Donating Unwanted Products to Charity is Good For Business, Study Finds

Businesses with extra products would be wise to use the excess merchandise philanthropically, new research shows.

Donating products to charities helps corporate bottom lines, reduces waste in landfills and provides relief for people in need, according to a study from researchers at Indiana University's School of Public and Environmental Affairs.

The study is the first detailed examination of the return on investment for donating merchandise versus liquidating or destroying it. The new data shows that donating extra merchandise benefits both the company's bottom line and its brand image.

Product giving presents a considerable financial advantage over cash donations because it can carry an enhanced tax deduction and helps companies avoid fees associated with disposal of excess inventory, according to the research.

Product donations also provide the same image-enhancement benefits as marketing and advertising programs, but at lower cost. Justin Ross, assistant professor of public finance and economics and the study's lead researcher, said the data suggest product giving is often an untapped strategic opportunity that could advance the business and have substantial social impact on the communities and causes it cares deeply about.

"This research demonstrates that donating products can result in substantial financial and social benefits for minimal cost and risk," Ross said. "Rarely is there such a win-win between business and social good."

Chad Brooks is a Chicago-based freelance writer who spent 10 years working as a newspaper reporter before working in public relations. You can reach him at chadgbrooks@gmail.com or follow him on Twitter @cbrooks76.