Publicity outweighs long-term impact of lululemon's luon recall

Lululemon - Sherway's new product shot

The publicity surrounding lululemon's recall of its core yoga pant has been the most prevalent story in retail this week.  The image of yogis settling into downward dog poses with see-through pants is too much to resist.  However, within the industry, the issue seems much less significant.  

Core product problems are common, particularly with so many touchpoints along the supply chain from fabric manufacturing right down to domestic shipping.  What sets retailers apart from their competition is their ability to manage these upfront, but also the creative solutions to protect revenue should a product shortfall become reality.  In-store, it doesn't look as if lululemon are missing product, but if a customer is seeking that particular pant they may be missing sizing.

The company has expanded into new activewear markets, menswear and  womens running now contribute significantly to lululemon's overall sales figures.  They've also released new, successful designs which allow them to move forward without being restricted by incorporating the logo within the garment seaming - creating broader brand possibility.  In 2012, same-store sales increased by 16% and the retailer achieved $2,058 in sales per square foot.   

lululemon's customer base is strong, growing, and loyal - and have an assortment of other high-quality, well designed yoga pants to choose from in-store.  The company will work to fix the issue, as their track record has shown.  The revenue shortfall will hurt the company in 2013, we still expect the retailer to come out on top.  

Darren Fernandes contributed a recap of the media commentary around the issue here.