No one is in business to lose money. Even so, disposal of excess and obsolete inventory is often part of the cost of business. Companies work hard to minimize these losses. A few of these companies have figured out that while there are many strategies for reducing this waste, there is a way to potentially cut those losses in half overnight.
WIN Warehouse (Worldwide Inventory Network, Inc.), has been helping companies find impactful uses for otherwise disposable inventory while maximizing the financial benefit of donating since 1991.
According to Celia Roady, writing for the American Bar Association Section of Taxation Newsletter, one of the most important aspects of this process is the proper implementation of IRS 170(e) tax code. Passed in 1976, the 170(e) code allows corporations to realize significant tax benefits from donating goods to a qualified charity. In many cases, this enhanced deduction is double what it would normally be compared to disposal.
Sometimes donation can even be more profitable than liquidation. The “break even” point is where donation and liquidation earn the same amount of benefit. To determine where that point is, the company’s finance or tax team should consider various costs of selling including:
- Taxable income received through the sale of liquidated items;
- The cost of distribution;
- Storage costs.
It’s also important to examine more intangible costs like lost opportunity. Donation liberates the sales force from concentrating on marginal or loss items to sell higher margin items. Items sold at liquidation prices could also cause a “fire sale” and determine a lower market value for your product.
Conversely, the process of donating inventory to WIN is 100% free. WIN does not charge any processing, storage, or handling fees to receive your contribution.
Keep in mind that the entire purpose of receiving your inventory is to get those items into the hands of nonprofits who need them. With this in mind, WIN was founded upon the principal that we will “take it all, or not at all,” meaning that we do not cherry-pick items out of your donation. We will tell you up front whether or not we can accept your generous gift.
“Excess inventory for impact in our world.” How cool is that? And it’s not just an external battle cry or positioning statement; it’s an inspirational, aspirational reminder that every day is another opportunity to “do good.”
Donations from companies like yours, and from leaders like you, make a significant impact on charities all over our nation, and the world, and to the people and communities they serve. We know that successful organizations and influential individuals are great because they are driven by purpose, not just profit. They build meaningful relationships, not just assets, accounts, and portfolios. And they thrive by surrounding themselves with kindred spirits who help drive them, deliver them and empower them to be awesome.
WIN is more than a warehouse or a provider of goods. We are, in fact, a provider for Good. We are a dedicated community committed to helping nonprofit organizations realize their boundless potential. We connect organizations with the goods they need, with the goods that enable them to further their impact, to do more good.