The charity shops sector is still growing, but more slowly than before, according to the Charity Shops Survey 2014, published today by Charity Finance and Fundraising magazines.

The report shows the number of shops was up 1.7 per cent, while profit was up 3.2 per cent and income was up 7.8 per cent.

Profit growth is the lowest since 2006, while growth in shops numbers is the lowest since 2008.

The report is based on responses from 73 charities who between them run 6,505 shops – the majority of the charity sector. Total income for these charities was £807.2m, and total profit was £189.6m.

The number of staff working in shops rose by 6.1 per cent, while the number of volunteers rose 2.9 per cent.

The four largest charities in the sector remain unchanged, with the British Heart Foundation in first place, with a turnover of £170.9m. Sue Ryder replaced Age UK in fifth place.

The Salvation Army increased its turnover by 67.7 per cent to £44.4m. However this increase is mostly down to its takeover of Kettering Textiles, a recycling firm which it used to partner with, and which passed a proportion of its profits to charity.

The charity agreed in 2012 to acquire the company for £11m after coming under fire over directors’ salaries. As a result its income from rag rose from £13.9m to £31.2m.

Charities’ concerns for the future centred around the price of rag, or recycled clothing, which has fallen by 30 per cent since January. Most of the drop is not reflected in this year’s figures, but even so, excluding the Salvation Army, income from rag was down by 4 per cent.

David Ainsworth, deputy editor of Charity Finance and author of the report, said: "This survey shows that after strong growth all the way through the recession, the charity shops sector is beginning to find things tougher.

"Charities are reporting concerns about acquiring good quality stock, and say they expect more competition for space on the high street.

"The drop in the rag price suggests that next year we might see profit growth slow even more.

"On the plus side, we see significant growth in online trading and charities diversifying their offer with more specialist shops."

• The Charity Shops Survey is distributed to subscribers of Charity Finance and Fundraising magazines. Click here to order your copy.