Operational challenges, frugal consumers squeeze Lululemon sales

One of B.C.’s largest homegrown retailers, Lululemon Athletica Inc. , saw its sales, profit and share price soar during the COVID-19 pandemic.

Another contributing factor to the company’s share-price decline was its May 22 announcement that its well-regarded, longtime chief product officer, Sun Choe, was leaving the company. Shares fell as much as seven per cent that day. “For a single apparel brand, there are not many that are bigger than Lululemon and growing faster. Nike is not growing this fast. Adidas is not growing this fast.”Lululemon warned the market in March that mistakes were made with its spring fashion line. The clothing was largely black, white and tan, and lacked colours that consumers wanted to buy, Nikic explained.

In the same quarter one year ago, year-over-year revenue growth in the U.S. and Canada was nearly 18.5 per cent. “We have a real big opportunity internationally, in particular in Asia,” he said weeks after he joined the company. Six years later, Lululemon doesn’t appear to have established itself more fully in the region.

“Competition in our space has always been there and been intense and we’ve always been able to continue to perform and compete,” he said.“Lululemon’s main competitor right now is Alo Yoga,” he said. “ Athleta is one of them to a degree, but it’s a lower price point and it’s probably a different quality level.”

Alo Yoga operates a store at CF Pacific Centre in Vancouver and Patterson said he expects the company to open stores in Burnaby, at Metropolis at Metrotown, and at Vancouver’s Oakridge Park, when that development reopens, likely next spring.

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