the condition of the item, as well as its rarity or collectable value
- psychology of the customer: a price ending in 99p or 95p seems better value that one priced a few pence higher to reach a round number
- competition with local charity shops and commercial ‘value’ retailers: goods may need to be priced in a similar range
- the shop interior: the perceived value of stock is affected by the quality of the shopfit (equipment, decoration and lighting etc)
- how much stock comes in to the shop: if you are given lots of good quality items, you can better afford to sell them at a low price than if you struggle for donations
- location and local economy: customers in affluent areas can pay higher prices for their purchases, while those in other areas would be put off by such costs
- rates of inflation: prices need to rise along with inflation, so as income does not decrease.
Some charity shops supplement their stocks of donated items with a range of new ‘bought-in goods’, such as Christmas cards or Fairtrade items.
However, while bought-in goods can attract new customers, there are several negative points which require consideration. The sale of these new goods:
- is more time-consuming and complicated to administer than donated goods - they require VAT returns, stock-takes and order placements
- has to be administered through a separate trading company
- could jeopardise a charity’s qualification for rates relief as entitlement is subject to the premises being used for ‘wholly or mainly’ charitable purposes
- should only be considered where the charity has the resources to properly manage the sales and believes that it will increase profits, perhaps by attracting new customers to the shop.
Selling at auction
Some second-hand items can achieve a higher price by sale at an auction or on eBay. Items such as as rare records, paintings or furniture can be very popular. Cultivate a relationship with a local antique dealer, and consider setting up an online shop through eBay For Charity.