partnered with 150 designers and employs 50 internal researchers who study

Partnered with 150 designers and employs 50 internal

This preview shows page 14 - 16 out of 20 pages.

partnered with 150 designers, and employs 50 internal researchers who study human action during sports to provide tailored sports goods which minimize discomfort and the risk of injury. Decathlon has over 50 innovations and 2,800 new products every year. On average the company registers 40 patents per year. Focus on R&D enables the company to understand the consumers’ demand better. It also helps the company to gain first mover advantage by launching products ahead of its competitors. Increase in Revenue Overall growth in the revenue provides confidence to the company’s management for future. The company’s revenue grew from EUR8,200 million in FY2014 to EUR9,100 million in FY2015, an increase by 12%. The revenue growth was attributed to the opening of new stores in various new markets including Mexico, Malaysia, South Africa, Slovakia and Thailand. In FY2015, Decathlon opened 140 new retail stores as compared to 103 stores in FY2014. Increase in the total revenue gives a positive impression for the company’s investors. Weakness Revenue Concentration Decathlon’s dependence on select region for major portion of revenue could affect its business operations, if the region experiences any adverse political and economical change. Although the company has operations in 29 countries such as France, Spain, Italy, China, Poland, Portugal, Hungary, Germany, Belgium, Brazil, the UK, Russia, Romania, the Netherlands, Turkey, the Czech Republic and India among others, it generates a major portion of the revenue from Europe. In FY2015, the company reported 35% of the total revenue from France, and rest from International operations. Dependence on a specific operating region makes the company vulnerable to risks associated with that region. Opportunity
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Decathlon S.A. SWOT Analysis Decathlon S.A. © MarketLine Page 15 Private Labels Gaining Momentum The company stands to benefit from the increasing demand for private label products. During a period of slow and negative economic growth, private label sales are rising as consumers increasingly shop to a budget. While price is a prime factor driving private label sales, improvements in packaging and quality have helped to remove the stigma attached to buying store brands. As Decathlon also sells private label brands such as Aptonia, Artengo, B'TWIN, Caperlan, Domyos, Fouganza, Geologic, Geonaute, Inesis, Kalenji, Kipsta, Nabaiji, Newfeel, Oxelo, Quechua, Simond, Solognac, Tribord, Wed'ze, and Orao it has a strong opportunity to increase its profit margins in the future. Focus on Emerging Asian Markets Decathlon intends to benefit through expanding its business in Asian market. According to the IMF report, the GDP of Asian and Pacific economies is projected at 6.3% in 2017. Emerging and Developing Asian markets including India and China are expected to report strong GDP growth. The GDP of China stood at 6.9% in 2015 and is projected to grow by 6.3% in 2017, whereas GDP of India stood at 7.3% in 2015 and is projected to reach by 7.5% in 2017. In FY2015, the Decathlon opened 51 new stores in China, 17 new stores in India and five new stores in Thailand. Focus on emerging Asian markets could increase the demand for its store products and improve its revenue.
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  • Fall '20
  • Brand, Private label, Sports equipment

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