We explore the nature of the metal-insulator transition in the two-dimensional organic compound β″-(BEDT-TTF)2Hg(SCN)2Cl by x-ray, electrical transport, ESR, Raman, and infrared investigations. Magnetic and vibrational spectroscopy concurrently reveal a gradual dimerization along the stacking direction (a-b), setting in already at the crossover temperature of 150 K from the metallic to the insulating state. A spin gap of Δσ=47 meV is extracted. From the activated resistivity behavior below T = 55 K, a charge gap of Δρ=60 meV is derived. At TCO = 72 K, the C=C vibrational modes reveal the development of a charge-ordered state with a charge disproportionation of 2δρ=0.34e. In addition to a slight structural dimerization, charge-order causes stripes most likely perpendicular to the stacks.