Egged on by a major new investor, Kitchen Bazaar is cooking up ambitious plans for growth.
The 23-year-old emporium of pots and pans, gourmet goods, dishes and cooking accessories hopes to more than quintuple its size in the next five years -- growing from a local six-store chain into a nationwide retailer with at least 32 stores.
"In three to five years, I anticipate we will be a real force in the marketplace," said Richard D. Kaufman, a 48-year-old lawyer-turned-businessman who purchased controlling interest in the Washington-based Kitchen Bazaar from its two top officers two months ago.
"I think this is a company whose time has come," added Kaufman, who has assumed the chairmanship of the chain, which this year is expected to sell about $8 million worth of goods.
Kaufman declined to say how much he paid for Kitchen Bazaar, but industry sources said the cost was about $4 million.
Along with a group of unidentified investors, Kaufman hopes to finance his expansion plans by selling stock to the public early next year, "assuming the marketplace doesn't deteriorate any further," he said.
"A public offering will put us into a position to complete our expansion program," Kaufman said.
Kitchen Bazaar's founder and former chairman, Sherman Shapiro, and its president, Alan Shefter, decided to look for a buyer or major investor for the chain early this year.
"We decided it was time to grow our business, and felt the best way to expand ourselves was to bring in an outside investor," said Shefter, 46, who remains as president in charge of day-to-day operations.
Shapiro, 63, has retired as chairman, but he keeps close ties with the company he started through a consulting relationship -- as well as through the large interests in the company both he and Shefter still hold.
"Kaufman asked me to stay, but I realized that the next five years would require a lot of hard work, and I had just reached the stage where it was time to take a sabbatical," Shapiro said.
The chain's planned expansion comes at a time when competition in the housewares industry has intensified not only from department store chains, which have expanded their gourmet and kitchen departments, but also from specialty chains such as Williams-Sonoma, which are setting up stores in malls across the country.
Nonetheless, Shefter remains confident that Kitchen Bazaar's distinct eclectic image will enable it to be a powerful competitor.
For one thing, Kitchen Bazaar carries 12,000 different lines of merchandise -- "considerably more than department stores or many other competitors," he said.
In addition, unlike many of the chain's specialty-store rivals, "we go in the for organized clutter look," Shefter said. "We're the bazaar; Williams-Sonoma is the museum."
Kitchen Bazaar was conceived in 1964 by Shapiro and Edith Schubert, the former owner of The China Closet -- a Washington-area china and glass store -- on a train ride back from the New York gift show, where they had seen a wide array of cooking equipment.
At the time, Shapiro was running the gift and lamp concessions in the GEM department store chain. Shapiro bought out Schuster's share in 1973.
Shefter joined Kitchen Bazaar in 1967 as an accountant. "He was to be here only for six months," Shapiro said.
Ten years later, Shefter was still at Kitchen Bazaar, and, with Shapiro, was considering ways to expand the profitable chain. Just how profitable the chain is, however, Kaufman declines to say.
"We had a lot of vibrant, creative people working here looking for ways to grow with us," Shefter said. "We felt that we had an obligation to them to provide that growth. Otherwise, we would not only lose those people but we would also become stagnant.
Although Shapiro and Shefter considered franchising the Kitchen Bazaar concept, they ultimately ruled it out because "franchising has a lot of pitfalls," Shefter said. "If you don't get quality franchisees, particularly in the initial stages, you run the risk of losing the entire concept."
Kaufman found out that Kitchen Bazaar was looking for an investor through a tennis partner who was the company's insurance agent.
Kaufman had been looking for a retailing venture since last spring, when his partner bought out his share in a Philadelphia furniture rental firm, IFR Furniture Rentals. Kaufman had purchased IFR 2 1/2 years ago after experiencing "burnout" from practicing business law for more than 20 years.
At first, Kaufman thought he had little chance of winning the chain, because he learned about its availability only 12 hours before a contract was to be submitted for it. But those negotiations fell through, and Kaufman acquired the firm in September.
Kaufman plans to expand the chain in cities close to Washington. However, he does not rule out buying another chain in other cities or setting up stores elsewhere. Within a year, he hopes to open four new stores, and within five years another 22. At this point, Shefter said, there are no plans to change Kitchen Bazaar's concept.
"So far, we have a winning formula," he said. "If it ain't broke, don't fix it."