Yesterday, Soutron Global (an “international library transformation company”) announced that Fossil, Inc., whose brands are sold in ninety countries worldwide, selected Soutron Global to transform their library, by cataloging information assets alongside their diverse creative design items. Fossil designs, manufactures, and sells clothing and accessories – watches, leather goods (wallets, handbags, belts, and shoes) – and sunglasses. The Fossil headquarters is located in Richardson, Texas.
At the suggestion of his brother Kosta, college dropout Tom Kartsotis founded Fossil, Inc. in 1984 under the name Overseas Products International as an importer of fashionable watches Tom Kartsotis had manufactured in Hong Kong. Tom’s friend (and later wife) Lynne Stafford designed the retro look of Fossil watches.
Tom Kartsotis brought in his brother, Kosta, in 1988. Kosta N. Kartsotis joined the board of directors in 1990.
In 1989, Fossil began to package watches in elaborately decorated tin containers and wooden boxes. This increased the nostalgic appeal of Fossil merchandise. They also launched a marketing campaign in which models in exotic locations were photographed with Fossil watches on their wrists.
Between 1987 and ‘89, Fossil sales skyrocketed from $2,000,000 to $20,000,000. In 1990, Fossil introduced a line of leather goods and a new brand of watches. Relic brand watches were marketed as a less expensive alternative to Fossil brand watches and were sold in Sears, Roebuck & Company and J.C. Penney.
Between 1989 and 1990, Fossil sales climbed from $20,000,000 to $32,500,000. The next year, sales leapt to $57,100,000. In 1991, Macy’s opened a 300-square-foot Fossil Watch “Super Shop” on the main floor of Macy’s flagship store in New York City.
Fossil sales jumped in 1992 to $73,800,000, more than 90% of which was generated by the sale of Fossil and Relic watches. In June of 1993, Fossil completed its IPO (initial public offering) of stock, selling 20% to investors, while Tom Kartsotis retained 40.5% (controlling interest), and Kosta retained 18.8% ownership. The proceeds yielded Fossil $19,000,000, half of which was earmarked for corporate debt reduction, while the remainder was set aside as working capital.
By 1993, Fossil produced over 4,000,000 watches a year, though the actual manufacture was outsourced as it took place overseas by contracted manufacturers. Back then, Fossil watches sold for between $45 and $110 dollars. They were sold at more than 2,000 locations. This included the department store units at Carter Hawley Hales Stores; Dayton Hudson Corporation; Dillard Department Stores; Federated Department Stores; May Department Stores Company; and R.H. Macy. Relic watches were targeted at the lower-middle-class market, sold through retail units operated by Ames Department Stores; J. C. Penney Company; Service Merchandise Company; and Target Stores.
By 1993, Fossil had several European subsidiaries. Fossil Europe GmbH in Germany was the company’s primary European operation. Other subsidiary companies in Continental Europe included Fossil France SARL and Fossil Italia SRL, which distributed Fossil products in France and Italy. In 1993, Fossil, Inc. established Fossil B.V. in Holland as a holding company for these three subsidiaries or operating companies. Fossil started out with controlling interest in the holding company – a 70% ownership stake.
In April of 1994, Fossil signed an agreement for a five-year-long deal with rival Seiko Corporation under which Seiko gained Japanese distribution rights to Fossil products in Japan through Fostim. Fossil soon afterward announced it would open 150 concept shops within department stores and would increase the number of outlets to 500 shops within two years.
In 1993, sales reached 105,100,000. The next year, sales reached $161,100,000. In the summer of 1995, Fossil brought out a line of sunglasses, and in October of that year increased its stake in Fossil B.V. This was the holding company for the Fossil’s European operating companies. For $1,700,000, Fossil increased its ownership stake in Fossil B.V. to 88%.
By 1995, Fossil watches were sold in department stores and upscale retail stores in more than fifty countries. In 1995, Fossil had four retail stores in Europe. The next year, it had twenty. In April of 1996, the company acquired 81% of the Seiko-owned Fostim, paying $700,000 in cash to gain greater control over the distribution of Fossil products in Japan. Fostim became Fossil Japan.
In addition to branching out into the design and manufacture of other products, Fossil has also acquired two older watch manufacturing companies, Zodiac Watches in 2001 and Skagen Designs, Ltd. in 2012. The acquisition of Skagen included $225,000,000 in cash and 150,000 Fossil shares for a total value of approximately $236,800,000. Nevada-based Skagen has retail stores in Denmark, Germany, the U.K., and Hong Kong and sells products in seventy-five markets.
Fossil has licensing agreements with designer brands such as Michael Kors, Marc by Marc Jacobs, Burberry, Emporio Armani, and Karl Lagerfeld. Further, the company distributes its products to customers like Nordstrom Inc.; Target Corp.; and Wal-Mart Stores Inc.Wholly or partially-owned subsidiaries includeArrow Merchandising, Inc.; Fossil East Limited in Hong Kong; Fossil Intermediate, Inc.; Fossil New York, Inc.; Fossil Overseas, Ltd. in the British Virgin Islands; Fossil Trust; Amazing Time, Ltd. in Hong Kong; Fossil Europe B.V. in Holland; Fossil Europe GmbH in Germany); Fossil Italia, S.r.L. in Italy; Pulse Time Center Company, Ltd. in Hong Kong; and Trylink International, Ltd. in Hong Kong.
Kosta N. Kartsotis served as President of Fossil, Inc. from December of 1991 to December of 2006, as Chief Operating Officer (COO) from December of 1991 until October of 2000, as Chief Executive Officer (CEO) since October 2000, and as Chairman of the Board of Directors since May of 2010. Tom Kartsotis has not served on the Board of Directors of the company he founded since he declined to stand for re-election by stockholders when his last term expired in May of 2010.
Soutron Global stated, “Innovative design and development lies at the heart of Fossil’s success, and Fossil needed an integrated library solution(ILS) that would manage and provide easy access to both their fashion design books and creative materials ranging from audio-visual items to vintage ephemera consisting of thousands of bag, fabric, and leather samples.” Brand Archivist Laura Pike-Seeley needed a single system to manage all of these different types of materials, a functional ILS to accommodate non-MARC records, and the facility to display their digital design assets in search results in a gallery view of horizontal rows.
As Ms. Pike-Seeley evaluated the available ILS and DAM solutions, she needed to take both library and creative needs into consideration. She stated, “Fossil is a fashion/design company, and its library must appeal to creative, artistic people. The look and functionality of Soutron’s OPAC answers this need, and because Soutron’s system is newer than the others I considered, it will be more responsive to OPAC development trends.”
In a press release, Soutron Global stated, “The capability to manage digital assets is built into the core of Soutron Global to provide an extremely flexible system for storing digital materials. Each type of digital content can be described to the system with a quick and simply defined record structure – without any need for IT support. Fields can be defined and added at any time, allowing meta-data specific to the digital asset to be recorded and assigned as needed.”
According to Soutron Global President & CEO Tony Saadat, “The challenges of maintaining contemporary library or information center collections created from ephemera has become increasingly acute. I’m proud that Fossil chose our comprehensive library automation solution for their digital asset management (DAM)due to its flexibility, ease of customization, and ease-of-use.”
By 2011, Kosta Kartsotis retained ownership of more common stock than Tom Kartsotis. Kosta N. Kartsotis owned 6,425,539 shares of common stock, while Tom Kartsotis retained ownership of 3,480,000 shares of stock. Tom Kartsotis further owned 63,521 shares of Common Stock as custodian for Annie Kartsotis and Jack Kartsotis, both minors. His wife, the aforementioned Lynne Stafford Kartsotis owned 3,450 shares.
Do you remember Dayton Hudson? They purchased Marshall Field & Company, started Target, realized Target was more profitable, turned Dayton Hudson stores into Marshall Field & Company stores, and turned into Target, then sold Marshall Field & Company stores to May Department Stores. Eight months later, Federated Department Stores, which had already acquired Macy’s, acquired May Department Stores. Federated Department Stores, of course, ignored pleas from Roger Ebert and many other Chicagoans and renamed the Marshall Field & Company stores Macy’s. In 2007, Federated Department Stores renamed itself Macy’s Group, Inc.
M.A.R.C. stands for machine-readable cataloging developed by the late computer programmer and systems analyst Henriette Davidson Avram (1919-2006) in the 1960s for the Library of Congress. Libraries use MARC to encode and hare information about books and other holdings.
D.A.M. stands for digital asset management.
O.P.A.C. stands for online public access catalog. It is online database-type card catalog for a library or union catalog for a library consortium (group of libraries). The largest such online union catalog is WorldCat.