Whiskey sales fell dramatically during the first days of the COVID-19 emergency. When governments closed bars and pubs, it dropped the demand for spirits by 50% or more.
It was an immediate financial hit to craft brewers and distillers. Instead of closing shop, many owners used their entrepreneurial skills to make something their communities needed: hand sanitizer.
About 80% of American distilleries rely on direct-to-consumer sales. Instead of using alcohol to make unwanted whiskey, groups came together in each state to bring producing 100,000 bottles of hand sanitizer.
If all 50 states reached that quota, then 5 million additional bottles of hand sanitizer would be available for purchase.
Government Support Helped to Make This Goal Possible
The U.S. government charges a federal excise tax on distilled spirits. The ATF waived parts of the law that also required prior authorization to make something other than alcoholic beverages.
Companies that produce whiskey and similar beverages must pay $2.70 per gallon on the first 100,000 gallons of distilled spirits produced each year. The $2.2 trillion stimulus package that authorized up to $1,200 per person and $500 per child also exempted distillers from this charge.
It’s not only craft distillers and micro-breweries that turned to hand sanitizer as a way to make it through the COVID-19 emergency. Anheuser-Busch started making batches to help communities.
Almost all of the producers who turned from alcoholic beverages to hand sanitizer gave the products away for free. Anheuser-Busch formed a partnership with the American Red Cross to make sure the people who needed it the most got what was necessary to survive.
Those that did sell their hand sanitizer used the money to support first responders.