Oxfam's retail profit fell 23% to £4.9m in the last financial year, compared with £6.4m previously, as UK charity shops struggle against growing competition from online secondhand clothing platforms. The British Heart Foundation, which operates the biggest charity shop presence on the high street, has announced plans to close 150 stores after reporting a £3.3m loss in the last financial year. Cancer Research UK and Scope have also closed or are closing some of their shops, signalling a broader crisis across the sector.
The decline comes despite UK spending on secondhand clothing quadrupling over the past decade to £8.8bn a year, according to GlobalData. Online platforms such as Vinted and Depop have reshaped how people buy and sell used clothes, with individuals now selling directly to consumers rather than donating to charity shops. Chinese companies selling more clothes in developing countries, particularly in Africa, have further diverted a traditional market for unwanted secondhand clothing away from UK charities.
Oxfam's latest accounts reveal the scale of the impact on its charitable work. For every £100 people spend in its shops, just £6 now goes towards the charity's work alleviating global poverty, down from £22 in 2022. However, Oxfam's focus on books and music means it has no plans to reduce its number of shops. The British Heart Foundation, which employs almost 3,700 staff, saw profits plunge from £18.8m in 2024 to £3.6m in the year to 31 March 2025, prompting it to aim for closing 90 stores by March 2027 and another 60 by the following March.
Charity shops face structural disadvantages compared with online competitors. Unlike Vinted and Depop, which directly connect sellers with buyers, charity shops bear the costs of high street and warehouse rents, as well as collecting, sorting, pricing and storing clothes. Quality has also become a major problem, with charities receiving increasingly poor-quality donations as people use shops as convenient disposal points for unwanted fast fashion purchases.
Lorna Fallon, head of Oxfam's retail operation, told the Financial Times the shift had been "challenging" and "it is going to be painful for the sector". However, Robin Osterley, chief executive of the Charity Retail Association, argued that the impact of online platforms had been overstated. He suggested instead that the November 2024 budget's national insurance increases and lowering of the threshold, alongside broader inflationary pressures, had a "really significant" effect on costs for physical charity shops.
For savers, borrowers and charitable donors, the shift means the fundraising potential of giving unwanted clothes to traditional charity shops has diminished significantly, with less money now reaching charitable causes.