The 42-year-old charity says that excessive competition among housing and homelessness agencies causes them to waste countless hours coordinating their activities with others, and competing for funding.
Instead, the trust is refocusing its services on offenders, a market with more potential for growth. Director Daniel Currie said: "Although there are not enough services to homeless people, there are too many agencies. A homeless client can be picked up by an outreach team run by one charity, go to a day centre run by another and receive tenancy support from a third."
He said the sector needs more mergers like the one between Thames Reach and Bondway, incorporating services into a single charity.
St Giles does not run hostels but provides support services such as housing and benefits advice, and help to obtain medical treatment.
With the help of a £330,000 grant from the Impetus Trust, St Giles will progressively reduce these services and expand its offender work, which includes training serving prisoners as housing advisers and helping them access housing, benefits and health advice.
"We wanted to focus on something we are good at in an area where we know the market is less competitive," Currie said. "We are not big enough to do everything for everyone. Now we can become more knowledgeable on specific issues, and explain more easily what we do when we approach funders."
From a projected income of £1.7m this year, £550,000 will go specifically to offenders and £400,000 to homelessness projects, with another £750,000 for either offenders or homeless people.
St Giles began providing services to offenders 10 years ago, and expanded them in 2000 after a £120,000 grant from the ODPM.