Craft Distilleries Stayed Afloat by Making Hand Sanitizer. Now, They’re Struggling.
The spirits industry has provided a much-needed product during the pandemic
Back in the spring, several craft distilleries turned to making hand sanitizer because 1) it was important and 2) they really couldn’t do anything else.
For some of the participants, the pivot provided a vital local service and kept the companies in business. But as The New York Times points out, once companies like Purell caught up with demand and once priorities in states shifted, this economic lifeline for the spirits industry started to crater … and with tasting rooms still pretty much closed and distribution models geared toward the bigger brands, the craft booze industry has suffered severely.
As the Times notes, the price for sanitizer has dropped from a high of $50 a gallon to around $15, and several distilleries now have excess product sitting in their warehouses.
While the distilleries have the equipment and know-how, they only have what amounts to a temporary wavier from the FDA and the Alcohol and Tobacco Tax and Trade Bureau to produce sanitizer. Larger drug manufacturers are subject to more stringent oversight and better equipped to produce these products in the long run.
Also, the distillers had to add agents like the compound Bitrix to the sanitizer so people wouldn’t drink it — which ended up ruining a lot of equipment.
“At the end of the day, our core business is making really great alcohol,” says Phil McDaniel of Florida’s St. Augustine Distillery. “To be able to get back to business and have demand for that and to sell it profitably is what we’re all looking for right now.”
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