<Growing sales in the handbag business ? case studies.
MooRoo Handbags
Established in 1998 as a one-woman operation by Mary Norton.
A trade show at the Jacob K. Javitz Convention Center, resulted in
orders worth $65,000.
Proof of the orders got her a $20,000 line of credit from a bank. The
$20,000 was invested in renting a warehouse and buying equipment.
In February 2001, MooRoo opened a store on South Carolina?s high-end
King Street. $50,000 was spent renovating the building.
Sales doubled each year from 1998 with the customer base increasing by
40% each season.
The company suffered a drop in orders after September 11 which were
revived when the company was featured in an article in People
magazine.
Projected sales for 2003 were $2million.
Product price range - $450 - $1,200.
Future expansion plans are to open stores in New York City and Beverly Hills.
http://www.entrepreneur.com/article/0,4621,306339,00.html
The company has virtually no advertising budget. The brand has been
built by celebrity placement. Norton is familiar with the film
industry and knows how to contact celebrities. Lots of products are
given away to stars so that they are photographed wearing it to an
event. For the Academy Awards the company rents a hotel in Los Angeles
for a week and offers refreshments to stars who want to come and
select a handbag to wear to the ceremony. This costs $25,000.
The company has good customer loyalty with about 80 percent of
customers returning to buy additional handbags.
Not being based in New York has the disadvantage that some
opportunities for press coverage are missed.
http://www.charleston.net/stories/092903/bus_29strictly.shtml
Moo Roo website.
http://www.mooroo.com/
Celebrities and press.
http://www.mooroo.com/press.asp
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Harveys Industries Inc.
Established 1996 as a home based business.
Sales ? 40,000 units per year.
Unit price ? over $100.
Their seat belt bags account for 95% of their sales.
The company does no advertising or marketing claiming that the bags
seem to sell themselves.
They are sold in retail outlets including Marshall Field?s in Chicago
and Nordstrom, and Henri Bendel in New York.
http://www.ocmetro.com/metro103102/hot25/Harvey_hot25_2002.html
Articles about the bags have appeared in a number of magazines
including Coast Magazine, LA Times Magazine, Glow, Organic Style,
Lemonade, Glue, Raygun, Shuz,, Womens Wear Daily Journal and Self.
http://www.seatbeltbags.com/news.php
Seatbeltbag website.
http://www.seatbeltbags.com/
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Susan Towner Totes
Established 2002.
The company called on speciality retailers and boutiques to see if
they would sell the bags. Their goal was to get into 10 stores in
their first year which they exceeded by getting into 20.
Susan Towner cold calls potential retailers for five or six hours a day.
Their sales breakdown as follows: retail 75%, trunk shows 15% and
website sales 10%.
http://www.boston.com/yourlife/home/articles/2004/02/12/house_works/
Susan Towner Totes website.
http://www.susantownertotes.com/
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Kate Spade Inc.
Established 1992.
In 1992 they paid $2,500 to take part in a trade show. They got orders
from two stores Barneys and Charivari but failed to get enough order
to cover the cost of the show. They produced designs for five markets
a year.
In 1993, revenues were around $100,000.
By 1995, revenues were $1.5 million.
By 1996, revenues reached $6 million and have more than doubled every
year since then.
In 1999, they sold 56% of the business to Nieman Marcus for $33.6 million.
In recent years they have licensed the Kate Spade name.
In the Groove with Kate Spade by Anne Ashby Gilbert ? Fortune.
http://www.fortune.com/fortune/smallbusiness/managing/articles/0,15114,360374,00.html
Lessons from America?s new entrepreneurs ? USA Weekend Magazine.
http://www.usaweekend.com/98_issues/980823/980823upstarts.html
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Corem Rose
Established in 1999 by Melinda Gomez.
With capital of $30,000, Gomez took samples of her work to boutiques.
She now employs a fashion rep to find shelf space at boutiques and
department stores. The handbags are also displayed in show room in New
York and Los Angeles where buyers shop for new merchandise.
Making contact with a celebrity stylist was the key to success with
the handbags worn by four celebrities at the Academy Awards. Since
then many more celebrities have been photographed with Corem Rose
handbags.
First year revenue was $100,000. This year (2001) revenue is anticipated to triple.
http://money.cnn.com/2001/09/10/sbstarting/q_handbags/
Designing Success ? how Corem Rose succeeded in the handbag business.
http://www.themanagementor.com/kuniverse/kmailers_universe/mktg_kmailers/0802_4.htm
Corem Rose website
http://www.coremrose.com/
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Ebags has produced a print catalog that was mailed to customers who
bought multiple times and had an average order size of $80. This
resulted in a 75 percent increase in sales over the same period last
year.
http://www.ebags.com/info/aboutebags/index.cfm?Fuseaction=newsitem&release_ID=63
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Coach
This article describes how Coach turned around its business from near
failure to success. http://www.pbs.org/wsw/tvprogram/guests/20021122.html
Coach has expanded its product line to cater for the lower-end market.
Four years ago Coach introduced a brand of Demi handbags that sell for
as little as $128 (compared to their high-end purses which sell for
$7,500). Sales over the holidays in 2003 accounted for 10% of the
companies business. Another product the Wrislet, a 6-inch long leather
accessory business that some use as a handbag (retail price $48)
generates $25 million business. Coach?s second quarter sales have
risen by 31% and net income by 41%.
http://www.usatoday.com/money/advertising/2003-01-30-marketing-luxury_x.htm
Analysis of the company?s business.
http://www.fool.com/news/commentary/2003/commentary030626lal.htm?source=EDNWFT
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Staci Woo
Staci Woo found retailers by knocking on doors.
http://www.mary-kateandashley.com/mind_body_soul/display.php?33.3
Woo website
http://www.underwoo.com/buzz/aboutarticle.html
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Lillian Vernon Corporation
Lillian started a mail order business selling a personalised handbag
and belt which would be monogrammed free of charge. With start up
capital of $2,000 she invested $495 in an advertisement in Seventeen
magazine which resulted in $32,000 in orders.
http://www.homebusinessmag.com/tarticle.html?aID=1011&mID=1
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Capobianco
Established in 2000, Capobianco used industry contacts to initially
market her handbags. They are currently sold in 100 boutiques and
retail for between $125 and $250. The bags have been featured in
Country Home and Organic Style. In March and April she will attend
trade shows in Dallas and Los Angeles.
http://www.thedesertsun.com/news/stories2004/business/20040321223344.shtml
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Geographical regions.
USA
American Apparel & Footware Association
http://apparelandfootwear.org/3col.cfm?pageID=92
The AAFA publishes two reports on the apparel and footware business.
The reports are free for members.
Focus: An Economic Profile of the Apparel and Footware Industries
contains details of imports, retail sales, consumption, exports and
domestic production. It also includes relevant economic indicators and
demographic information. In addition it features an analysis of the
industry?s past and future. It costs $250 for non-members.
Trends provides updates on production, imports, exports, consumption,
employment, trade by price line and consumer expenditures. It costs
$75 for non-members.
http://apparelandfootwear.org/4col.cfm?pageID=212
The 2004 USA Handbags Market Report costs $1250.00
http://www.infomat.com/research/infre0001235.html
Increase in sales of 5% for luxury goods predicted for 2003 Christmas season.
http://www.swlearning.com/economics/econ_news/econ_news_productivity.html
Europe
According to an article in Italian Style, the luxury goods market in
Italy and Europe is set to make a full recovery by 2005.
http://www.italtrade.com/countries/americas/usa/dec2003.pdf
Travel & Leather Goods Market in France.
http://www.uktradeinvest.gov.uk/giftware/france3/profile/overview.shtml
Far East
Hong Kong?s Travel Goods and Handbags Industry.
http://www.tdctrade.com/main/industries/t2_2_42.htm
This feasibility study for a leather goods manufacturing unit in
Pakistan gives details of the global trade for leather goods in 1999 ,
major importers by country with their percentage share and percentage
growth. http://www.smeda.org.pk/bopp/handbags.pdf
Japanese tire of luxury brands.
According to Merrill Lynch, Japanese consumers buy 40% of the world?s
high end handbags. According to Yano Research Institute sales of
luxury goods have fallen in five of the past six years and are
expected to fall a further 4.4 percent in 2003.
http://www.iht.com/articles/111456.html
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Trade shows.
NW Apparel and Footwear Materials Show.
http://www.americanevents.com/information.asp
Fashion Source.
http://www.sifair.com/fashionSource/index.html
The Luggage, Leathergoods, Handbags & Accessories Show - Toronto
http://www.tradeget.com/tradefairs/tradefair_25Apr.html
Directory of trade shows.
http://www.apparelnews.net/TradeShows/
Directory of trade shows.
http://www.expocentral.com/consumer_goods/industry_consumer_goods_apparel_footwear_and_leather.html>
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<Additional links:>
The Handbag Market from A-Z
This publication provides a industry overview with key press,
manufacturing and sales contacts. Trade shows and associations are
also featured. It costs $165.00
<http://www.infomat.com/publications/infpu0001590.html>
<Contact any Celebrity ? printed directory and online database.>
<http://contactanycelebrity.com/store/index.htm>
<Search strategy:>
<"handbags" "successful business">
<://www.google.com/search?q=%22handbags%22+%22successful+business%22&hl=en&lr=&ie=UTF-8&start=30&sa=N>
<handbags growth>
<://www.google.com/search?sourceid=navclient&q=handbags+growth>
<"handbag business">
<://www.google.com/search?q=%22handbag+business%22&hl=en&lr=&ie=UTF-8&start=20&sa=N>
<Hope this helps.> |
Clarification of Answer by
belindalevez-ga
on
10 Apr 2004 07:59 PDT
<Handbag sales.
Despite a thorough search, I was unable to find a figure for handbag
sales. This information only appears to be available at a price. I
found several reports about the handbag market (see below). However
the information given in a Reuters report about Coach allows a
calculation to be made that gives an estimate of the size of the
market that it is competing in.
Handbags account for 70 percent of Coach?s sales.
Coach currently has a 20 percent share of the market.
Last year the company had sales of $300 million.
It is therefore competing in a handbag market worth $1.05 billion.
http://www.smeda.org.pk/bopp/secbrf_goods.pdf
The following document shows value of shipments for Women?s handbags
but the latest figures are for 1994.
Recent trends in Luggage and personal leather goods - U.S industry data 1987-1994.
http://www.ita.doc.gov/td/industry/otea/usio/95s1465.txt
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Geographical growth.
General
According to a report from Reuters the entire luxury goods is
benefiting from a pickup in tourism and a return in consumer
confidence in the U.S. Sales of the Gucci brand have increase by 20
percent in the U.S., 14 percent in Japan, 16 percent in Hong Kong and
China and 10 percent in Europe.
http://www.forbes.com/newswire/2003/10/15/rtr1109698.html
According to Businessweek Online, there has been a global downturn in
the luxury goods business over the last two years. Analysts predict
that Vuitton had growth of 16% in 2003 and predict similar growth in
2004.
http://www.businessweek.com/magazine/content/04_12/b3875002.htm
U.S.
New York
According to a March 8, 2004, report by Anne Dinnocenzio, Federated
Department Stores Inc. report strong sales of handbags.
http://www.softcom.net/webnews/wed/bc/Aretail-sales.R580_EM4.html
According to a report in SmartMoney.com, Saks Inc report good sales of
handbags. http://www.smartmoney.com/bn/ON/index.cfm?story=ON-20040408-000522-1014
According to the St. Louis Business Journal, sales of handbags in May
Dept. Stores have been strong in February 2004.
http://www.bizjournals.com/stlouis/stories/2004/03/01/daily58.html
According to a report in Retail Net, JCPenney report growth in sales
of handbags. http://www.retailnet.com/story.cfm?ID=15225
Dallas
According to the Dallas Business Journal, luxury retailer Neiman
Marcus Group Inc. reports strong sales of designer handbags.
http://dallas.bizjournals.com/dallas/stories/2004/03/01/daily37.html
According to a report by Hidenet.com, Coach anticipates strong sales
of handbags for 2004. U.S. sales are stronger than predicted and
Japanese sales continue to rise by double digit percentages.
http://66.102.9.104/search?q=cache:0tQrsdPrEAgJ:www.hidenet.com/sampleLeather.asp+%22sales+of++handbags%22++&hl=en&ie=UTF-8
Hillmer?s Luggage, Leather and Gifts (based in Kansas), had 11 percent
growth in sales in 2003 and predicts 13 percent growth in 2004.
http://cjonline.com/stories/123103/04__directory.shtml
Japan
Kyushu Department stores report a 1.9% increase in sales of handbags.
http://www.fukuoka-now.com/news/index.php?lang=&id=8548
Japan ? overview of leather goods market.
According to a report Ismat Sabir, the Japanese bag market has grown
but the growth shows signs of levelling off. Imports of bags fell from
1996 to 2001 and halted in 2002. Imports of handbags showed the
greatest decline (60%).
http://www.jang.com.pk/thenews/dec2003-weekly/busrev-08-12-2003/p11.htm
According to the Taiwan Footwear Manufacturers Association, by 2004
internet sales of handbags and accessories from Japanese sites will
reach 41,000,000 yen
http://www.footwear-assn.org.tw/english/enews/show.asp?repno=27&page=1
UK.
According to Research and Markets Ltd, The UK market for hand luggage
and leather goods was £1.03 billion in 2002.
In the last 5 years handbag sales have increased at a greater rate
than those for small leather goods and hand luggage. Market growth is
anticipated to continue.
http://www.prweb.com/releases/2003/8/prweb77927.htm
Leather Goods ? sector brief.
http://www.smeda.org.pk/bopp/secbrf_goods.pdf
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Market reports.
The Market for Leather Accessories and Travel Wear. This report costs $£1,495.00
http://www.businesstrendanalysts.com/TOC/Leather2002-TOC.doc
Icon Group International produce a number of reports, each costing
$795, on the outlook for handbags 2003-2008 including :
The 2003-2008 World Outlook for Casual Handbags.
The 2003-2008 World Outlook for Classic Handbags.
The 2003-2008 World Outlook for Evening Handbags.
The 2003-2008 World Outlook for Fashion Handbags.
The 2003-2008 World Outlook for Handbags.
The 2003-2008 World Outlook for Women?s Handbags and Purses.
http://www.icongrouponline.com/industries.asp?sid=400160335&kw=handbags>
<Hope this helps.>
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