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Coach

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Introduction

Coach came began in 1941 as a simple company making fine leather handbags for women. For 40 years Coach grew steady within the luxurious accessory market while maintaining their reputation for sturdy, fashionable handbags that were 50 percent less than other luxurious brands. In 1985 the family ran Coach was sold to Sara Lee, a food and consumer good producer. Sara Lee acquisition of Coach did not change the preexisting strategy and approach to operations for manufacturer too much and allowed for Coach to continue to grow within the luxury market. In the mid-1990s the company’s performance began to decline due to consumers desiring the styles of Italian and French designers, Louis Vuitton, Gucci, Prada, Dolce & Gabbana and Ferragamo. The decline in Coach sales lead Sara Lee to make Lew Frankfort, whom had worked for Coach for 18 years, head of the handbag division. Frankfort’s first accomplishment in his new position was hiring former Tommy Hilfiger designer, Reed Krakoff. Krakoff revamped the Coach handbag line with his new designs and more frequent collections. Frankfort used outsourcing agreements for manufacturing, giving Coach a sizeable pricing advantage over other luxury brands, allowing for more profit from its full-price stores. Coach operated full-price stores, outlet stores, online sales, catalog sales and maintained relationships with many large department stores and offered wholesale distribution in the United States, China, Japan, Hong Kong, Australia, Mexico, Thailand, Malaysia, New Zealand, and France. By 2012 Coach had quadrupled its growth in annual sales from $555 million in 1999 to more than $4.2 billion.
Issues Facing the Firm and Industry While Coach continued to grow as a company and expand its product line the company still faced issues within the firm and industry. Counterfeit products of luxury brand handbags,

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