The owners of Total Truck Parts (TTP) in Florida, members of HDA Truck Pride, have announced that the company has completed its conversion to a 100% ESOP. Effective at the end of May, all the employees of the company will own 100% of the stock. Total Truck Parts has six locations in Central and South Florida.
Tom Gibson and Marc Karon, current owners of TTP, say they have always had the intent of making this transition. It took several years to develop both a strong leadership team to guide the company into the future, and to secure the financial structure necessary to support the ESOP as it continues to grow and serve its expanding customer base, the two owners noted.
Gibson and Karon explained that converting to an ESOP is not an easy process. It is expensive and time consuming. But other than selling the business to another company, an ESOP is about the only other alternative, they explained.
“This is all about what is the best choice for the employees and the best strategy for the company. The employees made this company successful and deserve to receive the reward that comes from ownership. In addition, our continued success will require that the culture, strategy, tactics, and brand of the company be maintained. In addition, we are seeing a changing environment for employees. Employees today need to feel more connected to their employer and the ESOP accomplishes that,” said Karon, president of TTP.
The current owners will continue to be involved and play key roles in the business, but the decision-making will now be made by an advisory board composed of key managers as well as past owners.
The earnings of the company will drive the stock value, which should increase each year, they said. That stock, owned by the employees, will then be sold back to the company upon their retirement and add to the employee 401K and other accumulated retirement funds.
Karon will be joining with Michael Callison, from Midwest Wheel and Brian Rieger from ConMet, both ESOPs, at the upcoming CVSN Summit in Lake Tahoe to present on their ESOPs.