Coach Announces Next Phase of Growth Strategy for Japan; Expects Business to Double over Next Four Years to over 80 Billion Yen Bolsters Leadership Team to Drive Growth
Coach, Inc. a leading marketer of modern classic American accessories, today announced the next phase of its growth strategy for Japan, with the completion of its present four-year plan in just three years. The new plan will allow Coach to capitalize on the significant growth opportunity that still exists with the domestic Japanese consumer. Coach is now the second largest imported handbag and accessory brand, having tripled its sales over the last three years. The company expects sales to more than double during the next four years to over 80 billion yen by FY09.
Coach also announced that it is strengthening its leadership team at Coach Japan (CJI) later this Spring, with the addition of two key executives, who will report to Ian Bickley, President and CEO. Mr. Norito Ebata will join the company as Executive Vice President, Retail and Customer Service. He will be responsible for all Coach Retail and Factory store strategy and operations, driving all key sales and distribution initiatives. In addition, CJI will shortly be announcing the appointment of its first Executive Vice President and Chief Operating Officer, a new position for the company. The Chief Operating Officer will spearhead logistics initiatives as well as oversee administrative, finance and information technology functions.
Mr. Ebata joins Coach Japan from Starbucks Coffee Japan, where he is currently the Division Manager, Human Resources. During his five years with Starbucks, he has held a series of increasingly influential roles, participating in leading the successful expansion of the Starbucks retail stores in Japan. Prior to joining Starbucks, Mr. Ebata spent thirteen years with Sumitomo Corporation, where he held positions in logistics, planning and coordination & trading.
“We are extremely pleased to announce the next phase of our growth plan for Japan, where Coach's unique proposition of innovation, relevance and value has resonated particularly well with the stylish Japanese consumer,” said Lew Frankfort, Chairman and Chief Executive Officer of Coach, Inc. “We believe that through expansion and increased productivity, we can grow at least 20% annually in constant currency, doubling our sales base over the next four years and taking our market share to our goal of 15% from about 8% today. We now believe we could have at least 130 retail locations throughout Japan, including at least 15 flagship locations – more than double the current number. Further, with the addition of Mr. Ebata and our new COO to an already strong CJI leadership group, we clearly have the right team in place to drive this growth, and capitalize on the overwhelming consumer response to our accessible luxury proposition.”
Coach will expand its multi-channel distribution model, primarily through the opening of new flagship and retail stores, as well as significantly increasing its presence in important department stores through the opening of new shop-in-shops and expanding key existing in-store locations. The company expects to open at least 10 new locations annually over the next few years, while continuing to maximize its productivity at existing locations.
Mr. Frankfort added, “Coach's strong results reflect the enthusiasm that Japanese consumers have continued to show towards Coach's broad and modern product offering and lifestyle collections. We are especially delighted with the initial excellent response to our new spring offering, including an expanded Hamptons Weekend collection. This group of handbags, totes and accessories is targeted to raise Coach's credibility as a fun, casual fashion resource. Customers' receptivity to Hamptons Weekend underscores our belief that Coach has significant potential with this very important consumer and reinforces our commitment to expand Coach's presence in this key market.”
Ian Bickley, President and Chief Executive Officer of Coach Japan, Inc. said, “Our sales and market share gains in Japan have been dramatic, as our business has grown rapidly during the last few years, yet we do not believe that we are even at the halfway mark. We have invested in the people, systems and infrastructure which will be able to support the continued significant growth that Coach foresees in the years ahead. We are especially pleased with our new additions to the CJI management team, both of whom bring significant experience to their respective positions and will be able to have an immediate, positive impact to our operations in Japan,” Mr. Bickley added.
Coach is hosting a series of events in Japan this week with acclaimed American music and film star Mandy Moore, the face of Coach's international spring 2005 advertising campaign. The gala week will include a number of high-profile events culminating in a performance by Mandy Moore, N.E.R.D and Japanese pop artist Mika Nakashima at Coach's Play for Peace concert benefiting UNICEF on the evening of April 9th.
Coach, with headquarters in New York, is a leading American marketer of fine accessories and gifts for women and men, including handbags, women's and men's small leathergoods, business cases, weekend and travel accessories, footwear, watches, outerwear, sunwear, and related accessories. Coach is sold worldwide through Coach stores, select department stores and specialty stores, through the Coach catalog in the U.S. by calling 1-800-223-8647 and through Coach's website at www.coach.com. Coach's shares are traded on The New York Stock Exchange under the symbol COH.
This press release contains forward-looking statements based on management's current expectations. These statements can be identified by the use of forward-looking terminology such as “may,” “will,” “should,” “expect,” “intend,” “estimate,” “are positioned to,” “continue,” “project,” “guidance,” “forecast,” “anticipated,” or comparable terms. Future results may differ materially from management's current expectations, based upon risks and uncertainties such as expected economic trends, the ability to anticipate consumer preferences, the ability to control costs, etc. Please refer to Coach's latest Annual Report on Form 10-K for a complete list of risk factors.