Famous Sportswear Retailer Closing 40 Stores, Laying Off Workers

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Lululemon Is Closing Most ivivva Stores Across U.S. & Canada

One of the most famous retailers of specialty athletic apparel, Lululemon Athletica Inc., is closing most of its “ivivva” stores across the United States and Canada, as the ivivva brand continues to face operational losses.

The company will be shuttering about 40 ivivva stores, out of a total 55 stores. Half of the remaining ivivva stores will also be reorganized and rebranded under Lululemon’s namesake. In the process, many employees will be handed pink slips.

Lululemon had launched the ivivva brand, focused on Tweens, in 2009. The brand, founded under former CEO Christine Day, primarily targeted girls aged between six and 12 years.

However, declining sales have forced current CEO Laurent Potdevin to phase out the brand. The company says it will continue to sell some ivivva products, however. The company’s management has identified that the demand frequency for ivivva products is not sufficient to support an expensive network of stores focused only on Tweens.

Lululemon, the yoga-inspired company that is popularly recognized for its “Ohm” logo, is actually Canada-based, but it derives much of its sales revenue from the American market. Most of the ivivva stores being closed are located in the U.S., with the remaining in Canada.

The company has been facing stiff competition from online retailers like Amazon.com, Inc., who are aggressively clawing away at its profits. Lululemon, however, is not the only retailer to face this pressure. Brick-and-mortar stores have generally been losing out as store traffic continues to fall and more Americans choose to shop online. Most American retailers are now scaling back their brick-and-mortar operations and are gradually gravitating towards digital retail.

Sports-focused retailers have particularly started winding down their businesses after facing years of losses. Some famous American sports-focused stores that have recently filed for bankruptcy—or have ended up in liquidation—include Sports Authority, MC Sports, Gander Mountain, and Sports Chalet.

To avoid meeting the same fate, Lululemon is turning its focus toward its online store in order to attract Web traffic and turn around its business. The company announced this major change in its strategy in the latest quarter, when it managed to deliver better-than-expected results. In spite of that, comparable sales for its stores were down by one percent. (“lululemon athletica inc. Announces First Quarter Fiscal 2017 Results and Plan to Restructure Its ivivva Operations,” Lululemon Athletica Inc., June 1, 2017.)

The company’s massive restructuring, which includes the store closings, is expected to be completed by the end of the third quarter this year.

Lululemon To Close Most Tween-Focused ivivva Stores,” Fortune, June 1, 2017.

How retail bankruptcies took their toll on Under Armour in latest quarter,” MarketWatch, April 28, 2017.

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