Star Kors made one mistake that most undermined its business

The company appreciated an impressive rise in popularity in recent years with the help of its trendy handbags and monitors. But growth has been slowing in recent months, and the company has reported any weak outlook for the future.

Shares have become down 34% in the past year. Nonetheless overall strength in the apparel world, the fashion company is the only real specialty retailer no trading above the 5-year median right now, according to a recent review by Morgan Stanley.

Many of Star Kors' issues can be traced to 1 mistake: rapid expansion.

The brand will finally be available in 4, 133 locations across the globe, including boutiques, department stores, and rebate outlets. That compares with a couple of, 913 stores at the beginning of 2013.

Star Kors has said it could still develop hundreds of locations to its roster.

While being available in more sellers can drive profits in the quick, it can also hurt the brand.

Widespread fame is the "kiss of death when considering trendy fashion brands, particularly many of those positioned in the up-market younger research sectors, " industry expert Robin the boy wonder Lewis writes on his blog. Lewis stabilizes Michael Kors to Tommy Hilfiger, which reached its peak back in the 1990s.

Michael Kors is considered another aspirational brand, with consumers investing a premium for its label. Once try to find again the product, it is no longer considered splendid.

Other brands that have experienced this way include Juicy Couture, Jordache, combined with Coach.

Michael Kors also has amount of brands at different price areas, a strategy that could easily backfire, Lewis says. Kors has a high-end department-store brand, a middle-market brand, including a brand for discount outlet stores.

"Some would argue all of those segments only will end up competing with each other, thus cannibalizing the top end of the spectrum, " my friend writes.

In other words, consumers will not fork over $300 for a Michael Kors net in a department store when they can get a specific at the outlet mall for semi the price

Coach's popularity also pumped into business struggles.

NOW WATCH: That it is official: Michael Kors isn't splendid anymore

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