Dark stores: the digital transformation of charity retail

The drop in income from charity retail during the pandemic was eye-wateringly large. The Charity Benchmarks Covid Impact Monitor report found that during Q2 of 2020 year-on-year income fell by 90%. This was extremely concerning for charities with a significant reliance on the high street for income.

 

As lockdown rules were lightened, the impact on income lessened. But retail stood out as an income stream crying out for rapid digital transformation.

 

 

Our high streets have changed

 

As we ease out of the pandemic, in-person spending is still down by more than 10% in major cities like London and the Office for National Statistics reports that the number of people working in a hybrid way is rising.

 

Charities with major retail arms have followed these changes and are beginning to undergo a process of digital transformation for retail in a way that diversifies their funding streams and allows for greater inclusion.

 

 

Dark stores

 

As the drop in retail income began to hit the British Heart Foundation hard at the beginning of the first COVID-19 lockdown, they worked with their e-commerce partner, Shopiago, to think creatively about how to recoup income.

 

The charity already had a focus on eBay with a presence on the online marketplace stretching back to 2006. However, the e-commerce operation was run from a central hub in Leeds and could not be accessed by local stores or by individual staff members and volunteers. Plus, during lockdowns the high street stores were removed from the e-commerce equation completely as pick-up locations for click and collect.

 

Working closely with Shopiago, the British Heart Foundation were able to retrieve some of the most saleable items from storage and send them to their network of trusted retail staff and volunteers at their homes.

 

Using the Shopiago e-commerce system, the staff and volunteers were able to list the items across multiple platforms and use the post office click and collect system to distribute sold items.

 

Richard Pallier, Head of Retail Online at the British Heart Foundation, said: “I’m not sure it’s possible to really take positives from something like a pandemic, but the speed and innovation demonstrated by our retail team, and the processes established then which still support sales and drive revenue now, are something to be proud of."

 

The charity was able to raise £100,000 through e-commerce over a six-month period during lockdown – a 12% increase on the previous period.

 

 

Widening accessibility

 

By shifting or at the very least adding in more flexibility to the geographic locations that charity e-commerce sales can take place, charities are inviting in a more diverse range of staff and volunteers.

 

Thom Bryan, Head of Product at Shopiago, is pleased to be “finding new ways of getting people to contribute without being on the premises.”

 

Shopiago also provides training for staff and volunteers on e-commerce products and undergo user testing to make sure their systems are accessible for people with disabilities – many of whom seek the flexibility of working from home.

 

 

The future of retail

 

As the high street has opened up again, there has been some decline in the rate of online shopping, but it’s remained consistently higher than before 2020. Current rates are around 38% online to 64% in person.

 

As our spending habits continue to evolve, it’s likely that we will keep seeing shifts in the role of charity high street stores. We could see physical stores:

• Become more of a hub for online sales as click and collect locations
• Play more of a role as sorting centres for donations that are divided into items for in-person sales, items for ecommerce or items to be sold in bulk by weight
• Begin to specialise in larger higher priced items that are less suitable for e-commerce, like furniture

Is this truly the beginning of the end for high street charity shops as we know them?

 

Since the Mary Portas makeover of a number of Save The Children’s shops in 2009 the role of the charity shop in the vintage clothing and anti-fast fashion movement has been significant. It’s spawned a bank of influencers with audiences who watch as they wander the rain-soaked pavements of UK cities in search of an achingly cool OOTD.

 

Will they be just as happy with the content on items from Depop or Vinted?

 

What we do know is that the need for digital transformation in the retail arms of our charities is already there. It’s clear that a significant number of people who have shifted their buying habits online are not going back.

 

The mission for charities will be to translate the familiarity and charm of the high street store online, while embracing the opportunities for greater accessibility and inclusion with ecommerce.