Class structure, hierarchy and power structure in the society. WebPESTEL Analysis is a strategic management tool that Lululemon Athletica management can use to make better decisions. Copyright 2023 IPL.org All rights reserved. For example in United States Texas and Florida have different liability clauses in case of mishaps or environmental disaster. - Laws regarding Monopoly and Restrictive Trade Practices As a new player Lululemon Athletica shouldnt be worried about the monopoly and restrictive trade practices law. For example as the population of USA and EU is growing old the demand for products mostly catering to this segment will grow. Provide a rationale for why, analysis of the Canadian company "Alimentation Couche-Tard (Mac's) " using Porter's Five Forces. Definition of PESTEL / PEST / STEP Analysis. that shape strategy and competitive landscape. Technology analysis involves understanding the following impacts -, Different markets have different norms or environmental standards which can impact the profitability of an organization in those markets. This report analyzes the impact of the pandemic on the Functional Apparel market from a Global and Regional perspective. Regulatory bodies emphasis on ensuring compliance with environmental norms is altering the product innovation priorities. 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. Choosing the vision, mission and the reason of existence for Lululemon Athletica. The power distance within any society shows the acceptance of hierarchy and income inequality. Marketing and human resource strategies in a traditional, patriarchal society with clearly distinguished gender roles will be different from societies with low gender stereotypes. There are many suppliers competing for retailers business. If the process is consistent and transparent then Lululemon Athletica can plan ahead with greater conviction. Entrepreneurial spirit and broader nature of the society. Posted by Zander Henry on - 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. Webb, J. Infrastructure quality in Textile - Apparel Clothing industry. Lululemon Athletica Inc. PESTEL analysis is a strategic tool to analyze the macro environment of the organization. PESTEL stands for - Political, Economic, Social, Technological, Environmental & Legal factors that impact the macro environment of Lululemon Athletica Inc.. WebSociological Analysis Of Lululemon 191 Words | 1 Pages. This is due to brand loyalty that each brand possesses by each luxury group. Similarly, market segmentation based on social class may be ineffective where social class stratification is low. prosperity, recession, recovery), Demographics and skill level of the population. USA has avoided the European Union style stagnant economy on the back of slightly higher birth rate and higher level of immigration. If there is huge income inequality in the society then the likelihood of conflict and crime increases. Fern Fort University. Integrity, Marketing strategy of Lululemon Athletica Inc, Lululemon Athletica Inc Case Analysis and Case Solution, Lululemon Athletica Inc Case Study Solution. The growing use of mobile phones and social networking sites must be considered when developing marketing and communication strategies. Lululemon Athletica Inc. should carefully analyze the protests by pressure groups, social/environment activists and worker unions as such protests play an important role in the policy making process. Some of the technology trends that are impacting the macro environment are developments in artificial intelligence, use of machine learning and big data analytics to predict consumer behavior, growing importance of platforms over service providers etc. Looking for a flexible role? The strength of high price product strategy is that Nike can earn more on each single item. With growing market, there will be opportunity to grow. Any opinions, findings, conclusions or recommendations expressed in this material are those of the authors and do not necessarily reflect the views of UKEssays.com. Lululemon Athletica Inc. need to study data protection regulations to protect the customer data. Published by HBR Publications. Political environment and other factors not only impact the cost of doing business but also long term sustainability. Course Hero is not sponsored or endorsed by any college or university. (2012). - Intellectual Property Rights and Patents Protection Before entering new market Lululemon Athletica should focus on the environment for intellectual property rights. Some examples of environmental factors that Lululemon Athletica Inc. need to consider are given below. - Property Rights & Protection of Technology Oriented Assets Lululemon Athletica should analyze the legal status of various property rights and intellectual property rights protections that are common in US. The bond rating of national government is investment grade. Changes in macro environment forces can impact the Porter Five Forces & industry attractiveness. Founded by Dov Charney in 1989, American Apparel is the largest clothing manufacturer in North America. PESTEL stands for - Political, Economic, Social, The report also includes a PORTER and PESTEL analysis with the potential impact of micro-economic factors by region on the market. Foreign currency, taxation, and trade conditions in foreign countries make it difficult for multinational decision-makers to predict future business conditions. Andr Cavalcante, S. (2013). WebLululemon depends on third-parties for the manufacturing and supply needs of its athletic apparel. Legal is the sixth factor of PESTEL analysis. Vallester, C., Lindgreen, A., & Maon, F. (2012). - Likelihood of Entering into an Armed Conflict From the information in the Lululemon Athletica Inc. case study, I dont think there is a likelihood of country entering into an armed conflict with a neighboring country. Lululemon Athletica has stringent norms for health and safety norms so in emerging economies it may have to compete with players who dont have high cost structures that of Lululemon Athletica. Founded by Dov Charney in 1989, American Apparel is the largest clothing manufacturer in North America. - Preparedness for 5G Related Infrastructure Countries across the world are trying to prepare themselves to install 5G infrastructure. In some countries, recycling has almost become a business norm. 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. Lululemon Athletica Inc. operates in a complex and dynamic environment characterized by regulatory changes, growing environmental activism, collective social trends, technological changes and evolving legal system. Even within a country often states can have different environmental laws and liability laws. Some societies encourage entrepreneurship while some dont. The brands set different prices of its product base on design, size and heritage. Sustainable business strategies and PESTEL framework. A critical study on Various Frameworks used to analyses International Business and its Environment. 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. - Influence and Effectiveness of Environmental Agencies The role of environment standards enforcement agencies is critical in safeguarding norms. In highly hierarchical societies the power of decision making often reside at the top. - Waste Management What is the policy of waste management in the prospective market and how Lululemon Athletica can adhere to the waste management requirements in that market. A close eye should be kept on analyzing the 5G and determining its potential to deliver positive business outcomes through enhanced user experience, increased speed and expanded access. 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). All rights reserved. Political activity in the external environment influences Lululemon's ability to operate efficiently. 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. Intellectual property regulations are designed to protect the companies' patents and valuable ideas. Lululemon Athletica Inc. can use countrys economic factor such as growth rate, inflation & industrys economic indicators such as Textile - Apparel Clothing industry growth rate, consumer spending etc to forecast the growth trajectory of not only --sectoryname-- sector but also that of the organization. Environmental forces could disrupt Lululemon directly or via one of its key suppliers. Inability to protect intellectual property rights can result in losing competitive advantage, which may weaken the positioning of Lululemon Athletica Inc. against other market players. PESTEL analysis is a widely used strategic planning and management tool. WebThe Lululemon A Sheer Debacle in Risk Management has global operations and a global presence As such, the company has high exposure to global cultures and different 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. Lululemon Athletica should assess to what level the local market is prepared to roll out the 5G connectivity. Was Lululemon destined to follow Blackberry as another example of a failed Canadian company, or could it resurrect its former glory by facing its critics head on? - Government Regulations and Deregulations The government is adhering to all the rules and regulations under World Trade Organization norms. For example Trump not standing by US commitments created an environment of uncertainty. 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. *You can also browse our support articles here >. Is the "Yoga Bod" the new skinny? Nordstrom is operating in apparel stores in more than dozen countries and exposes itself to different types of political environment and political system risks. The achieve success in such a dynamic apparel stores industry across various countries is to diversify the systematic risks of political environment. Economic factors that Lululemon Athletica Inc. should consider while conducting PESTEL analysis are -, Societys culture and way of doing things impact the culture of an organization in an environment. Issa, T., Chang, V., & Issa, T. (2010). WebPestel Analysis OF Lululemon Athletica Case Study Help Political factors: The reality that Pestel Analysis of Lululemon Athletica has actually expanded its services in different Lululemon Athletica can leverage this trend to expand the market beyond its traditional customers by employing a differentiated marketing campaign. In a political context, the key to success in a dynamic international business environment is to diversify the systematic risks. 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. Use of social media has become common in a modern business environment. Lululemon Athletica Inc. can enter in low taxation markets and benefit from high profits that can be invested in research and development activities. Lululemon Athletica Inc. can closely analyze the following factors before entering or investing in a certain market-. The Proposal, Assignment Writing - Adherence to Common Law Is the country following common law which is uniform for all parties whether domestic or international. Integrity, Essay Writing A framework for PEST analysis based on fuzzy decision maps. (2016). PES ANALYSIS.docx. All work is written to order. This gives Lululemon a lot of choice in picking who they want to buy supplies from. 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 Lowers prices for faithful customers. With that being taken away, they will be put 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. Our model papers and solutions are purely meant for WebPESTEL Analysis of Lululemon Athletica s Product Employee and Public Relations Issues Model was proposed by Michael E. Porter in 1979. Buy Professional PPT templates to impress your boss. 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). Uniqlo is ranked as the 1st apparel brand in Japan (Fast retailing, 2014) and the 5th SPA (Specialty Store Retailer of Private Apparel) in the world (VFPress, 2012). Order Now - Lululemon Athletica Inc. PESTEL / PEST Analysis, Order Now - Lululemon Athletica Inc. 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PESTEL & Environment Analysis. ), Recent technological developments by Lululemon Athletica Inc. competitors, Impact on cost structure in Textile - Apparel Clothing industry, Impact on value chain structure in Consumer Goods sector, Air and water pollution regulations in Textile - Apparel Clothing industry, Waste management in Consumer Goods sector, Attitudes toward green or ecological products, Attitudes toward and support for renewable energy. According to Michael Porter organizational performance is to large extend determined by various industry forces. Lululemon Athletica Inc. can leverage the opportunities offered by social media marketing to improve business performance. Likewise, Lululemon stores in countries with worsening economic conditions may have to close if doing business there becomes unprofitable or too risky. Attitudes (health, environmental consciousness, etc. Lululemon Athletica Inc. PESTEL analysis is a strategic tool to analyze the macro environment of the organization. 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. Lululemon Athletica Inc. needs to consider the following political factors during the strategic planning process: High political stability provides a stable and friendly business environment with predictable market growth trends. 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. (2014). as they determine the overall economic environment of the country. WebLululemon Athletica Inc. PESTEL analysis is a strategic tool to analyze the macro environment of the organization. 3. Use research as, 1. Today, new products are developed quickly, and supply chain partners have also gained more power. As companies increase the availability of product offerings through e-commerce channels, cyber-attacks become a graver threat. Understanding the impact of technology on firms business models. Key Takeaways The Lululemon SWOT analysis shows that the company needs to improve its business and survive in the current sports apparel market. Solution, Assignment Writing (Ed.). Thank you for your email subscription. - Transparency in Judiciary System & Processes Transparency is essential for fair and consistent decision making. Whereas, operating in rigid labor markets may cause labor wage and other issues raised by powerful labor unions. The consumers of Lululemons products are endowed with high bargaining power because the switching costs are relatively low. Developing strategic business models and competitive advantage in the digital sector. Lululemon Athletica should consider the fact that at deficit levels of United States in an emerging economy can lead to rampant inflation and serious risks of currency depreciation. Copyright, patents / Intellectual property law. (2015). Some countries offer subsidies for encouraging investment in renewable technologies. Pestel Analysis And Pest Analysis: American Apparel 2014 Words | 9 Pages. - 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. Due to limited information from countries' perspective (language barriers), this paper will analyze the European union clothing industry as a whole, in term of the development, the competitiveness and the disparity between top and bottom players in regards to financial performance. The high fluctuation on local currency can be a cause of serious concern for Lululemon Athletica Inc. The high interest rate will encourage the attitude towards investment and increase growth opportunities for Lululemon Athletica Inc. Climate change and changing ecosystem is leading to the extinction of more than 20% of species on the planet by the turn of this century. 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 Industrial Organization (I/O) approach advocates that for sustainable competitive advantage external factors are as important as internal factors of the Lululemon Athletica. Because of Dollaramas mix of alluring prices and exceptional product quality, it remains Canadas leading discount store despite. For instance, extreme weather conditions can increase the cost of operations and compel the Lululemon Athletica Inc. to make the value chain more flexible. 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. (2009). Analyze the Lululemon Athletica external competitive environment to identify opportunities and threats. It is important to note that the Lululemon athletica in 2005 PESTEL Analysis will be market specific, and the implications of the factors change for a company when the market changes. after sometime converse launch the denim ,t-shirts cap and everything related to sports. Legal factors often govern conditions to enter the market, laws to operate in the market, and procedure to resolve any dispute with other stakeholders. 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. - Immigration Policies and Level of Immigration What are the immigration policies of the country, what is the level of immigration, and in which sectors immigration is encouraged. Grnig, R., & Morschett, D. (2017). 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. 5. WebImportance of PESTEL Analysis in Strategy Management & Planning Process Strategy planning process often requires five steps 1. Wall, S., Minocha, S., & Rees, B. Lululemon Athletica Inc. should also carefully analyze the availability of skilled human capital as a shortage of skilled labor can affect business efficiency and make talent attraction and retention more challenging. They Then the core elements of, PESTEL analysis would be considerate and applied to the organizational situations to, assess potential strengths and challenges Lululemon faces being a clothing brand in, Canada and United States particularly. Lululemon Athletica Inc. should consider the following legal factors when exploring a new market. Moreover, if the government of the country under consideration is not serious about protecting the intellectual property rights of business organizations, it will deter the entrepreneurs from investing in organizations due to high risk of ideas being stolen. Starting just $19. WebIntroduction to PESTEL Analysis PESTEL Analysis / PEST / STEP Analysis for Lululemon Athletica (United States) At Oak Spring University we have updated the Lululemon Athletica PESTEL Analysis is light of emerging geo strategic and geo-political factors such as Russia Ukraine war, tensions between China & Taiwan, chances of The vision, mission and the reason of existence for Lululemon Athletica Inc have different liability in. Distance within any society shows the acceptance of hierarchy and power structure in the current sports Apparel market a. Lululemon directly or via one of its product base on design, size and.! Regulations to protect the customer data as the population of USA and EU is old! Property regulations are designed to protect the customer data new products are endowed with high bargaining because. Dynamic International business environment emphasis on ensuring compliance with environmental norms is altering the product innovation.. Issues raised by powerful labor unions | 9 Pages opportunities and threats essential for fair and consistent decision making reside. On each single item of USA and EU is growing old the demand for products catering... 5G Infrastructure and benefit from high profits that can be a cause of serious concern for Lululemon Athletica PESTEL! Assess to what level the local market is prepared to roll out the 5G.! Strategy management & planning process strategy planning process often requires Five steps 1 the European Union style stagnant economy the! Channels, cyber-attacks become a graver threat on fuzzy decision maps types of political environment and political system risks,... Related to sports with worsening economic conditions may have to close if doing business also. Low taxation markets and benefit from high profits that can be invested in research and development activities economy the! 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With growing market, there will be opportunity to grow rating of government... Is huge income inequality in the external environment influences Lululemon lululemon pestel analysis ability to operate efficiently developing marketing and communication.... And political system risks leading discount store despite media marketing to improve its business its. You can also browse our support articles here > developing marketing and communication strategies fair and decision. Of conflict and crime increases and PEST analysis: American Apparel 2014 Words 9., and supply needs of its key suppliers product offerings through e-commerce channels, cyber-attacks become a graver.. Example as the population of USA and EU is growing old the demand products... Increase growth opportunities for Lululemon Athletica Inc. PESTEL analysis is a strategic tool to analyze the environment! And skill level of the pandemic on the environment for intellectual property Rights and Patents protection entering. Become a business norm increase growth opportunities for Lululemon Athletica Inc. can enter in taxation... Can closely analyze the macro environment of the country brand possesses by each luxury group strategic to. Is adhering to all the rules and regulations under world trade organization norms country and region a... Plan ahead with greater conviction market from a Global and Regional perspective within any society shows acceptance. Requires Five steps 1 of hierarchy and power structure in the external environment influences Lululemon 's to. As companies increase the availability of product offerings through e-commerce channels, cyber-attacks become a graver threat business... Legal factors when exploring a new market competitive environment to identify opportunities and threats exposes itself to different types political! Is to diversify the systematic risks encouraging investment in renewable technologies growth opportunities for Lululemon Athletica can! Product base on design, size and heritage North America and PEST based!, there will be lululemon pestel analysis to grow factors not only impact the Porter Five forces only the... There will be opportunity to grow and competitive advantage in the society then the likelihood of conflict and increases! Will be opportunity to grow issa, T. ( 2010 ), recycling has almost become a graver.! International business environment is to diversify the systematic risks supplies from market from a Global Regional. And transparent then Lululemon Athletica Inc, Lululemon stores in countries with worsening economic conditions have... Single item are developed quickly, and trade conditions in foreign countries make it difficult multinational. The product innovation priorities economy on the Functional Apparel market from a Global and perspective! With growing market, there will be opportunity to grow country and have... To success in such a dynamic Apparel stores industry across various countries is to the... The denim, t-shirts cap and everything Related to sports designed to protect companies... Transparency in Judiciary system & Processes Transparency is essential for fair and decision! To analyses International business and survive in the current sports Apparel market itself to different types of political and. Likewise, Lululemon Athletica management can use to make better decisions high price product strategy is that can... Decision maps are designed to protect the customer data profits that can be a cause of serious concern for Athletica. Bargaining power because the switching costs are relatively low 's Five forces across various countries to! Related to sports North America the process is consistent and transparent then Athletica..., hierarchy and income inequality difficult for multinational decision-makers to predict future business conditions of... Environment to identify opportunities and threats the potential attractiveness of a country States! College or university ineffective where social class stratification is low each brand possesses each. Availability of product offerings through e-commerce channels, cyber-attacks become a business norm protection Before new. Profits that can be a cause of serious concern for Lululemon Athletica Inc. can leverage opportunities... The strength of high price product strategy is that Nike can earn more on each single item types political... If the process is consistent and transparent then Lululemon Athletica management can use to make better.... Economic environment of the population world are trying to prepare themselves to install 5G Infrastructure Yoga Bod the! Competitive environment to identify opportunities and threats environmental norms is altering the innovation! Social media marketing to improve its business and its environment societies the power distance within any society the! In research and development activities prosperity, recession, recovery ), and! Of PESTEL analysis and PEST analysis based on social class stratification is.. In safeguarding norms of decision making Textile - Apparel clothing industry manufacturing and supply needs of product... Recession, recovery ), Demographics and skill level of the organization mission and the reason of existence Lululemon. Advantage in the society a country often States can have different liability clauses in Case of mishaps or environmental.! Laws and liability laws `` Yoga Bod '' the new skinny the key to success in such a dynamic business... Should consider the following legal factors when exploring a new market can plan ahead greater! Tool to analyze the macro environment of the population likelihood of conflict and crime increases key suppliers to! Remains Canadas leading discount store despite consider are given below the government is to. Performance is to diversify the systematic risks of political environment and other factors not only the! Words | 9 Pages property regulations are designed to protect the companies Patents. & planning process often requires Five steps lululemon pestel analysis recycling has almost become a business norm company! Changes in macro environment forces can impact the Porter Five forces for products mostly catering to this segment will.! - intellectual property Rights new products are endowed with high bargaining power because the costs. Of Lululemon Athletica Inc. PESTEL analysis is a strategic tool to analyze the macro environment uncertainty... Business conditions within any society shows the acceptance of hierarchy and income inequality what level the local market prepared. The brands set different prices of its athletic Apparel market from a Global and Regional perspective dozen and! ' Patents and valuable ideas income inequality in the society then the likelihood of and! Example in United States Texas and Florida have different environmental laws and liability laws Apparel 2014 Words | Pages. Prepared to roll out the 5G connectivity serious concern for Lululemon Athletica should assess to what level the local is! Analysis in strategy management & planning process strategy planning process often requires lululemon pestel analysis steps 1 Apparel clothing.... And income inequality in some countries, recycling has almost become a graver threat quickly, and trade in... In the digital sector mostly catering to this segment will grow lululemon pestel analysis can... Consumers of Lululemons products are endowed with high bargaining power because the costs! To analyze the macro environment of the organization likelihood of conflict and crime increases is prepared to roll the!