Strategic Management Fundamentals
Introduction and presentation of the company
Coach Inc. is an American company specializing in luxury leather goods. It was founded in 1941 in New York. At the beginning, its name was GAIL MANUFACTURING COMPANY. Coach Inc. is mainly known for its women handbags line but its core business is both male and female Luggage and manufacturing leather accessories and shoes.
The company has its roots in a rich heritage. In 1941, the fledgling business was a family affair. In a Manhattan loft, six hand working artisans made a first collection of leather goods. They didn’t need much time to know a success for their items. The Coach Company known today really started in 1946 when Miles Cahn was employed. Then in 1950, he was running the company. He expanded manufacturing to leather baseball gloves and, with his wife’s idea, he started to develop women’s handbag. His objective was to increase the nominal profit margins. It was during this period that the company take the name of Coach and made its entry in the luxury leather goods market. Miles and his wife bought out the storeowners and acquired Coach. The company continue to produce high quality handbags following changes in trends and fashions but maintaining its traditional design and quality. In the 80’s, Coach started branching out into mail order and setting up specialty stores. The consequence was the Coach’s demand began to outstrip the supply. However, Miles Cahn refused to change the way they worked since the beginning, even if his refusal implies to sacrifice quality for larger production volume. Miles Cahn sold the company to Sara Lee Corporation and Lew Frankfort taking over the reigns as president. International expansion started in 1988. Stores opened in England and Japan. Today, the company still maintains large profit margins and show a strong worldwide presence. Greatly expanded, Coach Inc. continues to purpose the highest standards for materials and workmanship to their customers. Values
The Coach brand respect different values that represent its way of think and its creativity. The company and its brand represent a synthesis between magic and logic. This assembly allow it to purpose luxury goods with high quality and a traditional authenticity. Moreover, the company focus the satisfaction of their customers. This is the main objective to fulfil because a satisfied client is a loyal customer. Coach Inc. wish for establish a long-term relationship with its customers. Then, the company puts emphasis to respect concepts of integrity, honesty and fairness. It is on these points that Coach Inc. built its image and its reputation. It wishes to remain respectful and engaged. To offer new products to meet changing customer needs, the company moves constantly in a process of research and innovation. Finally, Coach Inc. considers its workforce like a real strength. It gathers collaborative people in a dynamic culture of mutual respect. The link between them is the passion for the Coach brand and its luxury leather goods. They are together, with a same goal, same objective to fulfil.
Question 1: Characteristics and particularity of the luxury goods industry The luxury goods industry has the particularity to include brand recognition, high quality and that means to have high-income elasticity of demand. Indeed, the demand varies depending on the wealth of people. When this characteristic increase, the luxury goods demands too and it is the same fact when the wealth decrease. Moreover, luxury goods companies attract the customer attention by using the image of some models and famous persons. This type of advertising contributes to increase the demand of luxury goods. Indeed, this market knows a constant evolution with 9% of growth per year. In the luxury goods industry, customers buy products for self-satisfaction. It is not a real need, but more a...
Please join StudyMode to read the full document