Coach Outlet Store

Founded in 1941, Coach designs high-quality, modern American classic accessories. Coach offers handbags, accessories, business cases, outerwear and related accessories to its customers. Coach targeted international markets.

Coach offers watches, footwear, sunglasses and office furniture with its licensing partners. The price of Coach’s luxury products vary different levels, allowing the brand to reach a wider demographic than most luxury retailers, resulting in what the company has called an “accessible luxury” offering. Coach does this effectively by operating in two business segments: Direct-to-Consumer (through stores, e-commerce and catalogs) and Indirect (through department stores and other third-party retailers). 

Coach’s products are sold through a number of direct-to-consumer channels, which at the end of fiscal 2005 included: 193 North American retail stores; 82 North American factory stores, the Internet; and the Coach catalog. Coach’s remaining sales were generated from products sold through a number of indirect channels, which at the end of fiscal 2005 included: approximately 1,000 department store locations in the U.S.; 94 international department store, retail store and travel shopping locations in 19 countries; 103 department store shop-in-shops, and retail and factory store locations operated by Coach Japan.

Starting in the mid-1990s, CEO Lew Frankfort repositioned the leather-goods firm as a less expensive Louis Vuitton and saw the sale of  $300 bags. Following in the footsteps of Coach, mass marketers are also trying to adopt the similar strategy. H&M first collaborated with Karl Lagerfeld in 2004 and now works regularly with big-name designers. Target deals with Mossimo Giannulli and Isaac Mizrahi. Through these partnerships, says Target VP Trish Adams, “our guests have learned - and come to expect - that high fashion doesn’t have to mean high prices.”

Over the last several years, Coach has successfully established itself from a manufacturer of traditionally styled classic leather products to a retailer of modern, fashionable handbags and accessories using a broad range of fabrics and materials. With the revival of product line, Coach has created a consistent brand position in the market. Finally, Coach has established a flexible, cost-effective sourcing model in which independent manufacturers supply virtually all of its products, allowing Coach to bring its broader range of products to market more rapidly and efficiently.

Coach has experienced rapid growth, catapulting from $926 million in net sales in 2003 to $3.1 billion in fiscal 2008. The company faces the challenges of expanding their brand while maintaining the cachet that luxury brands must have to be attractive. Although it has no presence in European markets, Coach is increasing its presence in international, primarily Asian, markets. As the handbag market matures, Coach will be challenged to find new opportunities in other product categories where it can exploit its brand appeal and manufacturing relationships to continue to grow its business. The company has already begun this process with licensed lines of Coach-branded sunglasses, watches, footwear and other accessories.

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