BIZCHINA> Center
|
BIZCHINA> Center
|
|
Style and substance, Coach commits to China
By Lillian Liu (China Daily)
Updated: 2008-07-01 13:38 Lin Huijuan has 45 handbags in her handbag closet. She is going to get one more because none of the bags match her new Prada shoes. Elegantly dressed marketing manager Lin, 37, said she wouldn't consider herself a fashion and accessories spendthrift compared to many other women of her age in Shenzhen, where she lives and works for a business consulting firm. "Handbags are the ultimate status symbols in modern life, and I would like to have prestigious branded bags. They also carry my status, and they have to match my clothes and shoes of course," she said. The Chinese fashion and accessory market recorded double-digital growth annually over the last five years as consumers are increasingly becoming preoccupied with the trappings of wealth.
It expects China to become the company's third largest growth driver betting on a growing number of middle-class female shoppers seeking fashion accessories that carry social status. The New York-based group, which competes with its European rivals in China, is facing a tough economic climate in its home market where consumers are trimming spending amid the soaring gasoline and food prices. Coach will expand its sales network in China from nearly 30 stores to 80 by 2013; the country has the potential to quickly become the third major market for the company following North America and Japan, Chief Executive Lew Frankfort told China Daily in an interview. He declined to comment on how much the expansion will cost Coach, but said the company was aiming to be one of the top three imported handbag and accessory brands in China by 2013. "And we are targeting global annual sales to reach $250 million in five years, up from currently $30 million," said Frankfort. He expects sales from China to contribute 5 percent of the company's turnover by then, rather than the current 1 percent. To propel its local presence and better facilitate its sales in the promising market, Coach acquired its own retail business on the mainland, Hong Kong and Macao from current distributor Imagine X group. Frankfort said the acquisition would allow the Coach team to focus on brand-building and direct management of the front end of the retail business where it directly touches the consumer. The company's expansion plan also includes the enhancement of manufacturing bases, which is also an effective way to lower business costs. (For more biz stories, please visit Industries)
|
