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By Root 3632 0

her,” said Louie.41 If somebody needed carpet for a nine-by-twelve room, she priced it out, added the tax, and gave the buyer a discount for being a good customer, all calculated within seconds in her head. And she still made occasional forays into the furniture department, often enough that the family could never be sure if even their own furniture was safe. Once, Rose called her daughter and told her to “empty the baby chest,” because she had a customer. “When I made up my mind,” she said, “I didn’t want to wait for nothing. That’s mine habit.”42 Nevertheless, it was Louie to whom Buffett talked. Louie said, “You should meet my sons Ron and Irv, who’ll be running the store someday.”

Buffett invited Ron and Irv to come to his office for a visit, and struck up a relationship with them. He sent Louie a letter, explaining his thoughts on the pros and cons of their selling to Berkshire. The Blumkins should be in no hurry to sell, he wrote, dealing with them as honestly as anyone possibly could. If “you decide not to sell now, you are very likely to realize more money later on. With that knowledge you can deal from strength and take the time required to select the buyer you want.”

Then he laid out what he really had to offer. They could sell to another furniture company, he wrote, or to somebody in a similar business. But “such a buyer—no matter what promises are made—usually will have managers who feel they know how to run your business operations, and sooner or later, will want to get into hands-on activity…. They will have their own way of doing things and, even though your business record undoubtedly will be far better than theirs, human nature at some point will cause them to believe that their methods are superior.”

Then there is “the financial maneuverer, usually operating on large amounts of borrowed money, who plans to resell either to the public or to another corporation as soon as the time is favorable,” he wrote. “If the sole motive of the owners is to cash their chips and put the business behind them, either of these types of buyers is satisfactory…. But if the sellers’ business represents the creative work of a lifetime and remains an integral part of their personality and sense of being, both of these types of buyers have serious flaws.

“Any buyer will tell you that he needs you and, if he has any brains, he most certainly does need you. But a great many, for the reasons mentioned above, don’t subsequently behave in that manner. We will behave exactly as promised, both because we have so promised, and because we need to.”

Buffett explained that if he bought, he wanted the Blumkins to stay on as partners. If they looked back with regret, the deal would be a disappointment for everyone, including him. He told Louie that he would get involved in only two things: capital allocation and selecting and compensating the “top man.”

Buffett had something else to offer. He was not German. The German company had offered well over $90 million, but to Mrs. B, who had traveled 9,000 miles across Asia to escape the pogroms, selling to a German company was anathema. The Blumkins agreed to sell the company to Berkshire, so Buffett drove out to the 200,000-square-foot store to make a deal. There he found the eighty-nine-year-old Rose gunning the motor of her three-wheeled golf cart and racing around the store, roaring at her employees, “You’re all good for nothing! I wouldn’t give a nickel for all of you!” while Louie and her three sons-in-law looked on.43

“I don’t even want to take inventory,” said Buffett. “I’ll take your word, Mrs. B, whatever you say you got.”

Mrs. B looked at her sons-in-law, who stood against a wall. One of them was taller than her by at least a foot. “Norman’s been married to Frances forty-one years,” she said. “Jerry’s been married to Sylvia thirty-six years. Charles was married to Cynthia thirty-nine years ago. I told those boys, ‘I don’t take return merchandise!’”

Her daughters owned twenty percent of the stock and had sent their husbands to sign off on the deal. The sons-in-law were not dumb