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Coach ‘Luxary’ Brand Loses Millions to Outlet Stores

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.

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