The founder of hi-fi and TV retailer Richer Sounds is handing over control of his business to employees. More than 500 staff will also share a bonus of £3.5m as owner Julian Richer signs over 60 per cent of the company.
The UK’s largest specialist hi-fi retailer will be controlled by an employee-owned trust, drawing comparisons with the John Lewis partnership model.
Mr Richer said the “time was right” to give his stake to staff as he stepped down from day-to-day running of the firm he started in 1978, aged 19.
He said: “I have always planned to leave my company in trust on my death for the benefit of the colleagues in the business.
“Having hit the ripe old age of 60 in March, I felt the time was right, rather than leaving it until I'm not around, to ensure that the transition goes smoothly and I can be part of it.”
“The company's banks, suppliers and customers should feel that the move is (hopefully) seamless and Richer Sounds carries on as normal.”
Richer Sounds will pay its owner £9.2m for his stake but £3.5m will be given back to employees. Each of the company’s 522 staff member wills receive £1,000 for every year they have been at the company.
The average payout will be £8,000 and 39 employees who have clocked up more than two decades’ service are in line for large windfalls.
Called the Richer Sounds Trust, the employee ownership plan will run according to a set of principles to make sure the firm “continues to operate in a responsible manner, and is based on honesty, commitment, trust and respect”, according to the group.
Julian Richer has for many years gone against the grain of much of corporate Britain, gaining a reputation for his progressive principles and charitable activities. He is also a drummer in a folk band.
Richer Sounds donates 15 per cent of its profits to charity and says it is founded on “the ethical principles of being decent, honest and truthful and hopefully [this] runs through everything we do”.
The company, which has 53 branches across the UK, has championed a model of hiring knowledgeable staff, giving them secure jobs and paying them well.
Speaking to the Financial Times in 2013 of his plans to sign over much of his stake, Mr Richer said: “It's important... My life's work is my legacy and I haven't got a spoilt child to run the business.”
He plans to stay involved in the business, but a management board will oversee day-to-day operations, along with a newly set up colleagues' advisory council and trustees.
The colleagues' advisory council will be chaired by a trustee and will be made up of current staff and will represent their interests and concerns.
David Robinson, chairman of Richer Sounds, said: “It's incredibly exciting times and allows our colleagues to feel even more connected to the company.
“They have a real stake in the success of the business and can take pride in knowing that they are shareholders, building for the future.”
Mr Richer, who founded the business in 1978 at the age of 19, had long planned to hand control of the firm to staff and had already written the plan into his will, but wanted to ensure he could oversee the transition.
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