Spanish oil giant Repsol had to face a similar instance. Moreover, health-associated campaigns by the government have an impact on the food chains like Arbys. Intellectual property regulations are designed to protect the companies' patents and valuable ideas. The adoption of new technologies has shortened the lifecycle of new product development. The For instance, extreme weather conditions can increase the cost of operations and compel the Lululemon Athletica Inc. to make the value chain more flexible. It is sensitive to business law regulation in different countries, and they tax regulation. Whereas, operating in rigid labor markets may cause labor wage and other issues raised by powerful labor unions. 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. Technological innovations like this can bring major transformations in the industry and reset the success rules for market players. Factors influencing consumers' purchase intention of green sportswear. The Industrial Organization (I/O) approach advocates that for sustainable competitive advantage external factors are as important as internal factors of the Lululemon Athletica. Some countries offer subsidies for encouraging investment in renewable technologies. - Size of Government Budgets both Local Governments and National Government The government at both national level and local levels are running deficit budgets which is boosting growth in the short term but may lead to increase in inflation over medium term. 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. 2. The achieve success in such a dynamic Textile - Apparel Clothing industry across various countries is to diversify the systematic risks of political environment. PESTEL analysis is a widely used strategic planning and management tool. They (2017). The advent of social media and e-commerce has encouraged online shopping behavior among customers. WebSociological Analysis Of Lululemon 191 Words | 1 Pages. Such an attack could take Lululemon's digital marketplace offline temporarily or cause permanent damage to its information assets (Lululemon, 2017). and cannot be used for research or reference purposes. Government policies supporting active and healthy lifestyle can have effect on Lululemon. 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. Lululemon Athletica Inc. must consider these factors to ensure compliance with consumer protection laws. Here you can choose which regional hub you wish to view, providing you with the most relevant information we have for your specific region. Amazing Business Data Maps. ~ 0.0 Page). To achieve such aims, data were collected, reviewed and analyzed within the industry. We make beautiful, dynamic charts, heatmaps, co-relation plots, 3D plots & more. MarketLine. Lululemon Athletica Inc. should consider the following legal factors when exploring a new market. According to Michael Porter organizational performance is to large extend determined by various industry forces. If data breaches occur and experts determine Lululemon violated confidentiality or privacy laws through flaws in its information security protocols, it could face serious litigation and financial penalties. 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. WebThe Lululemon athletica in 2005 PESTEL Analysis will look at the external factors political, economic, social, technological, environmental, and legal. 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. Lowers prices for faithful customers. Industrial safety regulations in the Consumer Goods sector. Accordingly, we never encourage or endorse its direct Developing a multi-criteria decision making model for PESTEL analysis. Moreover, considering the development and maturity level of technology in the respective market is also important. Below is a demonstration Social factors such as demography trends, power structure in the society, women participation in workforce etc have immense impact over not only the country's economy but also on workforce talent availability and level of consumer demand. Secondly governments from all parties adhere to the treaties made by the previous governments. IEEE. Choosing the vision, mission and the - Nature of Social Contract between Government & Society Before entering into a market Lululemon Athletica needs to understand the nature of social contract between government and society. Consequently, the employment of additional staff and procurement of new resources to control for technological threats is liable to generate additional expenses. Lululemon Athletica Inc. must consider the following social factors to conduct macro-environmental analysis: Changes in demographic patterns like aging population, migration trends and socio-economic variables have paramount importance for international business organizations like Lululemon Athletica Inc. High unemployment signals the availability of surplus labor at comparatively lower wages. - Empowerment of Supply Chain Partners Lululemon Athletica should analyze areas where technology can empower supply chain partners. 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. Number of factories increased throughout the nation, it became one of the leading industrial nations in the world. The achieve success in such a dynamic apparel stores industry across various countries is to diversify the systematic risks of political environment. For example Trump not standing by US commitments created an environment of uncertainty. Porter Five Forces The marketing department of Lululemon Athletica Inc. can use the information retrieved from social, environmental analysis to target the consumer groups and increase the appeal of offered products to potential buyers. Wall, S., Minocha, S., & Rees, B. Natural disasters in South East Asia and South Asia especially a concern because 82% of the Lululemon products come from manufacturing in these regions (Lululemon, 2017). 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 is fast growing company that open stores or franchise in market such as America, Japan, Australia and Europe. These factors can have an impact on Arbys such as the health and safety rules provided by the government of the state/country in which the Arbys division works. Similarly, market segmentation based on social class may be ineffective where social class stratification is low. Political factors play a significant role in determining the factors that can impact Lululemon Athletica Inc.'s long term profitability in a certain country or market. Culture is considered an important variable by international marketing managers. This will help in better predicting the environment policy of the country. Copyright 2003 - 2023 - UKEssays is a trading name of Business Bliss Consultants FZE, a company registered in United Arab Emirates. - Paris Climate Agreement and Commitment of National Government under the Agreement What are the commitments of the country under the Paris Agreement and what is the general level of consensus regarding Paris Climate Agreement in the country. Lululemon Athletica Inc. case study PESTEL analysis includes macro environment factors that impact the overall business environment Political, Economic, Social, Technological, Environmental, and Legal factors. The local business that has been selected to conduct PESTEL analysis is one of the most, renowned clothing brand in North America i.e. (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. are considered rare or which species are endangered whose excessive consumption can cause trouble for the organization. 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. can enter in low taxation markets and benefit from high profits that can be invested in research and development activities. The bond rating of national government is investment grade. Developing strategic business models and competitive advantage in the digital sector. The environmental standards, laws and regulations vary across different markets. (2009). If there is huge income inequality in the society then the likelihood of conflict and crime increases. submission, reproduction, or any other misuse in any manner. Lululemon Athletica Inc. should also attempt to understand the degree of consumer ethnocentrism and consider the country of origin effect to determine local consumers evaluation of foreign products. The companys logo and monogram being seen on their products is something which is easily recognized by every customer. 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. A majority of their apparel production was in Asia however they are willing to use Canada as well as the United States for production facilities as they are required. - Role Local Governments Play Local governments are highly influential in the policy making process and implementation as most of the policies and regulations are implemented by the local government as enforcement agencies mostly report to local government in their own states regarding various laws. All work is written to order. Supply chain risk management framework: A fishbone analysis approach. Managers at Lululemon Athletica need to examine three inter-related environments in order to come up with an effective strategy. Attitudes (health, environmental consciousness, etc. Lululemon Athletica Inc. is operating in Textile - Apparel Clothing in more than dozen countries and expose itself to different types of political environment and political system risks. Anti-trust law in Textile - Apparel Clothing industry and overall in the country. The growing use of mobile phones and social networking sites must be considered when developing marketing and communication strategies. Key Takeaways The Lululemon SWOT analysis shows that the company needs to improve its business and survive in the current sports apparel market. The strength of high price product strategy is that Nike can earn more on each single item. Lululemon Athletica Inc. cannot enter a new market without studying in detail the legal environment and regulatory structure of the new consumer market. There is a growing trend towards the use of green/eco-friendly products. Analyzing the companys financial statement helps in evaluating performance of the company that further helps in making smart decisions. WebPestel Analysis is a strategic method/ tool used by marketers to analyse and evaluate the organisation's external marketing environment factors that directly impact the In order to evaluate a company, we need to go beyond the numbers mentioned in financial statements. WebPESTEL Analysis of Lululemon A Sheer Debacle in Risk Management Model was proposed by Michael E. Porter in 1979. A careful evaluation of legal aspects is required to avoid getting into some serious trouble. Some of the environmental factors that a firm should consider beforehand are -, In number of countries, the legal framework and institutions are not robust enough to protect the intellectual property rights of an organization. Economic Lululemon Athletica Inc. needs to consider the investments made by competitors on a micro and macro level to understand how new technologies influence the firms value chain and prevailing cost structure. Company originally is from Canada and when they are entering to the new markets they might encounter Strict tax laws against foreign enterprises. WebThe PESTEL Analysis of Lululemon Athletica Inc - Moving Forward With Humility will take into account the most important aspects of the external environment that impact the business. No plagiarism, guaranteed! Providing a secure work environment for the workforce is the ethical and moral obligation of Lululemon Athletica Inc. WebLululemon Athletica Inc. case study PESTEL analysis includes macro environment factors that impact the overall business environment Political, Economic, Social, Technological, - Transition of Government and Changes in Policy There is consistency in policy making from one government to another. 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. If you have BIG dreams to score BIG, think out Finally, the exchange rate fluctuation can also influence the profitability and international trade. - Political Governance System Based on the information provided in the Lululemon Athletica Inc. case study, it seems that the country have a stable political system. WebLululemon Athletica Inc. PESTEL analysis is a strategic tool to analyze the macro environment of the organization. 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). Use of social media has become common in a modern business environment. Entrepreneurial spirit and broader nature of the society. In a political context, the key to success in a dynamic international business environment is to diversify the systematic risks. By so doing, primary tools were exploited to give an in-depth information, these include: Orbis database, companies' web pages as well as academic and non-academic literatures. 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. The demand and supply of labor determine the wage rates and supply of skilled workforce. It can enable Lululemon Athletica to hire skilled workforce at competitive salaries. Some societies encourage entrepreneurship while some dont. - Health & Safety Laws What are the health and safety laws in the country and what Lululemon Athletica needs to do to comply with them. Studying the demographic characteristics can help Lululemon Athletica Inc. in choosing the right market segment/segments with high growth potential. Lululemon Athletica can leverage such a situation to hire the best people in business. Pestel Analysis And Pest Analysis: American Apparel 2014 Words | 9 Pages. In fact, a proper understanding of these factors helps organizations to identify potential business opportunities and threats in the international market (Baines et al., 2011). A., & Gomez, o. The international presence of Lululemon Athletica Inc. require the organization to consider these differences to avoid undesired circumstances carefully. Analyze Strengths and Weaknesses of Lululemon Athletica. 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 Technology is fast disrupting business models across various industries. The Essay Writing ExpertsUS Essay Experts. 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). Product labeling and other requirements in Textile - Apparel Clothing. - Regulatory Practices - The regulatory practices are streamlined with global norms which have helped the country to improve its ease of doing business ranking. The external environment includes opportunities and threats which can impact on the marketing strategy of Huawei. Bureaucracy and corruption negatively influence the business environment. All the regulations about design patent need to be monitored by company. Pearson Education. This will enable the Lululemon Athletica to determine if required can it hire talent globally to work in that particular market. 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. Marketing and human resource strategies in a traditional, patriarchal society with clearly distinguished gender roles will be different from societies with low gender stereotypes. Its information assets ( Lululemon, 2017 ) easily recognized by every customer damage its. Whose excessive consumption can cause trouble for the organization chains like Arbys business and survive in the and... 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