Apparently, lack of supply has actually been a real threat to the lulus. No worries though, they’re hurrying to make even more lulu goods because they can’t keep up with demand. It’s true. Ask Versace.
Here’s your annual lulu fiscal report on the state of yoga pants, your wallet and therefore the world.
The 2011 annual results are out, and if 2012 is anything like last year, we’re in for emptier hidden pockets and a lot more viral videos. This time lulu is prepared to meet the fiery frenzy of demand with abundant supply, which CEO Christine Day credits to “investments in the distribution chain and an 81 percent increase in total inventory over March 2011 levels.”
“We have a team that forecasts fabrics now. We have a new head of raw materials, and we made investments in our sourcing team and production team,” Day said. “We brought on some additional factory capacity, and the main part is we have a bigger inventory of fabric which has allowed us to have more choices and more responsiveness.”
A forecasting fabric team? Sounds serious. So predictions of 2012 first quarter revenue are around the $270 million mark, a 45 percent jump from 2011 numbers. And total sales for 2012 are predicted to hit $1.35 billion. That’s a lot of zippers!
How will they live up to such high numbers? According to an analyst “the limited availability of their product is part of their [lululemon's] model,” and “they’ve trained their customers to come in and shop when new products hit the stores.” Pavlovian lululemmings.
Lulu will also keep profits high by keeping prices high. Did we just hear you just say ‘brilliant!’? Ah, but all you warehouse sale shoppers may take this one hard:
“We did warehouse sales at the end of 2012, it was just an end of the year sale, and we have no plans to do additional ones,” Day said. “We don’t want to create a dependance on more outlets.”
You can forget about bargain bins and discount racks. Why? Need we get into the mediocre discussion again?
“We don’t want to compete with the average product,” says Christine Day. But our prediction is if you’re an average schmo with $100 in your pocket they’d love to sell you a new pair of stretchy pants with empty ‘hidden’ pockets.