How one of America's hottest beverage brands shifted gears to help a Dallas hospital
Retailers and consumer goods companies are stepping up in unique ways to help Americans cope with the fallout from the COVID-19 outbreak. That was the situation again recently when federal regulators issued an emergency allowance so distillery owners could create hand sanitizer.
Merrilee Kick, CEO of BuzzBallz/Southern Champion wasted no time converting production lines, especially after receiving an urgent phone call from Presbyterian Hospital in Dallas regarding a shortage of hand sanitizer. Kick’s company was able to quickly shift production to help satisfy much needed demand throughout Texas. Kick shared how her company was able to move quickly to transform manufacturing processes while continuing to satisfy retailers’ demand for the company’s popular products.
Progressive Grocer: How did you decide to turn your manufacturing facilities into producing hand sanitizer?
Merrilee Kick: It’s the right thing to do, the market is out of stock, and all production facilities that have access to alcohol can do this. Our first line of defense is our medical teams, police/fire/post, grocery teams and our distribution teams. Next are the airlines. We plan to help them all.
PG: How long did it take to reconfigure your facilities to process it?
MK: We didn’t have to modify our equipment to make this, and if we did, there wouldn’t be time. The need is now. We already have the bottles that we use for our beverages. We had to source some raw materials from chemical supply houses to mix with our batch to make sure it conformed to the World Health Organization standards. We got permission from the Alcohol Tobacco Tax & Trade Bureau (TTB) on Friday, March 20, and we went into production on Saturday with our first test batch of 100 gallons. We plan to make 10,000 gallons of this stuff. We may need to make more if it is required.
PG: How did you figure out how to do it?
MK: The TTB and World Health Organization gave us a couple of formula options that we could use during this emergency shortage. We had a good team of scientists working on our end to validate the formulas, validate our ingredients, and do the math trying to figure out how make it. Weird thing is, although this is a donation, there is no exemption from federal tax at this point, so we are writing our senators to complain because we are going to pay some hefty tax on this. For a 10,000 gallon batch it will cost me around $150,000 on the low end.
PG: How did you come to distribute to Texas Health Resources and ProPath Pathology Labs? Are they paying you for the product or are you donating?
MK: We are donating to them. I contacted Texas Health Resources procurement buyer on Friday, March 21, and he said of his 14 hospitals, 3 were in critical need. On Saturday, my management team and production team were making hand sanitizer, then it was delivered on Saturday night. Quite the team effort. We also had a call from Mayhill Hospital in Denton – we gave them some today as well. I just got a call from a doctor in Dearborn, Michigan. Word is getting out. Our plan is to donate to retailers, airlines, local cities, hospitals and convenience store.
PG: Are you still producing your alcoholic beverages at this time? Or how much has this cut back on your normal production of BuzzBallz and Southern Champion products?
MK: Yes we are. We have to pay our employees and food/beverage is considered “essential” to supply the food stores. Go figure, booze demand has skyrocketed. Just goes to show you, booze sells in good times and bad.
PG: How long do you intend on producing hand sanitizer?
MK: We can make sanitizer until we run out of bottles. Our planned production next week is 10,000 gallons. If it’s required for us to make more we can, but we may have some support to keep it going. Our raw material prices are going up by the hour because supply is being squeezed. We are wanting to do our part to help. There are many craft distilleries doing the same thing. Nobody is making money on it, but we are coming together as a community to help our citizens.
PG: How have you changed production to factor in social distancing, city and county mandates related to COVID-19?
MK: I’m up all night trying to source masks from China, paying wires, express shipping. It’s costly, but we need to stay safe. We have changed rules, nobody within 6 feet of each other, no touching, no visitors, mandatory hand washing hourly, and the list goes on. So far everyone is showing up and doing their part. It’s really cool how our team is willing to help America.