Michael Kors (NYSE:CPRI) has been making waves since its debut on the market late last year. It's a high-margin business, with high-end clientele, and the market has rewarded its fantastic growth rate. But like any company that jumps out in front, there are risks associated with going so fast.

The biggest risk facing Kors in the near future is a pullback in American demand. Right now, the company earns 91% of its revenue through its North American segment. That segment is still experiencing fantastic growth. Last year, capital expenditure was $88.2 million, which was a 52% increase from the previous year; revenue rose 62% over that period. While the company continues to grow sales and its footprint at a pace that allows for that kind of unbalanced growth, a protracted pullback in American demand could lead to a shortfall.

Tied to American demand is demand for the brand as a whole. Fashion is a fickle mistress, and tastes can and do change quickly. Kors has been designing high-end, popular clothing and accessories for over 10 years, but there is nothing saying that the company will continue for another 10. Investors should keep an eye on same-store sales, as any slip could signal the beginning of a long hard slide.

Finally, Kors is at risk from larger economic factors. The brand thrives on disposable income, and should thrive as the American economy continues to gain strength. But Kors can only really take off if it's a realistic option for aspirational shoppers -- the middle class. Disposable income growth slowed over the past year. While the total value that Americans have at hand continues to grow, it's no longer doing so at the 5% rate that we saw in 2010.


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