Employee-owned business model helps secure success for Lindum Group
CONSTRUCTION company Lindum has praised the employee-owned business model as being a key part of the thriving group’s success.
The group, which last year opened a regional office in York covering North Yorkshire and East Yorkshire, is an employee-owned business and director Warren Glover said the model has been highly successful for the company, helping it maintain profitability.
Mr Glover was speaking a Round Table discussion held at Lupton Fawcett Lee & Priestley law firm in Leeds city centre, hosted by TheBusinessDesk.com founder David Parkin.
Employee-owned business leaders from across Yorkshire highlighted the benefits of the growing business model, which as a sector, accounts for 3% of GDP and is growing 10% year on year in the UK.
Mr Glover said; “The start was tricky. We were coming out of the last recession and were scraping along, so we had to think how do we not get into that situation again, and one of the ideas was employee ownership.
“We offered the idea up to employees and they said, ‘you shouldn’t think you are fobbing us off and giving the responsibility to us’. We had to give the first shares to them – they wouldn’t buy them. They had to be given away because they just weren’t involved at this stage.
“But now, what we have is successful. It is a family business, but employees don’t feel like they have to have the same name. That is when we get that engagement. It is up to them if they decide if they want to buy shares.
“There are different levels of engagement. Some don’t want to drive the company but as long as they are happy in our company going forward, that is fine.”
Mr Glover said Lindum has seen 14 years of growth and one “blip”. It has 480 employees, of which 96% are shareholders.
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“It is no surprise for us when the shares go up,” he said.
“Our year ends in November and we all know how the company is doing. It’s usually a sweep of how much the shares are going up.
“We are all in it together and that’s a powerful management tool. Staff know that their bonus is the same as management’s. That really helps.
“For us, an employee-owned business is when the employee feels like they own it. If they don’t feel like they have any ownership, it’s not as easy as it seems. It took almost four years before staff starting getting it at Lindum and it is not a magic bullet. It is one thing that helped our company and it is one thing that helps generate a good company.”
In its 2012 annual report, Lindum reported group pre-tax profit of £2.4m on turnover of £83m. The directors recommended the payment of a final dividend of 20p per share, bringing the total dividend relating to 2012 activities to 38p per share.
The Round Table event was attended by Katharine Jeffreys, Grant Thornton; Jonathan Oxley, Lupton Fawcett Lee & Priestley; Melanie List, Lupton Fawcett Lee & Priestley; lain Hasdell, Employee Ownership Association; Alistair Graham, Voice Technologies and Andy Davis, Gripple.
