If you've spent any time watching television in Colorado, you've probably seen American Furniture Warehouse President and CEO Jake Jabs onscreen talking up his furniture store. The now 87-year-old purchased American Furniture Company, which had gone out of business, in 1975 for $80,000. The chain is now one of America's largest (and, Jabs will tell you best), with 14 locations across two states and a pending expansion into Texas.
Jabs is also an avid giver, and AFW has made DBJ's list of top corporate philanthropists every year this decade, with $2.23 million in 2017 reported donations.
In an age when online retail has become so dominant, how have you changed your business model to continue to succeed?
One thing is we've added a big home-decor department to our stores. The reason we have it is that customers don't want to buy accessories on the internet — it's too personal. I've checked it out and that's the reason a lot of stores like HomeGoods and Hobby Lobby and Marshalls are opening stores instead of closing them — because they sell a lot of accessories.
And we sell furniture for about a third of what Amazon sells it for. Amazon charges 15 percent to sell other people's merchandise where we buy direct from the factory and sell direct from the factory so we kick butt on Amazon and Wayfair both.
You’ve spent a lot of time and money giving back to the community. Why is that so important to you, and what does it mean to your business?
It comes from growing up really poor in Montana, where we saw a lot of poverty and we saw people die of diseases that today are cured. So I think that's where my first desire was — I could make the world a better place, a safer place and help cure some of these diseases. But education changes lives. My dad only went to second grade, my mother went to seventh, and he wanted us to get an education so all of us went to college. I graduated from Montana State University.
As someone associated with a “Colorado company,” how much does the local aspect still mean in buying, and how do you incorporate it into your business model?
We buy furniture for the market. In Colorado there are a lot of ranches and mountain homes, so we carry a lot of leather. We also buy from a local manufacturer — there's a factory here in town that makes patio furniture. We buy from them and I certainly would help any local company we could that manufactures furniture here. There used to be more, but a lot of them have gone away. We'll buy every time we can locally.
What do you find most rewarding about your role as CEO?
I think it's keep improving the company — making American Furniture a better company. You know, I think without a doubt we are the best furniture store in Colorado, and we get a lot of people saying we're the best furniture store in the country. I [recently] spent all day with 90 new employees, and what I do is teach the culture of American Furniture Warehouse to sell honestly: no high pressure and don't lie to customers.
I think that's really my job is to keep American Furniture Warehouse the best furniture company in Colorado, and maybe the best in the country.
What workforce trends do you see most impacting your business in the coming years?
I think with the unemployment so low and every place you go there's signs up, "now hiring." Particularly with millennials, I think what you see is a little more movement. You know, we used to have people that worked for us for 40 years. I think with the younger people you don't see that anymore. They want to work somewhere awhile and maybe go try somewhere else. So we've seen a little more people coming and going than we have in the past. And I think that's a real challenge.
Tell us about a time you took a risk and it paid off.
Maybe one of the biggest ones is when I first started my first business: I bought a half interest in a music store in Golden, Montana — paid $1,500, and I really leveraged that $1,500 into the multi-million-dollar business we have today. And then I first bought the old American Furniture Company which had actually went out of business. Gave them $80,000 cash for a million-and-a-half worth of assets. Those are risks that both really paid off.
Why do I want to work for you?
You're working for the best furniture store in Colorado. I think that really goes without a doubt. I don't think anybody would argue that. We don't have quotas for salesman. We pay better than other stores do, we have lots of people who make over $100,000 that work for us. We have delivery drivers that make from $60,000 to $100,000 that work for us. Same thing with salesmen. We have no pressure in selling.
What is your theme song?
Colorado by Merle Haggard — "Colorado"
Jake Jabs
Title: President and CEO
Organization: American Furniture Warehouse
Website: afw.com
