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Business
Kaufmann's gave start for many

As the central offices mark their last days, local entrepreneurs who cut their teeth there look back with fondness -- and sadness

Sunday, July 14, 2002

By Teresa F. Lindeman, Post-Gazette Staff Writer

Resumes rich with Kaufmann's department store experience have been touring the country in recent weeks, as have the people whose names appear on them.

Former Kaufmann's executives Dan Harris, front, and David Knouse opened Le Mix, a gift and home furnishings store, last fall in Edgewood. (Franka Bruns, Post-Gazette)

Friday was the last day for several hundred employees of the department store group's Downtown credit center. By August, a total of 1,200 employees who worked in the central offices will take their severance checks and move on. When they do, a number of area entrepreneurs will be wishing them well.

Many learned -- not everything they know -- but an awful lot of useful skills during their own stints inside the big, old Downtown store.

Here are some of their stories.

Tech transfer

Ensconced in a modern boardroom filled with light woods and sleek furniture, the co-executive directors of the Pittsburgh office of high technology firm FullTilt Solutions Inc. cheerfully zoom down memory lane -- back when they lived "The May Way."

Larry Honig came first, hired out of college to join an assistant buyer training program at Sibley's department stores in New York state. When Sibley's St. Louis-based parent May Department Stores abruptly announced it would merge the division, he ended up in Pittsburgh as part of Kaufmann's new crop of recruits in 1990.

Steve Bass came a year later, choosing Pittsburgh over New York because his girlfriend lived here. He started at $28,800, not bad for a new Penn State marketing graduate in 1991.

Honig, a business major, hadn't intended to go into retail. He just went to the interview for practice. But the training sounded ideal for a wanna-be entrepreneur. "You actually learn how to run a multimillion dollar business."

Once here, the drill was pretty much the same for both men. They joined a group of 20 to 30, most fresh out of college and new to town. During six months at Kaufmann's headquarters, they bonded. Took tests. Learned how to talk with top company executives. Analyze reports. Work with vendors. Everybody had to spend a year in the stores, like it or not.

Topics included advertising, forecasting, identifying the best-selling items. Bass remembers spending three days in the steamy warehouse packing up all the damaged merchandise. "That was bad."

May trainers wanted them to understand every piece of the business.

Kaufmann's executives had their blind spots. Honig can still quote a human resources official's comment when he left in 1995 to start his technology business: "What are you leaving a great career here for? The Internet is a fad."

Kevin J. Smith had been an electronics buyer for Kaufmann's before leaving to open the Elite Runners & Walkers store in Robinson in 1999. (Lake Fong, Post-Gazette)

He also vividly remembers his lackluster office tucked behind a fitting room on one of those cavernous floors of the Downtown department store. Days often started at 6 a.m. and stretched past 9 p.m., as he worried over sales reports and whether the thousands of dollars he'd spent on a new line would boost business in the juniors department.

Yet the challenge was addictive and the pay good. "Kaufmann's people got paid very well because they were (among) the best in the industry," Honig said. As a buyer, he received calls weekly from recruiters.

He and Bass credit their training with grounding subsequent business ventures. Both went out on their own for a while before hooking up to pitch a deal to yet another former Kaufmann's type who gave them their first big contract.

Together they set up Compuvisions, with the idea of building retail stores on the Web. Business-to-business services proved more successful and in May 2000 they agreed to an acquisition by Philadelphia-based FullTilt. At that point, they had eight employees. They've since grown to 20.

"I left (Kaufmann's) with an understanding of retail," said Bass. "That understanding to this day is still of value to our business."

Run, run, run

A sign advises customers to take a number as soon as they enter the Elite Runners & Walkers store in Robinson. At peak times, the wait can last long enough to pick up a coffee nearby, admitted owner Kevin J. Smith.

He's selling service -- the right fit for serious runners who want to minimize injuries -- so his staff doesn't rush while it analyzes each customer's exercise style.

Smith left Kaufmann's in June 1998 and opened his store in January 1999.

He's another one trained in the May Way. He started with the company in 1988 at the nine-store O'Neil's division in Akron, Ohio, coming out of Miami University of Ohio into an executive training program.

The demanding, transient life of retail kept him moving. O'Neil's was merged into May Co., Ohio, based in Cleveland. Smith was made a buyer in the electronics division in 1990, but decided not to stick around a couple of years later when another merger put the Ohio stores under Kaufmann's.

A move to Milwaukee for Kohl's department stores was hard enough on the family that he was glad for the opportunity to move back East in August 1993 as an electronics buyer for Kaufmann's.

"Being a buyer is wonderful," said Smith. "It's a very dynamic job. Nothing is the same from day to day."

But the hours hadn't changed a bit and would probably get longer if he tried to advance further. Starting his own business allowed him to stay in the area and regain family time.

When he left, Smith felt confident that he understood marketing strategy, advertising costs and how to analyze locations. "If it hadn't been so demanding, I couldn't have done this."

Visual appeal

Dan Harris gleefully suggests items that he could show off in a photograph for the newspaper. Perhaps the vintage bar items or the religious artifacts or the jewelry or the art pottery over on that shelf. He's having a wonderful time, churning out wry comments at rapid-fire pace.

His business partner, David Knouse, is more deliberate as they poke around Le Mix, the colorful, 1,700-square-foot gift and home furnishings store they opened last fall in Edgewood.

Accustomed to working together, it only took the former Kaufmann's executives two months to open the doors once they'd committed. "We've opened huge department stores before," said Harris, almost dismissively. "We only had this little space."

Their niche had been in creating the look of the stores. From the Kaufmann's windows on Smithfield Street to the Tommy Hilfiger or Ralph Lauren shops, they've done it.

Knouse was vice president of Kaufmann's visual merchandising, responsible for the appearance of all of the company's stores, until he left in 1999.

Harris left in 2000 with the title of capital projects manager. He'd been a visual merchandise manager with May Co., Ohio, until the two divisions merged. Knouse had lured him to Pittsburgh with the assignment for the Ross Park Mall store.

On their own, they went different routes. Knouse initially opened a men's clothing store on the South Side. Harris took a position as a traveling sales representative for a vendor in New York City.

Last year, they teamed again to sell an unusual mix of decorative and gift items. Other services include color and design advising, specialized painting, even store presentation consulting. "Pittsburgh has a lot of great stores but that presentation level on the walk-by is a little limited," Harris said with the authority and assurance of a major department store veteran.

It's nice not to have senior vice presidents walking by and demanding last-minute changes. They still faithfully track inventory -- another Kaufmann's alumnus created a special software program -- and watch for marketing opportunities.

In honor of the recent Edgewood garden tour weekend, they rushed to set up new garden-theme window displays. Nearly 100 people stopped by within three hours.

Christmas plans are already in the works.

Changing times

Kaufmann's role as one of May's growth divisions has kept Pittsburgh supplied with retail expertise. The parent company's consolidation in recent years regularly brought in talent from other markets.

Kaufmann's was top dog in a succession of mergers: Youngstown, Ohio's Strouss, Rochester, N.Y.-based Sibley's, and Cleveland's May Co., Ohio (which had earlier absorbed O'Neil's). The division even picked up a few former Hess's stores.

This time, it's different. In a few weeks, managers in the Boston offices of Filene's will be responsible for the department stores here.

"We thought Kaufmann's would be the acquirer," said FullTilt's Honig, voicing a sentiment common among alumni.

Steven Bass, left, and Larry Honig began their careers in the assistant buyers program at Kaufmann's. They are now co-executive directors of FullTilt Solutions Inc. (Lake Fong, Post-Gazette)

Yet Elite Runner's Smith sees the logic. Filene's had higher sales per square foot. Also, he said, while Kaufmann's had the most so-called top performing stores in the company, it also had the most low performing ones.

Eventually, it may not matter. The talk he always heard was that May eventually would have just three divisions -- East Coast, West Coast and Central.

Department stores, once entrepreneurial havens with a lot of freedom from store to store, are making more decisions at corporate headquarters. They save money by concentrating choices in the hands of fewer people.

It has been evident in the level of recruiting at colleges. At Purdue University, retail career fairs of the 1980s were dominated by department stores, said Sally Harmon, internship director. Last year, she saw very few but welcomed a number of specialty retailers, mass merchandisers, even some banks.

May was once among the coveted employers. "When they recruited our students, it was always the best students," Harmon said.

Pittsburgh can expect to maintain a network of alumni for a while longer. Those who've left often use former co-workers in the region for advice or services, from lawyers to printers, online retailers, even sign makers.

Lately, the expatriates have been taking calls from job seekers. They offer suggestions for places that might be hiring, such as Dick's Sporting Goods, GlaxoSmithKline or perhaps Roomful Express Furniture.

It's sad to see the old place go.

"As a whole, I think Pittsburgh loses out a lot," said Honig. "There's a lot of talented people that are here today that will have to leave town."

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