While economizing high fashion has been on the agenda of many companies since the recession of 2008, it seems as though the 73-year-old luxury brand Coach just may be doing so with mixed success.
According to The NY Post, third-quarter sales for the fashion powerhouse are down 24% in the US, equating to $493 million; while total sales went down 15.5% to $929.3 million.
The obvious dip in numbers is being attributed to the vast opening of “Coach Outlet” stores, which are offering customers last season’s fashions at a massively discounted price. Steve Murray suggests that current estimations indicate that four out of five Coach bags being sold is coming from a Coach outlet location, leaving a marginal 25% of business to be sold at full mark-up.
These numbers are in contrast with other high-fashion brands such as Calvin Klein, who has seen nothing but increase since rolling out its “CK Collection” for low-tier sales, and the “White Label Collection” for mid-tier sales. These moves seemed to only diversify their clientele, making for what Yahoo Finance reported to be a $78 million increase in 2014 alone.
Despite losing market shares and a significant amount of profits, Coach representatives claim they have met with some of the industry’s finest consultants, and feel confident in turning business around to a respectable, and profitable place.