Lululemon Athletica
BUS 478 – Synopsis
Jade Tsang
Julie Chu Matt Pothecary Morgan Chung
INTRODUCTION
Company History
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. However, the company started to realize
the difficulties in using their store as a community hub and retail store as their store
became very busy. This caused them to focus more on training their staff. One of their
goals was to train their people so well that they could positively influence their families,
communities and customers. Lululemon’s vision was to elevate the world from mediocrity
to greatness. To achieve this, they partnered with the right people and developed three
different kinds of strategic sales programs in hope of spreading yoga love and increasing
the level of health within their communities. They chose to value quality more than
quantity. Besides producing high quality yoga and athletic clothing, they integrated high
quality in building relationships with their partners (Lululemon Athletica, 2013).
The Company Today
Lululemon is recognized as one of Canada’s fastest growing brands. As of August 30th
2013, the company operated 218 store locations worldwide in addition to its online store
(Kowitt & Leahey, 2013). In 2012, the estimated brand value was $3.245-billion which
had increased 292 % compared to 2010 (Krashinsky,
2012). Their financial strength was shown by their growth in revenues and increase in
stock price. Their
stock price is at $69.62 as of Nov 5 2013, compared to less than $3 a share in early 2009
(Oursler, 2013).
As of Feb 3, 2013, the company’s profit had increased 34 percent to $762.8 million and
revenue increased
37 percent to $1.4 billion compared to the previous year (Clifford, 2013.)
Current Situation
2013 has been a challenging year for Lululemon due to production glitches and
management uncertainty. In March 2013, Lululemon recalled 17 percent of its stretchy
black yoga pants due to an unacceptable level of sheerness. Management expects the recall
