A yoga clothing manufacturer and retailer based in Vancouver is on a major expansion kick and expects to operate 200 stores worldwide – and generate annual sales of $50 million – by the year 2009.

“Part of our major push will be into Japan and Europe, because they are four years behind the trends,” says Chip Wilson, CEO of Lululemon Athletica. “These markets are at the stage where we were four years ago.”

The company is also considering a foray into Australia.

Launched in 1999 by Wilson, Lululemon Athletica has been a major success story in the specialized world of retailing because of its unique products and brash, insightful marketing strategies.

The company started off modestly and in 2001 its sales totalled $2.4 million. Today, says Wilson, “the company is very very profitable.”

He attributes the secret of his success to “20 years of making no money and learning from your mistakes.”

Currently, Lululemon operates nearly 20 stores in North America – four of them franchised. Merchandise is sold all over the world to retail stores, yoga and Pilates studios.

Next month, the company will start franchising its stores in the United States.

To be considered a potential franchisee, a minimum investment of $500,000 is required. However, those living in Seattle, New York, Newport Beach, Santa Monica and San Francisco are out of luck. Those locations already are locked up.

Lululemon has 200 employees and the majority of its products are made in Vancouver although some of them, Wilson says, “may be going offshore . . . it always is an option.”

Lululemon does some things differently than other retailers. It does not publish a catalogue because it restocks its styles and colours every 45 days. Buying at any of the company’s stores or on its e-commerce website is almost like a religious experience. Everything is tied directly to the world of yoga. The website is peppered with inspirational sayings such as: “Yoga is our inspiration and being yogis we believe in the inter-connected and co-dependence of all beings on our planet . . . We take stringent steps to ensure our production processes are both socially and environmentally sound and our goal is to continue to be leaders in this area.”

This whole enlightened attitude carries over to its workforce, and the company’s mantra includes respecting each individual “for their uniqueness and the value they bring to our company,” as well as placing an emphasis on self-empowerment and “positive inner development.”

The company has a huge following among its customers, the virtues of its products being extolled on several Internet fan websites.

Yet another marketing technique is to invite its customers to design Lululemon merchandise. Each store has a design form that budding designers fill out.

A Lululemon team assesses the idea and, if approved and it sells 200 items, the new designer receives a free sample.

Some of its marketing techniques raise eyebrows. Two years ago, the company opened a store on Vancouver’s Robson Street, the Rodeo Drive of British Columbia, and offered free merchandise to the first 30 naked shoppers.

The stunt proved wildly successful, receiving extensive Vancouver media coverage and a large lineup of potential customers willing to bare it all.

One of Wilson’s earlier retailing ventures was in the late 1980’s when he had established a $15-million-a-year snowboard and surfer fashion business, which he sold to a U.S. firm in 1997.

After taking two years off, he started Lululemon – correctly predicting that yoga would become the next fitness craze.

Originally, the company only sold to women, but eventually expanded into a men’s line.

Wilson’s philosophy about his merchandise is simple and to the point. “I don’t have to provide a better product at a better price. I have to make a quality product.”

(George Froehlich can be reached at george@businessedge.ca)