Purell maker GOJO lays off staff as it announces it will stay in Akron, no longer for sale

Akron-based GOJO Industries is eliminating some salaried positions as the company also announced to its employees that it is staying in Akron and no longer for sale.

A company spokeswoman confirmed GOJO, the maker of Purell, was eliminating roles for “less than 10%” of its workforce. The spokeswoman did not provide an exact number but said the positions were mostly salaried positions. The layoffs were not limited to Akron, she said. Effects to the company’s manufacturing and distribution would be limited, she said.

GOJO has about 2,300 team members worldwide, including 1,800 in Ohio.

Employees were notified Thursday of the layoffs. The company asked hybrid or GOJO-plaza based employees in Akron to work from home today to enable the necessary one-on-one conversations to occur, the spokeswoman said.

In a statement provided to the media, GOJO President and CEO Carey Jaros said the company is committed to remaining independently owned and based in Akron.

“We remain deeply committed to our GOJO purpose of saving lives and making life better as an independent family enterprise headquartered in Akron, Ohio, which has brought innovative solutions to the world for nearly 80 years, and we are confident in our future," she said.

Those impacted by the workforce restructuring are getting severance, benefits continuation and career counseling, along with other supports, Jaros said.

Akron Mayor Dan Horrigan said that while restructuring and the loss of jobs is difficult news, particularly for the employees, he was happy that GOJO will ultimately stay in Akron.

"GOJO has been a solid and stellar partner with us in the city," Horrigan said. "We will continue to value them as a key strategic partner to help them become as successful as possible. They have been a close business partner with the city and we hope to continue that in the future."

Horrigan said that employees facing job loss can turn to resources such as Summit County's Jobs and Family Services. With many looking to hire, he added, they will hopefully be quickly snapped up other companies.

"We have a robust community to help absorb those who have lost their jobs," Horrigan said.

GOJO was founded in Akron by the late Jerry Lippman and his wife, Goldie, in 1946 to create a cleaner to replace tire workers having to wash their hands with kerosene and benzene to remove carbon black and graphite. Marcella Kanfer Rolnick, the third generation of the Lippman-Kanfer family, is the company's executive chair, taking over in 2018 for her father, Joe Kanfer, who remains involved with the company.

In April, the Wall Street Journal reported that family-owned GOJO had hired JP Morgan Chase to explore a sale.

The Wall Street Journal said the company could be valued at around $3 billion with about $1 billion of annual sales, citing anonymous sources saying the process is at an early stage.

COVID-19 pandemic and aftermath affecting GOJO, CEO says

Before the COVID-19 pandemic, the majority of GOJO's sales came from business-to-business, such as sales to the health care industry, rather than directly to consumers through retail, Jaros said in an email to employees.

Demand for the hand sanitizer Purell grew at unprecedented levels at the beginning of the pandemic, but competitors quickly jumped into the retail market with their own products, she said.

"We started a journey in 2018 to increase profitability to fund future growth and unlock the full potential of our business — and we were making good progress," she said.

“In 2020, a once-in-a-100-year pandemic created an unprecedented need for our Purell products. We did everything we could to produce and ship as much hand sanitizer as possible – but demand felt infinite. We ordered equipment and opened additional facilities, expanding our capacity and capabilities."

But then “hundreds of new manufacturers flooded in with off-brand sanitizer and wipes," Jaros said. "As inventory clogged the market, orders fell sharply across the industry. Even though individual usage of hand sanitizer remained significantly elevated — and does still today — hand sanitizer orders stayed depressed through 2021 and 2022, as surge inventory was slow to clear. At the same time, staffing shortages and a choppy return to public life kept traffic below pre-pandemic levels, which depressed demand for soap.”

In her email, Jaros acknowledged that she, Marcella Kanfer Rolnick and Joe Kanfer and the board “explored a wide range of options to restore financial strength," including a possible sale or refinancing.

"Today, we can share that we have found a path that enables GOJO to remain an independent Family Enterprise and Purpose-driven market leader," she said. "We need to restructure the business and right-size our cost structure to move forward on this path.”

April 2023: GOJO, Akron-based maker of Purell, is up for sale, Wall Street Journal reports

Jaros said the company will “focus on the projects and work that most directly grow sales and serve our customers in the near term. This will enable us to protect and extend our market leadership and will also put us back in a position to make longer-term investments."

In response to a question asking if there was a hiring freeze in addition to the layoffs, a spokeswoman said, "We have right-sized staffing levels to meet the needs of the business, and we will continue to hire for critical roles we need to fill."

GOJO faced similar struggles to others in industry, expert says

News that GOJO was successful but also struggled due to the pandemic is not surprising, said an industry expert who follows GOJO.

Laura Mahecha, Kline & Co.’s director of industrial and institutional cleaning products, has tracked GOJO and other companies that also make away-from-home cleaning products, hand soaps and hand hygiene products.

Kline is a global advisory consultancy and market research firm based in Parsippany, New Jersey.

“It was an industrywide trend that there was an enormous surge in sales, especially gel hand sanitizers and foam hand sanitizers as people were obsessively hand sanitizing and cleaning their hands,” Mahecha said in a phone interview.

However, she said, “you had so many mixed forces going on. You had all the brands that had never been present on the market flooding it." There were even distillery and alcohol companies making sanitizers at a time when the supply chain was also challenged.

When businesses and consumers started emerging from the lockdown, after a huge surge in sales, most companies and people had stockpiled sanitizers, she said.

With businesses and office occupancy not back up to pre-pandemic levels, the market for sanitizers remains depressed, Mahecha said.  As a result, the market is starting to rebound but still experiencing lower-than-normal growth.

Mahecha said some in the industry thought GOJO was looking to find a way out with a potential sale of the business because it had to expand its manufacturing abilities so quickly during the pandemic.

Mahecha said she wasn't sure whether GOJO got any offers when it was on the market.

In an email statement, Jaros said GOJO did receive "several offers" to buy the company and has previously received other acquisition bids.

Mahecha said the news that GOJO will stay independently owned is good news.

“To me, GOJO is a unique situation where it was started by the Lippmans and it’s a family-run business and the fact that they’re not going to get gobbled up by some other huge corporation is good,” she said. “Understandably they have to restructure so some people are going to be laid off.

The company may have “expanded their capacity or overshot the mark a little bit” with COVID, she said, “but they are absolutely a very well run company and the Purell brand is synonymous with hand hygiene. It’s good to see that they’re figuring a way forward.”

Chamber CEO: Layoffs are short-term pain, will help long-term health

Local business and government leaders also were pleased with the news that GOJO was no longer for sale and committed to staying in Akron.

Steve Millard, president and CEO of the Greater Akron Chamber, said although no one wants to see layoffs, which will be "short-term pain," many companies have had to make changes in this economy.

“There’s been a lot of speculation about GOJO for a little while now,” said Millard in a phone interview. “To me, this is a really positive resolution for the company and the fact that they’re going to stay family owned, they’re going to stay in Akron, that’s exciting.”

But that excitement comes at a cost, he said.

“Like every other company that we’re dealing with right now, they’re trying to adjust to sort of what the new realities are post-COVID with questions about the economy, etc.

“GOJO’s business...did some huge growth over the last few years, so this is tough for the people who are going to be affected,” said Millard.

“For the company long-term, I think it’s good for Akron and good for the company. Overall, we’re going to do all we can to help GOJO and help place people and get people out there because we want people to stay in our community,” he said.

While Millard acknowledged that the majority of the layoffs are likely at the Akron headquarters, company officials have also told him that they will be adapting their hybrid structure of work and employees will be returning two to three days to the office.

“That allows them to connect with each other more but also supports our downtown,” bringing more workers back during the day, he said.

Akron's next mayor reacts to GOJO news

Akron's next presumptive mayor, Shammas Malik, who won a Democratic primary in May and faces no competition in November, released a statement Thursday regarding GOJO's news:

"Today’s announcement that GOJO will remain in Akron provides a stable future for a family-owned business with a proud legacy in our community. I recognize the uncertainty ahead for employees affected by today’s layoffs, and I appreciate that GOJO will provide severance and other career supports to those impacted.

"As we work to transition between mayoral administrations at the end of the year, I look forward to working with small and large businesses alike. We must ensure good jobs are readily available for all, particularly by reducing obstacles like childcare and transportation, and prioritizing safety and education for our residents and workforce."

Staff writer April Helms contributed to this report. Betty Lin-Fisher can be reached at 330-996-3724 or blinfisher@thebeaconjournal.com

This article originally appeared on Akron Beacon Journal: GOJO, maker of Purell, laying off staff; no longer for sale