City Fresh Foods looks to give employees an ownership stake
Roxbury company was “freed” from its shareholders, buying them out and becoming fully minority-owned
On Juneteenth, City Fresh Foods celebrated more than one kind of freedom. While the June 19 holiday commemorates final emancipation of African slaves, this Roxbury company was also “freed” from its shareholders, buying them out and becoming fully minority-owned for the first time since opening in 1994.
The new shareholders will be the employees, CEO Sheldon Lloyd hopes, through his new employee shareholder program.
City Fresh Foods provides family-style and individual meal catering for schools, community centers, child care facilities, seniors facilities and Meals on Wheels programs. The firm employs 130 people and normally produces 15,000 meals a day. During the current COVID pandemic, City Fresh Foods is producing closer to 20,000 meals a day. The company is truly local, with 95% of its clients in Boston, and the majority of its employees Boston residents, many from Roxbury.
“We have people who have been here almost 20 years, [and] multiple people in their teens, from drivers to people packing meals,” Lloyd tells the Banner. No matter how the economy turned, he says, they’ve never had trouble finding people, due to so many family referrals.
Lloyd is clear about the reason why he wants employees to buy stock in the company: to address the wealth gap in the community.
“We know that equity is everything. So this would enable people to have a stake in what they’re building,” he says.
COVID-19 got in the way of his first announcement of the program, so now Lloyd is spending time drumming up interest with employees, who can start buying stock within a few months. After the minimum share price is decided, employees can buy up to a 5% share with a small deposit. In addition to getting dividends and receiving the appreciated value of the stock upon the time they leave or retire, if employees buy enough (up to about 40%), they would elect two seats on City Fresh’s board of directors – giving them not only profit-sharing power but decision-making power outside of managing, cooking and packing food.
This reorganization comes at a time where demand for prepared meals is high. During the COVID pandemic, Lloyd has made several changes to meet the emergency demand for meals while making sure workers are safe and healthy when they return home. Workers split into two shifts, so the kitchen is less crowded, and Lloyd even found himself driving the trucks to distribute meals.
As likely the only minority-owned company in the area that is in what Lloyd refers to as the “community feeding business,” there is pressure to do better than competitors, and possibly sell the company to one. But Lloyd believes establishing employee ownership is the right choice.
“It’s not the biggest bang for the buck,” compared to selling to outsiders, he says, “but it’s right … You lay the groundwork for what the future will be. Because you’ve been working together, and [the employees] understand the mission better than anyone else.”