Fashion Apparel Manufacturing - Essay Example

? Term Paper Outline - Fashion Apparel Manufacturing Table of Contents Table of Contents 2 COACH 3 Marketing Strategies 3 Target s 4 Promotions 4 Licensing 5 Apparel Product Lines 6 Global Sourcing Strategies 6 Production Planning and Strategies 7 Quality Control 7 Conclusion 7 Works Cited 8 COACH Coach, Inc is iconic American luxury leather goods organization. The company is headquartered at New York City, USA. The luxury leather goods company was founded through partnership with Gail Manufacturing Company in the year 1941. Total market capitalization of the company is 15.90 billion while total sales revenue earned by the company in the year 2011 was 4.87 billion (“COH”). Marketing Strategies Coach always tries to offer something new to customers through carefully designed marketing strategy. The company has revamped their product line over the time in order to fulfill demand of various customers. Coach has great success because of the strength of its brand. The company specializes in selling ladies handbags, luggage, wallets, briefcases and leather accessories. Brands offered by Coach have three distinctive brand equities. These three factors can be classified as product innovation, excellent value offering and relevance. The company conducts market research about customer preference by conducting interview of 15,000 people every year and based on interview report they innovate products in accordance to customers’ lifestyle. Product line of the company maintains relevance with demand of the customers by changing fashion statement and trend in periodically. Coach offers value products by offering, inspirational, stylish leather goods to customers. Coach offers leather goods to both men and women in the following manner. Women Reason Men Reason Handbags, wristlets, shoes, outerwear, jewelry, fragrance, sunglass and many more To attract women with colorful product line Wallet, accessories, belts, shoes, outerwear, tech accessories and many others To fulfill multidimensional fashion requirement of men (Source: “Shop”) Target Customers The company mainly targets women in the age range of twenty to fifty five. Coach has significantly introduced new products in their offering in order to fulfill demand of women belong to various age group. Analyzing mailing list of the company helps the study understand demographics of target market in the following manner (Paxson 64). Professional women and women with white collar job. These women prefer to shop trendy and fashionable shoes, wardrobe items, apparels in order to enhance their professional image in front of external society. Women do not want to compromise with style, fashion statement in order show their taste to external society. They believe by purchasing branded products of coach will not only enhance their social image but beautify them also. Research report shows that average age of women purchasing leather items from Coach is forty five with an average spending of $100 on each item. Promotions The company relies heavily on e-marketing in order to promote their product. The value proposition offered by the company has five distinctive pillars. Providing sufficient links in the website to attract customers and investors to access financial statements, stock information, report of new product launch etc. “My Account” feature is added in the website to engage customers with the company. The company updates their feature product line on website periodically in order to retain existing customers. The company conducts online market research on customer preference and based on the research report they decide marketing strategy. Coach has introduced “Coach by Request” section for customers in order to offer them superior customer service. “Coach by Request” gives the opportunity for customers to order home delivery of tailor made items. Licensing Coach has recently signed license agreement with Luxottica Group for designing, manufacturing and distributing sun and prescription eyewear under the brand name of Coach Poppy, Reed Krakoff and coach. In the initial stage total duration of the agreement was fixed as three year. Luxottica Group has forecasted that the eyewear segment will earn revenue of $100 million annually from Coach’s retail distribution network. Industry insiders believe that licensing agreement will help Coach to expand their category membership in the eyewear segment (brand name of Luxottica Group will help Coach to attract exiting customers of eyewear segment) without hurting their leather product line. Luxottica Group will earn profit margin from global distribution of eyewear products through Coach. Apparel Product Lines Primary product line for Coach is handbag and leather apparels. For example signature carryall handbags have a price range of $80 to $300 dollar. Prices of products vary due to their size, quality of leather used and utility. Coach also offers leather accessories in the price range of $100 to $300 in order to increase purchase ratio from customers belong to various income group of the society. Coach sells eyewear products, fragrance items and tech accessories as complementary items with their primary leather product line. Coach believes that selling leather goods can help them to sell items connected with primary goods due to high attachment rate. Companies offer complementary items in order to increase purchase ratio from their loyal customer and also increase category membership in new segment. Global Sourcing Strategies Coach believes in diversifying their supply source in order to decrease bargaining power of suppliers. Main supply item for Coach is leather in order to manufacture apparels, shoes and handbags. Countries like China, India, Turkey and few other developing countries are major leather suppliers for the company while in many cases Coach buys manufactured leather goods from countries such as China, India, Italy, Costa Rica, Mexico, Spain and Hungary. Coach takes supply from developing countries because in countries like China, Costa Rica and India cost of manufacturing in terms of labor cost and raw material cost is much less in contrast to developed countries. Decreasing supply cost helps the company to earn larger profit margin by selling leather apparels (Cotton, Butts, Stevens, Kosarak, and March). Production Planning and Strategies Coach spends huge amount of money on production planning which is almost 37% of net sales. The company also tries to manage their production inventory effectively in order to revaluate old stocks. The company has established product development unit in Florence, Italy. This broad-based and cross country production strategy helped the company to reduce cost, lead times and increase construction capabilities. Quality Control Coach sources leather products from licensing partners and independent manufacturers. The company maintains quality by becoming very selective about choosing right raw material. Coach maintains quality standard by control monitoring production process via onsite quality checking (Smoltczyk 593). Each of the raw materials needs to get through internal quality check in order to enter into production process. Conclusion Coach is pretty successful with their selective marketing strategy to cater global demand. The company was awarded as one of the most profitable brand in leather handbag segment by industry leaders. Works Cited “COH.” Yahoo Finance. Yahoo! - ABC News Network, n.d. Web. October 27, 2012. Cotton, Chris, Jordan Butts, Heather Stevens, Ryan Kosarak, and Matt March. “Analysis of Coach Inc”. Tech Investment Research Group (2005). PDF file. Paxson, Peyton. Media Literacy: Thinking critically about the Internet. Portland: Walch Publishing, 2004. Print. “Shop.” Coach, Inc. Coach Services, n.d. Web. October 27, 2012. Smoltczyk, Ulrich. Geotechnical Engineering Handbook, Procedures. Hoboken, New Jersey: John Wiley & Sons, 2003. Print. Read More