Decathlon Accelerates Expansion Of China'S Sporting Goods Market

Five years later, sales in China will account for 1/4 of the group.

Retail as a whole

The downturn did not affect Decathlon's sporting goods retail giant's expansion in China.

From Decathlon, the company has 32 new shopping malls in China in 2014, ranking first in the world.

The number of new outlets in 2015 can reach 50.

Obviously, the Chinese market is very important for Decathlon.

Although no specific investment in China has been disclosed, BertrandTison, Decathlon's Greater China Development Director, revealed that "5 years later, the country's sales may account for 25% of the company's total sales."

China opens new store number one

Although it wasn't until 2003, Decathlon opened the first shopping mall in China in Shanghai.

Earlier, the sporting goods company realized the importance of the Chinese market.

"First Financial Daily" learned that Decathlon first entered China in 1994 as a producer, and the Shanghai industrial purchasing department was established in 1995.

In the interview, the reporter learned that unlike Decathlon's brand name, the business of Decathlon in China is directly operated. There are mainly two types of shop opening: self purchase and long-term lease.

"At present, land purchases account for 30% of all projects.

Self sustained property investment returns cycle is longer, but Decathlon is originally on the long road of development, which is consistent with the company's vision.

Our goal is to further increase the proportion of land purchase projects.

"In fact, even if it is a rental property, we will sign the 20 year contract with the longest period stipulated by the state, which is committed to the development of shopping malls and cities," an internal director of Decathlon Greater China told reporters.

Leasing projects appear in relatively mature areas.

Combined with each other, we can achieve good long-term, medium and short term comprehensive cooperation.

"Decathlon China is now independent of the global, self financing mode of operation.

The whole is profitable.

The person in charge disclosed to the first financial daily.

With the coming of the national sports craze, the company began to accelerate its expansion in China.

At first, Decathlon opened stores in the five small cities of China, Shanghai, Beijing, Guangzhou, Chengdu and Shenzhen, and the population of these cities was between ten million and twenty million.

Then, between 2008 and 2010, Decathlon opened stores in thirty of the second tier cities with 3 million to 10 million people.

Now, Decathlon is moving towards a more remote three tier city.

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According to official data, as of October 2015, Decathlon has entered 135 stores in 60 cities in China.

It is worth mentioning that in 2014, the number of newly opened shopping malls in Decathlon China was 32, ranking first in the world.

In 2014, Decathlon China achieved a 46% increase in revenue.

"Decathlon's sales grew by more than 40% in three consecutive years."

The official said that Decathlon's plans to open 50 new stores in China this year can be completed without any suspense.

In other words, by the end of this year, the total number of Decathlon China will reach 160.

The goal of Decathlon in the future is to enter 120 cities in China, and have 500 physical stores in five years.

In order to adapt to the rapid development of logistics and warehousing, Decathlon China is ready to expand its logistics storage area to two times - 38600 square meters at the end of 2016, all of which are applied to the Chinese market.

There is no shortage of competitors.

In fact, the Chinese market has become a battleground for many foreign sports brands.

Why do these big names value China's market so much?

It is predicted that in the next 10 years, the global sports sales market will expand, and Asia will account for 60% of the expanded market, of which China will account for 2/3.

The value of the Chinese market is between 15 billion and 25 billion euros, two times that of France.

Famous brands such as Nike, Adidas and others are sponsoring sports events, activities and heavy gold to win more market share by celebrity endorsements.

But compared to brands that spend a lot of marketing on advertising and star marketing, Decathlon is relatively low-key, and there is no future budget for these marketing costs.

There is a view that Decathlon's popularity in China is largely due to its performance price ratio.

"You can often see twenty or thirty yuan in Decathlon.

And about one hundred yuan walking shoes.

As a distributor of sporting goods, Zhang Yusheng has more than 10 years of experience in this industry. "

As a distributor in a large area, he has represented several domestic sports brands in his hands. "This price is comparable to many domestic brands, and even lower."

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"The key to our success is to use high quality sporting goods and competitive prices to cater for the non basic needs of sports."

Di Bai hang also confirmed the above views.

Decathlon is a whole industry chain group integrating R & D, design, production, brand, logistics and retailing. Its whole industrial chain reduces the cost as much as possible.

In China, the layout of the whole industry chain has involved all aspects of R & D, design, production, logistics and retail business network.

This mode of operation allows the company to save many middleman costs and save costs in the final retail price.

Take raw material procurement as an example.

Decathlon buys fabric and supplies it to the manufacturer for processing.

However, Decathlon said it was not convenient to disclose how much it could save.

Another advantage of the company lies in its overall and innovative products.

At present, 90% of Decathlon stores sell their own brands, and the whole group has 21 brands, covering 70 sports.

It is understood that Decathlon will launch 3000 innovative products every year.

These products may not all come into China for sale, but they will choose new products according to the different needs and preferences of different markets in the world.

Based on the layout of the whole industry chain, Decathlon is confident of China's market development.

"Despite the recent financial crisis, we have not been affected by the crisis in China's sales market."

Di Bai hang said that although China's competition is huge, the market itself has great potential. Our rapid expansion also proves this point.

It is reported that Decathlon Tmall flagship store has achieved 100% growth rate for three consecutive years.

Decathlon online business now covers more than 370 cities.

But don't be too happy.

The expansion of the consumer market means that competition is more intense. This competition will continue.

Zhang Yusheng told reporters that Decathlon's competitors are the biggest in the world.

Intersport (its annual turnover of 10 billion 600 million euros in 2014, and Decathlon's 8 billion 200 million euros) has entered the Chinese market by establishing a partnership with a Real Estate Company in China. When the company entered China, it said it had to open 80~100 stores within five years.

Faced with increasingly picky Chinese consumers, Decathlon and its rivals need to be prepared to deal with all kinds of variables.