Gets Beyond The Bag, Goes For Guys

Trefis analysis is produced by a team of analysts who build detailed models for each company on the platform Trefis.com.

Coach is a leading U.S. retailer of luxury lifestyle handbags and accessories which competes with exclusive brands like Louis Vuitton, Hermes, Gucci and Prada.

Handbags are Coach’s main driver of sales. However, since 2005 handbags as a percentage of total sales dropped from 65% to 62%, while sales of accessories like belts, wallets and wristlets increased from 28% to 29% of all product sales. These changes are in line with Coach’s attempt to gain a greater share in the accessories market. Cheap Christian Louboutin Shoes

We estimate that Coach’s accessories business (belts, wallets, wristlets, etc.) constitutes 28% of the $46 Trefis price estimate for Coach’s stock. Cheap Tiffanys

Increasing demand for men’s luxury

Men have long been treated as an afterthought by luxury designers and retailers, given that they spend far less than women on clothes and accessories. But as men’s tastes grow more sophisticated, they are providing a new avenue for much-needed growth in the industry.

In mature luxury markets such as the United States and the United Kingdom, sales of men’s designer clothing have risen at twice the rate of the women’s sector over the past five years. The fasts pace of growth for men’s products is especially noticeable in developing markets, such as India and China where the market is growing at a brisk pace of 25-35%. Even during the crisis, men’s accessories have proven to be more resilient than those for women. cheap authentic Louis Vuitton bags

We believe the rising demand for men’s luxury provides a tremendous growth opportunity to Coach given the lack of competition in the market segment.

Coach aims to capture share in men’s luxury accessory market

The men’s imported leathers market is nearly $1 billion in size and has been less impacted by the macroeconomic environment than women’s. With only a 3% share of the men’s market today Coach has room for growth. Over the next few years Coach plans to achieve a market share of 14%.True Religion purses

In the U.S. luxury accessories market as well, Coach has increasingly focused on gaining market share. With plans to come up with all men’s stores in the near future, Coach’s accessory offerings are likely to increase. We estimate the average per store revenue that Coach earns each day from selling accessories will increase from an estimated $3,700 in 2010 to about $6,800 by the end of the Trefis forecast period.