If costco does sell to corp accounts, they may not be for much longer . . . I found this on the internet a few days ago, and this post reminded me . . . it's interesting that Coach makes reference Corp account distributors and their product getting into the grey market . . .
Breaking News: Coach Exits Corporate Markets
March 07, 2007
From the
Incentive Newsletter
By Leo Jakobson
After weeks of speculation and rumor, leather goods maker Coach Inc. announced yesterday that it will no longer sell its products in the corporate special markets channel, citing a need to take more control of its brand.
"The rumor I heard is that transshipping is being done, that Coach products are ending up on the grey market," says Mike Arkes, CEO of Chicago-based Hinda Incentives, a leading fulfillment specialist that carries Coach products. A number of other sources, speaking off the record, told
Incentive the same thing.
Arkes says he has also heard Coach does not know exactly who is transshipping its products, and asks, "if that's so, how [does Coach] know it is coming from special markets?" Regardless, having to replace Coach in an award catalog "is not the end of the world," he adds, noting that his company also carries similar leather goods by Dooney & Burke and Kenneth Cole. "The reality is, every item in [Coach's] price point competes with them," he adds, saying incentive participants might also turn to items like a Blu-ray high definition DVD player. Other top handbag manufacturers in the incentive market include Kate Spade and recent entry Furla.
At this point, Hinda is uncertain if Coach will continue to fulfill orders for programs to which it had previously committed. "The question is, are they going to do this professionally," Arkes asks. "Are they going to live up to their commitments, to enable [us] to live up to our commitments? That will be the bottom line."
That is a question Coach is unwilling to answer publicly at this time. When asked, Andrea Resnick, Coach's vice president of investor relations and corporate communications, said the company would not make any comment beyond a general statement it issued by e-mail on Tuesday, March 6. The statement reads, in its entirety: "Over the past several years, as Coach has grown to well over $2 billion in sales, the company has increasingly taken direct control over its global businesses. In keeping with this strategy, Coach is exiting its small corporate accounts business that sells to end users, primarily through distributors. This is being done to ensure that the company has more control over where Coach product is ultimately sold, in order to certify that it is through authorized distribution in image enhancing locations."
Incentive Marketing Association (IMA) Executive Director Karen Renk says Coach "terminated its network of incentive manufacturers representatives" the day before. "The IMA is saddened by Coach's decision," she says, adding "Their strong brand has benefited the corporate gift space, as has their image been enhanced by their presence in the incentive market."
Coach has been a prominent brand in the special markets industry for many years. Last year, Paul Spitzberg, New York-based Coach's vice president/general manager of corporate accounts, was president of the IMA, and he sits on the board of the Foundation for People Performance Management and Measurement, an industry-sponsored research organization at Northwestern university. Coach has also been a sponsor of The Motivation Show in Chicago.
Spitzberg could not be reached for comment. His voicemail says he is "on extended absence as a result of an illness in the family." Nor were calls to other Coach special markets employees returned.
At retail, Coach has become highly protective of its brand, only selling its products through company-owned stores and at select department stores with Coach boutiques, including Bloomingdales, Nordstorm, Lord & Taylor and Macy's.