No More Coach Bags At Bonus Time

The 5.79 percent dip in Coach stock yesterday was due in part to the company's announcement that it is getting out of the business of selling bags to distributors for corporate gift-giving and incentive programs. They said too many of those bags were ending up in 'unauthorized' channels like Costco. And the gift-giving thing didn't fit in with the upscale image they're going for. Analysts seem to agree that this makes it a great time to buy Coach stock.

I don't think anyone, including Chairman and C.E.O. Lew Frankfort, could have forseen what an incredible success this turnaround would be. The company now says they want 500 stores in the US and Canada and plan to open 40 more stores each year for the next few years. They are equally enthusiastic about Asia, based on their success in Japan, and on the Middle East.

The one place they're still not talking about is Europe. According to their website, There are four outlets in Guam, but only one in France and that's pretty much it for Europe. They've often said it's a more complicated market and they see no reason to rush in.

The Coach Maude Vintage Leather Tote from Spring 07 collection

So here in Europe, we play a fun little game called "What Should Be The European Coach?" I still can't believe no one has snapped up this positioning. Quality, stylish bags at a reasonable price -- a price a working girl can affrord. Bally would seem to be the obvious choice, but they're firmly set on luxury, with crocodile and ostrich bags in the latest collection. Furla, the handbag of choice for many a corporate girl, would be the next most likely candidate, but they don't seem inclined to take any fashon risks thereby insuring they'll never create the same excitement. Oh, ho hum.

In the meantime, at least we can look forward to two new lines from Coach, Bleeker this fall and Heritage Stripe next spring.