Employee owned companies

Employee owned companies perform better than traditional companies.

Employee owned companies perform better than traditional companies.

Guardian reports that Julian Richer is gifting his company Richer Sounds, to his 531 employees. Richer sounds is a hi-fi and TV retail chain, with 53 stores. Its annual revenue is INR 1800 crores.

Why is he gifting it away?

Julian turned 60 this year. He did not marry and he did not have kids. He wanted that the next generation should run the company, as he feels loyalty towards his colleagues. He also cited that his father died, when he was 60. He also wanted to avoid aggressive outside investors.

Employees will own 60% of the company. They will also receive £1,000 for every year they have worked for the retailer. There are 39 employees, who have worked for more than 20 years.

What can entrepreneurs learn from him?

John Lewis founded Richer Sounds in 1978 at the age of 19. He wrote in his book The Rihcer Way, that the key to long term business success is by providing well-paid jobs, and keeping the workforce happy.