In 1941, Coach was first established as a small family run premium leather goods manufacturing business, which was seen as a premium brand with superior leather goods. In 1980, Coach opened its retail store and in 1985 Coach was sold to Sara Lee. Coach then began to experience paid expansion and growth including accessories, luggage, and brief cases into the product line. Today Coach is known for being one of the leading luxury accessories brand in the US and internationally. Some of these products now include purses, footwear, jewelry, travel bags, fragrances, wallets, and brief cases to name a few. Below will be information on where Coach Incorporated needs to gain or lose access using Porters Five Forces model. Porters Five Forces include the following forces that shape an industry according to the model and Michael Porter: New Entrants, Competitive Rivalry within the Industry, Bargaining Power of Buyers, Bargaining Power of Suppliers, and Threat of Substitute Products or Services.
New Entrants will be discussed first and it is not a category that has the most intensity, yet there still is some. I would say new market entrants is at a medium intensity but Coach would have a distinct advantage over any new brand simply for being an establish brand already. This would be a huge barrier of entry for a new luxury brand to overcome in the type of market Coach demands. Brand recognition and brand loyalty are among the main factors that drive middle to high-income earners towards luxury brands such as coach, which a new company would have to think greatly about before jumping into the fire. In addition, another barrier would be having capital expenditure for marketing and floor space. However, creating a company over the internet has low barriers and new players can pop up in this sector selling apparel, accessories, footwear and other items.
Next we will dip into Competitive Rivalry within the Industry, which would be the...
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