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Coach Still Sees Growth in China: CEO

Tuesday, 23 Oct 2012 | 4:11 PM ET
David McNew | Getty Images

Unlike for many European luxury brands, China remains a strong market for Coach, Lew Frankfort, CEO of the high-end leather goods company, said Tuesday.

"With regard to China, our position is an accessible luxury brand which means our price points are 40-60 percent lower than the average European luxury brands," the executive said. "So our products are more in reach for the emerging middle class."

That has meant that the company's products are finding acceptance not just in the tier one Chinese cities like Shanghai and Beijing but smaller cities as well, Frankfort said on CNBC's "Closing Bell."

(Read More: 10 Best Cities for Shopping.)

Coach shares rose more than 7 percent on Tuesday after the company beat third-quarter earnings expectations.

Coach CEO: We're Finding Acceptance Everywhere
Coach shares jumped on strong Q1 sales and profit numbers. Lew Frankfort, Coach chairman & CEO, discusses strong consumer acceptance of the company's products globally, and his agenda for Coach going forward.

The better-than-anticipated results followed a string of warnings about China from luxury competitors like Tiffany and Burberry . (Read More: Luxury Retailer Finding Upside in China.)

With strong demand for its accessories worldwide, Coach is opening dual-gender stores outside the U.S. and is shifting its merchandise toward men's products.

The men's category is up 50 percent worldwide, Frankfort said, adding "it's a meaningful business" for Coach.

"We think we're going to do $650 million in men's this year," he said. "In some places in China it represents 30 percent of sales."

-By Justin Menza, CNBC News Writer

Questions? Comments? Email us at consumernation@cnbc.com.

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