How to Source In-Kind Donations for Your Nonprofit’s Mission

According to Double the Donation, nonprofits receive approximately $18 billion worth of donated goods every year. From canned goods donated to food banks to gently worn clothes donated to thrift stores, in-kind gifts can fuel a wide range of nonprofit missions.

As we approach the year-end giving season, consider how your in-kind donations fit into your strategy. In fact, in-kind donations can increase your total fundraising by allowing you to connect with individual donors and organizations that are unable to give cash gifts but still want to support you.

In this guide, we’ll review how to source in-kind donations and make the giving process simple.

The easier it is to give any type of donation, the more donations you’ll receive. A few ways you can improve the giving experience for in-kind donors include:

• Create a donation wish list. Don’t make supporters guess what types of in-kind donations will help your cause. Instead, create an easily accessible list of needed items on your website. Additionally, provide directions for what state items must be in for your nonprofit to accept them. For example, a thrift store might specify that donated clothing must be in good condition and free from stains and odors.
• Provide donation receipts promptly. Nonprofits are required by the IRS to issue donation receipts for gifts worth $250 or more. However, it’s best practice to provide receipts for all contributions. When it comes to donation receipts for in-kind gifts, write down a description of the donation and ask donors to supply the fair market value of their gift.
• Use inventory management tools. The better your technology, the easier it will be to accept and process in-kind donations at scale. With the right inventory management tools, nonprofits that rely heavily on in-kind donations, like those operating thrift stores, can easily catalog gifts received, update their inventories, and report back to donors.

Additionally, ensure donors are aware of your in-kind giving opportunities. While supporters obviously need to physically drop off their gifts, you can promote your in-kind giving program online.

On your website, create a “Ways to Give” page that features information about how supporters can contribute to your nonprofit outside of monetary gifts. For example, the Atlanta Humane Society’s Ways to Give page shares how supporters can donate stock, make DAF gifts, and make Amazon wishlist purchases. This page should include your in-kind giving wish list, your gift acceptance policy, and directions for how to donate a gift.

Gifts from individual donors can be valuable but are often scattershot. If your nonprofit needs large amounts of in-kind donations or highly specific gifts, connect with corporations and retailers to solicit the donations you need.

ThriftCart explains a few ways nonprofits can source inventories from corporate partners:

• Wholesalers. Wholesalers are the middlemen between manufacturers and retailers, buying items in bulk and selling smaller quantities to individual businesses. Generally, wholesalers sell their goods at a reduced price, meaning your nonprofit can likely get a good deal from them.
• Business liquidations. When a company goes out of business or closes a location, it often needs to dispose of inventory quickly. Nonprofits in need of in-kind donations can leverage these situations by purchasing inventory at a reduced price or potentially even receiving items for free, depending on your prior relationship with the business.
• Dead stock. Dead stock is inventory that a business is unable to sell. For example, after a major holiday, unsold festive goods might be considered dead stock. Businesses are often willing to sell dead stock at a massive discount to make room for new items.

Most of these options require your nonprofit to spend some money in exchange for goods. If your nonprofit needs completely free donations, consider exploring companies with in-kind donation programs.

These programs enable nonprofits—even those without a prior relationship with the business—to apply for an in-kind donation. While forming individual partnerships with local businesses is one of the best ways to get individualized gifts, these corporate programs can be incredibly useful for nonprofits that have yet to establish corporate relationships.

Whether they’re helping you collect donations from individual supporters or donating themselves, community partners can be one of your most reliable sources for in-kind gifts. A few ways organizations in your local community can help with your in-kind donation efforts include:

• Co-hosted events. Fundraising events have massive potential for bringing in all types of gifts, including in-kind donations. Work with local businesses and community groups to host large-scale events that engage as many people as possible. By partnering with multiple organizations, you can reach more supporters and reduce event costs by sharing the financial burden.
• Dropoff points. Accessible dropoff points significantly increase your potential for receiving in-kind gifts. After all, when supporters pass by dropoff points every day, they’re far more likely to consider giving. Ask businesses, schools, and community organizations if they would be willing to house a donation dropoff point in their facilities.
• Internal donation drives. Some organizations may be willing to launch internal in-kind donation drives for your nonprofit. For example, schools often host canned food drives or an apartment building might encourage residents to donate food items that the apartment management will then contribute to a local food bank.

Additionally, various organizations in your community might also be willing to make in-kind donations themselves. Consider which organizations have goods or services your nonprofit might benefit from. Then, when making your donation appeal, emphasize how a gift benefits their organization and your nonprofit.

In-kind gifts put the resources your nonprofit needs in your hands immediately. In particular, some nonprofits, such as thrift stores and food banks, thrive on vast amounts of in-kind gifts of goods and should prioritize identifying reliable donation sources. As part of your in-kind giving process, remember to also create a standardized reporting system and build relationships with each in-kind donor to encourage future gifts.

With three years in the thrift industry during a pivotal shift to omnichannel selling, Kyle Payton helps stores better manage inventory and forecast product needs. As General Manager at ThriftCart, he focuses on equipping nonprofit thrift operations with point of sale technology that makes their day-to-day operations easier. Kyle’s passion lies in helping thrift store managers embrace digital solutions that support their unique mission and maximize their impact in the community. “Supporting nonprofits is incredibly rewarding. I’m here to provide thrift store managers with the tools they need to thrive, so they can continue making a positive difference in their communities.”