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). PESTLE analysis Political Lululemon operates at wide range of market. It must look at regulations and law in each of countries that they operate in. Lululemon is fast growing company that open stores or franchise in market such as America, Japan, Australia and Europe. DCLL We make the greatest data maps. Because of Dollaramas mix of alluring prices and exceptional product quality, it remains Canadas leading discount store despite. 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. A firm should not only do technological analysis of the industry but also the speed at which technology disrupts that industry. Similarly, high trade restrictions can make the business environment more complex by affecting the exports and harming relationships with foreign trade partners. Seifert, C. & Chattaraman, V. (2017). In 2008 International Conference on Information Management, Innovation Management and Industrial Engineering (Vol. Sustainable business strategies and PESTEL framework. Yksel, I. The external environment includes opportunities and threats which can impact on the marketing strategy of Huawei. - Types of Immigration & Attitude towards Immigrants Given the latest developments such as Brexit and Immigrant detention on Southern border of United States. Moreover, considering the development and maturity level of technology in the respective market is also important. Desai, K. J. as they determine the overall economic environment of the country. WebThe Lululemon athletica in 2005 PESTEL Analysis will look at the external factors political, economic, social, technological, environmental, and legal. It started an above average profitability operations in Argentina and made strong returns in 5-7 years. Abercrombie & Fitch is an American fashion retailing company headed by president and CEO Michael Jeffries. Near the end of November 2013, Lululemon Athletica (Lululemon) became the subject of a viral firestorm after a series of negative events seriously ruptured the company's reputation. Infrastructure quality in Textile - Apparel Clothing industry. Choosing the vision, mission and the Patents are very important in Lululemon operation to have advantage of their competitor. As mentioned, marketers cannot control the factors of the external environment. Check your email Use research as, 1. - Government Spending As mentioned in the political factors, government of the country is running deficit budgets. Over the last 5 years the industry has been transforming really fast, not even giving chance to the established players to cope with the changes. Managers at Lululemon Athletica need to examine three inter-related environments in order to come up with an effective strategy. because now a days all people not buy alder fashion product. Furthermore, A&F currently operates four other brands, which are: A&F, Abercrombie Kids, Hollister Company, and RUEHL. The international presence of Lululemon Athletica Inc. require the organization to consider these differences to avoid undesired circumstances carefully. The corruption can influence various business operations, ranging from licensing, contracting, fraudulent deals to frequent lawsuits. With the running of those four brands, the company is collectively targeting consumers of 7 through 35. Excessive resource depletion by Lululemon Athletica Inc. can draw the negative response from media, environment protection groups, customers and the general public. Copyright 2003 - 2023 - UKEssays is a trading name of Business Bliss Consultants FZE, a company registered in United Arab Emirates. Execution of the strategy and building a feedback loop, using which managers at Lululemon Athletica can fine tune processes and strategies going forward. Here you can choose which regional hub you wish to view, providing you with the most relevant information we have for your specific region. Similarly, it is important to understand the industry lifecycle stage. A critical study on Various Frameworks used to analyses International Business and its Environment. 4. 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. Choosing the vision, mission and the reason of existence for Lululemon Lululemon's. Attitudes (health, environmental consciousness, etc. Disclaimer: This work was produced by one of our academic writers to help university students with their studies. European Journal of Innovation Management, 16(3), 285-300. Lululemon Athletica Inc. can benefit from it and invest in renewable technologies to ensure long-term sustainability. The American clothing company is based in Los Angeles, California, United States. The organization should also carefully consider the interest rate and its influence on borrowing ability and attitude towards investment. Technology' is the fourth factor of PESTEL analysis. Lowers prices for faithful customers. Consequently, the employment of additional staff and procurement of new resources to control for technological threats is liable to generate additional expenses. Economic factors that Lululemon Athletica Inc. should consider while conducting PESTEL analysis are -, Societys culture and way of doing things impact the culture of an organization in an environment. WebLululemon Athletica Inc. PESTEL analysis is a strategic tool to analyze the macro environment of the organization. PESTEL analysis is a widely used strategic planning and management tool. We've received widespread press coverage since 2003, Your UKEssays purchase is secure and we're rated 4.4/5 on reviews.co.uk. 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. Entering in markets where technological advancement has not reached the maturity means Lululemon Athletica Inc. can increase the market share by focusing on emerging technological innovations. and cannot be used for research or reference purposes. Lululemon is fast growing company that open stores or franchise in market such as America, Japan, Australia and Europe. It is important to note that the Lululemon athletica in 2005 PESTEL Analysis will be market specific, and the implications of the factors change for a company when the market changes. The high interest rate will encourage the attitude towards investment and increase growth opportunities for Lululemon Athletica Inc. Moreover, there are laws to set the maximum price, ensure a certain quality standard and protect consumers from fraudulent marketing claims. WebPestel Analysis OF Lululemon Athletica Case Study Help Political factors: The reality that Pestel Analysis of Lululemon Athletica has actually expanded its services in different Rate each of the forces (High, Medium, or Low). . Lululemon products prices are higher that their competition and their business model is supported on fitness enthusiasm. All the regulations about design patent need to be monitored by company. For example Uber employment system is not consistent with French laws and it is facing challenges in the country. Such changes can also influence the consumers' spending patterns, causing the organization to revise its product and marketing strategies. Nordstrom is operating in apparel stores in more than dozen countries and exposes itself to different types of political environment and political system risks. Hence, Lululemon Athletica Inc. should study how intellectual property rights are protected in the host country and make the business strategies accordingly. Article continues after ad Entering in mature industries can be more challenging due to market saturation than industries at the growth stage. Also, to accurately analyze the performance of the company, we need to compare its performance. The demand and supply of labor determine the wage rates and supply of skilled workforce. Lululemon Athletica should assess what are preferred choice of mobile payments in local economy and chose the business model based on it. We are here to help. - Regulatory Practices - The regulatory practices are streamlined with global norms which have helped the country to improve its ease of doing business ranking. Bertels, H. M., Koen, P. A, & Elsum, I. Issa, T., Chang, V., & Issa, T. (2010). Comparative advantages of host country and Consumer Goods sector in the particular country. The GDP growth rate will determine the Lululemon Athletica Inc.s ability to pursue its long-term growth strategies. correct email will be accepted, (Approximately - Level of Consumer Activism Regarding Environmental Concerns Lululemon Athletica needs to know the level of consumer activism regarding environmental concerns is. Lululemon Athletica Inc. PESTEL analysis is a strategic tool to analyze the macro environment of the organization. PESTEL stands for - Political, Economic, Social, Technological, Environmental & Legal factors that impact the macro environment of Lululemon Athletica Inc.. GSTF International Journal on Computing, 1(1), 73-80. Technology is fast disrupting business models across various industries. We make beautiful, dynamic charts, heatmaps, co-relation plots, 3D plots & more. Daidj, N. 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. Revista ESPACIOS, 39(16). Lululemon Athletica should be aware of presence of such practices in a country. A., & Gomez, o. - 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. Proposal, Question Political factors also comprise of laws, activities and groups that impact and limit companies and individuals in a certain culture and society. Lululemon Athletica Inc. cannot enter a new market without studying in detail the legal environment and regulatory structure of the new consumer market. Lululemon Athletica Inc. should consider the following legal factors when exploring a new market. Even within a country often states can have different environmental laws and liability laws. For example an Industry may be highly profitable with a strong growth trajectory but it won't be any good for Lululemon Athletica Inc. if it is situated in unstable political environment. BusinessTeacher.org provide free business resources and online learning tools, perfect for helping students and professionals to develop their knowledge and gain a better understanding of different aspects of business. Warning! Nike PESTLE Analysis.pdf. The low-priced products policy could widen the customer group and attract more buyers to boost the sales. High unemployment signals the availability of surplus labor at comparatively lower wages. 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. Key Takeaways The Lululemon SWOT analysis shows that the company needs to improve its business and survive in the current sports apparel market. Springer Berlin Heidelberg. This is due to brand loyalty that each brand possesses by each luxury group. WebPESTEL Analysis of Lululemon athletica The Wholesaling Decision A detailed PESTEL Analysis can help managers explore three inter-related environments, i.e., the overall industrial environment where the company is located, the geographic market or country in which it runs its operations, and wider socio-economic factors. Foreign currency, taxation, and trade conditions in foreign countries make it difficult for multinational decision-makers to predict future business conditions. Industrial safety regulations in the Consumer Goods sector. Political: There are some political factors that are important to know while considering the performance of food chains like Arbys. So Dollarama struggles to find a balance between competitive prices and profitable prices. Choosing the vision, mission and the In highly hierarchical societies the power of decision making often reside at the top. The PESTEL analysis model supports strategic management by identifying the external factors that present opportunities or threats, based on the remote or macro-environment of the fast-food business, pertaining to the political, economic, sociocultural, technological, legal, and ecological factors (the PESTLE factors). Posted by Zander Henry on PESTEL stands for Political, Social, Economic, High GDP also signals the consumers ability to spend more on offered products. Solution, Assignment Writing It is important for Lululemon Athletica Inc. to study the current trends in the country's political scenario as changes in government may alter the government's priorities towards the development of different industries. Like all businesses they are sensitive to economic situation on global and local markets. The use of foreign labour and manufacturing resources among multinational enterprises can become complicated, where firms that violate principles of corporate social responsibility experience backlash from consumers often (Nam et al., 2017). Proposal, Assignment Writing Explain. Competition Levels Another threat to Lululemon is increased foreign costs. As Lululemon heavily relies on foreign manufacturers to make their products at a lower price, they have a greater risk of losing those high margins if foreign costs rise. The three inter-related environments are industry environment in which the company operates in, the geographic market or country in which company operates, and wider socio economic / macro environment. Soon, trusts became a new form limiting competition. A framework for PEST analysis based on fuzzy decision maps. PESTLE analysis Political Lululemon operates at wide range of market. 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. By association, should these companies engage in unethical business practices or skimp on quality guidelines, these acts will reflect poorly on the Lululemon brand (Vallester, Lindgreen, & Maon, 2012). Abercrombie & Fitch brand focuses on offering apparel that reflected the youthful lifestyle for a target audience, which was college students, designed to encourage teamwork and creativity On February 2007, A&F retailer operated 944 stores in 49 States, District of Columbia and Canada. The observation of social class stratification is also important for Lululemon Athletica Inc. Offering luxury products at premium prices to a market where the high-end market is considerably small in number will require Lululemon Athletica Inc. to adopt the niche marketing strategies. In Lululemon Athletica SWOT Analysis, the strengths and weaknesses are the internal factors whereas opportunities and threats are Pestel Analysis And Pest Analysis: American Apparel 2014 Words | 9 Pages. 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. In this situation, the suppliers have a low level of bargaining power. Lululemon Athletica Inc. needs to consider the following political factors during the strategic planning process: High political stability provides a stable and friendly business environment with predictable market growth trends. 1. Lululemon Athletica Inc. can enter in low taxation markets and benefit from high profits that can be invested in research and development activities. Nordstrom can closely analyze. If you need help with something similar, Moreover, if the government of the country under consideration is not serious about protecting the intellectual property rights of business organizations, it will deter the entrepreneurs from investing in organizations due to high risk of ideas being stolen. Just as Starbucks, Bloomingdales and Sephora use a point system, lululemon can incorporate rewards for repeat shoppers.49 Increases brand loyalty in a competitive market. Should nations where Lululemon operates enact disadvantageous tariffs, embargoes, or trade restrictions, the models Lululemon depended on for its expansion strategy could become obsolete (Lululemon, 2017). WebThe Pestle Analysis Of Lululemon 966 Words | 4 Pages Government policies supporting active and healthy lifestyle can have effect on Lululemon. This investment will also increase stakeholder satisfaction and expand the customer base due to enhanced brand image. Leyva, M., Hechavarria, J., Batista, N., Alarcon, J. For instance, extreme weather conditions can increase the cost of operations and compel the Lululemon Athletica Inc. to make the value chain more flexible. This report will provide useful information which can be guidelines for Uniqlos strategy to enter a new market. Academic writing has no room for errors and mistakes. The environmental standards, laws and regulations vary across different markets. 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. Below is a demonstration Many countries have placed strict norms to protect their urban areas through effective waste management. Ignorance in this regard can cause undesired circumstances for Lululemon Athletica Inc., such as- hurting competitive advantage as a result of intellectual property rights violation and harmed organizational image due to violation of consumer/employee/environment protection standards. The macro-environment factors can impact the 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). Natural disasters in South East Asia and South Asia especially a concern because 82% 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. Buy Professional PPT templates to impress your boss. Political environment and other factors not only impact the cost of doing business but also long term sustainability. Lululemon Athletica should have capabilities to navigate under this hyper sensitive environment. Government policies supporting active and healthy lifestyle can have effect on Lululemon. Political 5. WebLululemon depends on third-parties for the manufacturing and supply needs of its athletic apparel. The business practices of the Lululemon Athletica Inc. are influenced by the prevailing economic structure. - Transition of Government and Changes in Policy There is consistency in policy making from one government to another. Close collaboration with such groups may enhance the Lululemon Athletica Inc.s ability to collaborate with community and achieve long-term corporate goals. 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