Can employee ownership boost sales?

Posted by admin at 15:52 on 13 Feb 2017

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Sales and Margin dials being turned up to maximum

Can employee ownership boost sales, profits and brand perception? A landmark survey of UK consumers by RM2 indicates an emphatic yes.

Belief in the benefits of employee ownership is what inspires our work at RM2.  But we are always on the lookout for hard evidence to support our belief. To borrow a phrase from the philosopher David Hume, ‘a wise man proportions his belief to his evidence’.

We were excited to read about the work of Ownership Alliance in the US. Ownership Alliance is a US public benefit corporation that promotes fair and just ownership of economic organisations. As part of their work, they run a certification program for employee-owned companies. What caught our attention was a series of consumer surveys focused on the impact of employee ownership on brand perception and sales: specifically, how would consumers respond to a product that displayed the “Certified Employee-Owned” (or “EO”) mark?

We are grateful to Ownership Alliance for permission to report on their findings in the US, and to repeat their surveys in the UK. A summary of the UK results is in the table below, alongside the US results for comparison.

  UK Results* US Results
% willing to pay more 41% 49%
% more likely to buy 27% 41%
% associating EO mark with socially responsible practices 57% 65%

*each question was asked of a statistically representative population of the UK of at least 5,000 respondents.

Ownership Alliance concluded from the US results that the Certified Employee-Owned mark was more influential than a number of long-established social responsibility brands such as Fair Trade, Great Place to Work and B Corporation, indicating a “powerful and intuitive attraction to employee ownership”. Our initial research is that it is influential in the UK as well.

While the UK population’s positive association with employee ownership lags that of the US population, this is unsurprising as the US has lead the world on employee ownership initiatives. As an example, the US developed the employee stock ownership plan in the 1970s, whereas similar legislation was only introduced in the UK in 2014. Whilst we would expect the positive association with employee ownership to take time to build, we are delighted to see such a positive trend so early.

This post provides a brief introduction to the survey. The detailed results and further analysis will be published soon.