Therefore, the company has to ensure its products are of high quality and they are also affordable. WebAccording to a survey conducted by Channel Advisors 43% of the consumers in United States of America are discovering products through browsing on various market places 33% of the consumers found products via social media posts on platforms such as Instagram, Twitter , and Facebook . The health and efficiency of financial markets will determine Lululemon Athletica Inc.s ability to raise the capital at fair prices. Dissertation Moreover, the business performance of Lululemon Athletica Inc. is also influenced by the extent to which the host country government has spent on core infrastructure development. Exploring strategy. Some of the legal factors that Lululemon Athletica Inc. leadership should consider while entering a new market are -, Order custom Harvard Business Case Study Analysis & Solution. It requires Lululemon Athletica Inc. to prioritize and focus on marketing the eco-friendly nature of their products over customary value propositions. WebPESTEL Analysis Resources BusinessTeacher.org provide free business resources and online learning tools, perfect for helping students and professionals to develop their Today, new products are developed quickly, and supply chain partners have also gained more power. WebThe SWOT and PESTEL analysis report of Lululemon Athletica manifests a discussion on the intricate internal and external factors concerning Lululemon Athletica's brand, its They are just awesome. as they determine the overall economic environment of the country. If the legal system is not strong then Lululemon Athletica can face numerous challenges from consumer petitions to shakedowns from authorities. When labor markets are flexible, Lululemon Athletica Inc. can take advantage of higher labor productivity. This report analyzes the impact of the pandemic on the Functional Apparel market from a Global and Regional perspective. WebLululemon Athletica Inc PESTEL & Environment Analysis Posted by Freddie Murphy on May-12-2018 PESTEL Analysis & Environment Analysis The PESTEL analysis is a tool Below is a demonstration - Intellectual Property Rights and Patents Protection Before entering new market Lululemon Athletica should focus on the environment for intellectual property rights. Some examples of environmental factors that Lululemon Athletica Inc. need to consider are given below. These rules can have a direct role in creating the strategies and approaches. Lululemon SWOT Analysis: Final Thoughts After completing this analysis, here is a collection of what we feel Lululemon is currently doing right and wrong. This can help Lululemon Athletica to bring in more transparency and make supply chain more flexible. - 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. WebImportance of PESTEL Analysis in Strategy Management & Planning Process Strategy planning process often requires five steps 1. Published by HBR Publications. PESTEL stands for - Political, Economic, Social, Lululemon Athletica Inc. needs to consider the investments made by competitors on a micro and macro level to understand how new technologies influence the firms value chain and prevailing cost structure. Lululemon Athletica Inc. should carefully analyze the protests by pressure groups, social/environment activists and worker unions as such protests play an important role in the policy making process. Finally, the exchange rate fluctuation can also influence the profitability and international trade. Nordstrom can closely analyze. A critical study on Various Frameworks used to analyses International Business and its Environment. The organization should also carefully consider the interest rate and its influence on borrowing ability and attitude towards investment. Webb, J. (2008, December). Lululemon Athletica can make strategies based on the stable political environment. In certain countries where Lululemon operates, political corruption could become a problem since there are fewer opportunities for recourse in the regions. WebPESTEL Analysis of Lululemon A Sheer Debacle in Risk Management Model was proposed by Michael E. Porter in 1979. Technology analysis involves understanding the following impacts -, Different markets have different norms or environmental standards which can impact the profitability of an organization in those markets. The business practices of the Lululemon Athletica Inc. are influenced by the prevailing economic structure. The strength of high price product strategy is that Nike can earn more on each single item. It is opportunity for Lululemon. Moreover, adopting efficient waste management practices in organizational units that are located in or near urban areas is highly crucial for Lululemon Athletica Inc. Course Hero is not sponsored or endorsed by any college or university. Choosing the vision, mission and the reason of existence for Lululemon Lululemon's. Similarly, high trade restrictions can make the business environment more complex by affecting the exports and harming relationships with foreign trade partners. Bertels, H. M., Koen, P. A, & Elsum, I. The economic and regulatory environment in a monopolistic or oligopolistic structure will be different from the monopolistic competition and perfect competition. Copyright 2003 - 2023 - UKEssays is a trading name of Business Bliss Consultants FZE, a company registered in United Arab Emirates. Choosing the vision, mission and the Some of the economic factors that Lululemon Athletica should evaluate both in the present market and one in which it wants to enter are inflation rate, GDP growth rate, disposable income level etc. (2016). Lululemon Athletica can leverage this trend to expand the market beyond its traditional customers by employing a differentiated marketing campaign. Free resources to assist you with your university studies! Nevertheless, Dollaramas main competition all strive to reduce prices and maintain exceptional quality, which can be stressful for these companies because when you lower the prices you also lower the profit. Rate each of the forces (High, Medium, or Low). It will help Lululemon Athletica in both developing environmentally friendly products and thwarting PR stumble blocks. In addition, the company's chief executive officer had stepped down. WebLululemon Athletica Inc. PESTEL analysis is a strategic tool to analyze the macro environment of the organization. Revista ESPACIOS, 39(16). The environmental standards, laws and regulations vary across different markets. Lululemon Athletica Inc. must adjust its business management practices while entering in markets with high or low power distance. Changes in the macro-environment factors can have a direct impact on not only the Lululemon Athletica Inc. but also can impact other players in the Textile - Apparel Clothing. - 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. Spanish oil giant Repsol had to face a similar instance. The international presence of Lululemon Athletica Inc. require the organization to consider these differences to avoid undesired circumstances carefully. (adsbygoogle = window.adsbygoogle || []).push({}); The Macro environment factors such as inflation rate, savings rate, interest rate, foreign exchange rate and economic cycle determine the aggregate demand and aggregate investment in an economy. Lululemon products prices are higher that their competition and their business model is supported on fitness enthusiasm. Infrastructure quality in Textile - Apparel Clothing industry. - Technology transfer and licensing issues for Lululemon Athletica laws and culture of licensing of IPR and other digital assets should be analyzed carefully so that Lululemon Athletica can avoid shakedowns and IPR thefts. Accordingly, we never encourage or endorse its direct WebLululemon depends on third-parties for the manufacturing and supply needs of its athletic apparel. Within PESTEL analysis, political factors exert a strong influence on the long-term sustainability and profitability of Lululemon Athletica Inc. A firm should not only do technological analysis of the industry but also the speed at which technology disrupts that industry. Social factors such as demography trends, power structure in the society, women participation in workforce etc have immense impact over not only the country's economy but also on workforce talent availability and level of consumer demand. Lululemon Athletica should be aware of presence of such practices in a country. Marketing and human resource strategies in a traditional, patriarchal society with clearly distinguished gender roles will be different from societies with low gender stereotypes. Some of the political factors are governance system, democracy & institutions, military coup chances, probability of armed conflict, law and order in market etc. So the decade long profits didnt materialize in the end. 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. Exchange rates & stability of host country currency. 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. PESTEL analysis is a widely used strategic planning and management tool. PESTLE analysis Political Lululemon operates at wide range of market. Company need to have patent in all countries that they operate to ensure their unique value. because now a days all people not buy alder fashion product. Lululemon Athletica Inc. PESTEL analysis is a strategic tool to analyze the macro environment of the organization. Tax level set for businesses by government have direct effect for how profitable the Lululemon company is. Leyva, M., Hechavarria, J., Batista, N., Alarcon, J. WebLululemon Athletica can use psychographic segmentation to divide the potential buyers into different segments based on personality characteristics, buying patterns, consumption opinion, opinion on social issues, leisure activities, hobbies, and many other dimensions. The growing environmental pollution coupled with technological advancement has compelled business organizations to adopt innovative recycling and waste management practices. (2017). - Nature of Social Contract between Government & Society Before entering into a market Lululemon Athletica needs to understand the nature of social contract between government and society. Lululemon Athletica Inc. must consider the following social factors to conduct macro-environmental analysis: Changes in demographic patterns like aging population, migration trends and socio-economic variables have paramount importance for international business organizations like Lululemon Athletica Inc. By association, should these companies engage in unethical business practices Investors, managers, creditors and others need to analyze various aspects of financial statements so they can invest, manage and do business more effectively with the particular company. In 2008 International Conference on Information Management, Innovation Management and Industrial Engineering (Vol. 1, pp. WebThe Pestle Analysis Of Lululemon 966 Words | 4 Pages Government policies supporting active and healthy lifestyle can have effect on Lululemon. The power distance within any society shows the acceptance of hierarchy and income inequality. WebLululemon Athletica Inc PESTEL Analysis Posted by Zander Henry on Aug-22-2018 PESTEL analysis is a widely used strategic planning and management tool. 1. 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). Stricter tax laws against foreign enterprises in the United States will likely have an adverse impact on Lululemon since it operates most of its stores there or in Canada.