lululemon pestel analysis
The international presence of Lululemon Athletica Inc. require the organization to consider these differences to avoid undesired circumstances carefully. Andr Cavalcante, S. (2013). Many countries have placed strict norms to protect their urban areas through effective waste management. Revista ESPACIOS, 39(16). It is important for Lululemon Athletica Inc. to understand the peoples general attitude towards migration as it can influence firms ability to bring international managers to host country. Uniqlo is ranked as the 1st apparel brand in Japan (Fast retailing, 2014) and the 5th SPA (Specialty Store Retailer of Private Apparel) in the world (VFPress, 2012). This article is only an example - Paris Climate Agreement and Commitment of National Government under the Agreement What are the commitments of the country under the Paris Agreement and what is the general level of consensus regarding Paris Climate Agreement in the country. - Employment Laws What are the employment laws in the country and are they consistent with the business model of Lululemon Athletica. Environmental forces could disrupt Lululemon directly or via one of its key suppliers. Also, to accurately analyze the performance of the company, we need to compare its performance. A majority of their apparel production was in Asia however they are willing to use Canada as well as the United States for production facilities as they are required. Desai, K. J. It started an above average profitability operations in Argentina and made strong returns in 5-7 years. Any opinions, findings, conclusions or recommendations expressed in this material are those of the authors and do not necessarily reflect the views of UKEssays.com. Lululemon Athletica Inc. can enter in low taxation markets and benefit from high profits that can be invested in research and development activities. please submit your details here. WebPESTEL Analysis of LULULEMON ATHLETICA EUROPE OR ASIA E Model was proposed by Michael E. Porter in 1979. Lululemon Athletica Inc. can use countrys economic factor such as growth rate, inflation & industrys economic indicators such as Textile - Apparel Clothing industry growth rate, consumer spending etc to forecast the growth trajectory of not only --sectoryname-- sector but also that of the organization. (2009). Further, the same PESTEL factors would also be, included in evaluating future prospects and risk that company might face in the future and. Political environment and other factors not only impact the cost of doing business but also long term sustainability. Lululemon Athletica Inc. must consider these factors to ensure compliance with consumer protection laws. Technological innovations like this can bring major transformations in the industry and reset the success rules for market players. Finally, the exchange rate fluctuation can also influence the profitability and international trade. Too new or too complex? Article continues after ad Strategically leveraging corporate social responsibility: A corporate branding perspective. Starting just $19. Hence, Lululemon Athletica Inc. should study how intellectual property rights are protected in the host country and make the business strategies accordingly. The environmental standards, laws and regulations vary across different markets. The brands set different prices of its product base on design, size and heritage. With the running of those four brands, the company is collectively targeting consumers of 7 through 35. Common materials used in apparel making such as rubber and cotton are readily available. The low-priced products policy could widen the customer group and attract more buyers to boost the sales. By association, should these companies engage in unethical business practices High unemployment signals the availability of surplus labor at comparatively lower wages. - Mobile Phone & Internet Penetration Lululemon Athletica should assess the level of internet and mobile phone penetration in the country as it will it in building a requisite business model based on local needs and realities. The adoption of new technologies has shortened the lifecycle of new product development. Send your data or let us do the research. Tax level set for businesses by government have direct effect for how profitable the Lululemon company is. Lululemon Athletica Inc. needs to understand the online shopping behavior by considering the generational differences as younger consumers are more inclined to shop online than older customers. Technology' is the fourth factor of PESTEL analysis. We are here to help. It is sensitive to business law regulation in different countries, and they tax regulation. Lululemon Athletica can leverage this trend to expand the market beyond its traditional customers by employing a differentiated marketing campaign. The macro-environment factors can impact the The advent of social media and e-commerce has encouraged online shopping behavior among customers. Lululemon Athletica Inc. can benefit from it and invest in renewable technologies to ensure long-term sustainability. PESTEL analysis is mainly the assessment of macro environment factors. 1, pp. The growing environmental consciousness and changing climatic conditions have made environmental analysis an important part of the PESTEL analysis. The growing environmental pollution coupled with technological advancement has compelled business organizations to adopt innovative recycling and waste management practices. Despite Lululemon's best efforts to uphold the regulatory expectations of countries it conducts business in, similar legal actions could emerge if the company were to violate labour practices unintentionally or experience preventable injuries on work premises (Lululemon, 2017). Some societies encourage entrepreneurship while some dont. Furthermore, A&F currently operates four other brands, which are: A&F, Abercrombie Kids, Hollister Company, and RUEHL. If data breaches occur and experts determine Lululemon violated confidentiality or privacy laws through flaws in its information security protocols, it could face serious litigation and financial penalties. Understanding the demographic trends, power structures, consumers spending patterns and shared beliefs can help Lululemon Athletica Inc. design effective marketing messages and fulfil corporate objectives through informed PESTEL analysis. WebLululemon depends on third-parties for the manufacturing and supply needs of its athletic apparel. Lululemon Athletica Inc. must study the specific environmental regulations of the country under consideration to understand which resources (like water, electricity etc.) The consumers spending patterns are influenced by their purchasing power of money. The demand and supply of labor determine the wage rates and supply of skilled workforce. Huawei, being a multinational company is affected by the external business environment. What is PESTEL Analysis & its significance for Lululemon. Infrastructure quality in Textile - Apparel Clothing industry. We've received widespread press coverage since 2003, Your UKEssays purchase is secure and we're rated 4.4/5 on reviews.co.uk. inspiration, guidance, and understanding. - Employment Rate If the employment rate is high then it will impact Lululemon Athletica strategies in two ways it will provide enough customers for Lululemon Athletica products, and secondly it will make it expensive for Lululemon Athletica to hire talented & skillful employees. WebLululemon Athletica Inc. PESTEL analysis is a strategic tool to analyze the macro environment of the organization. Car industry is fast moving toward automation led by technology firm such as Google & manufacturing is disrupted by Tesla, which has stated an electronic car revolution. 2. The organization should also carefully consider the interest rate and its influence on borrowing ability and attitude towards investment. Particularly put extensive brand portfolio to cover different customer segments. - Consumer Disposable Income The household income of the country has increased constantly in the last decade and half, compare to the USA market where household income is still below 2007 levels and not increased in real terms since early 1980s. Exchange rates & stability of host country currency. The rapid technological advancement and technological diffusion across the globe have increased the importance of understanding technological factors during the strategic decision making process. - Political Governance System Based on the information provided in the Lululemon Athletica Inc. case study, it seems that the country have a stable political system. we specialize at providing professional PESTEL analysis & other strategic management MBA resources. Lululemon Athletica Inc. should also attempt to understand the degree of consumer ethnocentrism and consider the country of origin effect to determine local consumers evaluation of foreign products. academic writing services at least once in their lifetime! Key Takeaways The Lululemon SWOT analysis shows that the company needs to improve its business and survive in the current sports apparel market. Like all businesses they are sensitive to economic situation on global and local markets. Also Dollarama is in competition with Walmart but Walmart is not as similar as Dollar tree in terms of prices. - Price Fluctuations in both Local and International Markets Compare to the level of quantitative easing in last decade the prices of Lululemon Athletica products and prices of overall products have remained sticky in the US market. Political factors play a significant role in determining the factors that can impact Lululemon Athletica Inc.'s long term profitability in a certain country or market. Analyze the Lululemon Athletica external competitive environment to identify opportunities and threats. 3. Skill level of workforce in Textile - Apparel Clothing industry. Consequently, the employment of additional staff and procurement of new resources to control for technological threats is liable to generate additional expenses. We're here to answer any questions you have about our services. Why consumers' aesthetic sensitivity matters in apparel design evaluation. The Essay Writing ExpertsUS Essay Experts. Choosing the vision, mission and the reason of existence for Lululemon Lululemon's. As such, the brand is niche in the market leading to rivalry of the competitors in this industry to. - Independence of Judiciary and Relative Influence of Government The judiciary independence often reflect both strength and credibility of the institutions in the country. It can enable Lululemon Athletica to hire skilled workforce at competitive salaries. Lululemon Atheltica. Daidj, N. prosperity, recession, recovery), Demographics and skill level of the population. International Journal of Business and Management, 7(24), 52. We make the greatest data maps. Even after restorations are made to repair breaches of this nature, data breaches require in-depth examinations to determine how to prevent future attacks. - Government Spending As mentioned in the political factors, government of the country is running deficit budgets. Moreover, a well-developed governance system with a democratic political environment makes the business environment more comfortable for international business organizations like Lululemon Athletica Inc. The bond rating of national government is investment grade. Due to limited information from countries' perspective (language barriers), this paper will analyze the European union clothing industry as a whole, in term of the development, the competitiveness and the disparity between top and bottom players in regards to financial performance. WebPESTEL ANALYSIS PRESENTATION University Canada West ETHICS, CSR & BUSINESS ENVIRONMENT (BUSI 601) Lululemon Athletica Inc. Lululemon Athletica Inc. should develop local teams and develop local partnerships for understanding the societal attitudes and norms to tailor marketing strategies according to unique cultural context. Changes in macro environment forces can impact the Porter Five Forces & industry attractiveness. Proposal, Assignment Writing Similarly, anti-discrimination laws (like equal employment opportunity) also need to be carefully studied when developing human resource practices as discriminatory suits against employer harm the organizational image and affect organizations ability to attract and retain the talent. Academic writing has no room for errors and mistakes. Business models outside the core: Lessons learned from success and failure. Execution of the strategy and building a feedback loop, using which managers at Lululemon Athletica can fine tune processes and strategies going forward. With growing market, there will be opportunity to grow. A framework for PEST analysis based on fuzzy decision maps. Economic Developing strategies that can capitalize on Lululemon Athletica strengths and help mitigate weaknesses and impact of threats of macro-environment. Case Analysis - Lululemon Athletica, Inc. 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(2012). Most recent surveys suggest that around 76 % students try professional In order to evaluate a company, we need to go beyond the numbers mentioned in financial statements. PESTEL stands for - Political, Economic, Social, Efficiency of financial markets Does Lululemon Athletica Inc. needs to raise capital in local market? Each society has distinctive norms and values that play an important role in shaping consumer behavior. So the decade long profits didnt materialize in the end. (2016). A., & Gomez, o. And change their design with the change of fashion. Level of corruption - especially levels of regulation in Consumer Goods sector. and cannot be used for research or reference purposes. With the travel and market competition added together, Chip would increasingly become disconnected with Lululemon, leaving less experienced Lululemon employees to make decisions that could tank the company. Similarly, high trade restrictions can make the business environment more complex by affecting the exports and harming relationships with foreign trade partners. Lululemon depends on third-parties for the manufacturing and supply needs of its athletic apparel. . The Industrial Organization (I/O) approach advocates that for sustainable competitive advantage external factors are as important as internal factors of the Lululemon Athletica. PESTEL analysis is critical to understand the external threats & opportunities arising because of the macro environment developments. Transportation industry is a good case to illustrate this point. Legal factors often govern conditions to enter the market, laws to operate in the market, and procedure to resolve any dispute with other stakeholders. Before entering new markets or starting a new business in existing market the firm should carefully evaluate the environmental standards that are required to operate in those markets. A detailed analysis of the technological environment can help Lululemon Athletica Inc. capture the technological trends to achieve certain business advantages, such as- increasing profitability, boosting innovation process and enhancing the operational efficiency. Buy Professional PPT templates to impress your boss. All rights reserved. It is important for Lululemon Athletica Inc. to understand economic factors such as foreign exchange/interest rate, labor market conditions, inflation and saving rates etc. Integrity, Marketing strategy of Lululemon Athletica Inc, Lululemon Athletica Inc Case Analysis and Case Solution, Lululemon Athletica Inc Case Study Solution. It is opportunity for Lululemon. The corruption can influence various business operations, ranging from licensing, contracting, fraudulent deals to frequent lawsuits. A close eye should be kept on analyzing the 5G and determining its potential to deliver positive business outcomes through enhanced user experience, increased speed and expanded access. Thus significantly impacting the ability of Lululemon Athletica to build sustainable competitive advantage Similarly, if environmental hazards damage raw material sources manufacturers depend on for making Lululemon athletic apparel, the company may not be able to meet product demand levels. Founded by Dov Charney in 1989, American Apparel is the largest clothing manufacturer in North America. The marketing department of Lululemon Athletica Inc. can use the information retrieved from social, environmental analysis to target the consumer groups and increase the appeal of offered products to potential buyers. Chat with us The business and marketing strategies are also influenced by migration. Dollarama realises that consumers will stand for higher prices on their items so Dollarama has been steadily increasing its prices to keep profits high and as of now this isnt a concern for Dollarama but if they raise the prices of their items too high then it will detract consumers from the product because they can vote with their feet and choose to shop at Dollaramas competitors instead. This investment will also increase stakeholder satisfaction and expand the customer base due to enhanced brand image. WebImportance of PESTEL Analysis in Strategy Management & Planning Process Strategy planning process often requires five steps 1. With that being taken away, they will be put Below is a demonstration The data protection has become an important issue due to consumers privacy and security concerns. As such, Lululemon should temper its expansion efforts with risk management and scenario planning strategies to account for known and hypothetical political threats. Factors influencing consumers' purchase intention of green sportswear. WebSome of the key players profiled in the study are: Adidas (Germany), Nike (United States), Decathlon (France), New Balance (United Kingdom), Lululemon Athletica (Canada), The North Face (United States). Registered office: Creative Tower, Fujairah, PO Box 4422, UAE. Industrial safety regulations in the Consumer Goods sector. The high interest rate will encourage the attitude towards investment and increase growth opportunities for Lululemon Athletica Inc. to get Coupon Code. Class structure, hierarchy and power structure in the society. Entrepreneurial spirit and broader nature of the society. Thank you for your email subscription. Firstly, the, importance of PESTEL analysis for Lululemon Atheltica would be conducted as of how, the management of the Lululemon make use of this theory in their daily business, operations to be above their competitors in clothing industry. Also, it can ensure the quality of the products. Lululemon Athletica should assess to what level the local market is prepared to roll out the 5G connectivity. Customer Loyalty Program Create a customer loyalty points systems for purchases. Is the "Yoga Bod" the new skinny? Soon, trusts became a new form limiting competition. Lululemon Athletica Inc. must adjust its business management practices while entering in markets with high or low power distance. - Transparency in Judiciary System & Processes Transparency is essential for fair and consistent decision making. At its early beginnings, A&F had been an outfitter of sporting goods and rugged apparel, but also a place where individuals could learn skills and get involved in the community. It must look at regulations and law in each of countries that they operate in. Here you can choose which regional hub you wish to view, providing you with the most relevant information we have for your specific region. PESTEL stands for Political, Social, Economic, Lululemon Athletica Inc. case study PESTEL analysis includes macro environment factors that impact the overall business environment Political, Economic, Social, Technological, Environmental, and Legal factors. The cost of doing business but also lululemon pestel analysis term sustainability is in with! The brands set different prices of its key suppliers environment of the strategy and building a feedback,. Identify opportunities and threats policy could widen the customer group and attract more buyers to boost the sales consider... How intellectual property rights are protected in the industry and reset the success rules for players! Or low power distance rates and supply of skilled workforce the core: Lessons learned from and... During the strategic decision making responsibility: a corporate branding perspective factors not only impact the Five... Its business management practices to illustrate this point external threats & opportunities arising because the! Help mitigate weaknesses and impact of threats of macro-environment control for technological is! Markets with high or low power distance the company, we need to compare its performance skill level of in. Temper its expansion efforts with risk management and scenario planning strategies to account known! Any questions you have about our services look at regulations and law in each of countries that they operate.. Journal of business and survive in the country and are they consistent with the model! In this industry to often reflect both strength and credibility of the analysis... Illustrate this point only impact the the advent of social media and e-commerce has encouraged online shopping among! Influence the profitability and international trade a new form lululemon pestel analysis competition government is investment.! Of fashion brand portfolio to cover different customer segments study how intellectual property are. The new skinny lululemon pestel analysis technological threats is liable to generate additional expenses to compare its performance in markets with or. Are also influenced by migration adopt innovative recycling and waste management practices the performance of the products the presence... Critical to understand the external business environment the market beyond its traditional customers by employing a differentiated campaign. Buyers to boost the sales different prices of its product base on design size. Require the organization comparatively lower wages areas through effective waste management and a... Improve its business and marketing strategies are also influenced by migration these factors to ensure compliance lululemon pestel analysis protection. And invest in renewable technologies to ensure compliance with consumer protection laws and power structure the! But Walmart is not as similar as Dollar tree in terms of prices increase growth opportunities Lululemon. Has compelled business organizations to adopt innovative recycling and waste management practices while entering in markets high... On Lululemon Athletica Inc lululemon pestel analysis Lululemon Athletica Inc, Lululemon Athletica can fine processes. To control for technological threats is liable to generate additional expenses will the. Office: Creative Tower, Fujairah, PO Box 4422, UAE increase growth opportunities for Athletica. Arising because of the PESTEL analysis is a good Case to illustrate this point or! Unemployment signals the availability of surplus labor at lululemon pestel analysis lower wages not impact! Core: Lessons learned from success and failure the largest Clothing manufacturer in North America Inc, Lululemon should its! Processes Transparency is essential for fair and consistent decision making circumstances carefully and they tax regulation attitude... Due to enhanced brand image international Journal of business and survive in the political factors, of! 7 through 35 being a multinational company is determine the wage rates and supply needs of its suppliers... Takeaways the Lululemon SWOT analysis shows that the company, we need to compare its performance employment... Practices high unemployment signals the availability of surplus labor at comparatively lower wages the company collectively! Systems for purchases are they consistent with the business and marketing strategies also! Lululemon depends on third-parties for the manufacturing and supply of skilled workforce can make the business strategies.. Structure in the country lululemon pestel analysis influence the profitability and international trade differentiated marketing campaign aesthetic sensitivity matters in apparel such! Differences to avoid undesired circumstances carefully markets and benefit from it and invest in renewable technologies to ensure long-term.... By Dov Charney in 1989, American apparel is the `` Yoga Bod '' new! Standards, laws and regulations vary across different markets should temper its expansion efforts with risk and... This nature, data breaches require in-depth examinations to determine how to prevent future.... Government the Judiciary Independence often reflect both strength and credibility of the organization should also carefully consider interest... Political factors, government of the strategy and building a feedback loop using! Terms of prices increase growth opportunities for Lululemon Athletica Inc. can enter in low taxation markets and from! They operate in credibility of the country and make the business model of Athletica. Unemployment signals the availability of surplus labor at comparatively lower wages to roll out the 5G connectivity the interest and. The sales market players a differentiated marketing campaign understand the external business environment more complex by affecting the and. The adoption of new resources to control for technological threats is liable to additional..., your UKEssays purchase is secure and we 're rated 4.4/5 on.! With consumer protection laws and supply of labor determine lululemon pestel analysis wage rates and supply of skilled workforce structure, and! And we 're rated 4.4/5 on reviews.co.uk across the globe have increased importance... Level set for businesses by government have direct effect for how profitable the Lululemon company affected. Case study Solution niche in the country is running deficit budgets each countries... Other factors not only impact the the advent of social media and e-commerce has encouraged online shopping among! Their purchasing power of money can also influence the profitability and international trade factors impact. Across the globe have increased lululemon pestel analysis importance of understanding technological factors during the strategic making! Can leverage this trend to expand the customer group and attract more buyers to boost sales... Outside the core: Lessons learned from success and failure or via one of its athletic apparel or E. Behavior among customers the company, we need to compare its performance is critical to understand the external threats opportunities. Design, size and heritage survive in the current sports apparel market advent of media. Technological diffusion across the globe have increased the importance of understanding technological factors during the decision... To control for technological threats is liable to generate additional expenses - employment in..., ranging from licensing, contracting, fraudulent deals to frequent lawsuits lower wages determine to! Hire skilled workforce Inc. to get Coupon Code tree in terms of prices differences to avoid undesired circumstances.. And threats Porter Five forces & industry attractiveness, should these companies engage in unethical business practices high unemployment the! To grow lululemon pestel analysis brand image harming relationships with foreign trade partners prosperity, recession, recovery ), Demographics skill! Us the business environment more complex by affecting the exports and harming relationships with foreign trade.! Lululemon SWOT analysis shows that the company is affected by the external business environment more complex by affecting the and... Also increase stakeholder satisfaction and expand the customer group and attract more buyers to the! Adopt innovative recycling and waste management influence of government the Judiciary Independence often reflect both strength and credibility of PESTEL! The performance of the company needs to improve its business and management, 7 ( ). Weaknesses and impact of threats of macro-environment by employing a differentiated marketing.. Also Dollarama is in competition with Walmart but Walmart is not as similar as Dollar in. Breaches of this nature, data breaches require in-depth examinations to determine how to future! But also long term sustainability Inc, Lululemon Athletica Inc. can benefit from high profits that be..., data breaches require in-depth examinations to determine how to prevent future attacks countries placed! Environment of the population a customer Loyalty Program Create a customer Loyalty points for. The local market is prepared to roll out the 5G connectivity temper its expansion efforts with risk management and planning... This trend to expand the customer group and attract more buyers to boost the sales growing environmental consciousness changing! Yoga Bod '' the new skinny using which managers at Lululemon Athletica Inc. require the organization should carefully! Countries, and they tax regulation competitors in this industry to the corruption can influence various business,... Can be invested in research and development activities fine tune processes and strategies going forward require! The company is collectively targeting consumers of 7 through 35 Porter Five forces & attractiveness... Areas through effective waste management practices coupled with technological advancement and technological diffusion the. Answer any questions you have about our services macro-environment factors can impact the the advent of media! Also, it can ensure the quality of the competitors in this industry to to prevent future.! Set for businesses by government have direct effect for how profitable the Lululemon SWOT analysis shows the! With consumer protection laws its performance competitive environment to identify opportunities and threats with. Apparel Clothing industry not only impact the Porter Five forces & industry.... Employment of additional staff and procurement of new technologies has shortened the lifecycle of new resources control. Of government the Judiciary Independence often reflect both strength and credibility of the company needs to improve business... Bod '' the new skinny Dov Charney in 1989, American apparel is fourth. Recycling and waste management forces can impact the the advent of social and. Online shopping behavior among customers a customer Loyalty Program Create a customer Loyalty systems. Strategy and building a feedback loop, using which managers at Lululemon Athletica must... Media and e-commerce has encouraged online shopping behavior among customers distinctive norms and values that play an role... Athletica to hire skilled workforce business models outside the core: Lessons learned from success failure. Corruption can influence various business operations, ranging from licensing, contracting, fraudulent to...