For many charity shops, donated clothing has always had two opportunities to generate valuable income.
The best items are sold in the shop, while clothing that cannot be sold is passed to a textile merchant – traditionally as “rag” – generating another, albeit smaller, income stream.
But the market around that simple model is changing.
Charities are working incredibly hard to maximise the value of every donation. They need to. Every additional pound generated through their shops supports the services their charity exists to provide.
At the same time, however, the businesses collecting the textiles that don’t sell are facing a very different commercial reality.
Donations don’t always mean saleable stock
We continue to encourage people to donate unwanted clothing rather than throw it away – and rightly so.
But volume and value are not the same thing.
The quality of some clothing entering the donation stream has changed. Lower-cost clothing, mixed fibres, damaged garments and items with limited second-hand demand all eventually have to go somewhere.
A charity shop may receive a bag containing ten garments, but that doesn’t mean ten garments have a viable second life.
Someone has to sort them. Someone has to transport them. Someone has to find a market for them. And increasingly, someone has to deal with the material that has no realistic reuse market at all.
Even the weather has an impact
This summer’s heatwaves have provided another reminder of how interconnected the system is.
When temperatures soar, high-street footfall can fall. Volunteers and staff can be affected, and in extreme conditions shops may need to reduce hours.
Meanwhile, donations don’t necessarily stop.
That can leave charities with more stock to manage while having fewer opportunities to sell it.
The obvious answer is often to move more stock through alternative routes – sales, clearance, online channels and eventually the rag collection.
But the rag merchant is not an unlimited outlet.
Then there is the changing resale market
Online resale has transformed how we think about second-hand clothing.
Platforms such as Vinted have made it incredibly easy for people to sell clothing themselves rather than donate it.
There is nothing inherently wrong with that. Keeping clothing in use for longer is exactly what a circular economy should encourage.
But the resale landscape is evolving.
Increasingly, online resale platforms aren’t simply individuals clearing out their wardrobes. Commercial sellers and businesses are also using these marketplaces to move larger volumes of stock.
That changes the dynamic.
It can mean that some of the clothing which previously might have been donated – particularly items with an obvious resale value – is sold online instead.
What eventually reaches charity shops can therefore be a very different mix of material.
And when those charities have extracted everything they can sell, what remains for the textile merchant can be harder again to find a viable market for.
“Rag” doesn’t automatically mean reusable clothing
This is where I think the sector needs an important conversation.
Historically, many charity shops have been able to put their unsold textiles together and receive a price per kilogram from a merchant.
But if the proportion of genuinely reusable clothing within those collections continues to reduce, how long can merchants continue paying for everything in the same way?
A collector still has vehicles, drivers, fuel, warehouses, staff and sorting costs.
If more of what they collect ultimately needs recycling rather than reuse, the economics change considerably.
And this isn’t about blaming charities or merchants.
Both are trying to make the numbers work.
Perhaps we need to stop treating everything as “rag”
I believe one of the next changes we are going to see is greater separation at source.
Rather than asking a merchant to collect one mixed stream, charity shops may increasingly need to distinguish between:
REUSE – clothing that has a realistic opportunity for another life.
and
RECYCLING – textiles that are worn out, damaged or otherwise unsuitable for reuse but could potentially become a feedstock for recycling.
That doesn’t mean turning charity shop volunteers into professional textile graders.
It means developing simple, workable systems that recognise an important reality:
Not every donated textile is reusable – and we shouldn’t pretend that it is.
Better separation could help protect the quality and value of reusable textiles, give recyclers cleaner and more consistent material, and importantly help keep textile collection commercially viable for the merchants that charities rely upon.
We need the whole chain to work
Charity shops exist to raise money for their causes. We should never lose sight of that.
But the merchant collecting from the back door also needs a viable business.
The recycler needs suitable feedstock.
And ultimately we need to find a responsible destination for the growing proportion of textiles that simply cannot be reused.
If one part of that chain becomes commercially unviable, the impact will quickly be felt by everybody else.
The future therefore cannot simply be about asking:
“What’s the rag price?”
Perhaps the better questions are:
- What is actually in the bag?
- How much of it is genuinely reusable?
- What should be separated for recycling?
- And how do we create a system where the charity, collector, reuse market and recycler can all continue to operate?
Because keeping textiles out of general waste is important.
But to achieve that, reuse and recycling have to work environmentally, operationally and commercially.
And that is a conversation I think the charity retail and textile sectors increasingly need to have.
25 September 2026
