Australian charity shops have come under renewed criticism for their prohibitive prices after an angry second-hand shopper discovered a second-hand jacket for a whopping $850. Industry experts have responded by reiterating calls for regulation of the sector, which they say is long overdue.

This week, an outraged Yahoo reader criticised the “ridiculous” price of a used Burberry jacket she recently saw at a thrift store near her Brisbane home. “Who could afford this when shopping at a thrift store?” the woman asked.

And she’s not the only one speaking out. Another woman named Sarah from Cooma, NSW, told Yahoo News Australia that she had “noticed the same thing” at her local Salvos store. “I was disgusted when I saw the prices of branded items like recorders and shoes,” she said. “$60 for a second-hand Kathmandu jacket for a child and coats up to $400.”

“They also charge $2 to $3 for shirts that cost $3.50 brand new,” she claimed.

The woman said that “a lot of local people who rely on charity shops” are now having to go without “because of the high prices”. “It’s a cost of living crisis and they’re capitalising on it,” she said.

She acknowledged that “a lot of people are struggling” and said charity shops are “making the situation worse” by raising prices – and experts agree.

Dr Andrew Hughes of the Australian National University told Yahoo News Australia that second-hand shops and charity shops, mostly run by religious organisations, had an “obligation” to keep prices low for consumers but had chosen not to do so.

He said, particularly because they are exempt from paying taxes – even though most of them now operate as fully fledged businesses with permanent employees – charity shops are failing Australians with their “exorbitant” prices, pushing struggling communities ever further away.

Hughes argued that products priced at hundreds of dollars “might have fair value from a market perspective,” but questioned whether this was “ethically fair,” particularly given “their business and their customer base.”

Experts warn: Second-hand shops are driving Australians away with their prices

“In the past, these stores were run by volunteers, and the volunteers would just sell things at whatever price they thought was appropriate,” Hughes told Yahoo. “But now there are professionals involved in running the stores, so that’s where the price hikes come from.”

“In terms of running costs, that’s quite a lot of money because they don’t pay taxes. They’re not operating as charities now, they’re operating as professional organizations – professional businesses.”

The “point” of convenience stores is to offer “someone out there who may be struggling” a product “at a better price” than in stores elsewhere, Hughes said.

“By setting these prices, the target market changes. Suddenly the prices are so high that people who are cash-strapped, maybe low-income – or even middle-income people – can no longer afford these types of items,” he said.

“And they ask, ‘Okay, where do I go now? Where do I need to go? Do I need to go back to a low-cost retailer?’ A lot of people I hear say it’s Temu or big Chinese online brands.

People are changing their spending habits due to unaffordable prices in second-hand shops

People are changing their habits because they can no longer afford to go to places where they used to live, even though the organization claims to be a charity that “helps those in need.”

In the context of ultra-cheap e-retailers like Temu, not only are manufacturers raising clear ethical questions, including the obvious environmental impact and the fact that dangerous chemicals such as phthalates, lead, chromium and nickel have recently been detected in Temu and Shein products, but this is also driving the companies overseas.

Hughes said all of these points taken together underscore the need for a regulator to monitor shady practices in retail.

What is particularly worrying, in his view, is the fact that large charity shops such as Vinnies and the Salvation Army almost completely dominate the market and can therefore easily “eliminate” their competitors.

“So if you look at it as a business model, it’s almost perfect because you’re getting free stuff from people who think they’re doing the right thing by donating to charity,” he said.

“And all you have to do is take care of the donation bins or monitor donations on the weekend. So you don’t get any cost of goods anyway, but your profit from selling those items is probably the market price, which means your profit is huge.”

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