The distribution of hand sanitizer was not new to KGPCo at the time, but the usual suppliers were all being tapped from around the world causing lead times to spike, and with it, mounting concern from KGPCo customers. Even with expedited ordering, the ability to meet the demand of our customers through traditional channels was becoming more challenging by the day. Our efforts had to shift to alternative means of sourcing sanitizer, and fast.
Delivering creative and cost-effective solutions to our customers is a cornerstone principle of KGPCo. After brainstorming sessions focused on doing whatever it takes to step up and help solve the problem, discussions began around the idea of addressing the gap in supply by setting up our own sanitizer production. The idea was presented to a major customer with a significant demand to get sanitizer out to their technicians in the field and retail stores, and the plan was quickly set into motion.
Through a relationship with an organic ketchup bottler in Denver, Colorado, KGPCo secured a location to set up our sanitizer production operation. KGPCo sourced all raw material and the ketchup bottler provided their expertise, mixing/bottling equipment, and an initial supply of empty ketchup bottles to manage the production operation. In a matter of days, KGPCo finalized plans for the bottling operation, including FDA-approved product formulas, and arranged sourcing of raw materials. The first tanker truck of alcohol and other raw materials were on their way to Denver and within a week the plant was in full operation. Shipment of the first customer orders were out the door the first of April.
Over the course of the next few weeks the hand sanitizer production increased rapidly to supply the major customer with nearly 100,000 18 oz. bottles of product. Substantial orders from other major customers rolled in and by May 1, more than 300,000 bottles of sanitizer had been produced and shipped. That month concluded with the clear realization that this would not be just a temporary set-up; the Denver operation was expanded with additional equipment, warehousing, and full-time staff.
By this time, the demand for other PPE, like masks, gloves, and sanitizing wipes was growing nationwide and similar sourcing shortages had transpired. KGPCo’s Sourcing Team and the PREMIER Team worked round the clock to source large volumes of PPE from previously established overseas and U.S. suppliers to fulfill orders for KGPCo’s customers. Dozens of additional suppliers were onboarded to help meet the demand. The hand sanitizer line, branded under KGPCo’s house brand PREMIER, also expanded to include spray bottles, 1-Gallon jugs, and sanitizer dispenser machines. Long-term agreements for continued raw material to keep the sanitizer operation flowing were solidified. By June 1, over 1.2 million bottles had been produced by KGPCo’s operation.
During the summer of 2020, KGPCo was awarded several major contracts. One award was to provide KGPCo sanitizer and dispensers to outfit 100% of a major carrier’s real estate division, including retail stores around the country, plus, all of its distribution centers, call centers, and offices nationwide. Another customer awarded KGPCo a commitment to purchase nearly 1 million bottles of KGPCo sanitizer, which was produced by KGPCo in a period of approximately 3 months.
"It was an all-out team effort to produce the vast quantities of sanitizer that our customers needed. With severe raw material shortages around the world, we had to be creative and persistent to get our hands on the materials required to produce high volumes of product. We had daily tanker trucks of Ethanol delivered from Ethanol plants in small towns in Minnesota, bottles and caps on boats from China, and custom hand sanitizer labels printed by a ketchup company’s labeler. Fortunately, we were able to manage the many moving parts and ultimately meet our customers’ needs during that very uncertain time," said Tyler Putrah, Chief Analyst and Director of KGPCo’s hand sanitizer operation.
KGPCo has produced and bottled over 40 million ounces of hand sanitizer. Full FDA registration has been completed and all required long-term FDA production processes and quality assurance measures have been implemented.
We may have never imagined running a production operation of this nature, but through ingenuity and established partnerships we rose to the challenge. As long as there is demand KGPCo will remain committed to supplying our customers with products to keep their team members, technicians, and customers safe through the COVID-19 pandemic and beyond.