The founder of the Richer Sounds audio equipment chain is handing control of the business to staff in an unusual move that will trigger windfalls for more than 500 employees.
Julian Richer, who opened his first shop in London Bridge in 1978 and remains the retailer’s sole shareholder, announced that 60 per cent of his stake would be transferred into an employee-owned trust.
“Having hit the ripe old age of 60 in March, I felt the time was right,” Mr Richer said. “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 will pay Mr Richer £9.2m for his shares but he will give £3.5m of that back to 522 staff, who will receive £1,000 for every year they have worked for the retailer. The company’s nine board members — the newest of which has served for 25 years — will not share in the bonus.
Mr Richer said he planned to stay involved with the business, but would leave the day-to-day running to the management board.
He is one of the UK’s most successful retailers, building his audio chain into a business with 53 stores nationwide. The last published accounts show Richer Sounds had a turnover excluding VAT of £157.5m in the 12 months to April 2018, 1 per cent up on the previous year, with a gross margin of 25.4 per cent.
A regular on the UK’s rich lists, Mr Richer, who has no children, was 23 when he bought his first Rolls-Royce, adding a private jet not long after. His business ethics are driven by a strong Christian faith. Each week, he hosts a Bible study group at his Georgian mansion in the Yorkshire countryside.
The entrepreneur has previously written in his will that he would like the company turned into a John Lewis-style employee-owned trust after he died.
The Richer Sounds Trustee, as the new entity will be known, will have a set of principles that will ensure the business operates in a responsible manner, based on honesty, commitment, trust and respect, the company said.
The company refuses to employ people on zero-hours contracts and donates about 15 per cent of operating profit to charity each year.
Mr Richer has said that motivating staff was a “crucial element” of the retailer’s success along with its “second to none” commitment to customer service.
The move to employee ownership status, which has been in process for the past 18 months, was welcomed by Deb Oxley, chief executive of the Employee Ownership Association.
“We’re delighted to see it secure its future independence with a focus on its people and an eye on the future world, a world with a more inclusive economy where more businesses are doing well while doing good,” she said.
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