Definition Of Product Donation
There are multiple ways an individual/company can contribute to a noble cause: monetary support, cause related marketing, cause promotion and, last but not least, product donation. Also called in-kind contribution or gift in-kind, this form of charity is somewhat underrated. As a matter of fact, it is generally believed that the most helpful aid someone can give to a non-profit is money. On the contrary, donating goods (and services) to can be actually more effective, depending on the context.
Breaking Down Product Donation
It happens to exist an extensive literature around the concept of in-kind donation. Is it better than simple checks? Over the time this dilemma broadened up until it created two opposite parties. While generalizing is completely captious, this is the actual scenario. The ones preferring this kind of charitable giving over cash donations maintain that providing goods or services is more useful to non-profit organizations, especially during disaster-relief campaigns. Furthermore, another positive argument refers to the fact that product donation is less likely to be affected by corruption. While cash contribution can end up in the wrong hands or come from criminal rackets’ money laundering operations, with in-kind gifts this doesn’t apply.
On the other hand, those criticizing this practice bring opposite arguments, which can be valid especially regarding individual donations. That is, these donations sometimes consists of useless goods that have no value whatsoever. Charities and non-profits – they assert – prefer to rely on grants in order to carry on their social campaigns. This way, they can better optimize their needs and invest these money in a more efficient and effective ways. Needless to say, in a corporate context, granters and grantees usually previously agreed upon the necessary goods and services, bypassing the problems aforementioned.
Corporate Product Donation
Nowadays companies are expected to do more for the community. That is, writing checks and donate money is not enough anymore. Customers and other stakeholders asks their favorite brands to proactively engage in order to support and further a social cause. And a way to do this can be through product donation. A lot of big firms, in fact, provide non profits with equipment (imagine an expensive medical machinery), computer, digital infrastructure, or simply with food, clothing and so on. Sometimes we can witness the example of service donation: companies offering their materials and knowledge to build houses, hospitals etc.
In summarize, both parties can benefit from in-kind contribution:
- The granters: promoting a noble cause, besides doing some good, can enhance their reputation.
- The grantees: they can rely on goods and services necessary to the pursue of their core activities.