Baxendale’s 10 Key Benefits of Employee Ownership

Baxendale’s 10 Key Benefits of Employee Ownership

1: Continuity

When becoming employee owned, the business continues with minimal disruption, unlike the alternatives to selling to employees.

2: A fair price

You don’t need to find a buyer and convince outsiders of the value of the business; your employees are already aware of its potential and will pay a fair price. A misconception is that selling to employees means selling at a discount.

3: Financial incentives

There are tax breaks – introduced in the Finance Act of 2014 – when you sell to an Employee Ownership Trust (EOT), because the government recognises the value of EO businesses to the economy. These tax gains impact on both seller – exemption from capital gains tax – and individual employees, who can receive up to a £3,600 tax-free bonus every year.

4: Your exit, your design

You’re better positioned to negotiate exit terms and can design a model that suits you and the business best.

5: Be fit for the future

The business becomes innovative and pioneering: more great businesses are looking to employee ownership because the model fosters agility, adaptability and invention. This mind-set is ultimately better at future-proofing against upcoming challenges.

6: Stronger communities

Loss of jobs in the community can be avoided; contractors and supplier relationships can continue, and plans will be executed only if the employees that know the business best think it’s the right thing to do.

7: Employee rewards

You are rewarding your employees, demonstrating gratitude for their loyal and oftentimes long service.

8: Your culture, protected

The unique culture you’ve created won’t be diluted by those that don’t ‘get’ it.

9: Flexible timelines

You’ll have more flexibility to proceed at the right pace, plus negotiate any input you might have in the business going forward.

10: Soaring engagement and productivity

A workforce of owners is an engaged workforce, often resulting in increased productivity and growth. EO businesses commonly go from strength to strength, meaning that the best health your business has ever been in may be in its future.

What business owner wouldn’t have these things on their wishlist?

Baxendale has helped over 100 businesses and organisations to become employee owned and are the sponsors of the Employee Ownership Awards – the winners of which will be announced on 19th November at the gala dinner at the Hilton Metropole Birmingham.

by Mia Vigar, Baxendale’s Communications Lead, who helps advise businesses on their communications strategies around transformation and change.