China a priority for Tapestry group
22/08/2018
“Our number one priority for this upcoming year is China,” the company’s chief executive Victor Luis said earlier this month. “We’re buying back distribution.”
This latter comment refers to Tapestry’s recent efforts to gain more control over its business in Asia. This has included signing agreements to acquire the Stuart Weitzman business in Southern China and Kate Spade’s operations in Singapore, Malaysia and Australia.
The Coach brand, which retained its name after the rebrand of its parent company, will receive “an unprecedented amount of attention and investments” in China, its CEO Josh Schulman recently told investors.
It will increase its spending on advertising in the country and will host its first fashion show in Shanghai in December.
While China looks set to become increasingly important for the Coach brand from a sales point of view, its manufacturing role is decreasing. According to Bloomberg, in 2011, around 85% of the brand’s accessories were made in China.
This has been significantly reduced with Coach and Tapestry’s other brands moving production facilities to Southeast Asia and India. This would largely protect its business should US President Donald Trump put into effect tariffs on $200 million worth of products imported from China, including handbags.
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