Warren Buffett Nebraska Furniture Mart

Rose Gorelick (aka Mrs. B) and her husband Isadore Blumkin are Russian immigrants who came to America in 1917. They have both passed. Mrs. B died at one-hundred and four years old. When they came to America, they started a successful second-hand clothing store.

They founded Nebraska Furniture Mart in 1937. Mrs. B was a very aggressive and competitive in promoting her store and bought furniture in Kansas City, Chicago, and New York at five percent over cost. Her strategy was to have lower markups on her furniture than her competition. Much to the dismay of her competition, they tried to drive her out of business by urging the furniture manufacturers to boycott Nebraska Furniture Mart, while she was known for her honesty and integrity.

In 1951, she had a significant sale on her furniture, in the Omaha city auditorium, with a sinking economy due to the Korean War. The result was a gross sales of one-quarter of a million dollars over a three day period. This success propelled the Nebraska Furniture Mart with a major of expansion of floor space up to 120,000 square feet. Her son Louie joined the business which, as a result, contributed to the business’s further growth and success.

1N 1975, a tornado damaged one of her stores, but this did not stop a rebuilding of the furniture store. Warren Buffett was so impressed with Mrs. B and the Nebraska Furniture Mart that he purchased 90% of the business, and in 1983 he added the company to his Berkshire Hathaway portfolio which owns over 60 subsidiaries and has made Buffett a billionaire.

When Buffett became involved, as a major investor, the Nebraska Furniture Mart developed three more locations in Dallas, Iowa, and Kansas. In his opinion, this store outsold its competition and was the most significant store in the Midwest.

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