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A Guide to Successful Chinese Auctions for Nonprofits

Learn more about Chinese auctions, other names for them, and how you can organize one for your next fundraiser.

Putting together a Chinese auction is a great way to raise funds at your next fundraiser. Here’s what you need to know to have a successful Chinese auction fundraiser, and a couple of ideas to inspire your fundraising approach.

What is a Chinese auction and how does it work?

Chinese auctions, also known as penny socials or tricky tray fundraisers, are a unique and fun way to raise money for your organization. A Chinese auction has both elements of a silent auction and a raffle, which makes it a fun and engaging way to fundraise.

Participants first purchase raffle tickets, which they then can divide however they like amongst various items available to win. These items or descriptions of items are laid out around a room, where participants can scan all the prizes and decide which items they want to spend their tickets on. Spending more raffle tickets on a particular item will increase the chance of that item being won. At the end of the night, the hosts can shake up each raffle ticket jar and pick winners for each prize.

Why is it called a Chinese auction?

When this fundraising method became popular in the 19th century, many Chinese immigrants faced a lot of discrimination, and did not get paid fair wages. Therefore, the term “Chinese” was often used as a derogatory adjective to mean cheap. Raffle tickets for these auctions were cheap, and these fundraisers ended up being called “Chinese auctions”.

While this is a fun and engaging way to fundraise, there is no Chinese culture involved whatsoever in this fundraising style, and the traditional name of this fundraiser is outdated and insensitive. Therefore, many nonprofits hosting this type of fundraiser have been moving away from using this term, and instead using a more descriptive and intuitive name.

What are some name alternatives for Chinese auctions?

These types of fundraisers are common, and they usually go by one of these names:

  • Tricky tray fundraiser
  • Penny social
  • Chance auction

For continuity, we will be using the term “penny social” for the remainder of this blog post.

What are the benefits of a penny social compared to a silent auction or raffle style fundraiser?

Silent auctions are a common and traditional fundraising method that can be very successful. However, some donors may not get the chance to participate in these events since silent auction items can be on the pricey side. Penny socials can be a great fundraiser option if many participants are younger, or if they are newer and less familiar with your organization.

A penny social is unique because it combines aspects of both silent auctions and raffles to make the fundraiser more accessible for participants who may not have the means to purchase a large auction item, but still want to support your nonprofit, and have the chance to win some prizes.

Penny socials are also a good opportunity to incorporate items of a large range of values. Items with a higher value will get more tickets, but participants will have a lesser chance of winning that item than a smaller value item, which incentivizes participants to creatively spend their tickets.

How does a virtual penny social work?

A virtual penny social can also be a good option to raise money for your nonprofit organization. Participants can still purchase tickets that they will use to bid on items, but they will be browsing through a list of items online instead. Also check out our list of virtual raffle item ideas for examples of easy to ship items that are perfect for virtual events.

You can set up your own penny social platform, or use an online raffling service.

However, it is important to note that due to online raffle regulations, only IRS verified Tax Exempt Nonprofits are able to hold virtual tricky trays or raffles. Also, note that some states do not allow online raffles.

How do you run a penny social?

Planning a penny social fundraiser can be daunting, so we’ve put a list of steps and tips together to break down the process.

  1. Set your fundraising goals.
    1. Set targets such as target number of attendees, target revenue, number of returning donors, number of new donors, etc.
  2. Set your logistics and budget.
    1. With a set budget, you can work on securing a venue, and start publicizing the event.
    2. If your budget does not allocate enough money to rent a venue, note that some companies are willing to donate their event spaces.
  3. Secure your donations.
    1. Penny socials need many raffle items, and many companies request at least one month in lead time, so start early on this step.
    2. To save time, use TheShareWay's directory to easily apply and track your donation requests.
    3. If you’re running out of ideas of penny social raffle items, we’ve also put together a list below of raffle item ideas as well as their donation requests.
  4. Market your penny social fundraiser.
    1. Once you’ve secured your venue and date, start publicizing the event on your website, social media, and email newsletters.
  5. Write descriptions of each raffle item.
    1. For each raffle item, write a descriptive paragraph about it that would make participants want to spend their tickets on that item.
  6. Finally, have a successful tricky tray fundraiser!
    1. Make sure all the raffle items are in view and easily accessible by participants.
    2. Make sure there is enough space between each item so it does not get too crowded in any one area.
  7. (Optional) Get feedback from participants.
    1. It’s a good idea to send out feedback forms to participants to learn which aspects of your event they enjoyed, and what aspects they think could have been improved.

What should be included in a penny social?

It can be difficult to figure out what to include in a penny social, so we’ve put together a list of tricky tray item ideas. To make it easier for you, we’ve also included companies that you can request donations from to fill up your tricky trays.

Gift Baskets

Gift Cards

Sports Memorabilia

Spa and Salon Services

Beauty and Makeup Products

Also check out our blog post with a list of raffle basket ideas if you need more inspiration, as well as our list of over 400 companies that donate to fundraisers, and our list of restaurants that donate gift cards.

Cover photo from Pixabay

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