In western North Carolina, “a growing number of companies in the area, which includes the city of Asheville and smaller Appalachian towns, are considering…a shift to worker ownership,” writes Adele Peters for Fast Company. As NPQ profiled last fall, with a tsunami of small business owners seeking to cash out as Baby Boomers retire, selling businesses to the employees who work there is emerging as an increasingly common strategy.
One North Carolina business owner pursuing this path is Eric Henry, owner of TS Designs, a 20-person, screen-printing business. Henry observes that, “We’re not a publicly traded company, we’re a small business. Those businesses that are tough to sell, you shut the power button off.” But for Henry, the sale is more than a transaction. Henry also expressed confidence that employee ownership provides a “better way to engage people…. Ultimately, when [workers are] more engaged, they’re more informed, they’ll make better decisions, which in turn makes the company more successful. I think it’s just a good foundation to move a business forward.”
A second business profiled by Peters is Opportunity Threads. Molly Hemstreet founded the worker-owned cut-and-sew factory in 2008. Peters writes that, “Workers at Opportunity Threads have the opportunity to become a worker-owner, through membership in an LLC, after a vetting process of 12-18 months by other members.” Hemstreet adds that, “We’re not a collective [where] everybody’s making every decision. There’s still a clear hierarchy. It’s just to say that the profits of the business and the risks are shared among a group of people.”
“At Opportunity Threads,” Peters details, “workers make up the board and management teams; the management teams run the business, rather than a traditional CEO. The company is saving some profits to invest in a new manufacturing facility, and has also invested in full benefits for all workers, whether or not they are worker-owners. The rest of the profits, about 30 percent of the total, go to the workers and worker-owners.”
Read more: https://nonprofitquarterly.org/2018/01/16/employee-ownership-gains-ground-western-north-carolina/