As the symbol of New York leather goods manufacturer, Coach will this month end officially renamed Tapestry. This change is to expand its multi brand image after the continuous acquisition of the two major brands of Kate Spade and Stuart Weitzman.
Victor Luis, the chief executive of Coach, said on Wednesday: “the transition from the previous single brand to the multi brand Coach is now at the decisive moment of the reform. Tapestry is the name that conveys creativity, craft, authenticity and inclusiveness in shared platforms and values.
Although the company has changed its name, Coach’s own brand is not affected and changed. This renaming is mainly to highlight the general company has been upgraded to be the top three brands of the boutique group.
After the package industry faced with falling demand, the decline in the retail store traffic. Coach is just taking the opportunity to build itself into a multi – Brand Company. In 2015, it bought the luxury women’s shoes brand Stuart Weizman for 574 million US dollars, and bought Kate Kate Spade earlier this year to enrich its customers.
“Three years ago, we worked out the vision of COACH’s strategic transformation and announced that it would look for more multiple growth opportunities outside the COACH brand.” Victor Luis, chief executive of the company, said, “now, we are at a critical moment for the company to reshape. We are changing from a single brand of professional retailer to a more than a Brand Company.
Founded in the last century in 40s, COACH is the United States a few of the “old” light luxury company, the beginning is under the banner of “offering accessible luxury”, and this has created the concept of “light luxury”. After decades of development, many of the more well-known successors, such as Michael Kors, Tory Burch, Kate Spade etc..
However, the company that once dominated the world by single brand finally encountered a “bottleneck” after its establishment for half a century. In 2014, the development of COACH was in a mire and its performance was declining.
According to the latest statement of American light luxury brand Coach parent company Tapestry released by Givenchy, former president Laura Dubin-Wander will serve as president of Coach North America and Ralph brand, Lauren Fredrik EMEA Malm, the former president will serve as president of the international brand and the European region. After the entry into force, Lauren Dubin-Wander will be responsible for promoting the business development of Coach North American direct retail channel. Fredrik Malm will lead all European branches and supervise the global franchise, distribution and tourism retail business.
In recent years, Gucci has gradually restored its leading position in the luxury industry in Italy. Now it has become the most digitalized luxury brand, and has successfully guided the trend of the industry in the millennial generation. And recently, Gucci again, the official launch of the WeChat small program, with the “self Yan Yan” and the purchase of gift cards two functions. Among them, “self facial features” encourages users to upload their own pictures and generate dynamic expressions by adding Gucci totem.
Recently, Canada yoga clothing brand Lululemon released third quarter earnings, according to its display in the three months ended October 29th, Lululemon sales rose 14% to $619 million, operating profit fell 8% to $85 million 600 thousand, comparable sales growth of 2%, including sales of electricity providers, retail sales increased by 26%. The brand will also launch a new website at the end of the quarter.
According to Reuters, Tapestry, formerly known as Coach luxury group, said on Thursday that the Hongkong Stock Exchange approved its Hongkong depositary receipt and withdrew its listing status in March 2nd this year, and stopped trading after the market closed in January 30th. After the company to the stock exchange for the delisting, the reason is the low trading volume and intends to focus its resources on the first listed on the New York stock exchange, i.e..
It is reported that the group has now become the three independent brands, including Coach, Kate Spade and Stuart Weitzman multi brand group, the group in the last year of the name of “Coach” to “Tapestry”, meaning “Chinese tapestry”, stock code group officially changed from COH to TPR”. The Group believes that the new name can better convey creativity, technology, authenticity and inclusiveness to consumers, and also provides more possibilities for the future acquisition plan of the group.
It is noteworthy that the Tapestry and Michael Kors group purchased the American light luxury brand Kate Spade and the British luxury shoe brand Jimmy Choo in 2017. Some analysts expect the two groups to continue to look for new acquisitions in 2018 to meet their growing ambitions. However, because of the value of the two transactions last year, both Tapestry and Michael Kors will not be in the first half of the year until there is a suitable opportunity to appear.
In recent years, Coach has been making innovations in products, and has launched the brand design of snow white, sleeping beauty, Mickey Mouse and Disney stars. Recently, when Mitch mouse’s long-term partner, Minnie mouse, appeared as a star in the “Hollywood Walk of Fame”, Coach also participated in its celebration.
The American luxury brand not only launched a lunch for Minnie in Losangeles, but also put on the Coach costume designed by Coach creative director Stuart Vevers for Mitch and Minnie.
The dress made a special combination of the Mickey Mouse style with the classic design of Coach. For example, Mickey’s clothing is a custom patch cool leather motorcycle jacket, Minnie wore a red flower in the prairie dress, shoes and hair on the crystal decoration. In addition, Vevers added black sequins and polka dots on the pattern of clothing, such as the landmark Minnie clothing elements.
Relative to the downturn in the Hong Kong stock market, Tapestry, Inc. and US stocks surged 1.47% on Monday, continuing the rally since last Thanksgiving. So far this year, the stock has increased by more than 9%, which has increased by 36% over the past year. But its performance is still far less than its rival Michael Kors Holdings Ltd. (NYSE:KORS), which has surged 60% in the past year.
At present, the competition between the two companies has expanded from the light luxury brand to the luxury group construction, and the two companies are actively merging. In October 11, 2017, the New York luxury group Coach, Inc announced that the company would change the company’s name to Tapestry, Inc, which came into force in October 31, 2017. At present, Coach group has a lifestyle brand Coach, Kate Spade New York and shoe track brand Stuart Weitzman. Nutchi, born in 1941. The headquarters is located in New York.
COACH is the high-end lifestyle fashion brand, offers exquisite accessories and gifts for men, women, men, ladies handbags series products including handbags, small leather goods, men’s and women’s shoes, clothing, watches, travel goods, scarves, sunglasses, perfume, fashion jewelry etc.. COACH’s products are sold all over the world through brand boutiques, designated department stores, specialized stores and official websites.
The two quarter period, Coach brand revenue of $1 billion 230 million, $1 billion 200 million compared to the same period last year growth of 2%, which provide 100 basis points for the 3% business same store sales growth, Consensus Metrix expects same store sales growth of 2%; the brand’s two quarter gross margin of 68.8%, a 20 basis point decline over the previous year 69%, operating profit rate within the period of 29.4%, up 130 basis points significantly improved.
The resumption of growth in the same store sales and the slowdown in the gross interest rate decline have eased the market’s concerns, and also prove the end of a discount strategy in the early stage of the light luxury industry. However, the Tapestry, Inc. acquisition, and the lower end of the light luxury brand, Kate Spade, continues to be in the doldrums.
The results could be restored by the driver, Victor Luis Coach said North America, mall traffic and improve inventory correction as the main stimulus reasons, China continued to perform well, Hong Kong and Macao markets improved, only the strong euro and the high base last year to Europe especially England have tight performance.
Kate Spade brand by two quarter sales of $435 million, same store sales fell 7%, but still better than market expectations of 8.8% decline, mainly because the company contracted wholesale business and electricity supplier channels to enhance promotion cause, especially the negative effect of 4% Kate Spade business promotion with store sales.
Sales decline and aggravation promotion led Kate Spade gross profit margin to fall by 370 basis points to 59.4%, operating profit in the two quarter was 10.5% to 10.5%, and 21.2% in the two quarter of fiscal year 2017.
Coach sales increased 2% to 1 billion 230 million dollars compared with the same period last year, and the comparable sales increased by 3%. Among them, the electricity business all over the world increased, the gross profit margin was 68.8%, and the business profit was 361 million dollars.
The sale of Kate Spade was 435 million dollars, which was 7% lower than that of wholesale sales and business promotion. The gross profit margin was 59.4% and the operating profit was 45 million dollars.
Stuart Weitzman’s sales rose 2% to $121 million, the gross profit rate was 60.8%, and the operating profit was $24 million.
As of the end of the reporting period, the group’s three brands had 1334 stores in the world, including 967 Coach brands, 284 Kate Spade and 83 Stuart Weitzman.
Group CEO Victor Luis said in the conference call after the earnings announcement, the performance of Coach, Stuart Weitzman and Kate Spade contributed to the growth of group’s total revenue, proving that the group is constantly making progress in resource integration of all brands.
Coach parent Tapestry released its second quarter performance report. Tapestry Luis Inc. CEO Luis Victor pointed out that the brand of the company will directly control the international distribution business to a greater extent. It is reported that at present, Tapestry has obtained the operation control right of Kate Spade joint venture in the mainland, Hongkong, Macao and Taiwan. At the same time, it has signed a purchase agreement with the relevant distributors to acquire Stuart Weitzman business in North China market. Beijing commercial newspaper reporter found that Stuart Weitzman official Tmall flagship shop has been unable to visit.
It will be an important direction for the future of Tapestry to rebuild the self-management system to increase brand control. Beijing Daily reporter learned that, in addition to the right, in Chinese operating control Kate Spade joint venture company acquired Kate Spade is located in the North China market China Stuart Weitzman business, Tapestry also announced the purchase of Coach business from Australia and New Zealand distributor, is expected to be completed this year in the third quarter to repurchase.
Tapestry said that the brand should be directly controlled by its brands to the international distribution business, and the strategy of “maximizing the opportunities of all brands in the global Chinese consumers” will be promoted. According to the latest quarter data, Tapestry sales increased by 35% over the 3 months to December 30, 2017, but net profit fell 68.2% to 63 million 200 thousand US dollars. In the first quarter of 2017, the net profit of the group was $17 million 700 thousand. In addition, in the two quarter, Coach brand sales increased slightly from 2% to 1 billion 230 million yuan, Kate Spade sales amounted to 435 million dollars, and Stuart Weitzman sales increased 2% to 121 million US dollars.
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