Final answer:
To forecast Lululemon's sales for 20X2, we calculate the sales from existing stores at $845,300,000 and from new stores at $52,000,000, based on the SSF and expected growth rate. The total forecasted sales sum up to $897,300,000.
Step-by-step explanation:
To forecast sales for Lululemon for 20X2, we must account for the sales generated from existing stores and the sales expected from the new stores. We understand that Lululemon operated 155 corporate-owned stores at the end of 20X1 and plans to open 20 new stores in 20X2. With an SSF (sales per square foot) of $2,000 in 20X1 and an expected same-store sales growth of 5% in 20X2, we can calculate the forecast.
First, let's calculate the sales from existing stores for 20X2:
- Existing stores' square footage: 155 stores × 2,600 square feet = 403,000 square feet.
- Expected SSF in 20X2 (with same-store sales growth): $2,000 × 105% = $2,100.
- Sales from existing stores: 403,000 square feet × $2,100 = $845,300,000.
Next, we'll calculate the sales from the new stores for 20X2, noting that they are expected to generate half of the sales of existing stores:
- New stores' square footage: 20 stores × 2,600 square feet = 52,000 square feet.
- Halved SSF for new stores: $2,000 / 2 = $1,000.
- Sales from new stores: 52,000 square feet × $1,000 = $52,000,000.
Adding both the sales from existing and new stores, we get the total forecasted sales for 20X2:
- Total forecasted sales for 20X2: $845,300,000 + $52,000,000 = $897,300,000.