LVMH makes pricey perfume. Ineos’s chemicals go into car components. Diageo distils vodka. Now they are all in the distinctly less glamorous — and less profitable — business of making hand sanitiser.
The old wartime edict of “repurposing” factories and businesses is back with a vengeance. Government leaders including UK prime minister Boris Johnson have sounded the call to arms, urging business bosses to lead a national effort to plug gaps in medical and other resources exposed by the coronavirus pandemic. Some have heeded these calls. Aerospace group Meggitt and automakers Nissan and McLaren are working to develop medical ventilators.
As they should. National service never looked so good. There is limited downside — it is not as if people are rushing to buy perfume, cars or planes right now — and factories are more easily retooled. LVMH normally puts more luxurious emollients in bottles, so it is not a huge stretch to switch the liquid. Ineos is unaccustomed to dealing with small bottles but produces the key ingredients, ethanol and isopropyl alcohol.
On the upside, here is real-time environmental, social and governance policy in a form understood by even the most misanthropic: companies doing undeniably the right thing at the right time. Human nature means our long-term memory is better for corporate misdemeanours (here’s looking at you Sports Direct) than good deeds, but the residual goodwill helps.
With supermarket shelves cleared of hand sanitisers and plenty of other key shortages, questions of supply and demand falling out of whack in the opposite direction look woefully pre-emptive. UK sales of hand sanitiser were up 255 per cent by value year-on-year in February, according to market researchers Kantar. Overall liquid soap prices have risen as much as 58 per cent in China, with South Korea not too far behind. Most of the newcomers’ supply online is going — gratis — directly to health professionals in the UK’s NHS and similar public health bodies. These customers can tell them precisely when they can revert to business as normal. Philanthropic, yes. But smart business too.
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