Coach, LV Combined Gross Profit Exceeds 60% US'S "Cabbage Price".

"If we simply look at the price of the two places, the US" cabbage price "really lets us vomit blood. Some styles of bags, the price difference between China and the United States is more than doubled, even if it is looking for purchasing, the price is cheaper than the domestic price by more than 1/3.

Lisa, a foreign white-collar worker who works in Xuhui District, Shanghai, recently saw a Tribeca Collage handbag of Coach brand. But by comparing the quotations of Coach American official website and the price of Coach store in Xujiahui Port Square, she found that the "Shanghai port exchange rate" of this package was more than twice as expensive as the "US official website price".

This makes Lisa very puzzled: I heard that many Coach packages are also "Made in China", so why is China's price more expensive than the US?

In fact, more than Coach, Prada, LV, Armani, Gucci, Vivienne Westwood, Ferragamo and Burberry and other international luxury luxury brands, in China pricing is also higher than the United States at least 1/3.

"Although Coach is manufactured in China, the foundry factory responsible for production certainly has no pricing power."

Zhu Mingxia, director of the luxury research center of Cheung Kei, China foreign trade and economics university, said that in general, American brands or agents decide the price of products in the international market.

Coach Shanghai Jiu Guang

A customs official in Shanghai agrees with the above statement.

He told reporters that such a luxury like Coach package is an important reason for the high price in China.

"When luxuries are imported, there will be three customs duties, consumption tax and value-added tax. The total amount is about 70%~100%."

He also told reporters that the value chain of an industry may have seven links, including R & D,

Will Coach lose the 70%~100%'s tariff conversion profits in order to get 10 dollars in the inspection fee? The customs believe that luxury goods manufacturers will not change the process because of a single paction for global strategic considerations.

Equally important is that outsourcing of testing and other links is likely to be under pressure from domestic employment.

What's more, the tariff of the 70%~100% is added to the importers and eventually pferred to the consumers.

In fact, since 2000, Coach has pferred more than 90% of its factories to Asian countries with relatively low labour costs.

The next year after the pfer, the effect began to appear: the gross margin of Coach's product was 64%, even more than 62% of LV, and then it jumped to 77% in recent years.

A French luxury wine China Trading Company told reporters that every luxury manufacturer has its own pricing strategy, and it is secret.

These secret pricing strategies are based on many factors such as social culture, consumption habits and behavioral characteristics of consumer groups in various countries, which have been formed through long-term in-depth investigation. The source said, apart from these factors, luxury manufacturers often need to spend a lot of energy to care about the impact of pricing on consumers' psychology.

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AndreCohen, President of Coach China, has confirmed this.

In an interview with the media this year, he said that in the survey of Chinese consumers, Coach found that consumers in Beijing were more concerned about their identities. They hoped to highlight their identities by buying and using high-grade brand goods, while consumers in Shanghai paid more attention to taste. They also pursued the famous brand's unique products to make themselves more confident.

According to a market report from Coach, by 2013, the market for handbags and accessories in mainland China, Hongkong and Macao will probably exceed $2 billion 500 million, which is more than two times the current US $1 billion 200 million.

In order to gain greater benefits in China, Coach announced in 2008 that it had recovered the retail business of the brand distributor, Junsi group in China, including related assets and its facilities and inventory owned by Chinese shops.

After recovering the camp, the price of Coach China has not changed, but the profit margin has risen to 77%.