Lululemon Case Anaylsis

Case Analysis: Lululemon Athletica, Inc. (Case 6)

1. Case background: Lululemon was founded by Chip Wilson in 1998 after participating in a yoga class offered in Vancouver, B.C. where he found that cotton clothing used for sweaty, stretchy power yoga was inappropriate. His passion was technical athletic fabrics where he opened a design studio for yoga clothing and classes.

2. The model I will use to analyze the case: review of key components of Lululemon’s value chain and SWOT analysis

3. The main problem: Luluemon’s is unable to produce their product internally because it does not own or operate any manufacturing facilities to produce the fabrics or make the garments.

4. Recommended solution: A possible recommendation for Lululemon’s distribution is to purchase warehouses in North America and British Columbia to help keep up with the demand. The costs of sourcing out their product for fabric and apparel is costly, but having a distribution center that they own can help increase their supply chain.

5. The logic supporting solution:

In utilizing the SWOT analysis on Lululemon, Lululemon’s strengths were that they had an innovative product geared to women and yoga. They also had brand loyalty with high profit margins due to their apparel being stylish and functional. The apparel has taken on the “must have” status by fitness-conscious women. Lululemon also has many opportunities in which they can take advantage of utilizing. They have untapped markets especially the international markets. Lululemon is primarily housed in Canada. They have untapped markets in North America where it can hold up to 300 more stores and mainland China. Another opportunity that Lululemon has is the availability of street wear. Their product does not necessarily mean it has be worn in a studio. They are stylish enough and comfortable enough to be worn outside for other athletic activities or just everyday use. Some weaknesses identified through the SWOT analysis...