Omaja, Neb. – Nebraska Furniture Mart is no stranger to TWICE’s Retail Excellence Awards and with good reason: the company’s vast assortment of mid- to super-premium products, its state-of-the-art showrooms and crack sales team, and its heritage of customer service have made NFM a retail icon across all channels and categories.
The company’s unique business model – emulated less successfully by Sears with its Great Indoors stores – combines the cavernous real estate of a warehouse club and the selection of an Internet retailer with the home vignettes and assisted sales floor of a specialty dealer, all at competitive prices.
Throw in the backing of billionaire Warren Buffet, who purchased a majority interest in the business in 1983, and you have the stuff of retail legend.
That legend began in 1937 in the basement of an Omaha jewelry store owned by Rose Blumkin’s husband. Described by her scions as “a tiny Russian immigrant,” the spunky Rose parlayed a $500 investment into a home furnishings emporium by building on the simple premise of “Sell cheap, tell the truth, don’t cheat nobody.”
Omaha’s local darling gained national attention after Buffet added NFM to his Berkshire Hathaway portfolio and Blumkin was profiled on CBS’s “60 Minutes.” Correspondent Morley Safer did his best to keep up with the elderly “Mrs. B” in the segment as she raced around her retail complex on a motorized scooter.
“Most home furnishings retailers are not attractive investments,” Buffett told TWICE at a store opening for fellow NATM buying group dealer RC Willey. “The return is not very good. It takes good execution, great managers and a lot of people willing to work very hard. The Blumkins showed the way.”
Rose reluctantly retired in 1989 at the age of 95, only to open a rival store, Mrs. B’s Clearance and Factory Outlet, across the street, which later merged with NFM. She passed away in 1998 at the age of 104.
Today the operation is run by Blumkin’s grandsons Irv and Ron, whose stated goal – boldly posted in each retail location – is “to excite, entertain and exceed customer expectations on a daily basis.” That was clearly the case earlier this year in Kansas City, when the company took the wraps off its newly remodeled CE department. The completely redesigned showroom encompasses more than 51,000 square feet of space, enough to accommodate its more than 40,000 CE items, including 200 TVs, 100 computers, 200 cameras, 100 mobile phones, and 20,000 game and software titles.
The department also features five in-store vendor shops, including an Apple Store, Bose Salon, HP Experience, Panasonic Technology Zone and Sony Store, and opened with eight HD video projectors and screens.
“Nebraska Furniture Mart’s quest is to provide its customers with a unique and engaging shopping experience,” electronics division director Jay Buchanan said of the showroom, which “symbolizes the creative and collaborative ‘best’ from our team” of designers, architects, builders and merchants, in addition to NFM’s vendor partners.
The Kansas City store was opened in 2003 and represents the company’s second out-of-state foray, following a move into Des Moines, Iowa, in 2001. The two-story, 1.2 million-square-foot Kansas complex features 450,000 square feet of selling space and sits on 80 acres. Its CE department reset followed a two-year, multimillion-dollar expansion of NFM’s 100,000-square-foot appliance, electronics and computer store at its Omaha headquarters that was completed in 2007.
Other recent additions include ATM-like recycling stations that accept used handsets in return for store credits, and an online assortment of cellphones and service plans from Verizon Wireless and Sprint Nextel, managed by Simplexity.
The efforts appear to have paid off: Earlier this year the Blumkins appeared on the short list of Berkshire Hathaway CEOs whom Buffet praised in his annual shareholders letter for “improving profits even as sales contracted, always an exceptional managerial achievement.”
Visits to NFM also remain a mainstay of Berkshire Hathaway’s annual shareholder meetings in Omaha.