Latest news with #employeeownership
The Independent
a day ago
- Business
- The Independent
Major retail chain to be put into an employee ownership trust
The Entertainer, the UK's largest toy retail chain, is transferring full ownership to an employee ownership trust. Founder Gary Grant opted for the employee ownership model to preserve the company's values and benefit its 1,900 workers. Under the new structure, employees will receive tax-free bonuses from company performance-related profits and gain a voice through an advisory board. The Grant family will be paid for their ownership stake over time from company profits, with staff expected to see the first rewards by January 2027. The company, which reported £6.7m in pre-tax profits last year, operates 160 stores and maintains partnerships with retailers such as M&S and Tesco.
Sky News
a day ago
- Business
- Sky News
UK's biggest independent toy shop chain given to employees
The UK's biggest independent toy retailer is being taken from private ownership and will be owned by its employees, who will share in the company's profits. The founder of The Entertainer chain, Gary Grant, is putting the future of the business in the control of its 1,900 employees. The company operates more than 160 shops as well as concessions in Tesco, Matalan and M&S. As a result of the ownership changes, employees will be rewarded through tax-free bonuses based on the profits generated in the future. Direction of the company will be overseen by a three-person trust, one of whom will be a representative of the staff board. That trust will own 100% of the company. Current shareholders, the Grant family, will be compensated for the sale of their stake from future profits of the business. It's being done to ensure the business, which also owns the Early Learning Centre and Addo Play, remains independent and to preserve the family legacy and feel of the business. 'A growing trend' It's part of what's being described by the chief executive of the Employee Ownership Association, James de la Vingne, as a "growing trend" for retailers. "We're seeing a growing trend for retailers making the move to employee ownership alongside calls to help save the high street," he said. Other businesses operating such a model include the John Lewis Partnership, home entertainment retailer Richer Sounds, and outdoor adventure company Go Ape. "I have no doubt that other familiar brands will follow The Entertainer's example of what's possible. The future of the high street is employee ownership," Mr de la Vingne added. What is The Entertainer? The company was founded in 1981 in Buckinghamshire by Gary and Catherine Grant. It's also a designer, sourcer, developer and wholesaler of toys across multiple international markets.
The Independent
a day ago
- Business
- The Independent
UK's biggest toy chain to hand ownership to its employees
The UK's biggest toy retail chain, the Entertainer, will soon be in the hands of its workers after its founder opted to put the organisation into an employee ownership trust. Around 1,900 people work at the Entertainer, including hundreds who have worked there for more than a decade and some more than 20 years. Under the scheme, full ownership of the 160-store company will transfer to a trust which is held on behalf of employees, who will then receive company performance-related profits in the form of tax-free bonuses. An advisory board also gives employees a voice in the future progress of the firm. Founder Gary Grant opened the first store in Buckinghamshire in 1981 alongside his wife, with last year's pre-tax profits for the company, TEAL Group Holdings Limited, standing at £6.7m. The founder and his family will be paid for their ownership stake by way of company profits over a period of time. 'This is a significant decision for the family, and one we haven't taken lightly, but it feels like the right time to transfer our entire shareholding into an employee ownership trust,' said Mr Grant, adding that his children - two of whom are involved with the business - have 'other plans'. 'We would have been very concerned selling to a business that has a completely different set of values to the values of the Entertainer which we've built over the last 44 years. 'This is a win-win for everybody that we employ. If the business had been sold just for money that would not have been passing on the baton in the way in which the family would have wanted.' Mr Grant predicted that staff would see the first rewards of the trust ownership following the end of the financial year January 2027, as much of the firm's profits come in the run-up to Christmas. As well as through its stores and website TEAL sells through partnerships with the likes of Tesco, M&S, Matalan and Moonpig. Chief executive of the Entertainer, Andrew Murphy, was appointed two years ago to the role as a first external leader. He will lead operational control of the firm once the transfer of ownership to the fund is complete. 'What the Grant family have built is a true British success story — all the more impressive for having consistently championed the belief that business can be a force for good across the communities they serve,' Mr Murphy said. 'The group's operational and financial strength provides a solid foundation for future success with a clear growth strategy, a dedicated and passionate team and a fantastic product offer.'
BBC News
a day ago
- Business
- BBC News
Entertainer founder gives toy shop chain to staff
The founder of the UK's biggest toy chain, the Entertainer, is handing over control of the business to his 1,900 Grant opened his first shop with his wife Catherine in 1981 when he was 23. He's now 66, and his multi-million pound empire spans 160 shops across the UK. He is transferring 100% ownership of the family-owned business to an employee trust which means staff will get a share of the profits and a say in how the firm is run. "If the business had been sold just for money that would not have been passing on the baton in the way in which the family would have wanted," Mr Grant told the BBC. Most of the Entertainer's profits are made in the lead-up to Christmas. Mr Grant said this meant it would be too early to say whether staff would get a bonus for this financial year. The "real rewards" should come for the year ending in January 2027, he says."That's when I think the staff will start to see something a little bit more meaningful."Under an employee ownership trust, Mr Grant and his family will be financially rewarded, too. They will receive a payout for the transfer of their 100% shareholding, which will be taken out of the profits over time. In its last set of annual accounts for the year to the end of January 2024, the Entertainer posted pre-tax profits of £6.7m. "The Entertainer has thrived against all the odds," says Mr Grant, listing the financial crisis of 2008, the Covid pandemic, the decline of the High Street and the shift to Grant family's Christian ethos is central to how the business is run. Unlike other big retailers, it doesn't open on a Sunday and it donates 10% of its annual profits to charity. Last year it expanded its partnership with Tesco to stock toys in more than 850 of the supermarket's stores. It also has concessions in 140 Matalan shops. Mr Grant left school in Amersham, Buckinghamshire, with one O level. He was fired from his first job in a local bike shop but then he and his wife took out a loan to buy a toy shop down the road, despite the couple having no knowledge of the sector. Two of their four children work in the company but Mr Grant says they have got "other plans for their lives" and after lengthy succession planning, which explored a number of exit options, the family chose an employee ownership believes the move will preserve both the family's legacy as well as the family feel of the business. Nearly 400 staff have worked there for more than a decade, around 50 have clocked up more than 20 years of service."We would have been very concerned selling to a business that has a completely different set of values to the values of the Entertainer which we've built over the last 44 years. This is a win-win for everybody that we employ," he said. Two years ago the family appointed its first external chief executive, Andrew Murphy, from the John Lewis Partnership, the UK's biggest and best-known employee-owned business. In November, Mr Murphy told the BBC it had been forced to drop plans to open two new stores and freeze hiring at its head office after the government said it would raise National Insurance contributions for month, when the transfer is due to complete, Mr Murphy and his senior leadership team will have full independent control of the company."It's a huge responsibility to continue the legacy and not just deliver success but do it in a way which they (the family) would be proud," he told the ownership model, he says, comes with its strengths and vulnerabilities. On the one hand, assets cannot be extracted and sold for personal gain giving everybody in the company a chance to earn an "upside" from what happens in the business. But it can limit the ability to raise external Murphy says the Entertainer does not carry any long-term debt and has no urgent demand for a capital injection."Gary and the family have built the business over 44 years in a very measured, consistent, way," he says. Asked what he would do after stepping back from his role as executive chairman, Mr Grant admits "switching the computer off" will be challenging, saying his wife often comments that "we've got four children and this business has been our fifth".He has bought a narrowboat and intends to spend more time with his 10 grandchildren and his charity endeavours."I'm not sad with the way that we're leaving the business to go on from strength to strength. And if the business was failing in any way, that would be a much more difficult thing to be facing into. But it's nice. It's in strong financial health."
Forbes
04-08-2025
- Business
- Forbes
A New Take On Shareholder Primacy
Evan Edwards is the CEO of Project Equity, a national nonprofit that helps businesses and communities build wealth through shared ownership. Much has been written about a shift away from shareholder primacy—the idea that an enterprise's primary duty is to maximize returns for its shareholders—as the top measure of its success. Shareholder primacy traditionally focuses on concentrating power and wealth in the hands of a few. This imbalance leads to many negative business and social outcomes that critics typically highlight—decisions that prioritize quarterly earnings over long-term growth and sustainability, a widening wealth gap between executives and frontline workers and a lack of business resilience in economic downturns. Critics have pointed out how this approach often leads to short-term decision-making, wealth disparities and even economic instability. In response, many alternative models have been proposed, from stakeholder capitalism to ESG-driven governance. While these conversations are meaningful, they frame shareholder primacy itself as the fundamental problem. But what if we addressed shareholder primacy's potential imbalances by coupling shareholder satisfaction with increasing the overall number of shareholders at the same time? I'm talking about employee ownership (EO). Beyond Zero-Sum I spent years working in the tech startup world, where equity ownership was a given. Founders, investors and employees are all expected to have a stake in the company's success. In many ways, tech startups challenge the traditional shareholder model, recognizing that widespread ownership helps attract talent, fosters commitment and drives innovation and productivity. This principle should extend beyond startups. At Project Equity, we approach these challenges through a different lens. Ownership, management and governance at employee-owned companies are not zero-sum games. Ownership, when broadly shared, can be a tool for alignment, accountability and long-term success. Employee ownership provides a proven way to bring in more shareholders. And by expanding ownership to workers, we can distribute the benefits of economic success more equitably while strengthening the businesses themselves, often in multiple ways. More Impact In More Ways One important way employee ownership strengthens businesses is by enhancing their ability to attract and retain talent. For example, Rutgers University found that during the pandemic, employee stock ownership plans (ESOPs) helped retain jobs at a rate of four to one compared to non-employee-owned companies. EO businesses are also less likely to face layoffs during economic downturns, adding to the overall stability of the business. Take Local Ocean Seafoods on Oregon's central coast, for example. Since completing its transition to an employee ownership trust (EOT) with a loan from our Employee Ownership Catalyst Fund in November 2022, the culinary company's turnover rate has steadily decreased to 40% last year, roughly half the industry standard rate of nearly 80%. Even though they were only an EOT for a few months in 2022, they elected to run a simulated profit share at the end of the year, allocating $122,000 to their team. Employee ownership often drives this kind of culture shift, where new ideas and collective decision-making are prioritized. Na Young Ma, the founder of Proof Bakery, a business we helped transition to EO, shared this insight with researchers from the University of California, Berkeley. She noted that when the bakery transitioned to employee ownership, it experienced rapid growth, tripling its revenue within a few years following the transition. As the co-op grows, it creates new opportunities to nurture its members' unique contributions and provides a workplace where they can actively exercise their ownership. Transitioning to employee ownership shifts the mindset from "this is where I work" to "this is what I'm building." We often refer to this shift as an ownership culture, where new ideas are generated among highly motivated and informed people, becoming the norm with EO. I've seen how this change can strengthen workforce retention and engagement, while elevating the recruiting process by attracting motivated individuals who want to create a lasting impact and share in the success they help achieve. Workers As Shareholders: A Good Idea For All Ultimately, through employee ownership, incentives can be aligned with traditional shareholder models by prioritizing the interests of both workers and shareholders. It's not an either-or situation. In working with CEOs as they transition to employee ownership, I have observed that employees are motivated to perform for the organization as a whole, rather than just for their own individual benefit. The beauty of EO as a business strategy is that it recognizes that ownership, operations, management and governance are not at odds. This alignment expands the number of shareholders while creating a more just and sustainable economy. Shareholder primacy, when viewed through the lens of employee ownership, can form a successful loop that benefits everyone within the economic ecosystem. Forbes Nonprofit Council is an invitation-only organization for chief executives in successful nonprofit organizations. Do I qualify?
