Buffett: The Making of an American Capitalist by Roger Lowenstein

Author:Roger Lowenstein
Language: eng
Format: mobi, pdf
ISBN: 9780804150606
Publisher: Random House Publishing Group
Published: 2013-07-23T14:00:00+00:00

* Berkshire disclosed big investments at year-end.

Chapter 13

THE CARPET WOMAN

One question Buffett always asked himself in appraising a business is how comfortable he would feel having to compete against it, assuming that he had ample capital, personnel, experience in the same industry, and so forth.1

It was after such an appraisal that, in the summer of 1983, he strode into the Nebraska Furniture Mart, a sprawling store opposite Ross’s Steak House. He made his way through the acres of convertible sofas and dining-room sets to the carpeting department, and there, amid the vast field of powder blues and placid beiges, he spied the store’s owner, a woman all of four feet ten inches, and slightly stooped at that. But as measured by Buffett’s yardstick, she might have been ten feet tall.

Rose Blumkin, known to Omaha as Mrs. B, was patrolling the store in her golf cart. She motored down the aisle, haranguing an employee and gesturing with her arms with the vigor of a woman half her eighty-nine years. Her cheeks were flushed, and her auburn hair, done up in a bouffant, showed gray only at the temples. Buffett reckoned that he would “rather wrestle grizzlies” than compete against Mrs. B, and that was why he had come.

Speaking deliberately, Buffett asked if she would like to sell the store to Berkshire Hathaway.

Mrs. B said, “Yes.”

“How much?” Buffett asked.

“Sixty million,” Mrs. B spat out.

They shook hands, and Buffett drew up a one-page agreement—Buffett’s biggest acquisition by far. Mrs. B, who could not write in English and barely could read it, made a mark at the bottom. Merely a few days later, Buffett presented her with a check for 90 percent (the Blumkin family kept a minority share). She folded it without a glance and, by way of concluding matters, declared, “Mr. Buffett, we’re going to put our competitors through a meat grinder.”2

So well did Mrs. B incarnate Buffett’s business ideal, she seemed to have sprung from the pages of his letters, as though he had invented her to illustrate the plain virtues that he most admired. Mrs. B had the toughness, determination, and common sense that Buffett had seen in his grocer grandfather, in the retailer Ben Rosner, and in other Buffett heroes. Her story was the familiar, and distinctly American, story to which Buffett thrilled. It was a Horatio Alger script, set to the score of Fiddler on the Roof, yet magnified almost beyond belief.

Rose Gorelick was born on the eve of Hanukkah, 1893, in a village near Minsk in czarist Russian.3 She and seven brothers and sisters slept in one room, on straw. Her father was a rabbi, but his piety was wasted on Rose, who observed that his prayers did not provide the family with a mattress.4 She would awake in the middle of the night to see her mother, who ran a grocery, slaving over an oven baking bread. Hating to see her mother work so hard, she helped her in the store from the age of six.

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