Lululemon's Too-Thin Yoga Pants Fiasco Could Cost the Company Over $20 Million

Posted: March 19, 2013 at 1:51 pm


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Over the weekend overpriced yoga pants peddler Lululemon announced that it wouldn't be able to sell an entire batch of bottoms, after some manufacturing glitch made them too thin (read: see-through). It's easy to make light of the situation, especially if you've ever seen anyone wearing too-thin yoga pants also known as too-much-information yoga pants. But the Canadian athletic apparel company's executives aren't laughing about this one. They stand to lose alot of money over this little incident. And the resulting yoga pants shortage? It's going to be awful, people.

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It's actually already happening. Lululemon pulled the suspect batch of yoga pants over the weekend, issuing a basically hilarious press release explaining the trouble in far too technical terms. "The ingredients, weight and longevity qualities ofthe pants remain the same but the coverage does not, resulting in a level ofsheerness in some of our women's black Luon bottoms that falls short of our veryhigh standards," the company said, adding that "the affected items represented approximately 17%of all women's bottoms in our stores and for the near term there will be ashortage." Lululemon also said that it will offer refunds for anyone who bought too-thin yoga pants after March 1. Bear in mind, this is one of the largest yoga apparel makers out there, so nearly a fifth of their inventory is a lot of yoga pants.

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From a business point of view, this is obviously bad news. Lululemon's stock plummeted in response to the news early Monday evening and continued to fall in after hours trading. Shares were down about 6 percent at the time of this writing, and while the stock could easily recover, the damage to Lululemon's revenue is likely already done. The company says that the "sheerness" incident will bring its first quarter sales down from an expected$350 million to $355 million to a more humble$333 million to $343 million. In other words, the company stands to lose over $20 million in sales, all because a bunch of see-through yoga pants.

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There is still hope and we're winging it with this idea. It doesn't take too much Internet searching to realize that too-thin yoga pants are kind of a thing. Maybe Lululemon could just sell the whole batch to the "Girls in Yoga Pants" subreddit (slightly NSFW) and call it a draw.

Originally posted here:
Lululemon's Too-Thin Yoga Pants Fiasco Could Cost the Company Over $20 Million

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Written by simmons |

March 19th, 2013 at 1:51 pm

Posted in Financial




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