05 Dec Lululemon Athletica Overview ‘Lululemon athletica inc. Is principally a designer,
Lululemon Athletica Overview
‘Lululemon athletica inc. Is principally a designer, distributor, and retailer of healthy lifestyle inspired athletic apparel and accessories” .
mrq: Most Recent Quarter | ttm: Tailing Twelve Months
Canadian Public Company (LULU, Nasdaq) born at Kitsilano, Vancouver B.C .
Founded by Chip Wilson in 1983.
Market cap $45.24 Billion USD (base on the outstanding shares).
The company has 491 stores in 17 countries, with a central presence in the USA, Canada, China, Australia, and the United Kingdom.
Note: lululemon logo. Adapted from Lululemon store by Lululemon, 2020. (https://shop.lululemon.com/) Copyright 2020 lululemon athletica.
Note 2: Financial Highlights retrieved from https://finance.yahoo.com/quote/LULU/key-statistics?p=LULU
1. Lululemon Athletica, Inc (n.d). 2019 Annual Report. https://investor.lululemon.com/static-files/8df91f4d-25a1-4e69-8b94-606f9c370440
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Five years Strategic Plan
Mission
Vision
“To create a community hub where people could learn and discuss the physical aspects of healthy living, mindfulness and living a life of possibility. To create real relationships with guests and understand what they are passionate about, how they liked to sweat and help them celebrate their goals.
Lululemon Athletica Overview
“to be the experiential brand that ignites a community of people living the sweatlife through sweat, grow and connect” 2
R & D
Operations
Marketing
Key financial drivers of strategic plan:
Total annual revenue growth for the next five years;
Modest gross margin expansion annually;
Modest SG&A leverage annually;
Operating income growth to exceed revenue growth annually;
EPS growth to equal or exceed operating income growth annually;
Annual capital expenditures of 6-8% of revenues; and
Annual square footage growth.
2 & 3 Business Wire (April 24, 2019). Lululemon unveils “Power of Three” Strategic Plan to Accelerate Growth. Retrieved from https://www.businesswire.com/news/home/20190424005350/en/
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Lululemon Athletica 2018-2023 Strategic Plan
Power of Three Growth Strategy
Product innovation
Omni guest experiences
Market Expansion
Double the size men’s business
Expansion in the women’s and accessories businesses
New product categories
Expand the popular Office/Travel/Commute category
Pursue new opportunities (selfcare)
Offer integrate guest experiences thru events to celebrate, inspire and provoke a healthy lifestyle
Dynamic new store formats
Quadruple international revenues
Innovative membership program that fosters connections among guests
Double digital revenues
Expand market across China
Expand market across the APAC region
Leverage the agile store formats, digital experience, and community connections on U.S. and Canada markets.
Expand market across the EMEA region
Note: Information from Business Wire (April 24, 2019). Lululemon unveils “Power of Three” Strategic Plan to Accelerate Growth. Retrieved from https://www.businesswire.com/news/home/20190424005350/en/
3
Project Proposal: To open a Lululemon branch in Mumbai, India
Market Expansion
Quadruple international revenues
Expand market across the APAC region
Lululemon Athletica 2018-2023
Strategic Plan (Operations)
Project Proposal:
To open a Lululemon branch in Mumbai, India
Project Purpose Statement:
“We believe we are operating from a position of strength as we invest in creating dynamic experiential moments for our communities to connect and come together.”
Calvin McDonald, Lululemon CEO
“To create a community hub where people could learn and discuss the physical aspects of healthy living, mindfulness and living a life of possibility”4, by introducing Lululemon products in the Indian Market with the opening of a branch in Mumbai, India. The country’s financial and commercial centre of the country with the highest number of millionaires and billionaires among all cities.
4. Extract from Lululemon Mission Statement
4
Lululemon Worldwide Presence ( February 2020)
United States 305 stores
Canada 63 stores
China 38 stores
Autralia 31 stores
New Zealand 7 stores
United Kingdom 14 stores
Singapore 4 stores
Germany 6 stores
Japan 7 stores
South Korea 5 stores
France 4 stores
Malaysia 2 stores
Sweden 2 stores
Ireland 1 store
Switzerland 1 store
Norway 1 store
Netherlands 1 store
Lululemon primary distribution channel, with over 60% of its revenues, is their 491 retail stores in 17 countries.
Project Proposal:
To open a Lululemon branch in Mumbai, India
4. Extract from Lululemon Mission Statement
5
Scope Statement
The intention of Opening a lululemon branch in Mumbai, India is related with two of the seven key financial drivers of the organization’s strategic plan: annual revenue growth and square footage growth. Additionally, its supported by the Market expansion purpose.
This project will provide a Market Analysis to identify the qualitative and quantitative characteristics of the Indian market (economic environment, size, segments, buying patterns, competitors…)
Yearly Cash Flows projection based on forecasted sales on target market to support the investment analysis.
Marketing Campaign to introduce the band in the local market (launching).
Store location, design, building, setting-up and opening.
Online shopping adaptation, website and app to the Indian Market.
Deliverables and Corresponding Objectives
| Deliverables | Objectives |
| Purchasing a commercial Property in Andheri West, Mumbai with dimensions of 3,000 square feet | To provide spacious store for lululemon and to meet its standards |
| Renovation of the purchased property | To provide standards that are required for lululemon |
| safety and security features | To incorporate required safety and security measures for running the store |
| Branding Activities | To make the store attractive to the customers and to improve sale |
| Market analysis | Providing a complete market analysis to understand and compete with the competitors |
Cost Estimates
The overall cost would be $950,000 in Canadian currency since Lululemon is a Canadian company.
The breakdown of the total amount has been given.
| Task | Cost |
| Marketing and Investment Analysis | $100K CAD |
| Property Purchase | $600K CAD |
| Renovation | $100K CAD |
| Upgrading Security | $50K CAD |
| Branding Activities and Marketing | $50K CAD |
| Hiring Employees | $50K CAD |
Timeframe Estimates
| Task | Time |
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