Borsheims CEO Karen Goracke.
Borsheims
Karen Goracke is the CEO of the jewelry store Borsheims, a Berkshire Hathaway subsidiary.Goracke worked her way up from the store room, and Warren Buffett interviewed her for CEO.She said she talks to Buffett about everything from sports to business.
This as-told-to essay is based on a transcribed conversation with Karen Goracke, CEO and President of Borsheims, about her career and working with Warren Buffett. It has been edited for length and clarity.
I started working as a sales associate for Borsheims, a jewelry store in Omaha, in 1988 straight out of college. It seemed like a glamorous place to work. It was a big company run like a small family business. There was no inventory, and our accounting practices weren’t great.
One year later, in 1989, Warren Buffett’s Berkshire Hathaway acquired Borsheims from the family that owned it.
Berkshire Hathaway likes to buy successful companies. When they acquired Borsheims, they were pretty hands-off about the daily running of the company, with one caveat: We should have a controlled inventory system.
I was promoted
Even though I was young, they put me in charge of the inventory project. There were 100,000 pieces of inventory. I went through each item one by one to create a data entry. I’d handwrite a tag for it, put the tag on the item, and put it back in its case. I often had to ask the former owners how much some pieces cost because a lot of them had been bought in cash.
Eventually they gave me a team to help out. It took us a few years, but we got everything in a system, and had data we could use. I shared the data with the buying team, telling them where they were making money and where they had too much stock.
I knew Warren Buffett knew what I did because he wrote notes about the inventory saying it was looking good or needed improvement.
They offered me a job as a watch buyer, which I took in 1996. I wasn’t the best salesperson or the most well-connected, but I really understood the mechanics of the business. I used to joke that I had tried on every piece of inventory in the store.
I’d grown up in Omaha and attended a small state college in Nebraska. As a buyer, I traveled to Switzerland, New York, and Las Vegas and learned more about the business.
I left and came back
At that point, I had two kids with my lawyer husband. He was becoming a partner, and it got chaotic at home. I’d been working for a decade and decided to take a career break. We had a third child, and I stayed at home for six years. I maintained my connection with the store, sometimes coming in with the kids.
Five years after I left, Borsheims called me to ask me if I would consider coming back. I waited until my third child was in preschool, and then returned as a jewelry buyer. It was a bigger department than watches, and a step up. I loved my job.
I was interviewed by Warren Buffett
Over the next decade, I worked my way up to the executive team as director of merchandise. When our CEO was planning to leave for a new role, she asked me if I would apply to become CEO. I nearly fell off my chair. I’d never managed more than five people, and it wasn’t on my radar.
I was asked to interview with Warren Buffet.
We’re both from Omaha, which can feel like a small town. I met him briefly over the years when he came into the store and to fundraisers in Omaha.
Before the interview, I was so nervous my hands were shaking. We talked about what I thought of the business and its strengths and weaknesses at a high level. He then offered me a job right there. We didn’t talk about salary or anything.
I walked about thinking: “I’m not even sure what happened,” but it was exciting. I’m still very humbled, and I pinch myself sometimes.
I don’t get nervous with Warren Buffett
The first time I had a one-on-one with Warren Buffet, I was probably terrified. But he’s so charming, funny, and informative. I’m never nervous with him now.
He visits the store several times a year and usually tells me ahead of time, but not always. Once, I was helping a customer pick out some jewelry, and he walked into the store and started asking questions about inventory. I had to ask the customer to excuse me. She had no idea Warren Buffett was standing next to her.
I’m a very curious person. He teases me about asking lots of questions, but I think, “I’m sitting with probably the smartest person in the world. Why wouldn’t I ask him about everything from the business to our local community to sports?”
We talk about different things going on across industries, such as insurance or energy.
The greatest perk of my life has been having uninterrupted time with Warren when I’m comfortable enough to have off-the-wall conversations about anything, from soda to football. It’s been a joy.
He’s so supportive and kind. It’s like talking to your coworker. I also try to be very respectful, and I don’t contact him more than a couple of times a year. He is 94.
He advised me to focus on what I’m good at
One of the things Warren has helped me focus on is celebrating our successes. He hones in on diving into things you are good at to make it better. He reminds me to focus on what I’m good at.
As a buyer, I was good at understanding the appropriate amount of money to spend, our inventory level, and how that drives the business for the company. Buying drives successful salespeople and happy customers.
Now, what I’m best at is understanding what that looks like at a high level.
Warren calls Berkshire Hathaway’s CEOs his managers. He wants to empower us to do what we think is best. I see him as a confidence booster.
I also have a network of Berkshire Hathaway businesses I can call for advice. That’s a blessing.
Warren is a huge reader. I’ve tried to take that from him and read huge amounts of articles and publications. Knowledge is power.
If you have worked with a well-known business person and would like to share your story, email ehopkins@businessinsider.com.
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