Coach, Inc.

Coach, Inc.
Public
Traded as NYSE: COH
S&P 500 Component
Industry Fashion, accessories
Founded 1941
Founder Lillian and Miles Cahn[1]
Headquarters 10 Hudson Yards
New York, NY 10001[2]
United States
Number of locations
 1,014 (2014)[3]
Key people
 Jide Zeitlin (chairman of the board)[4]
Victor Luis (CEO)
Stuart Vevers[5] (executive creative director)
Kevin Wills (CFO)[6]
Products Women's and men's bags, women's and men's accessories, women's and men's apparel, watches, footwear, jewelry, eyewear, and fragrance
Revenue Increase $ 4.24 billion (2016)[7]
  • Decrease US$1.2516 billion (2014)[3]
  • Increase US$1.577743 billion (2013)[2]
  • Decrease US$869.617 million (2014)[3]
  • Decrease US$1.066988 billion (2013)[2]
Total assets Increase $4.6 billion (2016)
Total equity
  • Increase US$2.420653 billion (2014)[3]
  • Increase US$2.409158 billion (2013)[2]
Number of employees
 approx. 17,200 (2014)[3]
Website Coach.com
Coach modern style logo

Coach, Inc. is an American multinational luxury fashion company based in New York City.[2] The company is known for accessories and gifts for women and men, including handbags, men's bags, women's and men's small leather goods, footwear, fragrance, jewelry, outerwear, ready-to-wear, scarves, sunwear, travel accessories, and watches.

History

1946-1985

190 Post St in San Francisco, CA
King of Prussia Mall in King of Prussia, PA

Coach was founded in 1941, as a family-run workshop in a loft on 34th Street in Manhattan,[8][9] with six leatherworkers who made wallets and billfolds by hand.[10]

In 1946, Miles Cahn and his wife Lillian joined the company.[11] Miles and Lillian Cahn were owners of a leather handbag manufacturing business, and were knowledgeable about leatherworks and business.[10]

By 1950, Cahn had taken over the business. During the early years, Cahn noticed the distinctive properties and qualities of the leather used to make baseball gloves. With wear and use, the leather in a glove became softer and suppler. Attempting to mimic this process, Cahn made a way of processing the leather to make it stronger, softer, and more flexible. Since the leather absorbed dye very well, this process also created a richer, deeper color in the leather.[12] Soon after Cahn developed this new process, Lillian Cahn suggested to Miles that the company supplement the factory's men's accessories business by adding women's leather handbags.[10] The "sturdy cowhide bags were an immediate hit."[10]

Miles and Lillian Cahn bought the company through a leveraged buyout in 1961.[10]

In 1961, Cahn hired Bonnie Cashin, a sportswear pioneer, to design handbags for Coach.[10] Cashin "revolutionized the product's design," working as creative head for Coach from 1962 through 1974.[10]

Cashin instituted the inclusion of side pockets, coin purses, and brighter colors (as opposed to the usual hues of browns and tans) in the products.[10] Cashin also designed matching shoes, pens, key fobs, and eyewear,[10] and added hardware to both her clothes and accessories–particularly the silver toggle that became the Coach hallmark–declaring that she had been inspired by a memory of quickly fastening the top on her convertible sports car.

In 1979, Lewis Frankfort joined the company as vice-president of business development. During this time, Coach was making $6 million in sales and products were being distributed through the domestic wholesale channel, primarily in the northeastern United States.[11] He was mentored by the then executive VP of sales, Richard Rose. Richard joined Coach in 1965, and he is credited with making Coach a household name after putting the product in department stores across the United States and abroad. He retired from his position in the company in 1995.

In 1981, under Frankfort's leadership, the company opened its first directly operated retail location on Madison Avenue in Midtown Manhattan.[13]

1985: Sale to Sara Lee

In 1985, the Cahns decided to sell Coach Leatherware after determining they wanted to "devote more time to their growing goat farm and cheese production business called Coach Farm in Gallatinville, New York, which they began in 1983".[10] Coach was then sold to Sara Lee Corporation for a reported $30 million.[10] Lew Frankfort succeeded Cahn as president.[10]

Sara Lee structured Coach under its Hanes Group.[10] In early 1986, new boutiques were opened in Macy's stores in New York City and San Francisco. Additional Coach stores were under construction, and similar boutiques were to be opened in other major department stores later that year. By November 1986, the company was operating 12 stores, along with nearly 50 boutiques within larger department stores.

Sara Lee Corporation divested itself of Coach first, by selling 19.5% of their shares of Coach at the Coach IPO in October 2000, followed in April 2001, with the distribution of their remaining shares to Sara Lee’s stockholders through an exchange offer.[14]

1996: Reed Krakoff leads design

In 1996, Lew Frankfort was named chairman and CEO of Coach. The following year, under Frankfort's leadership, Coach hired Reed Krakoff, whose creative and commercials instincts aimed to make Coach products functional, lightweight, and stylish.[8] Krakoff's design transformed Coach from the relatively small company that it was in 1985 into the worldwide-known brand that it is today.[8][15]

2013–present

In February 2013, Coach named Victor Luis president and chief commercial officer and announced that he would become chief executive officer in January 2014, with Lew Frankfort continuing as executive chairman.[16] In 2013, Coach generated $5 billion in sales and operated approximately 1,000 directly operated locations globally, including North America, Japan, China, Singapore, Taiwan, Malaysia, Korea, and Europe.[2]

In 2014, the company announced Stuart Vevers as the new executive creative director, replacing Reed Krakoff.[17]

During 2014, Coach also announced that Lew Frankfort would retire as executive chairman at the expiration of his term in November 2014.[18]

In January 2015, Coach agreed to buy shoemaker Stuart Weitzman for up to $574 million in cash.[19] In the same year, Coach also launched Coach 1941, "a new, higher-priced line centered on ready-to-wear." [20]

Coach marked its 75th anniversary in 2016 with the announcement of its partnership with Selena Gomez.[21][22]

In May 2017 it was announced that Coach was ready to purchase Kate Spade for $2.4 billion.[23] Michael Kors Holdings Ltd. had previously expressed interest in buying Kate Spade.[24]

Corporate affairs

Coach purse with the signature monogram C.

On June 1, 2000, the company changed its name to Coach, Inc.[25]

Lewis Frankfort has been involved with Coach for more than 30 years.[26] He was named chairman and CEO in 1995, and in 2014 became executive chairman. During 2000, he oversaw Coach’s transition to a publicly traded company listed on the NYSE and in 2011 became the first American issuer to list on the Stock Exchange of Hong Kong.

Victor Luis was named chief executive officer of Coach, Inc. in January 2014.[27] Prior to his appointment and beginning in February 2013, he held the role of president and chief commercial officer of Coach, Inc., also serving on Coach’s board of directors.

Luis has been a member of Coach’s senior leadership team since joining the company in 2006, holding a number of international management roles and leading Coach’s expansion in Asia.[27] Most recently, he served as president of the International Group, and was responsible for Coach’s operations outside of North America. Prior, he was president of Coach Retail International, where he oversaw the company’s directly operated businesses in China (Hong Kong, Macau, and Mainland), Japan, Singapore, and Taiwan, and president and CEO of Coach China and Coach Japan. Luis originally joined Coach as president and CEO of Coach Japan, Inc.

Before joining Coach, from 2002 to 2006, Luis was president and chief executive officer for Baccarat, Inc., leading North American operation of the French luxury brand.[28] Earlier in his career, Luis held marketing and sales positions within the Moët-Hennessy Louis Vuitton (LVMH) Group.

Stuart Vevers joined Coach in the fall of 2013 as executive creative director. Vevers joined Coach from Loewe, where he held the role of creative director since 2008.[29] Prior to Loewe, he served as creative director of Mulberry from 2005 to 2008. He began his career at Calvin Klein, and has contributed in creative roles with Bottega Veneta, Givenchy, and Louis Vuitton. In 2006, Vevers won the British Fashion Council’s Accessory Designer of the Year award.

Jide J. Zeitlin joined Coach Inc. November 6, 2014. He had previously been a partner at The Goldman Sachs Group, Inc. Zeitlin joined Goldman Sachs in 1987 and became a partner in 1996. He retired in December 2005, and currently serves Coach Inc. as independent chairman of the board, and the Affiliated Managers Group, Inc. as the director.[30]

Lillian Cahn died, aged 89, March 4, 2013, in Manhattan.[31] Miles Cahn died, aged 95, February 10, 2017, in Manhattan.[32] Richard Rose died, aged 87, May 7, 2017, in Massapequa, New York.

The Coach Foundation

The Coach Foundation was established in 2008 to support organizations that empower and educate women and children around the world.[33] According to the foundation’s website via Coach.com, the program has two areas of focus:

In 2016, "the Coach Foundation donated $3 million to Step Up, the New York-based nonprofit organization that helps teen girls fulfill their potential."[34] Additionally, Coach, Inc. also funds select projects that enhance the environment in communities where it conducts principal business operations.[35]

Operations

As of 2013, there were approximately 1,000 Coach stores in North America. Coach has also built a strong presence in the U.S. through Coach boutiques located within select department stores and specialty retailer locations.[14]

Coinciding with its 75th anniversary in 2016, Coach opened Coach House, a 20,000-square-foot Midtown Manhattan retail space.[36]

Today, Coach’s corporate headquarters remain in mid-town Manhattan on 34th Street, in the location of their former factory lofts. In August 2016, the company finalized the sale and leaseback of its office condo portion of 10 Hudson Yards – its headquarters. Coach received $707 million before transaction costs.[37]

In 1999, Coach launched its online store at www.coach.com.[38]

References

  1. ↑ Karmali, Sarah (March 11, 2013). "Coach Co-Founder Lillian Cahn Dies". Vogue News.
  2. 1 2 3 4 5 6 "Coach, Inc.2013 Annual Report Form (10-K)" (XBRL). United States Securities and Exchange Commission. August 22, 2013.
  3. 1 2 3 4 5 "Coach, Inc. FY14 Annual Report Form 10-K". United States Securities and Exchange Commission.
  4. ↑ https://www.reuters.com/finance/stocks/companyOfficers?symbol=COH
  5. ↑ Karimzadeh, Marc (4 February 2014). "Stuart Vevers Ready to Unveil First Coach Collection". WWD. Retrieved 4 February 2014.
  6. ↑ https://www.sec.gov/Archives/edgar/data/1116132/000115752317000016/a51487644.htm
  7. ↑ Coach Annual Report 2016
  8. 1 2 3 Tan, Cheryl Lu-Lien (August 10, 2003). "In the Bag". The Baltimore Sun. Retrieved January 22, 2012.
  9. ↑ DK Publishing (17 August 2009). 1000 CEOs. Penguin. pp. 350–. ISBN 978-0-7566-7057-3. Retrieved 23 January 2013.
  10. 1 2 3 4 5 6 7 8 9 10 11 12 13 Lockwood, Lisa (September 26, 2011). "The Early Years". Women's Wear Daily. Retrieved January 22, 2012.
  11. 1 2 Pogoda, Dianne M. (September 26, 2011). "Leather Road". Women's Wear Daily. Retrieved January 22, 2012.
  12. ↑ "Coach Inc Company History".
  13. ↑ "Coach". Vogue.
  14. 1 2 "FAQ: Coach", Thomson Reuters
  15. ↑ Levy, Ariell. "Brand-New Bag – The man from Coach goes upscale.". newyorker.com. The New Yorker. Retrieved 2013-03-08.
  16. ↑ Steigrad, Alexandra. "Victor Luis Named Coach CEO-Designate". Women's Wear Daily.
  17. ↑ "Stuart Vever's Vision: Coach's New Man Talks Heritage". Women's Wear Daily. Retrieved July 9, 2014.
  18. ↑ "Coach Announce the Retirement of Lew Frankfort, Executive Chairman" (Press release). Business Wire. September 25, 2014. Retrieved October 8, 2014.
  19. ↑ Michael J. de la Merced; Hiroko Tabuchi (January 6, 2015). "Coach Expands Luxury Fashion Brand Buying Shoemaker Stuart Weitzman". New York Times. Retrieved January 10, 2015.
  20. ↑ Indvik, Lauren. "Why Coach is Now Focusing on Ready-to-Wear". Fashionista. Retrieved 17 November 2016.
  21. ↑ "75th anniversary". Coach. Retrieved February 15, 2016.
  22. ↑ Schneider, Matthew. "Coach Confirms Its Partnership With Selena Gomez". The New York Times. The New York Times. Retrieved 12 January 2017.
  23. ↑ Lauren Alexis Fisher, COACH TO BUY KATE SPADE FOR $2.4 BILLION: the brand sets its sights on millennials. Harper's Bazaar, May 8, 2017
  24. ↑ Stephanie Hoi-Nga Wong, Coach Agrees to Buy Kate Spade for $2.4 Billion, Bloomberg.com, May 8, 2017,
  25. ↑ "Coach, Inc. Common Stock". Goldman Sachs, & Co.
  26. ↑ "Lew Frankfort". Columbia University.
  27. 1 2 "Coach Fy13 Current Report Form 8-K". United States Securities and Exchange Commission.
  28. ↑ "Coach, Inc. Announces Management Succession" (Press Release). Coach, Inc. February 14, 2013.
  29. ↑ "Stuart Vevers to Join Coach". Vogue.
  30. ↑ https://www.reuters.com/finance/stocks/officerProfile?symbol=COH&officerId=810108
  31. ↑ Coach founder Lillian Cahn dies aged 89 vogue.co.uk
  32. ↑ Miles Cahn dies aged 95 nytimes.com
  33. 1 2 "The Coach Foundation". Coach Official Site.
  34. ↑ Zilkha, Bettina. "Coach Opens Coach House On Fifth Avenue, Donates $3 Million To Step Up". www.forbes.com. Forbes Media LLC. Retrieved 23 December 2016.
  35. ↑ Nord, Dylan Nord. "The Coach Foundation". We-Care.
  36. ↑ Zilkha, Bettina. "Coach Opens Coach House On Fifth Avenue, Donates $3 Million To Step Up". www.forbes.com. Forbes. Retrieved 13 December 2016.
  37. ↑ "Luxury Handbag Designer Coach Enters into $707 Million Sale, 20-Year Lease Back for 10 Hudson Yards – CoStar Group". www.costar.com. Retrieved 2016-08-28.
  38. ↑ "Company Profile". Coach Official Site. Accessed 12 February 2012.
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