Some Distilleries That Got Into Hand Sanitizer Are Now Struggling to Sell It

By Brendan Menapace

For months after the start of the pandemic, hand sanitizer was in short supply. Traditional suppliers couldn't manufacture quickly enough to meet the surge in demand, with everything from plastics shortages to changing government regulations hindering production capabilities.

In response, many alcoholic beverage distilleries stepped up to make hand sanitizer. And they made a lot of it.

They made so much that, with the hand sanitizer supply starting to catch up and prices per gallon dropping, they have more than they know what to do with.

Eater reported that some distilleries now have thousands of gallons of leftover hand sanitizer and the task of replacing equipment they used to make the hand sanitizer if it didn’t meet adequate FDA requirements.

This was an issue for one distillery in Kentucky, which started making hand sanitizer to help out the local community and health care professionals, and reportedly mislabeled its products. That came back to bite it and ended with a recommended recall.

Unlike apparel manufacturers that used their factories to make face masks, which are still in high demand and didn't require extensive retooling of normal manufacturing operations, distilleries making hand sanitizer are now left with thousands of dollars in product they can’t sell because traditional manufacturers like Purell have their footing again.

“In the beginning, it was just unbelievable, sort of frenetic demand that was out there,” Phil McDaniel, owner of a distillery in St. Augustine, Fla., told the New York Times. “It was so gratifying to us to be able to come in and help.”

Craft distillers in the U.S. who leapt into action to help make hand sanitizer early in the pandemic are now hesitant to invest more time and money into those efforts. “As a long-term economic solution for a distillery, it’s not a way to make money.” https://t.co/qkpLWAHlAD

— The New York Times (@nytimes) August 4, 2020

That was when the price of a gallon of hand sanitizer shot up to about $50, and his company made 10,000 gallons. Now, that price is about $15 per gallon, and McDaniel’s distillery still has about 1,000 gallons sitting in the warehouse.

The New York Times also said that about 800 craft distilleries got in on the hand sanitizer game during the boom, only to face unforeseen costs and dwindling demand now. Some are finding it hard to go back to making their primary products after the money they spent on making hand sanitizer.

“It feels a little bit like no good deed is going unpunished right now,” Spencer Whelan, director of the Texas Whiskey Association, told the Times.

“[Distillers] have absolutely done their civic duty,” McDaniel said. “[Now] they’re all on life support.”