While making serious strides into the international market, Lululemon Athletica dismissed Sheree Waterson, who has been the chief product officer of the Canadian company since 2008, as part of a reorganization of its supply chain. Her departure has been widely linked to bad publicity about the recall of a style of black yoga pants in the company's proprietary Luon fabric, which were too transparent.
The line represented 17 percent of all the women's pants sold in the company's stores. On the other hand, company officials pointed out that this and other recent quality control problems may have been related to supply constraints caused by Lululemon's strong growth.
The company's sales grew by 36.9 percent to US$1,370 million in the financial year ended last Feb. 3, with a 16.0 percent increase on a comparable store basis. The gross margin fell slightly to 55.7 percent, but net earnings jumped by 46.7 percent to $271.4 million.
Meanwhile, company officials have confirmed plans to open stores in London and Hong Kong in the course of this year, while hiring or dispatching key personnel to Shanghai and seven or eight other European and Asian countries for “pre-seeding” in view of a future market introduction. The company had 211 stores in North America and Australia at the end of last year, 37 more than a year earlier. It plans to open 43 others in 2013, including ten to 15 showrooms in key foreign markets.
