With 64 stores throughout the U.S., The Container Store Group, Inc. (TCS, Financial) is a leading specialty retailer of storage and organization products, renowned for its excellent customer service and "conscious capitalism" culture. The company went public in November and the stock more than doubled through the end of the year. Its shares pulled back during the quarter allowing Baron Growth Fund to invest at what we believe to be attractive prices. The Container Store checks all the boxes we look for in a business, including significant growth opportunity, sustainable competitive advantages and management talent. We view the growth prospects for The Container Store as open-ended, with square footage growth that can sustain a double digit pace for at least a decade on its way to 300 stores. The company dominates its niche by selling exclusive merchandise and customized solutions that save customers time and space and generates loyalty and repeat business in the process. Its management team, including dynamic founder and Chairman Kip Tindell, is highly seasoned and focused on maintaining a positive corporate culture rooted in customer service and solution-based selling. (Matt Weiss)
From Baron Funds' first quarter 2014 commentary.
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