Created by: Kelsey Davis
March 21, 2014
Table of Contents
To: Laurent Potdiven
Chief Executive Officer
Lululemon Athletica Inc.
This report has been created with the intent to analyze the athletic apparel industry with a specific focus on Lululemon Athletica, Inc., further refered to as Lululemon. In this report you will find that the strengths and weaknesses of Lululemon’s current strategies and future goals are analyzed and compared to that of its closest competitors. In conclusion to the analysis, recommendations have been made to potentially guide Lululemon Athletica, Inc. in a positive direction in regards to its future endeavors. The following …show more content…
It is also hard to gain a share of the market when having to compete against already existing large chains. What causes there to still be a potential threat of new entrants is that consumers’ demand have consistently been increasing and they will have to be met by someone. If the existing companies in the industry can’t keep up with demand created by the consumers this will leave an opening for new entrants.
The threat of substitute products is low due to the consumers demand for the highest quality products and their strong loyalty to the already existing brands in the industry. It is nearly impossible to duplicate the performance of the high quality materials these products are made for a lower cost or lower quality material.(Morning Star)
The bargaining power of the suppliers is strong because very few suppliers offer the quality materials and fabrics needed to produce these products. Consequently, the bargaining power of the buyer is low because there isn’t much room for negotiation on the price of the products due to the need for such quality. (Morning Star)
Rivals and Industry Leadership
There are many competitors within the athletic apparel industry. With such a diluted market it can be hard to obtain and maintain a sizable portion of the market share, but Lululemon does just that by focusing its brand on the niche yoga market segment. The top two industry leaders with in the athletic apparel market are Nike and The Adidas Group as noted in