Slowing growth hits Kors in purse strings

The torrid growth at Michael Kors is slowing — and investors have been left holding the bag.

Shares of the redhot fashion house — whose namesake founder and designer built his fame as a judge for TV’s “Project Runway” — slid 5.9 percent, to $77.01, on Monday after execs warned that sales are slowing and margins could shrink this year.

CEO John Idol blamed the margin shrink, in part, on heavy investments in European expansion, which the company had also cited in May when it ratcheted down expectations.

But Idol also admitted that the brand was forced to slash prices on a surplus of fall clothing and handbags that had hit stores too early.

“That didn’t work for us,” Idol told analysts on a Monday conference call.

With demand for the company’s “affordable luxury” decelerating amid broad consumer malaise, Idol warned the company’s gross margins could fall by half a percentage point this year.

Michael Kors has taken credit for stealing shoppers away from its older rival, Coach, as it has posted samestore sales gains of more than 40 percent in most quarters since it went public in December 2011.

But now, the brand sees samestore sales up in the high teens for the rest of the year.

Kors is suffering because it has tried to be “everything for everybody,” says Robin Lewis, a retail analyst who has long warned of a coming slowdown.

While Kors handbags have been showing up at T.J. Maxx, true luxury brands like Louis Vuitton have always carefully controlled inventory, even if it means destroying unsold merchandise at season’s end, Lewis noted.