The Foster Lumber Company, under founder John McCullough Foster, established its first retail lumberyard at Randolph, Kansas, in 1879. By 1894, the Foster Lumber Company had acquired land in Montgomery County, Texas, near the present day town of Fostoria, formerly known as Clinesburg. Most of the company's Texas business was concerned with timberlands and sawmill operations to support their retail yards.
In 1905, the company constructed a big saw mill at Fostoria and began operations there the next year. At the time of its construction the mill was said to be the fastest one in the South. The company town was cleaner and better equipped than the average milltown at that time. Continuing to add to its holdings of Texas timberland, the company eventually expanded to include land in Polk, Harris, San Jacinto and adjoining counties in addition to its Montgomery County holdings.