Established in 1974 to serve the fledgling offshore oil industry, Instock has grown into one of the largest independent distributors of cleaning and non-food catering supplies in the UK.

Led by Guy Hudson, Instock is one of our more unusual clients in that it is perhaps not a business most would normally associate with a partnership model. One of the reasons we wanted to showcase Instock was to make the point that any business can reap the countless benefits of becoming a partnership, not just ‘professional’ businesses or tech startups (or whatever the stereotype might be).

Guy outlined three things that attracted him to the partnership model:

  • Engendering a co-operative customer service culture (on speed!)
  • Transferability AKA the ability to migrate the partnership ethos to newly-acquired businesses
  • Financial benefits
“We want to set ourselves up for the 21st century”

In response to mounting pressure from large internet firms such as Amazon, Guy knew he had to ensure Instock was able to provide a superior level of customer service to compete with the big boys, so to speak. “We wanted to engender a culture of inclusivity within our customer facing staff to incentivise them to provide an incremental level of service and customer care, recognising that Instock’s USP is its customer service level”, Guy explained.

Implementing a partnership model has helped encourage Instock’s customer service team to go the extra mile because they know their collective efforts will be rewarded in the profit share. Or, as Guy put it: “My view as owner of the business was that if I share some of the spoils of the business over and above normal remuneration based on achieved profit then that might incentivise staff to go the extra mile for our customers, recognising that they would be beneficiaries of incremental profit.”

Although some of Guy’s team (though not all) already enjoyed the prospect of earning commission based on their performance, the partnership ethos is more inclusive and encourages a culture of teamwork and co-operation, rather than unbridled competition. “The guys on the phone are at the destiny of the profits generated to provide a profit pool: the higher the profit, the higher the profit pool”, Guy said. He added: “We want to set ourselves up for the 21st century; the internet is our biggest threat, therefore we have to personalise our service levels otherwise we’re all going to be taken over by Amazon.”

Instock Optimal Compliance LLP
Instock offers innovative catering solutions

“The partnership model was transferable”

So palpable was the change in culture upon implementing a partnership model, Guy sees the LLP as a marketable product which, now established, can be migrated to other sections of his businesses and of course to newly-acquired entities along with third-party companies.

He said: “The partnership model was transferable to other companies so the skill-sets and service understanding of the staff within Instock’s LLP could provide that same level of service and understanding to a third-party company.

“Another advantage that we saw from the partnership model was that those same members and partners in the LLP are capable of doing the customer service requirements for third-party companies as well as within Instock.”

In this respect, a partnership model is the gift that keeps on giving, in that businesses can migrate the culture to other businesses or other sections of existing businesses.

Incidentally, a group structure (we can help with this!) is another fantastic way of bringing numerous entities together under one holding company; just FYI, these work great alongside our partnership models

“I wouldn’t just do it for the financials”

Although Guy acknowledged the financial benefits of restructuring, he advised against doing it solely for any potential tax savings. In fact, he told us that if there’d have been zero financial benefit, he’d ‘probably have done it anyway’. He said: “I wouldn’t just do it for the financials, I would do it for the culture that you’re trying to generate and the incremental performance. I’d be a liar if I didn’t say that the financial benefits were helpful but Instock was perfectly solvent before the LLP.”

If you’d like to find out more, please don’t hesitate to get in touch.