Nonprofits and teachers: Avoid tariffs and help your dollars go further with gifts in kind

Companies that import manufactured goods from overseas are likely to be saddled with much higher tariffs going forward. This can include anything from school supplies to toys to maintenance supplies.

So nonprofits, community organizations, social service agencies and teachers have more motivation than ever to consider obtaining goods from a gifts-in-kind organization. Why?

Because the merchandise available from a gifts-in-kind organization already is in the U.S., donated by a manufacturer, distributor or retailer that is looking to clear out overstock and excess inventory. If tariffs had been assessed, they already will have been paid by the company, not the consumer.

There are several of these organizations across the United States. Nonprofit 501(c)(3) organizations, community organizations and social service agencies, along with teachers in public and private schools, can join one of these groups. That membership entitles them to receive merchandise at no cost, aside from a handling fee. There usually is an online catalog that makes ordering simple.

Gifts-in-kind merchandise can be used to meet any need — for example, making sure a student has a warm sweatshirt for school or filling care packages for domestic and international mission trips. However, the merchandise must be used to fulfill the organization’s mission or supplement classroom supplies. It may not be sold, traded or bartered.

These goods can make a big difference to a nonprofit. One example is Teen Round-Up of Duncan, Oklahoma, which serves families in financial crisis and single-parent homes. It has been a member of a gifts in-kind program for more than a decade.

Every year, Teen Round-Up hosts a free three-day, two-night summer camp for 1,000 children ages 7-12. The camp includes seven home-cooked meals, crafts, sports, challenging zip lines and more. It also puts on a “Christmas Surprize” for more than 200 children and single moms, with dinner, gifts and a party atmosphere.

“This year, our giant Christmas tree and camp activity building were decorated with 100% gifts-in-kind ornaments, lights and decorations,” said Roxanne Kerley, vice president and director. “We gave 260 children a giant gift bag filled with novelty items, clothing, educational items and toys.

“We’re doing more for our community because of it,” she adds. “The small cost to be a member and allocation costs are just a token compared to what you will receive through the organization.”

For instance, membership in the gifts-in-kind organization National Association for the Exchange of Industrial Resources Teacher Program is free and helps stretch out-of-pocket expenses by providing materials such as arts and crafts items, pens and pencils, highlighters, scissors, incentive items like stickers and so much more. In most cases, participants in this program pay less than a third of what the products would cost even at the lowest prices available at deep discount stores

Donations come from dozens of companies as diverse as Crayola, McMaster-Carr, Avery Products, Newell Brands, and Cutter & Buck. Whatever a nonprofit or teacher needs, they’re likely to find it.

What motivates companies to donate to gifts-in-kind organizations? It may be to reduce storage costs, clear up space in their warehouse, keep unsold merchandise out of landfills or fulfill their philanthropic missions to give back to their communities. It’s also a way for companies to streamline their donation process. They can receive a tax deduction for donated items without having to tie up their own employees’ time searching for worthy groups or shipping items to multiple locations.

With gifts-in-kind organizations, nonprofits and teachers can both spend less on items they need while also providing more help to the communities and students they serve.

• Gary C. Smith is the president and chief executive officer of the National Association for the Exchange of Industrial Resources, the oldest, largest gifts-in-kind organization in the U.S. NAEIR receives donations of excess inventory from American corporations and distributes merchandise to a membership base of more than 13,000. Visit NAEIR.org or call (800) 562-0955.