More charity chain stores for Beijing (2)

"Because most of our customers are migrant workers, we chose to locate the stores closer to them," said Wang Dezhi, one of the founders of the chain.

After losing money for the first two years, the chain began to turn the tables in 2010. Last year, it reported a profit of about 130,000 yuan in its financial report, which is released once a year on its official website.

Wang put down the store's success to a number of reasons, among them its effective management.

Not only does Tongxinhuhui charity chain store collect donations of a variety of articles from residents, but also from universities, enterprises and other nonprofit organizations.

Up to now, it has established ties with about 50 colleges in Beijing and about 100 enterprises, such as Cathay Life Insurance Co's Beijing branch and Datang Telecom Technology & Industry Group.

"Volunteers in colleges help us to collect the donations and we also have set up donation boxes in companies," said Wang Dezhi. "The number of families that frequently contribute to our donation box is 3,000 and the number of our partners is on the increase year-on-year."

Charity chain store staff visit donors' homes to receive articles after being told they have something to give. The items are kept in a warehouse awaiting demand from stores.

"A store requires a delivery once a week when the business is doing quite well," said Wang.

Challenges grow with expansion because it will require more cost for management if more stores are opened. In addition, efforts should be made to improve transparency, said Wang.

"I hope we can release our financial report once a quarter or even once a month," he added.

Wang Zhenyao said that for most of the charity supermarkets sponsored by governments, the problem that needs to be solved immediately is in applying business systems. For Tongxinhuhui, the biggest obstacle in their expansion is that they lack the experience of running large-scale charity chain stores.