U.S. markets close in 25 minutes

Coronavirus: Spirits firm turns to hand sanitisers after sales evaporate

Simon Read - Business reporter

After sales of its specialist booze started slipping, a Cotswolds spirits company turned to making hand sanitisers to keep the money coming in.

The British Honey Company has made £500,000 from sales of its alcohol sanitiser since its end-of-March launch.

The cash "more than offset the decline in revenues from the company's core product", it said.

"Sales... have been exceptional," said chief executive Michael Williams.

The company makes a range of honey and fruit-infused spirits, such as Keepr's Gin.

They are sold through specialist online retailers and hotel chains, but sales have fallen since lockdown as customers remain indoors or buy booze through supermarkets.

It spotted the trend early in the coronavirus crisis and applied for permission from HMRC to use excess capacity at its Buckinghamshire distillery to produce the alcohol sanitiser, made with 70% alcohol and extracts of British honey and green tea.

Clear opportunity

"Very early on during the Covid-19 outbreak we identified a clear opportunity for the company to move into the production of alcohol-based sanitisers, to meet exceptional demand and supply shortages, given the basic ingredient is the same as for our infused spirit brands," said Michael Williams.

He said sales had "exceeded expectations".

The firm - which listed as a public company in March - will focus current production capacity on its Drip+Drop sanitiser in the short to medium term while demand remains high.

Mr Williams warned that problems in the alcohol supply chain were starting to emerge.

The company has responded by "ring-fencing" enough alcohol in its bonded warehouse to meet anticipated demand for its alcohol sanitiser and infused spirits products until at least the end of the calendar year, including the Christmas period, the peak time for spirit sales.

Sanitising production

A number of drinks firms have switched to producing hand sanitiser during the coronavirus crisis.

William Grant & Sons, better known for its whisky, has shifted production at three of its distilleries to make sanitiser.

Diageo has pledged to help create eight million bottles of sanitiser during the crisis by donating up to two million litres of grain-neutral spirit to hand sanitiser producers.

"This is the quickest and most effective way for us to meet the surging demand for hand sanitiser around the world," said Ivan Menezes, chief executive of Diageo.

Bacardi has turned its rum distillery in Cataño, Puerto Rico, into a hand sanitiser production site.

Scottish brewer Brewdog is producing about 4,000 litres a week of its Punk Sanitiser for the NHS and local Aberdeenshire charities.