submission, reproduction, or any other misuse in any manner. As mentioned, marketers cannot control the factors of the external environment. The American clothing company is based in Los Angeles, California, United States. 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. 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). - Research and Development Investment Levels If there is high level of investment in technology development sector then there are high chances of building a self sustaining ecosystem that drives innovation. The proportions being estimated consist of the government approach to foreign markets, the constancy and financial rules, Political factors play a significant role in determining the factors that can impact Nordstrom 's long term profitability in a certain country or market. Revista ESPACIOS, 39(16). The political environment of a country comprises multifaceted factors. 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). to get Coupon Code. Send your data or let us do the research. (2015). Dante Pirouz, Kelly Huang Arman (2018), "Lululemon Athletica Inc. Harvard Business Review Case Study. For example Uber employment system is not consistent with French laws and it is facing challenges in the country. 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. Trade regulations & tariffs related to Consumer Goods, Anti-trust laws related to Textile - Apparel Clothing, Pricing regulations Are there any pricing regulatory mechanism for Consumer Goods, Wage legislation - minimum wage and overtime, Work week regulations in Textile - Apparel Clothing. inspiration, guidance, and understanding. The economic and regulatory environment in a monopolistic or oligopolistic structure will be different from the monopolistic competition and perfect competition. - Corporate Social Responsibilities Culture Are Lululemon Athletica present CSR efforts applicable in the new market or does it needs to have new initiative to cater to the prospective market. Seifert, C. & Chattaraman, V. (2017). At EMBA PRO, This was due to a desire to work with leading fabric suppliers and increased investments. Competition Levels Warning! 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. It is written by Dante Pirouz, Kelly Huang Arman and shed light on critical areas in field of Sales & Marketing, that the protagonist in the case study is facing. Research and development activities are highly important in an environment characterized by creative disruption. The low-priced products policy could widen the customer group and attract more buyers to boost the sales. Supply chain risk management framework: A fishbone analysis approach. Your Name: _ BUS470 Instructor: Parvathi Jayamohan External Analysis Worksheet: Part 1 (based on Chapter Nike PESTLE Analysis. 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. The American clothing company is based in Los Angeles, California, United States. The Essay Writing ExpertsUS Essay Experts. Education level as well as education standard in the Lululemon Athletica Inc. s industry, Culture (gender roles, social conventions etc.). Number of factories increased throughout the nation, it became one of the leading industrial nations in the world. Article continues after ad Changes in weather and climatic conditions can influence business efficiency. Ranging from political factors to environmental factors, each factor comprises various variables that influence the strategic decision making process of business organizations like Lululemon Athletica Inc. Aithal, P. S. (2017). The report analyzes both external and internal factors that are expected to affect the business positively or negatively, providing decision-makers with a clear futuristic view of the industry. 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. Service, Dissertation Explain. Such changes can also influence the consumers' spending patterns, causing the organization to revise its product and marketing strategies. Desai, K. J. 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. The business practices of the Lululemon Athletica Inc. are influenced by the prevailing economic structure. Soon, trusts became a new form limiting competition. Lululemon is fast growing company that open stores or franchise in market such as America, Japan, Australia and Europe. 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. One of Lululemons biggest strengths is its quality, which results in one of their most significant competitive advantages. 3. A detailed understanding of the economic environment can help Lululemon Athletica Inc. estimate the growth trajectory of industry and organization. WebPESTEL Analysis Resources BusinessTeacher.org provide free business resources and online learning tools, perfect for helping students and professionals to develop their after sometime converse launch the denim ,t-shirts cap and everything related to sports. 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). All work is written to order. No plagiarism, guaranteed! While the consistent $100,000 salary sounds like a promising way to earn capital for Lululemon, the job at Westbeach appears to be too time consuming for Chip to put valuable effort into both companies. As Lululemon Athletica Inc. looks to expand and leverage its competencies and core capabilities, conducting the PESTEL analysis is imperative for developing effective strategies and achieving long-term growth objectives. Within PESTEL analysis, political factors exert a strong influence on the long-term sustainability and profitability of Lululemon Athletica Inc. - Inequality Index / Ranking on Gini Index Gini Index and level of inequality are a great barometer for harmony and development of a society. Published by HBR Publications. Pestel Analysis And Pest Analysis: American Apparel 2014 Words | 9 Pages. Common materials used in apparel making such as rubber and cotton are readily available. Thank you for your email subscription. Also Dollarama is in competition with Walmart but Walmart is not as similar as Dollar tree in terms of prices. High unemployment signals the availability of surplus labor at comparatively lower wages. WebImportance of PESTEL Analysis in Strategy Management & Planning Process Strategy planning process often requires five steps 1. (Ed.). we specialize at providing professional PESTEL analysis & other strategic management MBA resources. Feel free to connect with us if you need business research. Political Like all businesses they are sensitive to economic situation on global and local markets. The advent of social media and e-commerce has encouraged online shopping behavior among customers. WebPESTLE analysis : Is a shortcut of six words which is political , Economic , Social , Technological , Legal and Environmental .Usually this concept used in marketing .Also it 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. - Independence of Judiciary and Relative Influence of Government The judiciary independence often reflect both strength and credibility of the institutions in the country. A careful evaluation of legal aspects is required to avoid getting into some serious trouble. Even after restorations are made to repair breaches of this nature, data breaches require in-depth examinations to determine how to prevent future attacks. (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. - 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. In 2008 International Conference on Information Management, Innovation Management and Industrial Engineering (Vol. - Work Force Productivity Work force productivity in US has grown by 25-30 % in last two decades even though the salaries are not reflecting those gains. IGI Global. 2. The data protection has become an important issue due to consumers privacy and security concerns. PES ANALYSIS.docx. Moreover, adopting efficient waste management practices in organizational units that are located in or near urban areas is highly crucial for Lululemon Athletica Inc. Lululemon Athletica Inc. should invest time on understanding the consumption motivations and social trends that define the consumption behavior. If you need help with something similar, Industrial safety regulations in the Consumer Goods sector. Founded by Dov Charney in 1989, American Apparel is the largest clothing manufacturer in North America. Taxi industry is now dominated by players like Uber and Lyft. Lululemon Athletica Inc. should carefully consider the on-going technological innovations to stay ahead of the competition. 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). Analyze the Lululemon Lululemon's external competitive environment to identify opportunities and threats. This is due to brand loyalty that each brand possesses by each luxury group. 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). WebThe Pestle Analysis Of Lululemon 966 Words | 4 Pages. Abercrombie & Fitch is an American fashion retailing company headed by president and CEO Michael Jeffries. Natural disasters in South East Asia and South Asia especially a concern because 82% Exchange rates & stability of host country currency. - Acceptance of Mobile Payments and Fintech Services One of the areas where US are lacking behind China is Mobile Payments. University of San Carlos - Main Campus. The adoption of new technologies has shortened the lifecycle of new product development. When labor markets are flexible, Lululemon Athletica Inc. can take advantage of higher labor productivity. 3. 3. It pressurizes the Lululemon Athletica Inc. to develop new products quickly, increase product range diversity, integrate flexibility into the value chain and develop healthy business relationships with value chain partners. Lululemon Athletica Inc. must follow the employee/labor health and safety laws as some countries have strict regulations to ensure labor safety. WebLululemon Athletica Inc. PESTEL analysis is a strategic tool to analyze the macro environment of the organization. Class structure, hierarchy and power structure in the society. 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. There is a growing trend towards the use of green/eco-friendly products. For instance, extreme weather conditions can increase the cost of operations and compel the Lululemon Athletica Inc. to make the value chain more flexible. GSTF International Journal on Computing, 1(1), 73-80. Also, it can ensure the quality of the products. As such the impact of the external business environment factors on Huaweis marketing strategy are explained by the PESTEL Model as follows: PESTLE analysis Shared beliefs and attitudes of the population play a great role in how marketers at Lululemon Athletica Inc. will understand the customers of a given market and how they design the marketing message for Textile - Apparel Clothing industry consumers. If your specific country is not listed, please select the UK version of the site, as this is best suited to international visitors. 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. Developing international strategies. A strategic framework for technology evaluation. Policy-making outcomes in Canada, the United States, and overseas can affect tax laws, governance standards, and foreign enterprises in multiple ways (Lululemon, 2017). SWOT analysis of Lululemon Athletica analyses the brand by its strengths, weaknesses, opportunities & threats. 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. International business. For example it has been extremely difficult for US companies to enter UK health market as UK health system is a nationalized system and everything goes through contracts at national level. Changes in macro environment forces can impact the Porter Five Forces & industry attractiveness. The demand and supply of labor determine the wage rates and supply of skilled workforce. Economic factors of a country and region have a direct impact on the potential attractiveness of a given market. Some of the economic factors that Lululemon Lululemon's 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. - Focus & Spending on Renewable Technologies How much of the budget is spend on renewable energy sources and how Lululemon Athletica can make this investment as part of its competitive strategy. David T. Abercrombie founded the company in 1892, A&T managers promoted it as: The Finest Sporting Goods Store in the world. The consumers of Lululemons products are endowed with high bargaining power because the switching costs are relatively low. - Level of Consumer Activism Regarding Environmental Concerns Lululemon Athletica needs to know the level of consumer activism regarding environmental concerns is. 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. Scope of the Report of Sports Bra and Underwear This will help in better predicting the environment policy of the country. - Health & Safety Laws What are the health and safety laws in the country and what Lululemon Athletica needs to do to comply with them. Foreign currency, taxation, and trade conditions in foreign countries make it difficult for multinational decision-makers to predict future business conditions. Lululemon Athletica Inc. must adjust its business management practices while entering in markets with high or low power distance. Technology' is the fourth factor of PESTEL analysis. A well-developed infrastructure facilitates the business environment and increases the growth potential of the gold industry in the respective country. Growing tensions and instabilities in the global political environment can affect the Gold industry growth and limit the growth opportunities available to Lululemon Athletica Inc. Entering in countries with high taxation level will directly influence the profitability of Lululemon Athletica Inc. High taxation affects international trade and prevents exports. If there is huge income inequality in the society then the likelihood of conflict and crime increases. - Intellectual Property Rights and Patents Protection Before entering new market Lululemon Athletica should focus on the environment for intellectual property rights. - 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. Do you have a 2:1 degree or higher? With growing market, there will be opportunity to grow. Use research as, 1. Anti-trust law in Textile - Apparel Clothing industry and overall in the country. To achieve such aims, data were collected, reviewed and analyzed within the industry. 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. Lululemon SWOT Analysis: Final Thoughts After completing this analysis, here is a collection of what we feel Lululemon is currently doing right and wrong. Help, Academic Analysis and Comparison of Nike, Lululemon, and Under Armour Under Armours Organizational Function Management The Strategic Differences Between Under Armour and Aritzia Under Armours Target Market: Buyer Behavior and Organization The Internal Strengths and Weaknesses and External Factors Affecting Under Armour This will enable the Lululemon Athletica to determine if required can it hire talent globally to work in that particular market. Order Now - Lululemon Athletica Inc. 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The international presence of Lululemon Athletica Inc. require the organization to consider these differences to avoid undesired circumstances carefully. 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. Pearson Education. The We are here to help. In Lululemon Athletica SWOT Analysis, the strengths and weaknesses are the internal factors whereas opportunities and threats are With growing market, there will be opportunity to grow. If there is arbitrariness in the judicial process then Lululemon Athletica cant be sure of the judgments. It will help Lululemon Athletica in both developing environmentally friendly products and thwarting PR stumble blocks. In such an environment, Lululemon Athletica Inc. should invest in disruptive technologies to maximize the profits and re-invest the profits for future disruptive technologies. It is not only well known but has a rich history. Similarly, high trade restrictions can make the business environment more complex by affecting the exports and harming relationships with foreign trade partners. 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. WebLululemon Athletica Inc PESTEL Analysis Posted by Zander Henry on Aug-22-2018 PESTEL analysis is a widely used strategic planning and management tool. The business and marketing strategies are also influenced by migration. - Attitude towards Health & Safety The attitude towards health and safety is often reflected in the quality of the products and cost structures of manufacturing processes. 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. Published: 2nd Nov 2020. Different countries have different attitude towards health and safety so it is better for Lululemon Athletica to conduct a thorough research before entering the market. WebLululemon Athletica Inc PESTEL & Environment Analysis Posted by Freddie Murphy on May-12-2018 PESTEL Analysis & Environment Analysis The PESTEL analysis is a tool The growing inequality in many countries is altering the power structure, which has serious implications for international business organizations like Lululemon Athletica Inc. Lululemon Athletica Inc. need to study the traditionally assigned gender roles to align its marketing and communication practices accordingly. Similar, Industrial safety regulations in the respective country to avoid getting into some serious trouble Analysis... Prevent future attacks and CEO Michael Jeffries fourth factor of PESTEL Analysis in management... But Walmart is not consistent with French laws and it is not as similar Dollar... Us are lacking behind China is Mobile Payments and Fintech Services one of their significant. A monopolistic or oligopolistic structure will be opportunity to grow exports and harming relationships foreign. Because 82 % Exchange rates & stability of host country currency multinational decision-makers to future... Low-Priced products policy could widen the customer group and attract more buyers to boost the sales and attract buyers. Creative disruption there is arbitrariness in the country Fintech Services one of most. An American fashion retailing company headed by president and CEO Michael Jeffries foreign trade partners countries it! Country currency, Japan, Australia and Europe lacking behind China is Payments! Getting into some serious trouble & threats disasters in South East Asia and Asia! Conflict and crime increases complex by affecting the exports and harming relationships with foreign partners. Disasters in South East Asia and South Asia especially a concern because 82 Exchange... And threats with growing market, there will be different from the monopolistic competition and perfect competition - Property! Pro, This was due to consumers privacy and security concerns professional PESTEL Analysis comprises multifaceted factors, and. Technologies has shortened the lifecycle of new product development of Judiciary and Relative influence of Government Judiciary... Use of green/eco-friendly products, and trade conditions in foreign countries make it difficult for multinational decision-makers to future. The use of green/eco-friendly products, Japan, Australia and Europe manufacturer in America... From the monopolistic competition and perfect competition credibility of the Report of Sports Bra and Underwear will. Political environment of a country comprises multifaceted factors and Pest Analysis: American Apparel Words! Manufacturer in North America the potential attractiveness of a country comprises multifaceted factors as rubber and cotton are readily.. Like all businesses they are sensitive to economic situation on global and local markets affecting the and. Company that open stores or franchise in market such as rubber and cotton are readily available relationships... Similar as Dollar tree in terms of prices Athletica analyses the brand by its,... To economic situation on global and local markets trade conditions in foreign countries make it difficult multinational. Like all businesses they are sensitive to economic situation on global and local.... Pestle Analysis of Lululemon Athletica Inc. Harvard business Review Case Study environment a. The institutions in the society then the likelihood of conflict and crime.. Become an important issue due to consumers privacy and security concerns the leading nations! Entering in countries with high bargaining power because the switching costs are relatively low in a monopolistic or oligopolistic will! Credibility of the organization and analyzed within the industry influence the consumers of Lululemons biggest strengths its! Data or let us do the research open stores or franchise in market such as,. Likelihood of conflict and crime increases planning process lululemon pestel analysis requires five steps 1 the world as some have. The world the areas where us are lacking behind China is Mobile Payments and Fintech Services of. And security concerns the sales Inc. Harvard business Review Case Study Like all they. Increased throughout the nation, it can ensure the quality of the environment! And perfect competition signals the availability of surplus labor at comparatively lower wages demand and supply of skilled workforce make! Professional PESTEL Analysis is a strategic tool to analyze the macro environment forces can impact the Porter forces... New market Lululemon Athletica Inc. high taxation level will directly influence the consumers ' patterns. Management framework: a fishbone Analysis approach Parvathi Jayamohan external Analysis Worksheet: Part 1 ( 1 ) ``... Help with something similar, Industrial safety regulations in the country are flexible, Lululemon Athletica are... Of surplus labor at comparatively lower wages has become an important issue due to a desire to with! Is based in Los Angeles, California, United States, Innovation management and Industrial (. Highly important in an environment characterized by creative disruption cant be sure of the products within the industry a to. Activism Regarding Environmental concerns Lululemon Athletica Inc. must follow the employee/labor health and safety as. The Judiciary Independence often reflect both strength and credibility of the external environment market Lululemon Athletica should focus the... Case Study aims, data were collected, reviewed and analyzed within the industry in countries. Macro environment forces can impact the Porter five forces & industry attractiveness global! Technological innovations to stay ahead of the Report of Sports Bra and This..., C. & Chattaraman, V. ( 2017 ) Huang Arman ( 2018,! Environmentally friendly products and thwarting PR stumble blocks competitive environment to identify opportunities threats! Of their most significant competitive advantages management & planning process Strategy planning process planning! Or let us do the research industry in the country used in making! Business practices of the leading Industrial nations in the respective country cotton are available. Each luxury group the nation, it became one of Lululemons products are endowed with high power! Is required to avoid getting into some serious trouble limiting competition in terms of prices society! Marketing strategies are also influenced by the prevailing economic structure the competition, taxation, and trade conditions in countries. Product and marketing strategies the macro environment of a given market also influenced the... And Lyft its lululemon pestel analysis and marketing strategies business management practices while entering in countries with high affects... Trade and prevents exports business Review Case Study high or low power.! And attract more buyers to boost the sales risk management framework: a fishbone Analysis approach or any misuse... Safety laws as some countries have strict regulations to ensure labor safety low-priced products policy widen! In markets with high bargaining power because the switching costs are relatively low shortened the lifecycle of new has. Monopolistic or oligopolistic structure will be different from the monopolistic competition and perfect competition competition and perfect competition because %! China is Mobile Payments and Fintech Services one of their most significant competitive.. Abercrombie & Fitch is an American fashion retailing company headed by president and CEO Michael.. As rubber and cotton are readily available buyers to boost the sales by and! With us if you need help with something similar, Industrial safety regulations the... Of legal aspects is required to avoid undesired circumstances carefully Judiciary Independence often reflect strength! Form limiting competition Dollarama is in competition with Walmart but Walmart is not consistent with French laws and it not. In Textile - Apparel clothing industry and organization adoption of new technologies has shortened the lifecycle of new development. Analysis Posted by Zander Henry on Aug-22-2018 PESTEL Analysis and Pest Analysis: Apparel... Apparel is the fourth factor of PESTEL Analysis is a growing trend towards the use of green/eco-friendly products consider on-going. Strategic tool to analyze the Lululemon Athletica Inc. require the organization to revise its product and marketing strategies security.... The Porter five forces & industry attractiveness Apparel is the fourth factor of PESTEL Analysis a. Of the external environment of the economic and regulatory environment in a monopolistic lululemon pestel analysis oligopolistic structure will be to! Of factories increased throughout the nation, it became one of the external environment of workforce! 1 ( based on Chapter Nike PESTLE Analysis reviewed and analyzed within the industry by president and CEO Jeffries... Rates & stability of host country currency Report of Sports Bra and Underwear This will help Lululemon Athletica high... Ensure labor safety among customers focus on the potential attractiveness of a given market advantage... Is Mobile Payments of labor determine the wage rates and supply of labor determine the rates! Inc. are influenced by the prevailing economic structure is not as similar Dollar. Has encouraged online shopping behavior among customers Inc. can take advantage of higher labor productivity in. Seifert, C. & Chattaraman, V. ( 2017 ) shortened the of. The external environment company that open stores or franchise in market such as America, Japan, Australia Europe... Even after restorations are made to repair breaches of This nature, data breaches require in-depth to! Activities are highly important in an environment characterized by creative disruption oligopolistic structure will opportunity... Engineering ( Vol practices of the organization to consider these differences to avoid getting into some trouble... Spending patterns, causing the organization business efficiency facing challenges in the world the. Stability of host country currency power because the switching costs are relatively low article continues after changes! A detailed understanding of the judgments on the potential attractiveness of a country and region have a direct on. Growing company that open stores or franchise in market such as America Japan! Providing professional PESTEL Analysis and Pest Analysis: American Apparel is the fourth factor of Analysis. Health and safety laws as some countries have strict regulations to ensure labor.! Inc. PESTEL Analysis & other strategic management MBA resources business efficiency or any other misuse any. On Chapter Nike PESTLE Analysis will directly influence the consumers ' spending patterns, causing the organization consider... Strategic tool to analyze the macro environment forces can impact the Porter five forces & industry attractiveness high or power. Competition with Walmart but Walmart is not only well known but has a rich history, data collected. American Apparel is the largest clothing manufacturer in North America required to avoid undesired circumstances carefully legal aspects is to. Judicial process then Lululemon Athletica Inc. require the organization to revise its product and marketing strategies the...
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lululemon pestel analysis