Case Analysis #1 Problem Essay Lululemon Athletica Inc Samuel Ellison Presented for: Professor Kannangara Sunday, March 6th, 2016 BUSI4003 Introduction Lululemon Athletica Inc., founded in 1998 in Vancouver by Chip Wilson, is a company which designs and produces high-end yoga and technical athletic clothing. They have operated primarily in North America and Australia; their initial target customer was an educated woman who lives an active and healthy lifestyle. They opened their first store in Kitsilano in BC in November, 2000. The first store was intended to act as a community hub where people could learn and discuss about the physical aspects and mental aspects of a healthy life, in addition to selling yoga clothing. …show more content…
The company plans to launch stand-alone men's stores by 2016 and expand their business globally. That same day, the company announced plans to quit the Toronto Stock Exchange (TSX) due to a lack of trading on the Canadian exchange, stating that the expenses associated with having a dual listing were not justifiable(Nichols, 2016). The one remark that sent the media in a frenzy was in response to the public criticism of the sheer yoga pants, Wilson explained, “Quite frankly, some women’s bodies just actually don’t work for it. Even our small sizes would fit an extra-large(Nichols, 2016). It’s really about the rubbing through the thighs, how much pressure is there.” This statement triggered massive social outrage that was felt throughout many media platforms(Nichols, 2016). With this media “fire-storm” it was clear that Mr. Wilson needs to be reprimanded in the sense of being taught to speak to the media. Christine Day has stepped down from the CEO position and corporate will need to select another leader. To break down the analysis of the case I believe is it best divide aspects of the case and as well what they should do into categories such as : Economics, Sociocultural, Demographic, and Technological. These would all be considered apart of all external aspects. Economic: Continued economic struggles, especially within the European Union, have the potential to negatively affect Lululemon’s international expansion(Thomas
To ensure that they continue to provide our customers with advanced fabrics, our design team working closely with their suppliers to incorporate innovative fabrics that meet particular specifications into their product..In addition, to ensure the product quality of our fabric and its authenticity, we test our products using a leading testing facility. We also partner with a leading independent inspection, verification, testing and certification company, which conducts a battery of tests before each season on all of our fabrics across all product lines, testing for a variety of attributes including content, pilling, shrinkage, and color fastness. We collaborate with leading fabric suppliers to develop fabrics that we ultimately trademark for brand recognition whenever possible.
Lululemon’s success is due to its innovation in technology and fashion, as well as their use of community based marketing, and excellent customer focus. The company has positioned itself as a health conscience and fun brand that now operates 280 stores in North America, New Zealand, Australia, United Kingdom, and Singapore (Lululemon 10K).
Finally, Lululemon’s founder, Chip Wilson, made a publicly offensive suggestion, that some women’s bodies were not made to wear his yoga pants. “The problem was that the yoga-apparel company has been having with its pants on the size of women 's thighs” (EBSCO, Nov 14, 2013). After making those comments discourage plus size customers were embarrassed and felt like they don’t want to shop at the store anymore. Some women blamed CEO for making products that don’t last long. One of the examples from Financial Post. However, despite the unfortunate occurrences last year Lululemon is in a very healthy position in the Canadian and US markets. In addition to that, Lululemon’s baggiest competitor is now Sears Canada. Sears became a new stop for consumers who want high-quality and affordable yoga gear. “The struggling department store chain says its Pure Energy Athletics line of yoga clothes has been a hit with customers since they were introduced in February. The chain says it sells yoga pants for $14.99 or $29.99 — a steal compared to similar clothing from other retailers, like Lululemon Athletica” (Edmonton Journal, May 21, 2014). However, Lululemon has a tremendous
This report has been created with the intent to analyze the athletic apparel industry with a specific focus on Lululemon Athletica, Inc., further refered to as Lululemon. In this report you will find that the strengths and weaknesses of Lululemon’s current strategies and future goals are analyzed and compared to that of its closest competitors. In conclusion to the analysis, recommendations have been made to potentially guide Lululemon Athletica, Inc. in a positive direction in regards to its future endeavors. The following
a few percent, in 2012 the gross profit margin is the highest it has ever been
Lululemon, a yoga-inspired athletic apparel company for women and men was founded by Chip Wilson in Vancouver, Canada in 1998. What began as a design studio by day and a yoga studio by night, became an independent store in November 2000 (Lululemon Athletica, 2017).
This case analysis will focus on the issues surround the lifestyle product company Holey Soles. Psychologist Ann Rosenberg founded the company in September 2002. She initially operated in her garage and backyard, until she recruited Joyce Groote (now current CEO of Holey Soles) and expanded the company into other parts of North America. Holey Soles focuses on creating innovative footwear made from their trademarked technology SmartCel and SoleTek, which is an injection-molded foam technology. As of July 2007, sales had grown at 300% in each of the last two years and the company was ranked number four in the 2006 Profit magazine ranking of Canada’s Emerging Growth Companies. However as they continue to operate, they
Lululemon Inc. has a strong history of making quality fitness clothing for yoga and other athletic purposes by the founder of the company. Dennis “Chip” Wilson in 1998. After becoming “overwhelmed” by the company’s success in Vancouver, Wilson transferred management of the company to trained managers (Nicholes, 2016, p.6). During this time, Corporate CEO Christine Day’s leadership was put into question due to the low level quality of material used to make the Luon Pants, which had a “see-through problem” due to the extreme sheerness of the pant material. More so, in 2013, corporate leadership had a lawsuit brought against the company directors, including Christine Day, of massively raising the
The first Lululemon store was initially created as a place for people to gather to learn and share ideas about a healthy lifestyle. As the company expanded, Lulu could no longer target every individual walking into the store with knowledge of healthy living. At this point, the company shifted its focus to educating their employees who could positively influence everyone who walked into the stores. The thought and reasoning that went into the first Lulu store has continued as the company has grown. It has continued to target active people while pushing everyone towards a healthy lifestyle. Its main target market is young woman, between 15 and 34 years old, in the middle to upper classes. One of
Lululemon’s ability to source profitably merchandise may be affected; if new trade restrictions are imposed by The United States and other countries where products are produced or sold. These may include additional quotas, duties, tariffs, or other restrictions or regulation. Moreover, China increased in labor cost and other factors associated with production could increase the cost of product. (“Lululemon Athletica Annual Report, 2012”).
3. What is your assessment of the strength of competitive pressures stemming from substitutes for performance sports apparel?
As I walked through the open doors of Lululemon the smell of crisp clean cotton fragrance repealed off the neatly folded clothes. Looking around each item has a purposeful place. The running clothes hung in the right corner of the store and the yoga mats perfectly rolled and stacked like a pyramid. The soft golden lights evenly illuminating the merchandise. Thoughtfully placed and complementing themed fixtures to enhance the calming environment and catch the eye of the shopper.
The industry that Lululemen operates in is the Women`s Apparel industry which is a mature, large and fragmented market that has highly sensitive to the economic conditions and trends.
In 2013, Lululemon Athletica Inc found it succession of problems that damaged the company’s reputation, these included the following: (i) quality control was top on the list as there was a recall of 17 per cent of the company 's Luon pants, (ii) lawsuits issues with investors, (iii) withdrawal from the Canadian stock exchange, and (iv) bad publicity (Huang, 2014, p.5-7).