A few days ago, the French retail giant opened its first store in South Korea. Before the end of the year, Decathlon will also open its first full-fledged stores in Greece and Sri Lanka. The Ukraine will follow next spring, and there are unconfirmed reports that it is planning to also enter Japan, Kazakhstan and some other countries next year. It is already a big player in neighboring markets such as China, Romania, Turkey and Russia.
The new Korean project reportedly started out well, with big crowds entering the retailer's 7,000-square-meter big box in the futuristic city of Songdo, on the west side of Seoul. Negotiations have already started for an opening in the capital, which should be followed in the next couple of years by five sites in other major Korean cities such as Busan, Daegu and Daejon as well as on the island of Jeju, regarded as a major outdoor destination.
Longer-term, Decathlon's aim is set at a total of around 50 stores in Korea. The project is led by Stéphane Guy, a 13-year veteran of Decathlon who started by running one of its stores in France. He began to work seriously on the program in February 2016, with a market test online that supported the feasibility of the Korean venture.
Dominated by the outdoor sector, which has apparently stabilized after a major decline in the past few years, the Korean sporting goods market is relatively big by international standards, with an annual retail turnover estimated by some at about €1.5 billion and by others at a much higher level, but it is dominated by the country's big department store chains and by mono-brand stores.
Intersport failed to make a significant dent in the market after a five-year run, putting an end to a master franchising deal with LG Fashion in 2014. Apparently, the two parties could not agree on the financial terms of the contract or on the future positioning of the Intersport banner in the country.
According to the French newspaper Le Figaro, Decathlon may have a good chance to succeed in Korea. Aside from its low price positioning, the newspaper cited the success of other vertical retailers like Ikea in the country. Decathlon's strong private label of outdoor products, Quechua, is likely to be appreciated.
Meanwhile, Decathlon has officially confirmed a plan to open its first store in the Ukraine in the spring of 2019. The Ukrainian project is led by Florent Guieu, a French entrepreneur who previously worked as finance director for Decathlon in Russia and Romania. He said during a press conference on Sept. 25 that the store will occupy 2,500 square meters in the Petyrivka shopping mall of Kiev. A transactional website will start up at the same time, targeting customers all over the country.
Decathlon will study the feedback from the customers and the sales dynamics on the local market before opening other brick-and-mortar stores in the Ukraine. Most of the products will be supplied from Decathlon's warehouse in Poland, located not far from the Ukraine's border. In addition, Decathlon is in negotiations with new partners in Ukraine to expand its production in the country.
At the moment, the company produces shoes, gloves, hockey sticks, cross-country skis and some other products in three western regions of the Ukraine, which can be easily shipped to the rest of Europe. Decathlon has been getting many products and components from Korea.
It has also been sourcing textile products for more than ten years from Sri Lanka, where the first full-fledged Decathlon store is now set to open in mid-October, after a small market test. The local project is led by Etienne Mafart, a nine-year veteran of the company who was previously stationed at Decathlon's Indian head office in Bangalore for more than four years, handling logistics and other supply chain operations for the whole group in Southeast and West Asia.
