At a time when most businesses are scaling back on employee benefits, at least one Georgia company offers a perk that has created millionaire after millionaire. It's a chain of supermarkets that operates in only six southeastern states. Any guesses? If you said Publix, you're spot on.
Other companies, like Whole Foods, also offer a generous employee benefits package, but Publix's appears to have more perks than most, including the gift of private stock. And apparently, private stock is what a lot of millionaires are made from. Just as the word "gift" implies, employees are given shares of Publix common stock at no cost, accumulating, on the average, about 3.5 shares per week, according to one former employee.
"It's roughly eight percent of your annual pay," the employee said. "So for every ten thousand you make, you receive eight hundred in stock."
It doesn't happen overnight. Instead, part-time and full-time employee begin receiving stock after 1,000 hours of service, as long as they work at least 24 hours a week. Virginia Conn, an Atlanta area resident, retired from Publix last year after being hired as a deli associate in June 2003.
"It builds up quickly," Conn said of the stock. "But I think my first dividend check was for something like five dollars. I used it to buy lunch the day after I received the check," she laughed.
But by the time she retired, she could afford to buy lunch for everyone she worked with and then some. In fact, only five years after receiving her first share, Publix stock had increased so much in value, the board opted to do a split. Conn remembers the stock tumbling only once in the 13 years she was receiving it.
"That was when everyone's stock tanked," she recalled, remembering the Subprime lending crisis, which derailed Wall Street. But even then, it didn't take long for Publix private stock to rebound. Upon her retirement, Conn cashed in her shares for a sum she asked to remain confidential, but it's comparable to a mid-level executive's annual salary. Remember, she worked there only 13 years. Another Atlanta-area employee, who started with the company right after graduating from high school, recently took early retirement and cashed in his Publix stock for more than $1 million. He declined an interview.
Now to the fine print: Publix stock is privately held, and therefore only available to immediate workers and individuals who serve on the board of directors. It is not traded publicly on any stock market like the New York Stock Exchange or NASDAQ. Yet, private stock is regulated by the Securities and Exchange Commission, or SEC, much the same way public stock is governed. For example, according to a recent press release, Publix's overall sales for the fourth quarter of 2015 were $8.2 billion, which represents a 4.5 percent increase from last year's $7.9 billion. Therefore, on March 1, Publix stock increased in value from $41.80 per share to $45.20 per share. The market price of Publix's common stock is determined by its board of directors each quarter .
During designated offering periods, Publix's common stock is made available for sale to eligible active employees and non-employee members of the board of directors. "The key is investing your dividend checks to buy more stock," said one employee. "Buy as much as you can."
"It goes back to our founder, George Jenkins," said Publix's Media and Community Relations Manager for Georgia, Brenda Reid. "He believed by making us owners of the company ... if he took care of us as owners, we would take care of our customers. And we do."
Jenkins founded Publix in 1930. Many of his quotes are prominently displayed throughout the stores, regions and headquarters, but perhaps one in particular defines his selflessness: When asked once how much he would be worth if he hadn't given so much away, the founder simply said "nothing."
Publix is the largest employee-owned retail grocery store chain in the United States, with more than 113,000 stockholders and more than 141,000 participants of its Employee Stock Ownership Plan, according to the Publix website. Jenkins grew up in Harris, Ga. before moving to Florida in 1925 where he eventually launched his grocery store chain.
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