Suffolk coffee business launches company share scheme
PUBLISHED: 13:01 21 August 2018 | UPDATED: 13:01 21 August 2018
An independent Suffolk coffee business is following in the footsteps of big-name companies such as Royal Mail, Asda, Tesco, Morrisons and drinks group Diageo by offering all its head office employees a chance to be a part of its new company share scheme.
Paddy & Scott’s, which began in 2007 from the boot of its chief executive Scott Russell’s car, has recently diversified its portfolio from cafes in Hadleigh and Bury Saint Edmunds to become the replacement for Starbucks in 31 branded coffee shops in UK Marriott Hotels.
The company, which employs 27 staff in Suffolk, is also branching out overseas, with interests in Hong Kong and Shanghai and plans to move into the UAE.
Paddy & Scott’s chief executive Scott Russell explained that the decision was made to start a share scheme in order “to attract, and retrain high calibre talent, inspiring business growth and motivating our expanding team.”
The shares are given to 10 of Paddy & Scott’s head office full time Bean Barn staff who have been with Paddy & Scott’s for over 12 months as a method to thank them “for consistent and outstanding performance.”
The share scheme enables staff to become equity partners, allowing them a share in the business profits as well as taking a key role in the business strategy and development.
The scheme is the brainchild of Paddy & Scott’s brand director Jon Reed, who described the head office team as “heroes”.
“They are very much part of the business, developing new product ranges, delivering exceptional customer service and playing a key part in the business,” he said. “We’re proudly investing in our team as a way of rewarding them for their commitment whilst fuelling ambition for the future.
“Paddy & Scott’s are at the forefront of innovative business development, we’re a dynamic and inspirational team and it’s another strike for Suffolk in the worldwide coffee market.”
Martin Westhorp, national sales manager, joined Paddy & Scott’s team just two years ago and has seen an unprecedented increase in business. He said: “It was a proud moment becoming an equity partner at Paddy & Scott’s - it underpins the commitment of the company in recognition of a fantastic team.”
Under an employee share ownership plan, employees hold shares or have the option to purchase shares in their company at discounted and tax-efficient rates. Malcolm Hurlston is chairman of the Employee Share Ownership (Esop) Centre, which promotes such share schemes. He said: “An employee share ownership plan is the best tonic for any company. Making everyone an owner is a brilliant move. Both customers and the bottom line will notice the difference.”
But he said such schemes are not a “panacea.” “Share schemes are more complex to administer than cash incentive schemes and therefore more expensive to provide. As share prices can fall, the size of the reward is unpredictable, which is of special concern during times of economic uncertainty. For this reason companies often offer shares on favourable terms by, for example, offering free awards, discounts of matching share offers. However, share schemes are at worst almost invariably ‘no-lose’ for employees if the company fails to progress.”
Paddy & Scott’s has also been busy building on an initiative it launched last year to cut out the middle man and work directly with the coffee producers - the Muchomba Farm and Rugia School project in Kenya.
“Since the beginning of the project we have invigorated the farm, built processing equipment, installed drying tables and a new irrigation system.” explained Mr Russell. “We built an educational model farm with shared facilities that can be used by local communities who rely on the coffee for their existence. We set out to empower the farmer and revolutionise how consumers interact with the people supplying their coffee.
“Every bag of our Meru Farm coffee purchased is helping deliver real change, entrepreneurial spirit and better quality of life for families in Kenya.”