Owning It: How People Drive the PFlow Difference
At PFlow we know it takes great people to build great machinery and industrial equipment that’s built to last. That’s why we’ve long recognized the critical role our employees play in our success by giving them a stake in the company itself.
Today, PFlow is a 100% employee-owned company, and it shows. We’re known for innovative solutions for the most complex material handling challenges, precision engineering, best-in-class safety features, and around-the-clock service that keeps our customer’s businesses running.
Delivering exceptional products and customer service doesn’t happen by accident, but through commitment from people who have a real stake in developing, delivering, and supporting our equipment. Let’s take a look at how employee-ownership works, and why it makes a difference to you as a customer.
Employee Ownership at PFlow
Bob Pfleger, PFlow’s founder, created the vertical reciprocating conveyor (VRC) industry when he opened PFlow Industries in 1977, providing powerful, cost-efficient industrial lifting equipment capable of safely moving the heaviest loads.
Twenty years later as Bob Pfleger was approaching retirement, he wanted to ensure the creative, competitive, and “get-it-done” ethos he had fostered at PFlow would continue to drive the company into the future.
Rather than looking for an outside partner to buy the company, he invested in those who helped him build PFlow from the start. As part of its business transition plan, Bob created an employee stock ownership program (ESOP) that would give all employees an ownership stake in the company.
PFlow Industries Employee-Owners – circa 1997
Bob believed the ESOP was the best option, not just for employees but for PFlow’s customers and suppliers. It turns out he was right.
What is an ESOP?
An employee stock ownership plan (ESOP) is an employee benefit plan that provides workers with an ownership interest in the company in the form of shares of stock. In an ESOP, a company typically provides shares of stock to employees at no cost (after a vesting period) and the shares are held within a trust until the employee leaves the company. Upon certain events (retirement, disability, departure from the company), the firm purchases the shares from the departing employee and provides a cash distribution to them, provided they meet the plan’s “cash-out” guidelines.
By giving employees a direct stake in the ownership of the company and, ultimately, a real share in its profitability, ESOPs aim to:
- Increase employee pride in their role at the company
- Boost employee engagement, commitment, and performance
- Provide a valuable qualified retirement benefit to employees
- Improve customer service
- Attract high-quality job applicants
- Retain talented, experienced staff members
Today about 20% of employees at privately held companies, or about 25 million people have access to some sort of stock-based compensation, such as stock benefits, be it stock options or restricted share units. Only about 11 million workers participate in ESOPs which gives them an actual ownership share in the business.
PFlow’s decision to take the path toward employee ownership in 1998 was a bold one. Even today, less than 2% of private companies in the U.S. offer similar programs. However, Bob Pfleger believed then, that the future of the company would be best served by investing in PFlow’s considerable in-house talent and experience.
Who Benefits from Employee Ownership?
Our Employees
Our Customers
Bob Pfleger also knew the company’s long-term prosperity depended on PFlow’s ability to build and sustain long-term partnerships with our customers. Our customers depend on PFlow to deliver deeply integrated solutions to material handling challenges for mission-critical applications. Our customized equipment delivers long-term value, with return on investment measured in years and decades.
By making PFlow an employee-owned company, Bob was able to hand over the reins to experienced internal company leadership, rather than an outside buyer. These individuals shared the same vision and management philosophy as Bob and had the same ongoing commitment to the strength and flexibility of PFlow’s VRC technology.
As an existing PFlow client, you know your installed equipment will be developed, manufactured, and supported with the same commitment to the quality and service you’ve always depended on. It means that as a new customer, you can invest with confidence in our ability to deliver the highest quality products and stand by them for years to come.
In fact, since establishing the PFlow ESOP, we’ve found that employee ownership delivers many other tangible customer benefits, including:
- Better service at every stage of our customer relationships. PFlow’s employee-owners have a vested interest in delivering the best service and solutions at every touchpoint – from project conception, to equipment start-up, to life of equipment service, each owner is highly-motivated to provide customers with the best solutions and service. Your success = our success.
- A more knowledgeable, experienced, and tenured workforce. PFlow’s ESOP structure helps to attract and retain the best talent by allowing each employee-owner to be an intrapreneur who builds product knowledge, drives innovation, and builds tenure, ensuring business continuity that delivers uninterrupted and enduring customer and supplier relationships.
- Researchers at Rutgers University found that employees are less likely to leave a company where they have a stake in ownership. The research found companies with significant employee ownership experienced an average annual turnover of only 6% compared with 14% in non-ESOP companies.
- Information from the same study, conducted in association with the National Center for Employee Ownership (NCEO), found that employees at companies with significant employee ownership were also more likely to invest in employee training and development which leads to a greater emphasis on research, development, and quality control processes.
- Superior quality. You expect quality from PFlow. Now, more than ever, we expect it from each of our employee-owners. When employees are also shareholders, their financial well-being is directly tied to the company’s performance. This alignment of interests creates a shared goal of delivering high-quality products, which benefit both the employee-owner and the customer.
- More Innovation. When employees share in the profits, they have a stake in creating smart solutions that improve performance and cut costs. ESOPs create an environment that nurtures and encourages knowledge sharing, collaboration, and empowerment to explore new ideas. Innovation grows through fostering an environment where employees can experiment and take calculated risks to develop creative solutions.
In short, we’ve learned over the years what Bob Pfleger already knew – that taking care of the customer starts with taking care of your people.
In November 2021, PFlow completed a final stock transaction that handed 100% of ownership in PFlow to the people who make our lifting solutions and industry-leading customer service happen. Never before have our employees had a bigger stake in building long-term, high-value relationships with our customers.
PFlow’s employee-ownership journey has taken the company exactly where our founders hoped. PFlow remains the leading VRC manufacturer and vertical material handling solutions innovator — creating solutions for a wide variety of applications each day.
From offshore oil platforms to aerospace manufacturing facilities to libraries, our clients invest in our equipment knowing it is the best-in-class product built by the same people who pioneered the technology — and who will continue to stand by their products decades into the future.
Advantages of ESOPs
- For Employees
- Qualified retirement benefit
- Pride of ownership
- Sense of responsibility, partnership
- Improved customer service
- Increased productivity
- Reduced turnover
- For Customers
- Continuity during transitions
- Sustained partnerships
- Consistent quality and reliability
- Improved customer service
- Value-added services
- Long-term return on investment
As PFlow owner-operators and business partners, we’re 100% committed to delivering long-term value to our customers by delivering the best solutions for their unique material handling challenges and providing exceptional product support for the lift of the product. That’s why you can expect PFlow strength, quality, and reliability every day — from our products and our people — and why you can invest in our innovative industrial lifting equipment with confidence.
Contact us today to learn more about how PFlow Industries can partner with you to solve even your toughest material lifting challenges.