Why does Coach love China more than the US?? :P
- Thread starter ladybug2604
- Start date
i read the book last year and had to skim the pages again this morning cause i was pretty sure coach was mentioned somewhere. so here's what's on dana thomas' book about coach..
since lew frankfort became the coach ceo in 1996 he decided to renovate the brand. he then hired reed krakoff and together mapped out a plan. their idea was to reposition the brand as an american alternative to prada and lv with prices ranging from $125 to 2K and called it 'affordable luxury'.
in 2001 sales were a respectable $600 mil and they both decided to change the creative direction of the brand from traditional classics to more fashion-forward. they came up with the signature collection and began shipping new designs to stores monthly instead of twice yearly. the japanese particulary loved the signature collection that in 2003 coach became the 2nd most popular imported accessories brand in japan after lv.
to continue coach's financial growth, frankfurt focused on increasing distribution and maximizing productivity. coach opened new stores in north america and asia and switched its manufacturing from company-owned US-based factories to outsourcing overseas, much of it in china. today coach products are manufactured in 84 sites (cities?) in 15 countries and a significant majority are made in china.
in 2002, coach closed its last company-operated manufacturing facilities. the orig 34th st factory is now home to its executive offices as well as a small prototypes workshop. "by shifting our production from owned domestic facilities to independent manufacturers in lower-cost markets, we can support a broader mix of product types, materials, and a seasonal influx of new, more fashion-oriented styles. all product sources must achieve and maintain our high quality standards.. and we monitor to compliance through on-site quality inspections at all coach-operated or independent manufacturing facilities." the spokesperson said.
the strategy paid off. from 2001 to 2006, coach experienced double-digit growth every quarter; by 2006, it was doing $2.1 billion in sales. at the same time, thanks in large part to lower production costs, profits soared. coach's stock value increased a whopping 1,270 percent in the first five years after the company's initial public offering. and contrary to conventional wisdom, the perceived quality of coach products has risen since it shifted production from US to china and other countries.
once coach proved that chinese workers could meet luxury brand quality standards, several other brands moved a small amount of production there too but only few admit to it.
since lew frankfort became the coach ceo in 1996 he decided to renovate the brand. he then hired reed krakoff and together mapped out a plan. their idea was to reposition the brand as an american alternative to prada and lv with prices ranging from $125 to 2K and called it 'affordable luxury'.
in 2001 sales were a respectable $600 mil and they both decided to change the creative direction of the brand from traditional classics to more fashion-forward. they came up with the signature collection and began shipping new designs to stores monthly instead of twice yearly. the japanese particulary loved the signature collection that in 2003 coach became the 2nd most popular imported accessories brand in japan after lv.
to continue coach's financial growth, frankfurt focused on increasing distribution and maximizing productivity. coach opened new stores in north america and asia and switched its manufacturing from company-owned US-based factories to outsourcing overseas, much of it in china. today coach products are manufactured in 84 sites (cities?) in 15 countries and a significant majority are made in china.
in 2002, coach closed its last company-operated manufacturing facilities. the orig 34th st factory is now home to its executive offices as well as a small prototypes workshop. "by shifting our production from owned domestic facilities to independent manufacturers in lower-cost markets, we can support a broader mix of product types, materials, and a seasonal influx of new, more fashion-oriented styles. all product sources must achieve and maintain our high quality standards.. and we monitor to compliance through on-site quality inspections at all coach-operated or independent manufacturing facilities." the spokesperson said.
the strategy paid off. from 2001 to 2006, coach experienced double-digit growth every quarter; by 2006, it was doing $2.1 billion in sales. at the same time, thanks in large part to lower production costs, profits soared. coach's stock value increased a whopping 1,270 percent in the first five years after the company's initial public offering. and contrary to conventional wisdom, the perceived quality of coach products has risen since it shifted production from US to china and other countries.
once coach proved that chinese workers could meet luxury brand quality standards, several other brands moved a small amount of production there too but only few admit to it.
