Coach, Inc.

Coach is riding in style, thanks to the company's leather items and some savvy licensing deals. The company designs and makes (mostly through third parties) high-end leather goods and accessories, including handbags, wallets, and luggage. Founded in 1941, Coach also licenses its name for watches, eyewear, fragrances, scarves, and footwear. The luxury brand sells its wares through more than 1,000 department and outlet stores (in the US and more than 20 other countries), catalogs, and its website. Macy'sNordstromSaks, and others carry Coach items. It also runs more than 950 retail and factory outlet stores in North America, Japan, and China (including Hong Kong and Macau).

Geographic Reach

Coach operates about 320 retail stores and 190 factory stores in the US; some 30 retail stores and six factory stores in Canada; about 190 department store shop-in-shops, retail stores, and factory stores in Japan; and nearly 220 department store shop-in-shops, retail stores, and factory stores in Hong Kong, Macau, mainland China, Singapore, Taiwan, Malaysia, and Korea.

Coach also operates distribution, product development, and quality control locations in the US, Hong Kong, China, South Korea, Vietnam, the Philippines, and India. The handbag maker generates about 66% of its revenue from the US while Japan accounts for about 15%.


The company operates through five operating segments aggregated into two reportable segments: North America and International.

Within the North America segment, which represents 69% of its revenue, Coach includes sales to North American consumers through its retail stores, factory stores, Internet, and wholesale.

Its International segment, which consists primarily of sales to consumers through company-operated stores in Japan and mainland China, also accounts for revenue from the Internet, Hong Kong, Macau, Singapore, Taiwan, Malaysia, and Korea. Wholesale customers and distributors in 25 countries also contribute to the segment's sales.


Having reorganized its business in fiscal 2013 around its geographic focus, Coach is working to sustain growth within its global business. To this end, the leather products company boasts three key growth strategies: transformation to a lifestyle brand, increased global distribution, and improved store sales productivity. Still, growth is proving hard to come by. In mid-2014 Coach warned of lower sales next year and said it will close about 70 stores in North America. The company is facing increased competition from fast-growing rivals, such as kate spade and Michael Kors.

It's expanding globally by entering into joint ventures and distributor relationships to build its market presence and capability. It gains greater control over its brand, aggressively grows market share, and accelerates its brand awareness by later acquiring its partners' interest. For example, Coach in 2011 purchased a non-controlling interest in a joint venture with Hackett Limited to expand the Coach business in Europe. Through the joint venture, Coach opened retail locations in Spain, Portugal, Great Britain, France, Ireland, and Germany. In July 2013, Coach purchased Hackett Limited’s 50% interest in the joint venture. The company purchased the domestic retail businesses from its distributors in Hong Kong, Macau, China, Singapore, Taiwan, Malaysia, and Korea.

Coach has been banking on its upscale clientele in the US, Japan, and elsewhere to invest in its products. The company's looking to boost its global distribution efforts, mostly in North America, China, and Europe, while also improving store sales. It's also implementing several initiatives, prudently expanding its retail presence in North America in an effort to generate higher sales revenue. The company has been scaling back its once-aggressive expansion by halving its new US store openings. Coach believes that ultimately there is a market to support up to 500 Coach stores in the US and 30 in Canada.

It's focusing on a Men's initiative in North America and Asia to attract more males by opening new full-price and factory locations with in-shop stores and by broadening its product assortment to include more men's items. Coach's partnership with retail real estate company Simon Property Group has allowed Coach to get its foot in the door at some swanky digs where upscale customers spend more freely. The leather-goods maker has a presence in Simon's Forum Shops at Caesars Palace in Las Vegas and Roosevelt Field on Long Island. These two properties represent some of Coach's highest-volume retail operations. It's working with Simon Property Group and retail regional mall developer General Growth Properties to add new Coach retail shops and expand existing ones.

The leather goods maker has been looking at global markets to diversify. Coach is pushing to penetrate the European luxury goods market, helped by an exclusive arrangement with Printemps, the French department store chain, and in Spain with El Corte Inglés. It is also eyeing Germany, Italy, Brazil, and India. In Asia, Coach sees China as one of its largest opportunity and is adding new locations in the country. Its Japanese business is where the company counts on its trendy target audience. Coach anticipates an ultimate market penetration of up to 180 stores.

Financial Performance

Coach has grown its revenue for the past six years. Sales increased by 7% in fiscal 2013 (ends June) as compared to 2012. North America sales increased 5% from new and expanded stores and rising comparable store sales, offset in part by fewer shipments into wholesale stores. The handbag maker saw increases among its North American Internet business. During 2013 Coach opened 24 factory stores, including 10 Men’s, closed three net retail stores, and expanded six factory and one retail store in North America.

International sales jumped by 10% during the same reporting period from new and acquisition-related stores. Asia's strong comparable store sales, China's double-digit percentage growth, and increased shipments to international wholesale customers were dragged down by Japan's weak sales and by the Yen's negative foreign exchange impact, which decreased sales by $82.2 million. During 2013 Coach opened 42 net new stores in China, Hong Kong, Macau, and Japan. 

Sales and Marketing

The company's creative marketing, visual merchandising, and public relations teams maintain the Coach image. Coach leverages its consumer and market research capabilities to assess consumer attitudes and trends. As part of Coach's direct marketing strategy, it taps a growing database of some 19 million active households in North America and 8 million active households in Asia. To spur purchases and build brand awareness, the company communicates with customers through some 1.2 billion emails and millions of catalogs worldwide. It's looking to boost e-commerce sales through its digital strategy,, global e-commerce sites and programs, third-party flash sites, marketing sites, and social networking. Coach boasts 22 marketing websites in 23 countries.

Coach's advertising costs span direct marketing activities, such as direct mail pieces, media, and production costs. These growing expenses totaled $102,701 in 2013, $89,159 in 2012, and $74,988 in 2011.

The company's products are sold through more than 1,000 wholesale locations in the US and Canada. Top US wholesale customers include Macy’s (including Bloomingdale's), Dillard's, Nordstrom, Saks Fifth Avenue, Lord & Taylor, The Bay, Bon Ton, Belk, and Von Maur.

Coach operates an 850,000 sq. ft. distribution and consumer service facility in Jacksonville, Florida, which uses a bar code scanning warehouse management system. Coach's distribution center employees use handheld radio frequency scanners to read product bar codes. This allows them to more accurately process and pack orders, track shipments, and manage inventory. Coach's products are primarily shipped to Coach retail stores and wholesale customers via express delivery providers and common carriers, and direct to consumers via express delivery providers.

To support its growth in China and the region, in fiscal 2010 it established an Asia distribution center in Shanghai, owned and operated by a third-party. Coach also operates distribution centers, through third-parties, in Japan, China, Hong Kong, Singapore, Taiwan, Malaysia, Korea, and the Netherlands.

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Coach, Inc.

516 W 34th St
New York, NY 10001-1394
Phone: 1 (212) 594-1850


  • Employer Type: Public
  • Stock Symbol: COH
  • Stock Exchange: NYSE
  • CEO: Victor Luis
  • President and COO: Gebhard Rainer
  • Chairman: Jide Zeitlin

Major Office Locations

  • New York, NY

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