Coach Is Closing 70 Full Price Stores

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#61
jan1124 said:
I talked to the Coach specialist in a Macy's flagship store yesterday. Commencing in July - after the semi-annual Coach sale (incidentally, Macy's will run 25% off of all full price Coach until the end of the month, probably through the 4th of July weekend) - Per the Coach vendor rep - from then on out Macy's has agreed to follow Coach request that they only put Coach on sale to coincide with Coach sales. Apparently all department stores will do the same. She said it wasn't simply a "request" - but that Macy's had to sign an agreement. Maybe Coach is trying to move out of department stores again? I doubt any department store can afford to sit on stock until Coach permits them to put it on sale.
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They are cutting off all discounts, which will cut off a good deal of their sales. I do not think that their new line will replace enough of those sales to stop the financial bleeding.

Luxury brands take a very long time to build and sometimes do not catch on at all.

This is a very risky move on Coach's part.
 
#62
weibandy said:
I listened to their conference call today. Total disaster. They have a very snippy lady moderating the call and she was offensive. The info they gave was very pathetic. They are closing a ton of stores, they will spend a ton of money... Tons of buzzwords...they better get this right or frankly they will not be around, which is sad. It's like they are driving a car into a wall....
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Great post. I totally agree :smile1:
 
#63
jan1124 said:
I talked to the Coach specialist in a Macy's flagship store yesterday. Commencing in July - after the semi-annual Coach sale (incidentally, Macy's will run 25% off of all full price Coach until the end of the month, probably through the 4th of July weekend) - Per the Coach vendor rep - from then on out Macy's has agreed to follow Coach request that they only put Coach on sale to coincide with Coach sales. Apparently all department stores will do the same. She said it wasn't simply a "request" - but that Macy's had to sign an agreement. Maybe Coach is trying to move out of department stores again? I doubt any department store can afford to sit on stock until Coach permits them to put it on sale.
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that is just crazy!!!
 
#65
ltbag said:
They are cutting off all discounts, which will cut off a good deal of their sales. I do not think that their new line will replace enough of those sales to stop the financial bleeding.

Luxury brands take a very long time to build and sometimes do not catch on at all.

This is a very risky move on Coach's part.
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I agree...... and when Macy's and every other store that sell Coach are stuck with a boat load of merchandise, they'll quit buying. I'm guessing that's what the "new" Coach wants - to go back to exclusively selling in full price/boutiques. Years ago, Coach was a "luxury" brand...... but once they let loose, I, for one, don't think they can go back. It might work in New York, possibly San Francisco....... but every little city in between - the stores in the suburbs - the malls across America - doubtful!
 
#66
This is just nuts. First of all, department store buyers love the sales, that is one of the key reasons they buy in a department store. Very few people that shop there will be interested in Coach without the potential for discounts.

As for the FP stores, I agree with the above, that the model could potentially only work in the larger cities, but not in the other markets. I just don't see how they will actually make any more $$ from this....the bags might cost more, but they will have so many fewer sales. And in looking at the upcoming fall bags, some of them are okay, but not worth this transition in business model. It is not like they are something we have never seen before, or something that no other company can create.
 
#69
jan1124 said:
I talked to the Coach specialist in a Macy's flagship store yesterday. Commencing in July - after the semi-annual Coach sale (incidentally, Macy's will run 25% off of all full price Coach until the end of the month, probably through the 4th of July weekend) - Per the Coach vendor rep - from then on out Macy's has agreed to follow Coach request that they only put Coach on sale to coincide with Coach sales. Apparently all department stores will do the same.
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I knew this was coming.


Those on here a while probably remember Coach's glory years, when the stock shot way up? Think about what was going on at that time



  • Coach had a VERY successful Madison line (Sophia/Sabrina days)
  • PCE was not what it has been....every other week. PCE was done usually quarterly. And it really gave you something to look forward to
  • There were no Facebook coupons. Not sure if there was FB and if so it did not enjoy the mainstream popularity it does now
  • There were no FOS sales every week because here was no Factory Online Sale
  • Then when they started FOS, it was not every week. Again like the old PCE you had something to look forward to. Sometimes I don't even check FOS anymore,. I will just see the same stuff I saw last week. Price might fluctuate though
  • Deletes would take 6 months to go to the outlet. But they were there and all outlets got them not just flagship. There were always some outlets that got more but even the smaller outlets still got some
  • Which deletes the outlets got was not predictable either. It was a nice surprise what you might find....like a treasure hunt. And every once in a while you would find a bag from a couple years ago. Not returns, Coach would just all of sudden open the vault. Remember ladies how busy Saturdays and Sundays used to be here with all the outlet reveals?
  • Now it is standard that outlets always have an additional % off coupon when you walk in - then they did not. If they had a coupon it was a surprise. And you took advantage when they did have a coupon because you did not know when they would have them again
  • They were not making MFF bags in mass that were based on full price styles
And my personal pet peeve, they made great bags in medium size. Coach continues to almost exclusively make large bags and mini bags now.

This model worked. This model got people excited about Coach. Then they diluted the brand with constant PCEs and FB coupons, constant FOS, limited outlet deletes and only to flagship stores, MFF bags modeled on FP styles....they got crazy. Now they are going to the extreme with the new plan which I think will bite them. Why don't they look at what was working, what was going on when things were good and re-visit that?
 
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#70
Dragonflygirl02 said:
I think one of the issues is the dilution of the brand mostly to outlet sales. I live near an outlet and a stand alone coach store. It seems like every person I see is carrying Coach, mostly outlet brand. I used to love Coach and have many bags I still carry and love. But to be honest I moved away from Coach a few years ago when the outlet came to town. I did just purchase my first Coach in years, the Caroline Satchel and I love it. But I now mostly shop other brands. I hate to sound snobby but Coach has a brand image issue in my opinion and that is why people are leaving the brand and sales are slumping.
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I agree with this and it's so sad to see. Coach sold it's soul to the logo craze and now they are paying the price.
 
#73
ltbag said:
I totally agree cfc. They are cutting off ALL their current sources of income and gambling that a large number of people will like their new, full price line.

Very very unlikely they will build enough market share to replace the market share they lose but eliminating deletes and most FOS sales.

70 stores closing is a massive retrenching as well. It will take them a long time to regain presence in the markets they are retreating from.

Sounds like a company that is in a tailspin to me.
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Actually one of my Favorite stores in San Diego was nice enough to call me to say that they were closing. I was shocked. They said there were 3 stores in a small area. No explanation other than that. Sad.
 
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#75
I know I am the minority here; I am actually quite excited about the change. Even though I probably won’t be able to afford their new line, I look forward to see the brand that I love regaining their lost glory. It’s certainly better than the other away around (think Liz Claiborne or Juicy). Of course, if this doesn't work out, there’s no telling what can happen.
 
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