Michelle Killoran, CFO, was not aware that SCHEELS was an employee-owned company when she joined the team as a part-timer in 2000 while attending Concordia College.
“I had no idea that SCHEELS was an employee-owned company,” said Killoran. “Based on the name of the company, I assumed it was family-owned.”
From its founding in 1902 to 1991, SCHEELS was owned by family and a few select associate shareholders. However, the sporting goods company added to an Employee Stock Ownership Program in 1991 and now nearly 3,000 associates are employee-owners.
In order for an employee at SCHEELS to be eligible for the ESOP, they need to have worked one year and 1000 hours. There is also an opportunity for employees to purchase SCHEELS’ stock after working for five years with the company as a full-time employee.
From the part-timers who have accrued enough hours to the long-tenured full-timers literally investing in the company, Killoran says that employee ownership has been very helpful to SCHEELS in maintaining its culture and pushing the company forward.
“There’s a level of accountability that’s established when you’re an employee-owned company that I don’t think is necessarily always there otherwise,” said Killoran. “Because we are working towards the same common goal, a successful and thriving company, we hold each other accountable to a higher level. That dynamic has been very good for us. It breeds that culture of striving to do more to ensure this company is the best retailer in the United States. You can see it in everything we do, from coaching each other up to picking up trash in the parking lot.”
If your company is considering the use of an ESOP…
Make sure your employees are educated! Though Killoran didn’t know the company was employee-owned when she first started, SCHEELS makes it a top priority these days to educate its employees on the benefits of employee ownership.
“We’ve made a concerted effort over the past few years to ensure that our branding is visible that we are employee-owned,” said Killoran. “We’re working on the education component to make sure that our associates understand employee ownership. The quicker someone understands it, the quicker they buy into making their employment at SCHEELS a career.”
Wouldn’t Be Possible Without SCHEELS
Employees benefit from ESOPs as well. Marsha Kringstad, a former shipping, receiving and defects manager at SCHEELS, is now enjoying the weather in Lacey, Washington all thanks to the retirement benefit the SCHEELS ESOP provided her.
Kringstad spent 31 years in freight rooms like the ones pictured on this page in both the St. Cloud and Fargo stores and was able to retire with over $1.5 million due to the ESOP retirement plan, something she wouldn’t have been able to do working at many other freight rooms.
“SCHEELS made a lot of this possible for me,” said Kringstad. “Because of them, I was able to move out here and be closer to family.”
If you’re looking for a commitment from the ground up at your company, an ESOP might be the right route for you. However, Killoran believes that not all companies are built for it. So, make sure you closely examine your company culture before transitioning.