Analyze potential expansion of Lululemon Athletica into Brazil
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Today, the internationalization of businesses has become a norm for successful businesses but research shows that it’s only a few companies that have succeeded. Expanding a business across borders comes with challenges including differences in culture, geography, economy, and administration. Using the CAGE framework, this paper will provide the management of Lululemon Athletica with an analysis of potential expansion into Brazil and how these factors may impact its potential in the country.
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potential expansion of Lululemon Athletica into Brazil Case Study
Key Learning Outcomes
By the end of the case, students should be able to:
- Use CAGE framework to identify Cultural, Administrative, Geographic, and Economic differences or distances between countries that companies should address when crafting international strategies.
- Understand the concept of internationalization, its disadvantages, advantages, and why companies internationalize their businesses.
- Apply strategic business theory to real company cases
1.0 INTRODUCTION
Internationalization is a strategy used by those companies which identify business opportunities in the international market to enable them to obtain competitive advantages over competitors and decide to extend their activities abroad. Lululemon operates in a mature market characterized by high rivalry, low profitability, and slower growth. Lululemon is faced with the challenge of ever-growing competition in the athletic apparel industry from retail giants Nike, Adidas, and Under Armour. In order to increase market share and gain a competitive advantage, expanding into developing countries like Brazil, Russia, India, and China offer major opportunities. This report used CAGE framework, to provide the management of Lululemon Athletica with an analysis of potential expansion into Brazil and how these factors may impact its potential in the country.
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