The UK’s largest and longest-established street fundraising company, Gift Fundraising, which claims to have around 40 per cent of the market, is to go into voluntary administration and cease trading immediately.
Dominic Will, joint managing director of Gift, told Third Sector all 300 fundraising staff would be made redundant and he expected redundancy payments would be made in full.
Will said he and his colleague Neil Hope had taken over as joint managing directors in the middle of last year and taken measures to make the company more sustainable. But it had faced problems caused by "unexpectedly poor performance over the winter".
Will said that the company anticipated meeting all of its liabilities to clients, and that all the staff had been paid for any work they had done. Gift had a turnover of £10.1m and made a pre-tax profit of £442,000 in 2010/11 according to its most recent set of accounts.
Home Fundraising, the door-to-door fundraising agency that Will and Hope also run as joint managing directors, will continue to trade, Will said:"The two organisations are separate legal entities and Home will be completely unaffected."
Will said he did not think the closure had come about because of too much competition from other street fundraising firms. "There are some problems outside London with the allocation of fundraising sites," he said. "But other than that I think it’s a sustainable market."
Toby Ganley, head of policy at the Public Fundraising Regulatory Association, said the closure of Gift would cause problems for those charities that used its services in the short term, but he expected that other companies would fill the gap.
"It’s certainly our information from our charity members that demand for street fundraising continues to outstrip supply," he said. "Three or four times companies have gone bust in this arena, for all sorts of reasons.
"But I don’t think you can draw the conclusion that there’s any kind of problem with street fundraising itself."
In 2009 Dialogue Direct, which employed about 200 street fundraisers, went into liquidation after failing to agree a payment plan with HM Revenue & Customs.