The advancement and growth in the technology has helped the business enterprise to enhance its technological processes to develop high quality and unique yoga apparels. In the similar manner, development in the field of e-commerce has adequately improved the sales and distribution system for Lululemon across the geographical boundaries (Yüksel, 2012). The Company has been able to utilise the online platform to increase its customer base and strategically advertise its yoga apparel product in the target audience of the countries where it doesn’t have physical stores.
The economic conditions across the globe have been highly unfavourable since there is a global economic turndown in the recent years. In this regards to economic inflation, the high prices goods and low availability of Lululemon’s product will lead to minimising sales and increasing the costs (Hitt, Ireland and Hoskisson, 2012). Therefore, the Company must adopt changes in the pricing and marketing strategy to suit according to the changing economic conditions in order to sustain in the long run.
The political situation in the countries is subjected to volatility in the recent times which has led to changes in trade policies and regulations. It can be identified that the Company also has its manufacturing facilities in the Asian countries such as China, Thailand, Cambodia, South Korea and Israel, etc. Such countries have different tax regimes and in some of the countries, there are no appropriate counterfeit laws. This causes an increase in the overall Company costs and the possibility of selling duplicate products under Lululemon’s brand name (Yüksel, 2012).
Adherence to the legal frameworks also enhances the costs and complexity of the operations of the Company. In California, the laws and regulations requires the business dealers to abide by the California Transparency in Supply Chains Act of 2010 (Hitt, Ireland and Hoskisson, 2012). In such a case, Lululemon must focus on developing strategies to evaluate the political and legal conditions in the respective countries before setting up manufacturing and distribution facilities. A primary focus must be provided to achieving adequate government support in the country of business operation.
The unique and differentiated yoga apparel features has led to competitive advantage for the Company over its rival firms. Nevertheless, the concentration of the business level strategy to a niche customer base and a single product segment can pose a risk for the business enterprise (Hitt, Ireland and Hoskisson, 2012). Even though the rival firms have not actively entered the yoga industry, the companies are developing strategies to enter the same by focusing on customer segment of males and females, unlike Lululemon which only focuses on the female target customers. The focus on a particular segment of customer related to health and fitness also deters the Company to gain a larger customer base which might cause the risks of lower demand and sales of the product overtime.