Buffett: R.C. Willey had bang-up 2005
By Clint Engel -- Furniture Today, March 27, 2006
Omaha, Neb. — With business up and an effective growth strategy in place, furniture retailer R.C. Willey again earned praise in the annual letter to shareholders penned by Berkshire Hathaway's legendary Chairman Warren Buffett.
In the 2005 letter released this month, Buffett reported same-store sales for the Salt Lake City-based R.C. Willey grew 9.9% in 2005, and noted the retailer's closed-on-Sunday approach "continues to overwhelm seven-day competitors as we roll out new stores in new markets."
Buffett said the retailer's Reno, Nev., store, which opened in November, is off to a fast start, and that if a Sacramento, Calif.-area store succeeds as he expects it to, "Californians will see many more R.C. Willey stores in the years to come."
Investment company Berkshire Hathaway owns R.C. Willey, along with retailers Nebraska Furniture Mart, Star Furniture and Jordan's Furniture.
When asked for his reaction, R.C. Willey President Jeff Child said, "We're happy that he's happy. You always want to make your boss happy."
As for future California expansion, Child wouldn't go much further than what the company already has said — two Sacramento stores for sure, maybe three. A 550,000-square-foot distribution center will open in the next two weeks in Roseville, Calif., followed by R.C. Willey's first Sacramento-area store in Rocklin, Calif., set to open in June.
"That (distribution center) will serve Reno and the one Sacramento store initially, but it can do more than that," Child said. "We're trying to find another great location (in the Sacramento area) and get another store up and running to help with the economies of scale."
And after that? "I'm sure there will be more stores in California," Child said. He noted that greater Sacramento is the retailer's largest market to date, with nearly 2 million people, a few hundred thousand more than Las Vegas and nearly as populous as the state of Utah.
Near the end of his letter, Buffett mentioned Nebraska Furniture Mart, which, like Berkshire Hathaway, is based in Omaha. The big store has held a "Berkshire Weekend" discount-pricing event during Berkshire's annual meetings for the past nine years. Sales for the event have gone from $5.3 million in 1997 to $27.4 million this past year.
"I get goose bumps just thinking about this volume," Buffett wrote.
