Lululemon takes a loss with sheer pants

Published On March 22, 2013 | By | News
Lululemon which manufactures yoga pants has had a recall of their sheer pants. Not pictured above. COURTESY of Flickr

Lululemon which manufactures yoga pants has had a recall of their sheer pants. Not pictured above.
COURTESY of Flickr

By Sara Yonis

Lululemon expects to suffer a loss anywhere between $57 and $67 million from a yoga pant recall, according to the company’s chief financial officer John Currie.

The retailer, which provides women with athletic wear and apparel, recalled the pants earlier this week..

Lululemon, which operates 211 stores across North America and Australia, pulled the latest batch of their stretchy black pants because of the sheerness.

Even with the loss Lululemon is still expecting to have a revenue between $1.61 billion and $1.64 billion US.

In a statement to the CP24 Lululemon CEO Christine Day said that the pants passed through all the stages of manufacturing.

“The only way that you can actually test for the issue is to put the pants on and bend over,” Day said in a statement.

In a call to the investors, Day explained how the problem with the pants went unnoticed.

“It has to be engaged in a four-way stretch for the sheerness to appear. It’s a very complex thing to test for,” Day said in the statement.

Associate Dean of Humber’s business school Peter Madot said incidents similar to this one tend to hurt a company’s reputation.

“The worst thing any company can do is have a defective product get sold under their brand name. That basically hurts the brand. It goes against the meaning and integrity of the brand,” Madot told Humber News.

Prior to the incident Lululemon experienced problem in the dye in clothes bleeding, the issue has since been resolved.

Head of the University of Guelph-Humber’s business program George Bragues said  the recall isn’t going to hurt Lululemon that much.

“Key thing how the company responds,” Bragues said.

Bragues stressed the need for Lululemon to take action.

“If Lululemon responds quickly I don’t think it will harm the company,” Bragues said. “If a company is seen endeavoring to quickly fix it (the problem) the brand loyalty doesn’t get damaged.”

 

 

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