In the bag

Whenever actress Claudine Barretto is photographed with a Secosana-branded bag, sales volume for that particular design can reach 4,000.

"People bring pictures of Claudine when they go to one of our 190 outlets nationwide. They want the same bag that Claudine has," said Skies Merchandise Sales Corp. marketing head Philip Secosana. "Our main market are women searching for both quality and affordability. We have been successful in combining ultra chic designs and quality materials with moderate prices. For example, one of our bags along the designs of Prada or Coach can cost between P1,100 and P1,800."

The company produces four brands of bags, each with its own market niche. Secosana, which accounts for 80% of total sales, targets the B-C income market, particularly female office workers. Other company brands are Hawke, which specializes in backpacks; Urban, which is focused on luggage; and Cose, which targets the teen market.

Branding

Skies Merchandise has been producing bags since the 1960s. It was, however, only in 1997 that the company decided to brand its products.

"We started out as an SM concessionaire. Through the years, we had been able to build our network of retail outlets and suppliers who helped us make the transition," said Secosana.

Sixty percent of the company’s production is done in the Philippines, particularly in satellite factories based in and around Metro Manila. Raw materials are mainly sourced from Taiwan and Hong Kong.

"In terms of raw materials, China is improving. In terms of production costs, China is no longer cheap where quality products are concerned," said Secosana. "Although we have been able to keep our costs down because we produce in volume, our business is not so much price-driven as it is design-driven because bags are considered fashion accessories."

Every quarter, the company comes out with an average 50 shelf keeping units or designs in different fabrics and colors. Each Secosana outlet, many of them in malls, carry an average of 24 SKUs at any point in time. Depending on what consumers want in a particular store, the volume of some SKUs are increased while others are pulled out and moved to other stores where there is a demand.

"July is when we start producing for the coming Christmas season. We’re optimistic that we will make our sales target this year," said Secosana.

Judging from its annual sales growth of 30% to 40 since 2000, Skies Merchandise should easily meet a double-digit target for 2005. — MJGrey