S&W Wholesale is to shift to an Employee Ownership Trust (EOT) model of ownership as part of a succession plan for the Northern Irish business
Although the new structure will see no visible change at S&W Wholesale and day-to-day control will remain in the hands of the current leadership team, the new model means that the control of the business moves from its current private ownership to a Trust, which will manage and control the shares indirectly on behalf of its 320+ employees.
According to S&W Wholesale, the move to an Employee Ownership Trust will “secure the future of the business” without having to sell it. The change is expected to happen in January 2023.
S&W director Norman Savage said it was important that the business was able to grow without having to be sold on. “S&W has played a valued role in the retail community for more than one hundred years. We have been working on a succession plan for some time to secure the future of the business, while allowing for growth. We didn’t want to become another name swallowed up by the bigger players or potentially bought and closed by an investor. We have a loyalty to our people, customers, and supply partners. We also have ambitious growth plans, with a new purpose-built site currently in the planning system. We want this ambition to carry through the next generation of the business.”
Michael Skelton, CEO of S&W Wholesale, said: “This is a very bold and exciting move for us as pioneers of EOT at this scale in Northern Ireland. We know there will be learnings over time but the most important thing for us is that our team are going home this Christmas knowing that not only have they job security, and certainty for the long term; but they are working for an organisation that genuinely wants them to benefit from the business.
“Our suppliers are safe in the knowledge that S&W will be their partners for the long term with its ambitious growth plans and investment back into the business through the Trust. Our customers know that we will continue to deliver exceptional service, as every member of our team is now a beneficial stakeholder in the business. We will remain on the Board but as exiting shareholders we know that the hundred-year-old legacy of the S&W journey will live on for many years to come.”
What is an EOT?
Under an Employee Ownership Trust, employees become the indirect shareholders of a business. The trust then becomes the majority owner of the business as part of succession planning strategy. The model was introduced by the UK Government in 2014 to emulate the John Lewis Partnership.
While staff do not own shares in the business under this model, all members of the trust potentially benefit when profits are generated.