Follett Corporation History

Company Perspectives:

Follett Corporation is the foremost provider of materials, technology and ideas to the education marketplace. On campus, in schools and in public libraries around the globe and via the limitless realm of cyberspace, Follett enables students, educators and administrators to capitalize on the explosion in information access. Through our various operating units, we serve students, parents, bookstores, teachers, and professors, as well as publishers, school administrators, school and public librarians and consumers--every one with a vested interest in advancing learning skills and enhancing the educational experience. Key Dates:

Key Dates:

1873:

Rev. Charles Barnes founds a small bookstore in his Wheaton, Illinois, home.

1893:

Barnes sells controlling interest in the store to his wife's family.

1901:

Barnes hires 18-year old C.W. Follett to work in his new Chicago location.

1917:

Barnes' son William sells his stake in the company to C.W. Follett.

1923:

Follett purchases additional shares; company renamed Wilcox & Follett.

1930s:Company expands into book publishing and wholesaling.

1940s:Follett begins publishing children's books.

1952:

C.W. Follett's son Dwight assumes control of the company upon his father's death.

1977:

Dwight Follett retires and hands reins to his son R.J.R. Follett.

1983:

Follett Publishing Company division sold to Esquire Education Group.

1999:

Launch of efollett.com, an Internet-based textbook sales site.

Company History:

The Follett Corporation operates the largest chain of college and university bookstores in North America, sells books and audiovisual materials to elementary and high schools and libraries, and provides library automation software and consulting services. Augmenting the company's 625 stores, a national online textbook ordering site was launched in 1999. Headquartered in a suburb of Chicago, the company has been owned by members of the Follett family for over four generations.

19th-Century Origins

Follett family members were born and bred under the auspices of the printed word, a passion passed down through four generations from Follett's founder, Charles W. (C. W.) Follett. The history of the Follett Corporation may be traced to 1873, with a home-based bookstore located in Wheaton, Illinois. The homeowner and proprietor was the Rev. Charles M. Barnes, a scholarly man who used his private library as his initial inventory.

In 1901, 18-year-old C.W. Follett met and fell in love with Edythe Benepe, a Chicago reporter. Before the two could marry and begin a new life, however, Follett needed to find gainful employment in the Chicago area. He found a job with Charles Barnes, who hired him for a week to help move his bookselling business to another location in Chicago. After his week was up, Follett stayed on and worked as a stock clerk and salesman, learning the book business from the inside out while working alongside Barnes's son, William.

Though Barnes's tiny bookstore had grown rapidly since its homespun beginning in Wheaton, it had floundered in 1893 when the country was rocked by a recession. Needing capital, Barnes had turned to his wife's family and given up controlling interest. Subsequently, when the founder's son William Barnes married Blanche Wilcox, her father invested in the company, making the Wilcox family large shareholders. By 1899, the Barnes bookselling enterprise had bounced back from losses during the recession with sales in excess of $237,000. In 1902, just a year after C.W. Follett had joined the company, Charles Barnes retired, leaving William and William's father-in-law, John Wilcox, to mind the store. The business thrived under the direction of Wilcox and the younger Barnes until 1917, when William decided to relocate to New York to form a partnership with a gentleman named Noble. While the Barnes and Noble venture went on to make bookselling history, C.W. Follett was given an opportunity to pursue his own bookselling dreams.

When William Barnes left the company, Follett bought his shares and the bookstore was subsequently renamed J.W. Wilcox & Follett Company. In the preceding years, Follett had become head stock clerk and then made sales calls throughout the Midwest and beyond, so he was well-prepared for his new role. Wilcox died in 1923, and Follett purchased the Wilcox family's shares and shortened the company name to Wilcox & Follett.

Diversification Under a New Generations of Folletts

C.W. and Edythe Follett welcomed their first child in 1904, a son named Dwight. Three more sons soon followed: Garth, Robert, and Charles ('Laddie'). In the 1920s, Follett's four sons joined the business and pushed the company into new fields. Garth started a wholesale business to serve libraries, which later became known as Follett Library Resources; Robert began a business wholesaling college textbooks, out of which grew Follett Campus Resources and Follett College Stores; Dwight created an elementary textbook publishing operation. Charles 'Laddie' Follett, the youngest son, worked within Wilcox & Follett's core business. For the remainder of the 1920s and into the 1930s, the company continued to grow and diversify its bookselling; even the Great Depression did little to stem its expansion.

Over the next two decades, a third generation of Folletts began joining the company, helping to fuel its continued growth. These family members included: Charles R. Follett, Sr., Garth's son, who built the company's library wholesaling business and eventually retired; Ross C. Follett, Laddie's son, who eventually headed up Follett Library Resources; Kent A. Follett, Laddie's eldest son, who would head up Follett Educational Services; and Richard A. Waichler, who married Dwight Follett's daughter Nancy and would eventually serve as vice-president of operations.

On December 19, 1952, C.W. Follett passed away at age 69, after 51 years in the book industry. Eldest son Dwight Follett was tapped to succeed his father. During the 1950s, three new family members who would eventually converge in the executive suite joined the company.

First, Dwight's eldest child and only son, R.J.R. Follett, started his career as an editor for Follett Publishing Company in 1951 after graduating from Brown University and taking post-graduate courses at Columbia University. Like his grandfather before him, R.J.R. learned the business by holding a myriad of positions, including copywriter, designer, editor-in-chief, marketing manager, and salesman, eventually rising to the corporation's executive offices. Second, P. Richard Litzsinger's association with the Folletts began with his 1954 marriage to Dona Lucy Follett (granddaughter of C.W. and daughter of Robert D.). After graduating from the University of Missouri with a double degree in accounting and finance and a three-year stint as an air force officer, Litzsinger began working at Follett in its retail stores division. Finally, Richard M. Traut joined the company in 1958, following his graduation from West Point and military service. While in the military, Traut married Charron, granddaughter of C.W. and daughter of Robert. Traut began his career with Follett in its textbook wholesaling division in 1958.

During this time, the company created a corporate parent and distinct subsidiaries with officers for each, and then relocated the entire operation to 1000 West Washington Boulevard in Chicago. At the time, the company was comprised of a retail division, a publishing company, and three wholesaling arms that dealt with libraries, colleges, and elementary, and high school (El-Hi) markets. Follett's varied enterprises were only temporarily housed under one roof, however. Growth soon propelled several subsidiaries into the nearby suburbs.

Success With Books for Children in the 1960s

Follett made publishing history by developing the first racially integrated textbooks as well as the first textbook program for educationally disadvantaged children. Another milestone, its 'JUST Beginning-to-Read' series, featured small-formatted books with lively illustrations and straightforward prose (often retelling classic fairy tales). This series proved very popular with teachers and first-time readers.

By the 1960s, Follett's three young leaders were on the move. Litzsinger was named Follett's retail stores supervisor in 1962; within four years he was president of Follett's college stores division. On the wholesale side of the business, Traut was named assistant general manager in 1965, and he would eventually take the reins of Follett Campus Resources as president in 1974. In 1968, R.J.R. Follett was named president of the publishing company and continued his own writing and publishing efforts. In 1977, R.J.R. succeeded his father, Dwight Follett, as chairman of the board, and Litzsinger was appointed president and CEO. This year also marked the founding of Apline Guild, an Oak Park-based publisher established by R.J.R. to produce business- and finance-related titles.

In 1977, Dwight Follett retired as president, and Litzsinger was named president and chief executive officer. Dwight remained as chairperson until 1979, when he was succeeded by son R.J.R. Follett. In 1982, Follett decided to shift gears slightly, selling its publishing division. 'In the future, there will be room only for large publishing companies covering a broad spectrum with strong sales support, or for small companies filling a specialized niche,' Follett told Publishers Weekly in December 1982, shortly before the sale. 'Medium-sized companies are not going to be around,' he added. Rather than run aground as a well-intentioned, medium-sized publisher (1982 revenues exceeded $13 million), Follett Publishing Company--a leader in social studies texts and critically acclaimed children's books--was sold to the Esquire Education Group in 1983.

Expanding the Bookstore Chain in the 1980s-90s

Using funds from its divestitures, Follett bought a chain of 35 college bookstores. With the acquisition of other bookstore management businesses, including Campus Services, Inc. and Brennan College Services, Follett became the country's largest operator of college bookstores.

The second generation of Litzsingers joined Follett in 1978, when Dick's son Mark arrived after completing his schooling at Texas Christian University. Beginning as a retail stores management trainee, the younger Litzsinger managed college bookstores at the University of Illinois at Champaign and Northwestern University before leaving retail to become director of corporate development. In 1989, Christopher Traut, Richard's son, came to Follett from Vanderbilt University and worked in the software division. In 1991, when Follett Collegiate Graphics was on the drawing board, Mark Litzsinger left his corporate post to head up the new division. Chris Traut then left Follett Software Company and replaced Mark as director of corporate development in 1992. Todd Litzsinger, Mark's brother, also worked for Follett, as midwestern regional marketing director for CAPCO, within the graphics division.

As the 1980s came to a close, Follett's college and El-Hi divisions continued to thrive by staying one step ahead of their competition. Using computers long before they were mainstream (starting in 1952 with an IBM punch-card sorting system), Follett eventually revolutionized the book industry with its software applications. The systems gave libraries and schools the ability to place and track orders and take inventory of their holdings with the touch of a button. In 1989, Follett introduced Tom-Tracks, a fully computerized college bookstore system for textbooks. By 1994, Follett had installed Tom-Tracks in over 500 other bookstores nationwide. Additionally, the company introduced FIRSTsystem (Follett Integrated Retail Systems Technology), a state-of-the-art, point-of-sale system for college bookstores that was fully integrated with an accounts payable system. The year 1989 also marked R.J.R. Follett's retirement as chairman. Richard M. Traut succeeded R.J.R., while P. Richard Litzsinger remained president and CEO.

Six Strong Divisions By the Mid-1990s

By 1995, after several incarnations and name changes, the Follett Corporation's six divisions were: Follett Educational Services, Follett Library Resources, and Follett Software Company, all of which catered to elementary and secondary school markets; and Follett Campus Resources, Follett College Stores, and Follett Collegiate Graphics, which served colleges and universities across the country.

The company's largest division was the bookstore chain. Follett College Stores (FCS), located in Elmhurst, Illinois, was the country's largest operator of college bookstores. With more than 450 stores in 46 states and Canada by 1995, FCS's nearly seven decades of experience in the field met the needs of over 200,000 faculty members and upwards of three million students. Follett's stores carried not only textbooks and stationery supplies, but popular sidelines like computer software, clothing, and music. The number of bookstores subsequently grew to 625 just five years later. Most were at smaller colleges, but also included were locations at such universities as Notre Dame, Purdue, and Mississippi State.

Follett Campus Resources (FCR), the company's second-largest division, had been run by George Carr since 1994, when he succeeded Richard M. Traut, who became chairman. Located in River Grove, FCR served 3,000 U.S. college bookstores (a number of which were managed by its sister division, Follett College Stores) in 1994, as both a wholesaler of new and used textbooks and as a provider of software applications for college store management via its automated textbook software system. FCR's used book services offered students discounted prices on their textbooks, and its retail systems helped college store managers operate more effectively and efficiently. FCR also produced the Follett Blue Book, the industry's premier wholesale pricing guide for more than 60 years, which featured over 90,000 available titles and was updated 11 times each year.

Follett Educational Services (FES), formerly Wilcox & Follett, was the oldest of the company's divisions, dating back to 1873, and was overseen by Kent A. Follett (grandson of C.W. Follett, son of Laddie). By 1994 FES had become the largest El-Hi provider of used textbooks and new workbooks in the industry, with more than 23,000 customers nationwide. FES's state-of-the-art automated inventory and tracking system contained upwards of 20,000 titles and holdings in excess of two million books. With its 'zero-defects policy,' FES gave schools the chance to save money and be environmentally conscious at the same time. FES had more than quadrupled in size over the preceding decade, to occupy a 65 percent share of the market.

Follett Library Resources (FLR), having serviced elementary and secondary school libraries for more than 50 years, entered both the high school and public library marketplace in the mid-1990s. Headed up by Ross C. Follett (the eldest son of Laddie), FLR was the largest distributor of books, videos, and CD-ROMs to elementary and high school libraries in the country. Supported by a growing selection of over 65,000 precatalogued titles available to its more than 45,000 clients (roughly 40 percent of the market), FLR delivered comprehensive processing and cataloguing services, automated bibliographic data, and a professional staff with the expertise to help school libraries select titles and build collections.

Follett Software Company (FSC) operated from offices in McHenry, Illinois, with Charles Follett, Jr. (son of Charles R. and great-grandson of C.W.) as president. This division had been founded in 1985. With annual sales topping $21 million in 1994 (up from 1993's $16 million), FSC was experiencing incredible growth as a provider of automated management systems to 20,000 school and smaller public libraries. FSC's ongoing research produced trademarked DOS programs including AlliancePlus, CardMasterPlus, CirculationPlus, Sneak PreviewsPlus, and TextbookPlus, as well as MacCatalog and MacCirculation Plus for Macintosh computers.

Follett Collegiate Graphics (FCG), was founded in 1992 and run by Mark Litzsinger. Taking full advantage of a void in the production of customized 'coursepack' anthologies after the departure of the industry leader, Kinko's, FCG secured a substantial share of the $250 million national anthology market, which accounted for ten to 15 percent of the college textbook market. While FCG's subsidiary CAPCO (Custom Academic Publishing Company) handled copyright clearance and centralized printing operations for anthologies, a software program called CAPNET monitored the assembly process and paid the appropriate royalties. CAPCO was a joint venture with BMI Systems Inc., a Canon dealership in Oklahoma City. With the anthology market expected to top $500 million by 1997, FCG was exploring several alternatives to traditionally printed materials, including multimedia applications. In the latter half of the 1990s the division was renamed Follett Custom Publishing and expanded. Follett also bought out co-owner BMI Systems.

In 1998 the company's divisions were further reorganized and grouped into three larger business units. These were: the Elementary/High School Group (Follett Educational Services, Follett Software, Library Systems & Services); the Library Group (Book Wholesalers, Inc., Follett Audiovisual Resources, Follett Library Resources); and the largest, the Higher Education Group (the college bookstores, course pack publishing, CourseWorks and FirstSystem software systems, publishing and distribution of the Follett Blue Book and other promotional and marketing services). During the latter half of the 1990s the company also made several acquisitions, buying used book dealer Western Textbook Exchange and young-adult book distributor Book Wholesalers.

1999 and Beyond

Follett was also experimenting with new bookstore concepts, opening a redesigned $4 million outlet in the fall of 1997 at the University of Illinois. The store featured a two-story 'cyberwall' of television sets, an in-store café, Internet-connected computer stations for customers to 'surf' on, plus clothing, music and software for sale. The café was designed in partnership with Lettuce Entertain You Enterprises, and Kinko's Copies was involved with the creation of an in-store publishing and copying center. Input also came from the designer of Planet Hollywood's theme restaurants, Associates in Architecture and Design, Ltd. A $5 million deal was signed the following year to build a new store at the University of Texas.

With the rise of the Internet, Follett began creating Web sites for many of its individual bookstores which allowed students to order course books ahead of time, avoiding the inconvenience of standing in line at the start of a semester. They could simply arrive at the store to find them already assembled, pay for them, and be on their way. Professors could also send the stores lists of their required texts over the Web. By the end of the 1990s several new startup companies, including VarsityBooks.com and BigWords.com, had launched online textbook sites that advertised discounts of up to 40 percent off list price. Follett responded in January 1999 with its own nationally advertised site, efollett.com. In addition to discounted prices, the new operation capitalized on the company's core store locations, offering students the convenience of easy pickup and returns at existing Follett stores. Efollett was also able to offer a steady stream of less expensive used textbooks drawn from the stores, which the competitors could not.

As the new century began, Follett continued on in solid shape. The combination of college bookstores, wholesaling, coursepack publishing, software and consulting services was a strong one, and the addition of an online sales site and splashy new bookstore designs brought the company completely up to date.

Principal Divisions: Book Wholesalers, Inc.; Follett Audiovisual Resources; Follett Educational Services; Follett Higher Education Group; Follett Library Resources; Follett Software Company; Library Systems & Services

Principal Competitors: Baker & Taylor Corporation; Barnes & Noble, Inc.; Borders Group, Inc.; Chapters, Inc.; D & H Distributing Company, Inc.; Data Research Associates, Inc.; Ecampus.com, Inc.; Educational Development Corporation; Ingram Industries, Inc.; Kinko's, Inc.; Nebraska Book Company, Inc.; Varsity Group, Inc.; Wallace's Bookstores.

Further Reading:

• Beiser, Karl, 'CardMaster Plus,' Computers in Libraries, May 1993, pp. 50-51.
• Berss, Marcia, 'A Family Affair,' Forbes, March 27, 1995, p. 136.
• Borden Jeff, 'A Textbook Case: Campus Titan Follett Takes on Online Upstarts,' Crain's Chicago Business, February 8, 1999, p. 3.
• 'Charles W. Follett' (obituary), New York Times, December 20, 1952, p. 17.
• Christianson, Elin, review of How to Keep Score in Business: Accounting and Financial Analysis for the Non-Accountant by Robert Follett, Library Journal, August 1978, p. 1,504.
• 'The 500 Largest Private Companies in the U.S.,' Forbes, December 5, 1994, p. 208.
• Freeman, Laurie, 'Bookstore Contract Boosts Revenues,' School Planning and Management, January 1, 1997, p. 20F.
• 'General News: Follett Software Redesigns Products,' Online, January 1994, p. 81.
• 'Leading Private Firms,' Crain's Chicago Business, December 28, 1992, p. 5; December 26, 1994, p. 11.
• 'Management: Textbook Strategic System,' PC Week, January 23, 1989, p. 48.
• Miller, Cyndee, 'Marketing Textbooks to the MTV Generation,' Marketing News, October 13, 1997, p. 1.
• 'Projected Sale of Baker & Taylor to Follett Corp. Called Off,' Publishers Weekly, June 27, 1994, p. 13.
• Schmeltzer, John, 'Used Books 101--A Course on Profit,' Chicago Tribune, September 25, 1994.
• St. Lifer, Evan, and Rogers, Michael, 'Follett Ready to Finalize Deal for Baker & Taylor,' Library Journal, June 15, 1994, p. 12.
• 'Software News: Follett Introduces Library Applications for the Macintosh,' Online, January 1993, pp. 68-70.
• Unsworth, Tim, 'Tales from Chicago,' Publishers Weekly, October 14, 1988, p. 44.
• 'The Week: Esquire, Inc. to Acquire Follett Publishing Division,' Publishers Weekly, December 24, 1982, pp. 18-19.

Source: International Directory of Company Histories, Vol. 39. St. James Press, 2001.