FASHION NEWS: COACH CONTINUES TO PLUMMET IN SALES DUE TO HANGBAG RIVALS
Coach, the New York company most famously known for its Poppy handbags, is facing plummeting sales in North America. The American luxury leather goods retailer, once popular for their affordable totes with the infamous “C” emblem, is now falling behind fast-growing rivals such as Michael Kors, Kate Spade, and Tory Burch.
The key holiday quarter (Q4), more often than not, will provide retailers a welcoming or much-needed boost in annual sales; however, this past quarter Coach did not fare so well. The company’s holiday quarter sales fell more than the handbag maker had forecast as competitors continued to “eat away” at its market lead. A vast decline in customers at Coach’s retail stores was also a contributing factor to the company’s disappointing sales.
On Wednesday January 22nd, the company reported a 13.6% drop in comparable-store sales in North America making it the third straight quarter of decline in a market that accounts for 70% of it’s revenue. Coach had been dealing with a slew of issues that contribute to the company’s poor performance along “major changes in its top management ranks, including a new chief executive and creative director.”
In order to become a lifestyle brand the company is gravitating towards more footwear and fashion; however, products designed under new creative director Stuart Vevers will not be in stores for a few months leaving Coach with “stale merchandise.”
“These guys are definitely losing share. Fashionwise, they’re missing the beat,” said Edward Jones analyst Brian Yarbrough. “North America is their bread and butter. They have to get that going.”
In an effort to pick-up sales, Coach will be presenting a collection at New York Fashion Week in February for the first time. We can only hope that the company will feature some must-have items that will bring some foot traffic back into their stores.
Text reference via Yahoo Finance and photo via Forbes
