In the ideal world money is ultimately efficient in terms of its liquidity, a point which advocates for cash heavily rely on. Unfortunately, cash is also much more of a lucrative and appealing commodity to steal as a result. In a world of humans, corruption is an unfortunate byproduct which must be dealt with when there is a great deal of it floating around, even for such a humanitarian cause as a charity.
Unfortunately, laboring under a delusion that humans are perfect, incorruptible or at the very least not corrupt enough to steal a significant amount of money is far too easy when dealing with an argument from a dry standpoint. To truly understand the ramifications of donating goods as opposed to donating money, the facts must be faced: Not all charities are truly charities, some charities have corrupt members, and things will get lost in transition.
Under the right circumstances, if all goes through, money can be used to buy anything the charity needs: storage space, food, buildings, specialists, etc. It is all too often, however, that a member of the charity decides to embezzle funds, to spend an excessively extravagant amount of money on unnecessary supplies, etc.
The very same inconveniences that goods present (in that they cannot be converted to other needed goods) are also what make them simple and valuable. What is needed is given, and no extra steps need be taken to obtain the good. Furthermore, it is much less lucrative and easy to steal a storage room full of food and steal it for one’s own purposes as opposed to stealing cash or funds from an account.
Aside from these above issues with money, there is also the specificity. For the common charities, money may serve its purpose at times, but used goods that may go towards a better purpose than ending up in a dumpster should definitely find its way to the charities that need them, saving further need for these charities to go further in buying up these goods.
In terms of time and effort and efficiency (no need to ship things twice), goods go farther here. No more wait for the goods to be bought, no more effort to find the best prices for goods and finding where they are in sufficient quantities, less work devoted to finding sources of goods. Being direct is the source of efficiency, and donating the necessary goods as needed is the efficient way to go. As also mentioned, some goods have no substitute in terms of money, such as organs and other materials that no one has yet created an artificial substitute for. In these cases, goods are infinitely more useful than money.
As such, a win-win for multiple parties when we donate goods.