Thinking about it as "utility" is a cornerstone of effective altruists, so you're not alone in wondering that. From that point of view, for the price of one package of flour in Germany I can buy two in Uganda and four in Syria. Assuming that the charity keeps their costs low, writing a check to the local orphanage is a waste because you could be doing much more "good" somewhere else.

But from another POV helping your local orphanage gives you a stronger bond to your local community and contributes to the well-being of the society you live in. By sending your help (aka, money) away you're essentially corroding the pillars holding the nice society you're living in.