KEY POINTS

  • Gojo Industries Inc., the makers of Purell hand sanitizer, has doubled its sanitizer manufacturing and storage infrastructure
  • Demand for sanitizer has septupled during the pandemic, far outpacing other products
  • Other cleaning product companies are hedging their bets, increasing production without tying themselves to a volatile market
hand sanitizer packaging
A representational photo of hand sanitizer. Harvey Boyd - Pixabay

As the COVID-19 vaccine rollout continues to encounter distribution snags, Purell is predicting that health habits popularized by the pandemic are here to stay.

Purell’s parent company Gojo Industries Inc. has added a factory and a warehouse, doubling its stake in the hand sanitizer market, reports The Wall Street Journal.

Their bet could pay off big. The COVID-19 pandemic resulted in a full force demand for hand sanitizers septupled to a $1.3 billion retail market, which doesn’t account for large-scale purchases by institutions like hospitals. Sales of other goods sold out during the pandemic, like toilet paper, only jumped 20%.

Gojo Chief Executive Carey Jaros took his position right as the pandemic was starting, and told WSJ that the demand spike caught his company off guard.

“We hadn’t planned on adding new facilities for a decade,” he said.

Other cleaning product manufacturers are being more cautious, opting to find ways to increase production without making investments that could leave them with surplus infrastructure for years to come if demand falls.

Clorox Co. and Lysol manufacturer Rickett Benckiser Group PLC have both extended production, adding staff to run their factories more or less continuously. Clorox added a disinfectant line to an Atlanta factory that already had extra space.

Gojo spent months trying to keep up with demand using similar tactics before making the call to commit in early spring. It spent $400 million on capital investments in 2020, 10 times its normal amount and more than its entire 2018 revenue of $370 million. It also hired another 500 workers, bringing its total workforce up to 3,000.

“I don’t foresee any letup in any of the sanitizers, cleaners and wipes,” Reynolds Cramer, chief executive of midwest grocery chain Fareway Stores Inc., told the WSJ. “It will become a normal part of everyday lives to have three sanitizers: one in the car, one in your briefcase, one in your coat.”

If demand does keep up, Gojo Industries Inc. will be well-positioned to meet and expand Purell’s share of the ballooning sanitizer market.

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