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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 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

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/

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/

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

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

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 Frame	Duration
Marketing and Investment Analysis	90 Days	Dec 10 – Mar 10
Purchasing the Property	30 Days	Mar 10 – April 10
Infrastructure Improvement and Renovation	30 Days	April 10 – May 10
Installation of Security Features	30 Days	May 10 – June 10
Development of Marketing Strategy	30 Days	Jun 10 – July 10
Hiring Employees	30 Days	July 10 – Aug 10

The overall timeframe would be 8 months (240 days) for the completion of the project.

The breakdown of the total timeframe has been given.

Stakeholders and roles

Stakeholders	Roles
Project Sponsor (Nick Foles)	Has full accountability of the project that starts with guiding the whole team and ends with marketing.
Project Owner (Chip Wilson)	To develop the most effective strategies to complete the project with efficiency.
Project Manager (Brian Amouzegar)	To manage resources, team, scope of the project all together.
Government	The external stakeholder for the issuance of license and the completion of all the legal formalities.
Financial Institutions/ Creditors	Provide financial assistance for the operations of the project.
Suppliers	To ensure adequate supply of materials for the project.
Customers	General public or the individuals who are brand loyal and aware about the brand.
Professionals (Architects, Technicians)	To develop best design for the outlet. To set up the online E-business for the company.
Team members (Criseida, Nabin, Roohanpreet, Krishan, Sohan, Chandra)	To ensure all the activities should be performed as per the strategies and guidance of the project manager.

Apart from the financial resources, we need to have physical resources in order to help complete the project.

To open a store, we need to build a experienced team with excellent customer service skills that will help to carry the operations in India.

Staff we need –

Assisstant store manager ( build community within the store)

2. Store Manager (oversees day to day functioning of store)

3.Educator ( provides customer knowledge of the products)

4. Key leader ( promoting the brand and ensuring this culture shines)

5. Expeditor ( ensures stock received and processed from warehouse)

6. Inventory leader ( responsible all the back of house operations)

7. Cashiers

8. IT employees for online app and website

All of these are the requirement that would need to be done for the completion of project.

Without this team, store will not be operational in Mumbai.

Risks, assumptions and countermeasures

Risks	Assumptions	Countermeasures
Risk of Acceptance	Indian People are brand loyal	Advertisements, Campaigns
Altering Business Model	Cannot be successful based on other country’s model	Prepare Specific Business Model
Anticipate Bureaucratic Barriers	Complications in filing tax, Delays in court decisions	Expert’s Guidance
Cultural Differences in the workplace	Cultural issues may arise	Team Management Approach
Quick Success	Lack of preparations	Patience is important
Understanding business culture	Assuming India like a China and Other Asian country	Understand the Business culture
Losing Key Talent	Competition for top talent is intense, Strict rules and regulations	Salaries, Bonus, Incentives
Economic Risk	Inflation	Watch Exchange Rate risks and Interest rate risks
Currency Risk	If you have not fixed exchange rate you have not fixed your price	Agree terms in sterling, Advice of Financial Advisor

Communication Plan

Topics	Audience/s	Frequency	Goals	Communication Mode
Layout Building (Construction of Layout)	Project coordinator Layout designer Employees at site	Daily	Setting up a new branch Appropriate design	In-Person
Task Progress Update	Project Team	Daily	To share progress of the project task on daily basis	Face to face Phone call Social media
Project Status Report	Coordinator Project manager	Weekly	Reviewing project status Discussion of issues or delays, if any	E-mail In-Person
Required Supplies	Suppliers Coordinator	As per requirement	Fulfilment of project needs To continue project	Phone call E-mail Social media
Project Review	Project team Sponsor(s) of the project	At the end of a level	Accumulating feedback Discussion of the next step	Face-to-face or Virtual meeting
Post-Project Meeting	Project team	After completion of the project	To identify what is achieved and what is not Withdraw a conclusion	Face-to-face or Virtual meeting

Help to overcome the possible risk of failure of the project

Help to operate the project continuously