Supporting Local Makers Beyond a Global Pandemic
Mount Royal Soap Company is a Baltimore-based manufacturer of natural skincare products and a member of Made In Baltimore (MIB), “a strong community of manufacturers, retailers and maker spaces working together to create and promote locally-made products.” MIB is also a partner of Impact Hub Baltimore. Together, we detail Mount Royal Soap Company’s rapid growth and efforts to support frontliners last year, and how more intentional collaborations between Baltimore’s anchor institutions and small businesses can lead to a stronger local economy beyond a global pandemic.
It’s been a year since Mount Royal Soap Company’s three-person team first reimagined their 500 sf kitchen to meet local demand for personal protective equipment (PPE). Today, and ~1 million bottles of hand sanitizer and soap later, the Baltimore-based skincare manufacturer continues to defy expectations of what a small business is capable of when given the right supports.
Prior to last year, governments and institutions often overlooked the opportunity to partner with local makers, pointing to high costs and limited production capacity as key barriers. However, PPE shortages brought on by the breakdown of our global supply chain in the wake of the COVID-19 pandemic tested that calculus.
With nowhere else to turn, institutional buyers began sourcing from local manufacturers, and an interesting thing occurred: their investment allowed these businesses to increase their production capacity and lower their costs.
The case of Mount Royal Soap Company demonstrates that with the right investments, small businesses can overcome these challenges — all while circulating dollars back into the local economy and strengthening our regional supply chain.
A Year of Unexpected Exponential Growth
At the onset of the pandemic, early financial support from various investors and funders, including the Baltimore Development Corporation, enabled Mount Royal Soap Co to acquire new equipment and large volumes of materials to produce hand sanitizer and soap at large scale.
After relocating their operations site from their small kitchen to Charm City Meadworks’ building, the team decided to purchase a tanker of medical-grade alcohol to meet the growing demand for hand sanitizer at a faster pace. A loan for $36K from a friend and community-focused entrepreneur in Remington enabled them to make the purchase and scale operations.
Funding mechanisms created during COVID-19, and intended to support local makers, helped Mount Royal Soap’s team to increase critical supply while reducing retail price. As a result of the equipment purchase, they were able to reduce the cost of hand sanitizer from $9 to $3 per 4oz bottle. If it weren’t for these additional funds, it’s likely that the company may have not been able to offset high production costs and lower the prices of these critically in-demand goods.
Purchasing commitments from city agencies gave Mount Royal Soap the confidence to invest in scaling their operations even faster, and reduce costs even further. In April 2020, they received two large orders to deliver hand sanitizers to the Baltimore City fire and police departments. A grocery distributor ordered 25K units of hand soap in August to help fill a shortage in New England. And by December, Baltimore City procured 600 gallons of hand soaps and 20K 8.5oz units.
Other orders from large institutions included the University of Maryland Medical System (7K units per month), Maryland Food Bank (7.5K units of hand soap a month) and Johns Hopkins Homewood Campus.
Given how critical the demand for hand sanitizer and hand soap was in early April 2020, it may have made more sense for city agencies and anchor institutions to look to companies with larger and quicker production capacities first. But brands like Purell and Dial were stretched thin too.
By committing to buying local, Baltimore’s anchor institutions and city agencies were able to more meaningfully invest in the city’s immediate economy while supporting the company’s efforts to serve frontline responders. Such intentional collaborations between Baltimore’s anchor institutions and small businesses can lead to a stronger local economy, even after the pandemic is over.
Though it took an emergency for this particular story to unfold, the lesson learned is broadly applicable: invest in small local businesses now, and it will pay off later.
Looking Ahead: Where Are They Now?
The Mount Royal Soap Company of today is almost unrecognizable from the business they were this time last year. They have quadrupled their staff from 3 to 12 people, and have leased a 10K sf factory in Woodberry to contain their expanding operation. Their demonstrated ability to fulfill large orders continues to help them establish more local partnerships.
As of July 2020, JHU, MICA and Goucher College have a business relationship with the skincare company. They are now a preferred vendor with NBC Comcast. Their products can be found in Whole Foods, Eddie’s, and Grauls; as well as 200+ independent grocery stores across the east coast. Beginning June 2021, Mount Royal Soap Co will also launch their foaming hand soap in all 22 MOM’s stores.
Having fulfilled orders for city agencies is a great reference and vote of confidence, allowing the small business to thrive and expand their customer base. These partnerships are growing during a time when Mayor Brandon M. Scott recently announced strides toward reforming the city’s procurement process, demonstrating a broader alignment between Made In Baltimore’s push for buying local and the city’s ongoing plans.
We know that Mount Royal’s rapid evolution happened in a unique context. But with greater partnership and investment between Baltimore’s anchor institutions and small businesses, more companies like Mount Royal Soap Co can take the lead in guiding the city toward a stronger and more collaborative local economy moving forward.
Additional Readings & Resources
TOOLKIT: Doing Business with Anchor Institutions (Made In Baltimore)
Mayor Brandon M. Scott Takes First Step in Reforming Baltimore’s Procurement Process with Focus on Equity (Mayor’s Office)
