When COVID-19 turned the world upside down, Sagamore Spirit assumed it, like most other manufacturers, would have to shutter its Baltimore, Maryland-based distillery until Governor Larry Hogan said it was safe to reopen.
Then the company got a call from Johns Hopkins Hospital, which was in desperate need of hand sanitizer for its frontline medical workers.
Hand sanitizer is made up primarily of alcohol, so to answer the call for help, Sagamore Spirit converted its distillery from a producer of rye whiskey – “bourbon’s older brother” – to corn ethanol to start producing 54,000 liters of hand sanitizer for the hospital.
“There is no higher priority than serving the growing and vital needs of health professionals and first responders, and the entire team at Sagamore Spirit is prepared to contribute to this global effort,” said Drew Thorn, vice president of Operations and Finance at Sagamore Spirit. “We feel fortunate to have the expertise and manufacturing capacity to make a difference at a meaningful level and we are committed to servicing as many needs as possible.”
Sagamore Spirit is one of 700 distilleries across the U.S. that have joined in the effort to support hospitals in their localities. But the transition is involved.
Among the many things to take into consideration, Sagamore Spirit had to coordinate with pharmacists at Johns Hopkins to work out the formula to produce hand sanitizer. It then had to adjust its supply chain, and instead of sourcing primarily rye, it needed to source locally grown corn.
“Being a whiskey producer, we already have very reliable sources for corn from our existing vendors, as it is an ingredient we regularly use,” Thorn said. “We also have a lot of local farm relationships that were very happy to supply us and support this project. We have had no supply chain issues for agricultural products. The supply chain has been much more impacted for chemical ingredients and packaging materials.”
Sagamore Spirit is an SAP customer, and Thorn said the software made the transition almost seamless.
“All ingredients are inventoried items within our SAP system and assembled through the production module into finished sanitizer product inventory,” he explained. “It is an excellent system for managing inventory, COGS [cost of goods sold], resource planning, and then ultimately commercial transactions or donations.”
The sanitizer that Sagamore Spirit is producing does not have the same consistency of sanitizer bought in stores; because of the formula, it has a viscosity only slightly above water. It is packaged in five-gallon buckets in the hospital so that staff can refill personal-sized bottles. The buckets are then returned to Sagamore Spirit and used for the next batch.
Under normal circumstances, the company usually has about 50 employees working on-site, including tour guides for its distillery.
For hand sanitizer production, Sagamore Spirit is down to 12 employees on-site, all of whom have their temperature taken before entering the facility and are equipped with protective gear and required to social distance.
As states begin to ponder reopening certain sectors of the economy, Thorn said Sagamore Spirit will not go back to producing rye whiskey until Maryland’s frontline healthcare workers and first responders have the hand sanitizer they need.
“We plan to make sanitizer as long as there is a critical need,” he said. “We don’t plan to stop sanitizer production based on when the state opens, but rather based on when our hospital partners indicate their traditional supply chain has been reestablished to the point where they will be covered.”
Frank Hughes is a contributing writer for SAP Global Partner Marketing.