Decathlon's global business strategy and overseas expansion site selection analysis

Decathlon company ( Manufacturer apparels equipment a range sports France) Based understanding company's global business strategy key determinants success Anwser USA a suitable location overseas facility ? Discuss rational site company's future expansion.

There are several reasons why Decathlon could expand to the United States. First of all, the U.S. market is a large market, with over 300 million potential consumers. At the same time, this is also a market where the consumers that Decathlon would target are considerably important in volume and with the appropriate levels of revenue to justify accessing Decathlon products. First of all, let's determine what the Decathlon targeted group of consumers would be.

Decathlon aims towards individuals who are interested in sports, who have an average to high income, and who place an important focus in their lifestyle on exercising, on physical activities and on improving the way they live. In the United States, especially in the urban areas (basically on the main cities on the two coasts and in cities like Chicago in-between), the American consumer fits this characteristic and is willing to invest into sport equipment in different forms, while paying attention to the way he develops as an individual through exercise and fitness.

Opening a suitable overseas location facility in the United States would help Decathlon because it would give it closer access to the U.S. market that, as previously shown, is a generous and potentially highly profitable one. The main advantage would derive from the fact that the company would be much closer to the targeted market and would be able to supply it with lower transportation costs. At the same time, a physical presence in the targeted market would help the company in better understanding the consumer, in creating advertising and marketing campaigns that are in line with the requirements of the U.S. market.

The presence in the U.S. And opening a new facility there has certain challenges that the company will need to be aware of. First of all, other than presence in Russia, China and India, the company is entirely located in Europe, where cultural differences from country to country are relatively limited. One can also consider that presences in the countries outside Europe is, in fact, based on the company's necessity to outsource rather than on the need to access the local market and save on costs. As such, the motivation of expanding to the United States is different than the expansion that the company has undertaken in other countries.

At the same time, Decathlon can also consider outsourcing to the United States. Some of the states within the U.S., such as Mississippi or Alabama, have standards of living that are, on average, lower than those in Western Europe. Outsourcing there would mean that the company can still benefit from economies in the cost of production, while at the same time fulfilling the objective of being closer to the targeted market and of being able to save on additional costs.