Gifts-In-Kind Organizations Can Help Camps Cut Costs
By Gary C. Smith
Finding new ways to cut costs is always important for nonprofit camps. That need is even greater now in light of the COVID-19 pandemic. Even after non-essential businesses begin to reopen, revenue lost during the shutdown will have a long-term impact on camps’ budgets, especially buying necessary supplies.
But what if a camp could just flip through a catalog to find some of the items they need for free? That’s the idea behind gifts-in-kind organizations. These groups take in donations of excess inventory from companies and make them available to member nonprofits, schools and churches.
Here’s how it could work for you: A nonprofit camp pays a small annual membership fee to join a gifts-in-kind organization. In return, the camp can browse the organization’s available products through a catalog or online listing. The camp can request as many items as it wants as many times as it wants throughout the year, paying only a small handling/shipping fee for the items. The result is a huge cost-savings on items a camp needs to operate.
Donations run the gamut from cleaning supplies to the always needed arts and craft materials. A camp might find flashlights; office supplies such as pens, markers and tape; sports equipment; first aid items such as bandages; tools; books; and even basic plumbing supplies like toilet seats and faucets. Donations come in throughout the year, so if what you want isn’t there one day, it could be the next.
Obviously, if you’re looking for a specific brand, you might have a harder time, but lots of big-name companies donate to gifts-in-kind organizations. Companies like Sharpie, 3M, Paper Mate, Crayola and Rayovac donate products, as do many family-owned companies and small businesses. Since gifts-in-kind organizations don’t restrict the size of individual donations—they may range from a few boxes to a few truckloads—this helps ensure a variety of products will be on hand at any one time.
For companies, working with a gifts-in-kind organization gives them tax advantages that can actually save them money over practices like liquidating where they earn just pennies on the dollar. The donations also help them spread goodwill among a large variety of organizations across the country, often reaching people and organizations they might not otherwise reach. By donating their products rather than selling them at deep discounts, they also preserve their brand. And working with a gifts-in-kind organization puts their products into the hands of people who can truly use them, reducing the chance of those items winding up in landfills.
Since all companies have to do is ship their donations to a gifts-in-kind organization’s warehouse, the partnership also streamlines the donation process. It saves companies valuable time they would otherwise have to spend vetting nonprofits themselves and preparing and shipping donations to multiple locations. On the flipside, camps who join a gifts-in-kind organization benefit from the same streamlined process—they only have to go through one organization rather than reach out to several companies to get what they need, and they don’t ever have to worry about asking for too much too often.
To join a gifts-in-kind organization, a camp must be affiliated with a 501(c)(3) nonprofit organization, school or church. Members include charities, community organizations, government institutions and health facilities, among others.
Gifts-in-kind members must agree to act in accordance with IRC section 170(e)(3). According to those guidelines, merchandise must go to care for the ill, needy or minors. Members can use the items for their organization (as you would with office supplies) or donate them. The items cannot be bartered, traded or sold.
How much you can save with a gifts-in-kind organization really depends on how many and what types of items you order. If you want to put it into numbers, go through a gifts-in-kind’s web site and compare what the handling fee is for an item compared to its retail value. You will find the savings are typically more than 70 percent per item.
With all the uncertainty that will arise as camps reopen—will people return, will you have to make changes in the way you operate—one thing will be certain—you will have to cut costs however you can. Joining a gifts-in-kind organization could be one way you could make that happen.
Gary C. Smith is President and CEO of NAEIR, National Association for the Exchange of Industrial Resources, the largest gifts-in-kind organization in the U.S. Based in Galesburg, Illinois, NAEIR (naeir.org) has received donations of excess inventory from more than 8,000 U.S. corporations and redistributed more than $3 billion in products to more than 110,000 nonprofits. During fiscal year 2019, NAEIR collected more than $90 million in inventory and distributed more than $105 million. Gary may be reached at 800-562-0955.