Decathlon (1976), a company review

The History of Decathlon: From French Origins to a Global Sports and Outdoor Retail Giant

Decathlon, the world’s largest sporting & outdoors goods retailer, is renowned for its unique ability to offer high-quality, innovative sports products at affordable prices. Its growth from a single store in northern France into a global powerhouse with over 1,700 locations across 70 countries is a story of visionary leadership, strategic milestones, and relentless innovation. In this week’s chapter I’ll delve into Decathlon’s journey, exploring the role of its founder, key revenue milestones, and the company’s ambitious future plans.

Founding and Early Vision: Michel Leclercq’s Entrepreneurial Spirit (1976-1980)

Decathlon was founded in 1976 by Michel Leclercq, a passionate entrepreneur with a vision to revolutionize the sporting goods industry. Born in 1938 in northern France, Leclercq came from a family of retailers; his cousin Gérard Mulliez had founded Auchan, one of France’s largest supermarket chains. This family background in retail no doubt influenced Leclercq’s business acumen and drive. He had previously worked as a manager at Auchan, but his real passion was sports. Leclercq was an avid cyclist (like many French people at the time - they were ahead of that trend!) and outdoor enthusiast, and he claimed that he believed sports should be accessible to everyone, regardless of their financial means or level of experience.

Leclercq’s idea was simple yet innovative: create a store where people could find equipment for all sports under one roof at affordable prices. He envisioned a place where customers could buy products for running, cycling, camping, swimming, and more—whether they were beginners or seasoned athletes. In doing so, Leclercq sought to eliminate the elitism often associated with sports equipment, which at the time was either highly specialized or too expensive for the average consumer.

The first Decathlon store opened in Villeneuve-d'Ascq, near Lille, France, in 1976 (the year I was born!) with the slogan “Satisfying People with Sport.” From its inception, Decathlon’s mission was clear: democratize sports by making high-quality, accessible, and affordable gear available to all. It’s important to reiterate that this idea was relatively novel in the mid-1970s, as most sporting goods stores either focused on one type of sport or catered primarily to elite athletes. Decathlon’s model of offering a wide variety of equipment for all sports quickly attracted mass market customers.

The store’s success in its early years laid the foundation for the brand’s future growth. Leclercq’s visionary leadership and ability to recognize the importance of affordability and quality were key to the company’s success. He fostered a culture of innovation and customer service that would become integral to Decathlon’s DNA. A deadly combination when you can get it right.

Private-Label Strategy and Early Revenue Milestones (1980-1990)

A significant turning point in Decathlon’s history came in the early 1980s, when the company made the strategic decision to develop its own private-label brands. By creating its own products rather than relying on third-party suppliers, Decathlon could control the quality of its offerings while keeping prices low—a crucial part of Leclercq’s vision.

In 1986, Decathlon launched its first private-label brand, Quechua, which specialized in outdoor equipment like tents, hiking boots, and camping gear. This was quickly followed by the introduction of several other proprietary brands, each targeting a different sport. For instance, Domyos was created for fitness products, Kipsta for team sports like football and basketball, B’Twin for cycling, Kalenji for running, and Nabaiji for swimming. Each brand focused on a specific customer segment, with a strong emphasis on innovation and affordability.

The private-label strategy paid off handsomely for Decathlon. By 1990, the company had not only expanded its range of products but also achieved significant financial success. Its annual revenue had crossed the €100 million mark, driven largely by the increasing popularity of its own brands. The vertical integration allowed Decathlon to differentiate itself from competitors, improve profit margins, and reduce its dependency on external suppliers.

In 1986, Decathlon opened its first French warehouse - An 8,000 sqm warehouse opens in Vitrolle (in Southern France) - to streamline its logistics and inventory management, further helping its pricing strategy. This period marked the beginning of the company’s sustained growth, driven primarily by its private-label offerings and, again, what seems like a genuine commitment to making sports accessible to all. Authenticity? This year also saw the first Decathlon store opens outside France in Dortmund, (Germany).

International Expansion (1990-2000)

As Decathlon solidified its position in the French market, it accelerated its international expansion in the early 1990s. In 1992, Decathlon opened its first Spanish store in Barcelona. The company then moved quickly to enter other key European markets, including Italy in 1993, and the United Kingdom in 1999.

Decathlon’s international growth was strategically planned and executed, focusing on countries with a strong culture of sports and outdoor activities. By 2000, Decathlon had over 100 stores across Europe and had firmly established itself as a leader in the sporting goods sector. The company's growth was also bolstered by its acquisition of local competitors, such as Alpina in Germany, which further strengthened its market position.

The company’s aggressive expansion helped Decathlon reach a significant financial milestone in 2000 when it recorded annual revenues exceeding €1 billion for the first time. This achievement was driven by its combination of private-label products, customer-centric service, and the strategic opening of stores in high-potential markets. Decathlon’s model of offering a wide range of sports equipment at affordable prices resonated with consumers, and its financial performance reflected this success.

The Decathlon Sports Lab had also made its debut during this period - in 1997 to be specific. Again, a commitment to innovation, to to giving the everyday athlete access to the best data and facility. And it worked.

Technological Innovation and the €5 Billion Revenue Milestone (2000-2010)

The early 2000s were marked by Decathlon’s focus on technological innovation and adapting to the rapidly changing retail landscape. Recognizing that technology would be a critical factor in shaping the future of retail, Decathlon began investing even more heavily in logistics, product development, and customer experience enhancements.

One of the most significant innovations during this period was the introduction of self-checkout kiosks in stores, which allowed customers to quickly scan and pay for items without waiting in long lines. This was part of a broader effort to improve the in-store experience by making it faster and more convenient for shoppers.

Decathlon also capitalized on the rise of e-commerce, launching its online store in 2006 (koodza.fr, the forerunner to decathlon.fr). The company developed a strong omnichannel strategy that integrated physical stores with its digital platform, allowing customers to shop online, pick up products in-store, or have them delivered. They were a pioneer of the new ‘click and collect’ strategy. By the late 2000s, Decathlon had become one of the leaders in online sporting goods retail, generating significant revenue from e-commerce. In 2023 that figure was over 17% or revenues.

In terms of product innovation, Decathlon continued to new products such as the Quechua 2 Seconds tent, which could be pitched in seconds, and Kalenji running shoes, featuring ‘advanced cushioning technology’. These products not only enhanced the company’s reputation for innovation but also drove sales growth.

By 2010, Decathlon had surpassed another major milestone, recording annual revenues of over €5 billion. This growth was fueled by its continued international expansion, its embrace of technology, and its relentless focus on innovation.

Global Expansion into Asia and North America, and Reaching €10 Billion Revenue (2010-2020)

In the 2010s, Decathlon turned its attention to expanding outside of Europe, particularly in the burgeoning markets of Asia and North America. China became a key focus, with Decathlon opening its first Chinese store as early as 2003 and rapidly expanding its presence in the region. By 2020, China had become one of Decathlon’s largest markets, with over 300 stores across the country.

India was another major growth market for Decathlon. The company entered India in 2009, and by the mid-2010s, it had established itself as a major player in the country’s sporting goods market, with dozens of stores and a strong online presence. Decathlon’s affordable pricing and wide product range resonated with India’s growing middle class, further driving its expansion in the region.

In 2017, Decathlon entered the highly competitive U.S. market, opening its first store in San Francisco. The U.S. presented unique challenges, including stiff competition from established retailers like Dick’s Sporting Goods, but Decathlon aimed to differentiate itself with its private-label products and affordability. It didn’t work, and they closed their last 2 stores there in 2022.

However, by 2020, Decathlon had achieved another significant revenue milestone, surpassing €10 billion in annual sales. This impressive growth was driven by its international expansion, its robust private-label portfolio, and the increasing popularity of its e-commerce platform.

Sustainability, Innovation, and Future Plans (2020-Present)

As Decathlon entered the 2020s, like many others, the company began placing a greater emphasis on sustainability, aligning itself with global trends toward environmental responsibility. Decathlon committed to reducing its carbon footprint and increasing the use of sustainable materials in its products. By 2021, the company pledged that 100% of its stores and warehouses would be powered by renewable energy, and it launched initiatives to promote product longevity and reduce waste through repair services and second-hand sales.

Decathlon also continued to innovate in terms of product design and technology. The company’s research and development teams focused on creating eco-friendly products, such as backpacks made from recycled materials and reducing the environmental impact of its packaging.

Here are the company 2023 ‘planet’ figures:

Looking ahead, Decathlon has ambitious plans to further expand its global footprint, particularly in Asia, where there is significant growth potential. The company aims to increase its store count to over 2,000 by 2025 and continue to invest in digital and e-commerce channels, as well as enhancing the customer experience through AI. Innovation?

What’s next?

Decathlon’s journey from a single store in Villeneuve-d'Ascq to a global sporting goods giant is a testament to the vision and determination of its founder, Michel Leclercq, and the company’s genuine commitment to innovation, affordability, and customer service. You don’t get away with bluffing through these. With annual revenues now exceeding €15 billion and a presence in over 70 countries, Decathlon has firmly established itself as a giant of our industry, while maintaining an ability to react swiftly. I personally don’t see that changing any time soon.

Poll Results from last week's community input request

Firstly, thank you for your input. We had a huge response, which gives us a super insight into what the community wants.

1. The day long ‘think-in’ is a resounding yea, but the timing is a no. March seems to be inconvenient, with a lot of requests for April or May. And others requesting that we perhaps piggy-back on another outdoors event, so we can hit 2 birds with one stone. So, we’re now planning for around April 9th, and piggy-backing on a popular dike event on the west coast. More to follow so keep posted. And we will have to cap attendance at the first event, so we can learn as we go.

2. Product - Market fit. Again, this is a resounding yes, but people (reasonably) requesting much more detail before offering further commitment. So, here it is.

First - finding product market fit means: does your suggested product (or product evolution/improvement) solve a problem for a big enough audience, at a price that the audience deems acceptable.

If we get that wrong at stage 1, the rest will become impossible - eventually, after the initial launch phase. Regardless of who we get to market it. It just won’t work. That’s why, over the years, I have become obsessive about this subject. Honestly, I think that 99% of products that are launched for sale, do not have adequate product market fit (either because of the proposed solution, TAM or price). And hence, they will fail in one way or another.

So, I propose a course that laser focused on this one subject, and aimed at sport and outdoors business that either want to launch, or want to add to their product or service offering. For example, you could be:

• A new brand or manufacturer in sports and outdoors

• A growing brand in the same sector

• A new or growing retailer planning for their instore or online offering / assortment

• A guided service provider who wants to know how popular their trips are or can be with some adjustment

• Etc.

And the list goes on. Yet we will come back to the same core question: product - market fit. And the best ways to test this?

As usual, thanks for reading and I hope you find value in the newsletter. If you do, please share. It helps a lot. Also feel free to reach out directly with any thoughts or feedback at [email protected]

Happy camping, from here in Ireland.

Until next week and chapter 28 where we’ll be diving into Brooks running, go n-éirí leat!

Derek.