Hand Sanitizer Goes from Shortage to Surplus

More than a year into the COVID-19 pandemic, many manufacturers and retailers are navigating a sudden surplus — and how to get rid of it.

Remember in the early months of the COVID-19 pandemic when hand sanitizer was seemingly the most in-demand product — besides toilet paper — and stores were allowing only one or two bottles per customer?

Well, a year later, that supply-and-demand development has turned on its head.

As reported by USA Today, many manufacturers and retailers of hand sanitizer suddenly have a surplus of the product and are navigating how to get rid of it. This is especially true for the off-brand products that joined the market during its biggest rush, including products made by distilleries who converted some or all of their liquor production to making hand sanitizer.

Likewise, imports of the product have plummeted as many Americans now are well-stocked with their own supply. U.S. imports sunk from 9,000 containers of hand sanitizer last July to just 274 in March, according to Ocean Audit.

A big driver of the drop in demand is that most Americans now recognize that COVID-19 spreads primarily through the air, and much less through surface contact.

Still, the report notes that demand for hand sanitizer is elevated compared to pre-pandemic levels and will likely remain so for the rest of 2021, and that major manufacturers are still performing well. On March 10, the CEO of Gojo Industries — Purell’s parent company — told CNBC, “It won’t be at the levels it was at last year, but it’s going to be exponentially higher than it was in 2019."

According to NielsenIQ, U.S. sales of hand sanitizer soared more than 620% in 2020 to a total of $1.45 billion. But sales have declined for several consecutive months since last year’s peak. On a month-to-month basis, January sales fell 38% from December, followed by declines of 23% and 3% in February and March, respectively.

USA Today reported that store shelves have been well-stocked with the product lately — too much for some retailers. CVS donated excess hand sanitizer to community groups and added discounts, while Walmart donated 1.3 million cases of it and is giving free bottles to customers receiving the COVID-19 vaccine in its pharmacies. Many other retailers are offering buy-one, get-one-free deals, major discounts, or are going purely the donation route.

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