If you’re planning to buy books to give to the children in your life for the holidays, Holly Ritz can point you in the right direction.
In May, Ritz purchased The Penworthy Co., a children’s book distributor based in Milwaukee’s Historic Third Ward. Every month, a group of Penworthy employees finds the 80 hottest new books, then a contractor re-binds them in hardcover to make them more durable for its customers, which are mainly public and school libraries.
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Holly Ritz purchased children’s book distributor The Penworthy Co. in May.[/caption]
“We carry all the books that the kids fight over,” Ritz said. “It’s the Star Wars, it’s the LEGOs, it’s Barbie princesses.”
Ritz, an Elm Grove native who most recently served as vice president of wellness sales at Chicago health care startup Higi, is passionate about children’s literacy, which is why she made the leap to buy a business and is willing to commute from a Chicago suburb to her new job.
“I’m a mother of four boys and boys are generally not the most aggressive readers,” she said. “It’s the springboard to the future for these kids. If you can make an impact early, you can make an impact that will have longevity.”
Penworthy carries books about athletes such as J.J. Watt and Derek Jeter and pop culture icons kids are interested in that could open the door to reading.
John Komives, an independent consultant and a family friend, referred Ritz to Penworthy in March 2015. Ann Hanna of Schenck M&A Solutions advised Penworthy to complete the sale for an undisclosed price.
“When I first looked at this deal, I initially looked at it and thought, ‘Books are on the way out,’” Ritz said. “But we focus on pre-K to seventh grade. What’s very evident is that in that snapshot of time, not only parents, but educators have realized the value of a printed book.
“It’s so important to be able to have the child sit down, learn how to read from left to right, learn how to turn the page, feel the page. The other thing is the parent wants to feel that connection.”
Laurence Compton, who bought Penworthy with a partner in 1989, just seven years after it was founded, became sole owner of the company in 1992.
Compton brought the company’s processing into the computer age and later started selling Penworthy’s books over the Internet.
It previously had a large sales force that visited school librarians and laid out Penworthy’s newest selections, but now it has fewer salespeople creating virtual shopping carts tailored to the librarian, who can then select which ones to order, he said.
There was one other bidder when Compton decided it was time to sell the company and retire, but Ritz was the best fit.
“It was time. I’d owned it for 24 years,” Compton said. “I loved it while I had it and I was very happy to sell it and I thought I got a favorable deal on the sale and I thought it was a favorable deal overall.”
“He was looking for someone who was not going to dismantle the organization,” Ritz said. “What I think put me over the top was my interest to keep the business intact.”
Penworthy has about 36 employees now. Ritz has added four salespeople since she acquired it. It operates out of an 18,000-square-foot office and warehouse, from which it distributes to a national footprint through school district and municipality contracts.
The book distributor is now a certified Woman Owned Business Enterprise, which Ritz expects will be an advantage in securing contracts. While the company caters to school districts and municipalities, it hasn’t made much headway in the corporate world, Ritz said.
“The other opportunity that had never been uncovered or discussed was more of a corporate opportunity – KinderCare, Bright Horizons,” she said.
And its 4,500 existing clients could benefit from more options, Ritz said.
She took the reins in May. By October, Ritz had expanded Penworthy’s inventory by 1,800 titles and increased the average order size by about 35 percent. The company sets itself apart in the book distribution world by keeping all of its books in stock and completing every shipment the next day, without a shipping and handling charge.
“It is a competitive space,” Ritz said. “It’s highly fragmented, though. You order it from (our largest competitors) and you’ll get it in, I don’t know, maybe two or three weeks.”
Penworthy has taken strides to improve kids’ literacy, working with Milwaukee’s Messmer Catholic Schools to bring kids up to grade level in reading proficiency through leveled readers. And it donates publishers’ sample books it doesn’t select to nonprofits such as Chicago’s SitStayRead, a program in which kids read to volunteers’ dogs.
“There’s been a shift from ‘Let’s get them to read the classics,’ to ‘Let’s get them to read anything,’” Ritz said.