The Charity shop that's not a charity shop.
Options
Comments
-
Mrs_Huggett wrote: »Thank you lincroft1710 and pramsay13 there are things to consider aren't there? Greyteam, I'm not sure what your problem is?
Your post is difficult to read, if you were able to put in line spacing it is easier on the eye.0 -
If you are selling second hand items and expecting a wage yourself, and pay staff and running costs I can't see you selling enough to make any profit. Where will you get the money to start? What do you do if you make losses?
The bit that really sticks with me is the fact that you would expect a wage, it just seems a bit like jobs for the boys.
I think you might find that managers of charity shops get paid.
https://myjobsearch.com/careers/charity-shop-worker.html0 -
Our Waitrose has a scheme where £1000 a month is donated to local organisations.
Customers can take a token and put it in a box with the name of the organisation they choose from three different ones each month.
The £1000 is then shared out according to the percentage of tokens in each box.
You could do this with your customers.0 -
indeed they do, and typically so will a deputy manager, but the shop floor staff are not as you know, given they will be volunteersPOPPYOSCAR wrote: »I think you might find that managers of charity shops get paid.
https://myjobsearch.com/careers/charity-shop-worker.html
so whilst i think OP's intentions are excellent, the reality may be very different by the time OP has taken a salary for themselves and paid the staff a "proper living wage" of around £17,000 + employer's on costs for 1, 2 ,3 , more staff will make the finances of the project challenging.
of course charity shops bring a surplus over they cost, that is the idea, but even with careful marketing Op cannot hide the fact this is a money making exercise for himself and the staff and it is only what is left over that will be distributed
OP wants to retain personal control and has rejected CIC (or full blown registered charity) status. Therefore, the enterprise will have to pay tax on its profits before they can be given away.
it is a good altruistic idea, but as others have said will need a robust business plan and strong marketing to address where the funding is coming from and what happens when the incentives end.
If i was a resident in that community I may be warm towards its very local support agenda as an idea, but without charity status i would expect to pay sub charity shop prices for what will be other people's junk. that is because i do not get the satisfaction of the feel good reward for paying a small supplement to "charity" for secondhand goods that sell cheaper in a commercial junk shop (which appears to be OP's business model). For example, near full price for supermarket own label clothing as happens around our way on occasion.
Continuity of supply of donations for sale depends a huge amount on the name, hence the big charities do so well. It will take a great deal of effort to establish the credibility and name of a shop whose primary motive is to run it for the financial reward of its staff.0 -
And what about after that year, or do you only see it as a short-term venture? Also what about business rates? For a registered charity there are significant discounts, but you're actively wanting to avoid that which might be misguided.Mrs_Huggett wrote: »It's likely that very soon our council will be helping local start ups with rent free shops etc for a year or so, they did this recently and it was successful.
Others have pointed out how many shirts you've got to sell to make this fly. I'd like to ask for a definition of 'a proper living wage'. There is of course a minimum living wage, but it's a per hour rate. Are you assuming everyone will want to work full-time? Will they? And is that even desirable? You're going to need holiday cover, sickness cover and so on. Several part-time workers may offer more flexibility. Which means that while you may be offering a job which helps, it may not be enough by itself.Mrs_Huggett wrote: »My idea is to open a shop selling donated goods at affordable prices (so in essence a charity shop type set up) but to pay myself and staff a proper living wage, and pay the running costs.
There's also the issue of paying yourself: more below.
And that's just one are where paying yourself becomes complicated. You can, of course, as a sole trader, employ other people. But unless you have an elastic overdraft, you'd really have to pay the staff before you pay yourself. You could go for a Limited Company model - there would be some advantages, BUT you'd still have the issue that you can't pay yourself if you can't afford to do so.Mrs_Huggett wrote: »And I am not interested in opening a CIC as I would like to keep control of the management of the business.
I'm not saying these issues would go away with a CIC, but unless you are only thinking of a short-term project, then keeping sole control makes future development difficult. Lots of 'what if' questions crop up, and you've got no immediate support network to work through them with you.
Wages including holiday pay, SSP, SMP, SPP, and pension contributions. Insurance. Waste disposal (more below).lincroft1710 wrote: »Even with donated goods how much profit would you make after paying wages, rent, rates, utilities etc?
AND work out how many hours of paid staff time you'd need to be open, reliably, for the hours you anticipate being open, to include holiday cover, sickness cover etc.Produce a business plan and cost it properly and see just how many donated shirts you will need to sell to pay 1, 2 , 3 staff members.
Plus you won't be able to dump it yourself at the household facilities. It will be trade waste, to transport it in your car will require a trade licence, and trade disposal. You'll need trade disposal, plus trade disposal for your 'normal' refuse - kitchen waste, empty bags and boxes from donations, paperwork etc.Find out what other costs there are, e.g. I imagine waste licence as you will have to dump anything that can't be sold on.
Another thought is that depending on what sort of things you are selling, you may need someone who can check and repair for you. If selling electrical goods, you definitely need someone to do PA tests.
Oh, and banking: you may be able to get free banking, but cash withdrawals and paying in may make that tricky.
It's not just the trust issue (and note we're not suggesting you WOULD run off with the money! you're obviously committed to your local community), it's also the future planning issue which leads me to prefer Charity or CIC.Will people trust that you will not run off with their money? I think you should consider becoming a charity or CIC again as that would allay people's fears.
Sorry we are not overwhelmingly enthusiastic, but setting up a shop (of any kind) isn't a trivial undertaking, and there are extra things to consider in this situation.Signature removed for peace of mind1 -
Thank you for all your replies, some of the things mentioned I had already thought of, I will just shelve the idea for now I think.0
-
Unicorn Grocery in Manchester do something similar, granted they are selling new goods rather than donations.
https://www.unicorn-grocery.coop/0 -
I work in a hospice charity shop. Every member of staff is an unpaid volunteer.
For the getting rid of donations which are handed in and are not fit to sell (and these outweigh the good donations) we have a company which come in and pay for he bags of clothing and shoes so no going to the tip or having to get rid of it yourself.
I think the major drawback to your plan is in the costings, our shop is incredibly busy and does very well but we sell stuff at rock bottom prices to ensure a fast turnover. The problem now is that with the likes of Primark etc clothing can be bought so cheaply that you are not going to get much for 2nd hand. I see a lot of charity shops with rails containing t-shirts which are priced more than they were in Primark/Asda/Tesco.
Even with the turnover we have and the amount of donations we take in we would still not be viable if we had paid members of staff.1 -
of course charity shops bring a surplus over they cost, ..
Not always the case. A long time ago I spent some time volunteering in a local Oxfam shop - all in the shop made a loss and actually cost the charity money month-in, month-out (except at xmas where card sales boosted revenue, but not enough to make money over a full year). It's since closed but was in that state for at least the several years I was involved.
It might have been deemed worthwhile since it helped the brand out and presumably it helps out-of-store cash donations, and one or two supposedly "valuable" items got sent away to sell at auction or in London (and revenue was not properly attributed to the shop) but the point is: you must talk to a charity shop manager in your area and find out what kind of revenues they actually achieve - its probably less than you think.
You'll have to invest money in shop fitting and other things already mentioned to kick this venture off; its quite possibly only your ego will profit in the end.1 -
I did not mean all do, I mean the reason why charities have that business model (and the associated complexity for a charity having a trading activity which is not exempt from tax unless it operates in a very specific framework is not to be underestimated ) is that it makes money because staff costs are normally the single largest (non stock) cost for a retailer and they evade those leaving them only with rates - and where rates are high shops do as you close as they are uneconomicNot always the case. A long time ago I spent some time volunteering in a local .0
This discussion has been closed.
Categories
- All Categories
- 343.3K Banking & Borrowing
- 250.1K Reduce Debt & Boost Income
- 449.7K Spending & Discounts
- 235.3K Work, Benefits & Business
- 608.1K Mortgages, Homes & Bills
- 173.1K Life & Family
- 248K Travel & Transport
- 1.5M Hobbies & Leisure
- 15.9K Discuss & Feedback
- 15.1K Coronavirus Support Boards