Jason Barrett of Black Button Distilling shares the story of pivoting from distilling spirits to manufacturing hand sanitizer in the first week of the COVID-19 pandemic shut-down.
About this segment of Blackbird TV
Recorded: May 27, 2021
Published: June 1, 2021
Love to introduce Jason Barrett, we’re here at Black Button Distilling, we’re in Rochester, NY. Thanks for having me David. This is so great. Jason’s won awards right? You got an acknowledgement from American Express. Yeah, for “the big pivot” I think they called it. Yeah from American Express from the Greater Rochester Chamber of Commerce and the SBA. It’s been really a great year here at Black Button, although very difficult. Obviously during this pandemic. So the amazing story. It was the beginning of March, the middle of March and the United States shut down. And it was, I think it was the 15th. And everybody is out of business and within three days within days, Black Button Distilling is cranking out, cranking out hand sanitizer. Jason. Tell us about it. Yeah. So let me take you through that week. I mean just such an emotional rollercoaster we find out you know the governor asks businesses to voluntarily close. Distilleries are not an easy thing to shut down quickly. We’ve got live yeast in the fermenters that cannot be left unattended. So here we’re pulling double shifts trying to just crash the fermenters, get everything to a stable place so we can lock up and obviously stay in our homes and an on Tuesday, and we furloughed the entire staff and I said to my CFO, you know eight years to build it 8 hours to watch it all go down and it’s two days later I get this email from the FDA and they’re like, hey, emergency authorization if you can safely handle ethanol if you can get yourself some glycerol and some hydrogen peroxide. If you follow these exact steps. And label it exactly this way. This is emergency hand sanitizer, so I call up my head of production. I’m like hey, you were halfway through making our lilac gin right? Yeah, it’s in tanks in the warehouse. OK, we got about 5000 bottles of that start calling around. Find out that you know I didn’t even know if anybody needed this. Or is this a thing? It’s so early it wasn’t even clear that was a hand sanitizer shortage. So get in touch with Rochester Regional Health, I end up getting connected to their head of procurement and I’m like, hey, do you guys need hand sanitizer? he goes “do we need hand sanitzer? How much do you have and how fast can we have it?” And I was like I think I got about 5000 bottles. He’s like great. What do you want for it? And I was like I don’t know what do you normally pay for it. So he tells me the price. I do a little math. I realize we’re not going to lose money. Probably not gonna make any money, but we can get our guys back to work. We can do good for our community. So in about 3 days time we are able to get our label provider to make some emergency labels. We get the glycerol from a salad dressing manufacturer here in town and we get the hydrogen peroxide literally from under my staffs’ sinks. You only needed a little bit, so we only needed about 16 ounces to make the first 5000 bottles. Wow. So I literally put out an all company call. If you have hydrogen peroxide under your sink, bring it to the plant and we will pay you in your next check and our employees responded. So we make those 5000 bottles. We get them to Rochester Regional Health. The local news picks up on the story. They announced that we’re making hand sanitizer and all of a sudden the floodgates open. 1400 emails in 24 hours. We actually had to leave our phones off the hook, ’cause you couldn’t hang up, and as you went to put the phone back down, it rang again and it became clear that the need was going to far surpass our ability to produce. So we got the team together and we decided that we were going to do this on a massive massive scale. First thing we did was secure our equipment. This had to be done on manual bottling equipment because it was so potent that it would actually be too hazardous for the equipment behind me. Pause… yeah, we’re sitting here. We’re sitting here in the middle of a bottling line that’s used to automatically bottle stuff. We’re going to overlay a picture of the machine that you actually fill these bottles with, and then there’s there’s four little nipples on this thing, or udders, and you’re so you did it all manually. Did it all manually. I have $160,000 machine behind me, 1000 bottles an hour, and we can’t use it because this stuff is too high proof, so we did 405,000 bottles, 20 hours a day, six days a week with teams on 8 manual bottling lines for the next 14 weeks. Absolutely incredible. Absolutely insane. We we borrowed 18-wheelers and turned him into temporary warehouses in the parking lot. We got the city to change the time they do the tickets out front so the staff could park on the street. When you would order a pallet, we would give you a pick-up time and people would show up early and we’re like no, you have the 3:15 pallet, ’cause we’re making a pallet every 47 minutes and your pallet’s not done yet, ’cause it was all just-in-time delivery, in order to be able to do 405,000 bottles in 3600 square feet, we are not built to do this. We make 1000 bottles a day. We were making 17,000 bottles a day at its peak. In and out. Absolutely, absolutely incredible. Herculean lift and from from our perspective at Blackbird in the equipment business and from the dealers that we talk to, blending tanks, any kind of filling any kind of these things, they shot off the shelves and you could. Now you can’t give. Now you can’t get rid of that equipment. All that, it all went out and now it’s all coming back in, and so there’s there’s these price spikes and these these you know problems within the supply chains. It was a huge supply chain and logistics challenge. You couldn’t get bottles you couldn’t get caps. We luckily have a very good label supplier that stuck with us through that we had the air freight in the heat shrink caps from Germany because if you couldn’t seal it before it left, it didn’t meet the FDA standards. Getting cardboard boxes made. All of these logistical pieces all had to be aligned every single day or you couldn’t do production. And you started it in the second week of March? You started it instantaneously. Instantaneously. Because there were companies that did the “pivot” in May, June, July there were people getting in the hand sanitizer business when they should have been getting out of the hand sanitizer business. Yes. Are you making any hand sanitizer now? So the emergency authorization ended in December, but actually I can tell you we stopped at July 28th at 1:30 in the afternoon was the last order, and literally as fast… If you had 10 times as much in April and May, you could have sold every drop but as fast as it went up come August, everybody had stocked up and I think part of the problem was people didn’t know how much they needed. So they bought a case, stuck it in their basement and now come to find I mean every bottle had 250 hand washes in it. Even if you’re doing it a couple of times a day, 250 handwashes lasts for a while. I have a basement full of toilet paper. There you go, you’re set for life and they’re seeing those same demand curves in those things that spiked so. It was really an interesting challenge, but the whole team just responded so well and one of the things that I think we did really well really early on is that we made it simple. You could only buy it by the pallet or the case. You want 3/4 of a pallet? I can’t help you. Buy a pallet or buy a case. There was only one price for each. There was no special discounting, it kept it very simple. Everything was paid in advance. You want a pallet. You send me $900 when your $900 hits, my bank account, we’ll give you a time to pick up. Don’t be late and don’t be more than 30 minutes early. That’s the way it works. That’s the way it was. And rarely are you in a position where you can dictate terms like that to your customers. But being able to be that efficient was critical, because, again, that pallet wasn’t special for you. And in fact if you showed up late for your time and the other guy was early, we might give your pallet to him ’cause we need it off our dock. We need the space, and when you show up you might have to wait 20 minutes while we’re still making your pallet in the back. You want to talk about just-in-time delivery? We had bottles go from the bottling line to the 6th floor of the hospital in under an hour. Wow, that’s fascinating. ’cause in those early days, that’s how desperately they needed it. They actually had a car from the hospital every 15 minutes, leaving from here taking whatever we’ve made in 15 minutes and taking it to the hospital. Living and pivoting through perilous times. Our story here with Jason Barrett at Black Button Distilling. Jason, thank you so much for your time. Thanks for having me.