Lululemonathletica, Inc Case Study.
1 . Summary of Case:
Lululemon is a Vancouver based firm with over 201 locations most of them situated in North America, the rest in Australia, Fresh Zealand and Japan. The business is highly valued $ 1 ) 59 Billion dollars dollars. The organization was founded more than a decade ago by Computer chip Wilson, one full year after selling his surf, skate and snowboard attire company, using the taking Yoga classes which usually he really enjoyed nevertheless found the cotton garments completely incorrect for this type of physical activities. Passionate about technical athletic fabrics, he opened a design studio room to create yoga exercises clothing, the studio was also used as real yoga studio at night to aid pay the rent. That's where the origins of Lululemon started growing, Chip Pat developed new product and was in direct discussion with the Pilates community and continued to interact with anybody who was ready to try his new Yoga exercise apparel. The First shop opened in 2000 in Vancouver and since then the same core benefit and traditions has powered the company to success. Responding to the increased number of ladies participating in Pilates, lululemon has established products with new impressive fabrics and technology to adjust to, and feel better which assists women improve their fitness goals. They have provided a culture that increased knowing of the health benefits associated with doing pilates in daily life. Lululemon's mission statement is to assist individuals live extended, healthy, and fun stuffed lives. That they focus on making certain their products are of the finest quality and that their particular store experiences are one of a kind. lululemon invests money in schooling to educate all their staff upon effective and creative strategies to create a one of a kind experience in each individual retail outlet. With profound rooted jewelry in every single community, lululemon created the non-profit giving software, where guests of each position decide which local charities they would like to support. lululemon then selects up to eight of these non profit organizations to be section of the program. Industry environment:
Lululemon found the place in the industry by differentiation, taking advantage of a distinct segment market. Bigger price standard, premium quality, strange marketing and advertising strategy. Yet , they have strong competitors such as Nike, Adidas and Under Armor yet others such as Space, Athleta, Prana those two position themselves in the same kind of technique, niche market, premium quality and prices. However , Lululemon continue to keep a competitive advantage by way of a production productivity and their community based promoting. After starting the 1st store in 2000, they will weren't in a position to follow this customer romance model for their success, many folks on the shop. They start expanding and opening more stores canada and in america. From 2k to 3 years ago the company grew significantly, in 7 years they opened around 200 spots. They reach around $150 million income and $8 million net profit in 2007, the owners choose to take the firm public the next of August, selling a couple of, 290, 909 shares for the public and various stockholders selling 12-15, 909, 091 shares of their personal coalition. Nowadays, the corporation represent $1. 6 billion revenue and around $240 million net profit. Feedbacks from the industry are confident, the company is still growing. Issues:
Quality control issues at times with the supply chain, demand a great amount of and a constant attention to keep your standards together with the 45 different manufacturers of the company. Narrow focus, the main target is sophisticated and educated ladies who understand the need for a healthy existence. The company will need to open all their consumer part to new targets including men and youth. In addition to a narrow products, should available to others sport activities (tennis, golf, hiking... ) Limited brand reputation. Lack of manufacturer awareness and mass advertising. Limited geographic market, Western european and Hard anodized cookware market are waiting.
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References: Composing & Carrying out Strategy: The quest for competitive Advantage: Concept and circumstances, Thompson, Strickland and Bet, McGraw-Hill/Irwin, 2009, 19th Impotence. Lululemon extra case.