TABLE OF CONTENT

1. Overview of DECATHLON VIETNAM:

1.1. DECATHLON VIETNAM history
1.2. Shares valued in DECATHLON VIETNAM
1.3. Product Brand dedicated
1.4. Product development cylce

2. Overview of Shoe Department:

2.1. Key dates
2.2. Key figures
2.3. SWOT matrix

3. Positioning strategy of KALENJI

3.1. Positioning
3.2. KALENJI’ s segmentation
3.3. Products

4. Brand identity of KALENJI

5. New product development

5.1. Brand Extensions
5.2. Reason for lauching a new product
5.3. Identity of NEOFEEL
5.4. Products

6. Marketing plan for 2008

6.1. For KALENJI
- Products
- Price
- Promotion
- Place and Position
6.2. For NEOFEEL
- Products
- Price
- Promotion
- Place

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1. Overview of DECATHLON VIETNAM:

1.1. DECATHLON VIETNAM history:

Since its foundation in 1976, Decathlon has always had a very clear goal: to make sport
more enjoyable for everyone. In every comer of the globe, this purpose is expressed
through two complementary areas expertise: The design and manufacture of sporting
goods, and retailing sporting goods.

• In 1994, starting shoes production activities by placing trial orders for vulcanized
linen and selected the first subcontractor for pasted shoes TS300.
• In 1995, opening the Representative office of PROMILES and developing Shoes
Production activiites
• In 1996, lauching Heavy Stitching sector
• In 2000, starting Textile production activity

1.2. Shared values in DECATHLON VIETNAM:

• Dynamic
• Honest
• Friendly
• Responsible

1.3. Product Brand dedicated:

There are about 12 brands:

• QUECHUA: Mountain sports equipment: trekking, mountain-climbing-
mountaineering, skiing-snowboarding.
• TRIBORD: Water sports equipment: swimming, water-skiing, sailing, diving.
• DOMYOS: Fitness, gym, dance and combat sports equipment.
• KALENJI: Running and athletics equipment.
• KIPSTA: Team sport equipment: football, rugby, basketball, handball, volleyball,
field hockey, baseball,…
• INESIS: Golf equipment
• GEOLOGIC: Fishing, hunting and archery equipment.
• ARTENGO: Racket sports equipment: tennis, table tennis, badminton,…
• B’TWIN: Cycles, rollers and accessories.
• FOUGANZA: Partner of horseman and horse.
• APTONIA: The equipment for healthy athletes.
• GEONAUTE: The equipment for nomadic athletes.
• WEDZE: For enjoying the slopes: clothing and equipment for skiing,
snowboarding,…

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1.4. Product development cycle

• An idea for a product is generated by the Passion Brands

• Its design is perfected by Decathlon’s design teams
• Production
• Delivery of products to stores
• Retail

2. Overview of SHOES DEPARTMENT;

2.1. Key dates:

• 1994: Sourcing the shoes market in Vietnam and launched the trial order of
shoes.
• 1995: Openning the representative office and developped the vulcanized shoes.
• 1996: Launched the development and production of TS300.
• 2000: Launched the first hi-tech running shoes TRKA.
• 2002: Launched the development of hiking shoes waterproof.
• 2003: Launched the production of hiking shoes waterproof and developed the
mocasin shoes.
• 2005: Launched the development and production of soccer shoes and golf shoes.
• Be an innovative concept development of global shoes.
• 2006: Launched the development and production of double lasting process shoes.

2.2. Key figures about turnover:

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80000000

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2.3. SWOT matrix of Shoes Department:

STRENGTH: WEAKNESSES:
- The footwear industry has been one of key - Poor infrastructure. There are
contributors to Vietnam’s economic expansion. severe problems with roads and
Footwear is the third of top 5 major export items the railway system, port facilities,
(after petroleum & garment industry). Active bridges, water and electricity
government encouragement of foreign investment. supply, sewage and drainage.
Invested country for leading shoes manufacturers.
- The second footwear supplier for EU market (after - Dependence on the imported
China); the eighth-largest in footwear production technical upper components.
and the fourth in footwear export of the world ( after
China, Italy & Brazil). The annual capacity’s 550 - Anti-dumping tax to EU in
million pairs (est. with the growth average 18% 2007-2008
yearly)
- Cheap labor and skilled literate labor force to
absorb new technologies.
- Short distance to reach to manufacturers
- Short distance to the main port.
- Good reference of brands (all world leading brands
are being produced in Vietnam populated country
i.e. New Balance, Timberland, Marell , Speedo,
Caterpilar, Nike, adidas, Reebok, Puma, Superga,
Diadora…).
- Vietnam benefices the GSP form A, low import tax
to Europe i.e.
Upper leather shoes 4.5% instead of 8%;
Synthesis upper 11.9% instead of 17%;
Antidumping tax on leather upper shoes: 10% for
VN instead of 16.5% for China.
- Experience Production leader supply chain with
sufficient knowledge and know-how
(DECATHLON Vietnam has shoes department since
1994) in shoes process i.e. molds, able to start the
development to validation from the draft of design,
and standard of operation process.
- Produced wide ranges of process from basic to hi-
tech.
- Stable suppliers with strong growth of capacity.
- Constant delivery on time rate (DOT rate), and
stable improvement non-quality-cost rate (NQC
rate).
- Being low cost producer in an industry panel for a
given level of quality.

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- Availability of soles components and basic upper
components in Vietnam.

OPPORTUNITIES:
- Challenger, backup, alternative in front of China
(many suppliers are located in both country),
especially during anti-dumping tax application.
- Products with local components i.e. Forclaz snow
200
- Future high level of products with low price.
- More local components are recognised and
developed (including the main components)
- Foreign investors are coming to open the
components industry in Vietnam.
THREATS:
- China becomes the biggest rivals
in shoes exporting for Vietnam.
- Increase the labor cost in city
area  factory will move to the
country side
- Exclusively booked by other
brands.
- Heavy weight in one supplier if
no challenger

3. Positioning strategy of KALENJI:

At an altitude of 2000m on the high plateaux of West Kenya, in a place called Eldoret,
the Kalenjins live. It's from this tribe that we took inspiration for the name Kalenji.

3.1. Positioning:

* Runner by origin:

For an ancient nomadic people, running has been part of their lives throughout their
history. At one time it was a means of survival by escaping rival tribes. Their children run
15km each day: the kilometres mount up running to and from school, without noticing it
they run from soon after taking their first steps. Now considered as a sport, running was a
also important to the youth of the tribe as an important stage in their life: by catching an
antelope they attained the status of an adult.

* An original training approach:

They run according to what feels right and in harmony with the countryside. They force
fewer speed and heart rate constraints on themselves. They rarely run on a track, yet
always as a group and with a smile.

* Run for pleasure with KALENJI:

Running is man's most natural sport. You do it from your childhood with pleasure among
friends, nobody teaches you how to run, running comes from instinct. However, running
is often seen as an intense experience, sometimes violent both for the body and the
spirit."

This experience should not be a suffering but instead a moment of pleasure. It is

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important to run at your rhythm: as dictated by your body, not by your mind, the rhythm
where you feel at a balance.

3.2. KALENJI’ s segmentation:

After researching NIKE and ADIDAS (competior of KALENJI), KALENJI set up its
segmentation as following:
• Customer target: sportman
o For walking shoes: no limitation of customers
o For running shoes: concentrate on customers from 18 -35 years old.
• Geography: divide into 3 gammes:
o Gamme 1: buy at all of cities and rural areas (for best-seller products)
o Gamme 2: buy at about 70% stores in the country (less-quality products)
o Gamme 3: buy at about 50% stores in the country (less-quality products)
• Price:
o For Hi-tech product: (for example: Elite or Mythra): the price is about 20-
40 EUR
o For Blue product (cheap product, good quality) (for example: Success):
the price is about 4.5 EUR – 10 EUR.

3.3. Products:

There are products for running and also for walking. Below are some images of
KALENJI Products:

• Kiprun 1000:

Designed for running on a regular basis (1 to 5 times a week) on roads and paths. Ideal
for neutral runners. Lightweight shoe with excellent forefoot and heel cushioning to help
neutral runners running on a regular basis improve their skills in complete comfort.

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 • Elite 4000:

Designed for regular running - 2 to 5 times a week over long distances - on roads and
paths. For male pronators
• Mythra Jog:

Designed for occasional running - once a week - for up to 45 min, on roads and
paths. Comfortable shoes with forefoot and heel cushioning, to start running in the best
conditions.

• Ekiden 200:

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Designed for running on an occasional basis (once or twice a week) for up to 1 hour on
roads and paths. Excellent balance between cushioning and foot support, for runners of
all weights who are looking for stability.

4. Brand identity of KALENJI:

With the running passion brand KALENJI, it is this style of running we wish to
communicate and develop, and it is with this new approach to running that we want to
encourage participation.

Making the pleasure of running accessible to everyone, awakening and developing the
desire to practice this sport.

Every runner has different constraints according to stride type and running style.
KALENJI products are designed to allow runners of all levels to move on to a freer style
of running and bring about a new way of running: running with pleasure.

Come and join the "last free tribe", one that runs for pleasure not suffering, where
feelings count more than results. Which chooses its own path and is not held back. With a
light stride, those who run let their body and spirit soar, and they are free.

5. New product development:

5.1. Brand Extensions:

Innovation, positioning and adaptability are paramount to the making of a great brand.
The brand extensions of Kalenji originate from they reflected in how consumers think,
feel, and act with respect to the brand, this product brings the world of sport, and Kalenji
know “THE WALKING AS THE WAY OF LIFE”.

5.2. Reason for launching a new product:

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Concerning to the need of widening the sportive activities and professional function 
Kalenji decides to launch a new kind of product. It’s NEOFEEL.
Here are some arguments about NEOFEEL:
“Every morning, we go to the work by walking 3 km in shoes of urban walking,
comfortable and elegant. The come evening, we return by walking again. Maybe we wan
to promenade, and take some time for go shipping and so on. In the weekend, sometimes
we are going to walk in forest, to listen to the nature’s sound, to relax us. Our daily life is
made by walking, we became specialists! We privilege good light, supple, very
comfortable walking shoes like NEOFEEL! Since we walk every day, we feel more
relaxed, more dynamic, more cheerful... Then make as us, walkas soon as you can with
NEOFEEL ...... it is good for your health”.

5.3. Identity of NEOFEEL:

The aim is the kalenji technologies in the service of your pleasure to run.
Some specification on NEOFEEL:

• It designs for light walking and every day use (leather lining)
• Designed for regular urban walking and everyday travels
• Besides, it creates more flexibility for runner with very supple leather upper.
• Further, with Neofeel, we also feel the ventilation Leather upper allows breath
ability.

Due to a lot of conveniences, this kind of shoes brings to users, it drawn up all the
attentions in first week of sale in CAMPUS (Lillle-France).
With these shoes, we will stay comfortable throughout the day, WHY NOT TRY IT ON?

5.4. Products:
Let take a look over on some images of NEOFEEL

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6. Marketing plan for 2008:

6.1. For KALENJI:

* Product:

Every runner has different constraints according to stride type and running style.
KALENJI products are designed to allow runners of all levels to move on to a freer style
of running and bring about a new way of running: running with pleasure.
Here are our core competencies :
• Produce wide range of products.
• Localize maximum the components following the local needs at first.
• Secure the flow to supply and export components to other suppliers in panel.
Next to Neofeel, in 2009, Kalenji intend to come undone new style of shoes for baby. Its
name is TOOKEPAR. And we hope that it is also the sudden attack on shoes market as
the similar as NEOFEEL.

* Quality:

Regarding to the quality, Kalenji always care as much as possible about the runner’s
health. They consider what type of runner are you? (OCCASIONAL runners, REGULAR

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runners, COMPETITIVE runners) to give you the advice which kind of shoes is the most
appropriate.

If you are OCCASIONAL runners, you need cushioning, comfort and support

You need long-lasting cushioning, support and reactivity if you are REGULAR runners

And the last type need cushioning, reactivity and minimum weight

Everyone runs differently. The best way to work out your own style of running is to look
at the soles of your last pair of standard running shoes.

DID YOU KNOW?

The shockwave generated by every impact on the ground can be the equivalent of
2 to 3 times the weight of the runner.

RUNNING SHOE CHARACTERISTICS

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 5 main choice criteria:
Cushioning - Support - Reactivity - Comfort - Stability

Our quality rule is: We send ‘right quality’ shoes. Do not send if it is not met required
quality.

* Price:

By take care so much on quality, it leads their price is a little bit higher than the same
brand. However, we also have the price strategies in detail:
• Be the best low cost producer in the panel.
• Able to offer one price for whole year.
• Challenge the cost at 2 suppliers.
• Able to analyze the cost/ gain in terms of quality-cost-lead time. Propose solution
to reduce cost.

* Promotion:

• We have the projects to be Able to discount x % anytime for Opeco models (high
quality, low cost).
• We propose the Opeco to customer to reach “I wan” turn over.
• Furthermore, Kalenji team display of the shoes project in the rural areas
• The project is to supply a pair of shoes to go to the school to the young people of
the poor families located away from the school under the following conditions:
o Be motivated by the school and having encouraging results;
o Agreement of the relatives and the school;

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 o Agreement of maintaining the shoes and restore it in the term of the
schooling.

* Place and Position:

At the first period of Lotus project, we concentrate our products in European market, in
principal, we produce in Vietnam and export to many countries all over the world such
as: Europe, China, USA, Poland, Spain, Brazil, Russia, Korea, Japan…
Moreover, we have good long-term contract with big suppliers in Shoes branch to
allocate capacity for production planning. Our suppliers are Bitis, Thai Binh, Pouyuen…
For further projects, we will establish the outlet in VN in coming years, and we strongly
have believed that with this special event, the sale of Kalenji shoes will increase more
and more.
Relating to the position plan
• Able to analyze the cost/ gain in terms of quality-cost-lead time. Propose solution
to reduce cost.
• Develop the method to reduce lead-time i.e. stock components…
• Work on the automatic orders for blue products.
• Each process is able to produce at 2 suppliers.
• Suppliers are autonomous in quality control

6.1. For NEOFEEL:

* Product:

• With this new running passion brand KALENJI, it's this style of running we wish
to communicate and develop, and it's with this new approach to running that we
want to encourage participation.
• It is great style and excellent quality leather at an unbeatable price.
• Easy to put on and fasten, this shoe is extremely flexible. Thanks to it plain and
sporty.

 Here are below are the summary of product process from sample to mass production:

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1. Production leader technical (PL tech) shall validate the sample and decide if he sends
it or not. In any case he writes his comments.
2. Since the first price estimation (from designer), PL informs designer and Industrial
Buyer about any gap due to component or pattern change. When the Cost breakdown
is issued from supplier it can be compared and analyzed more efficiently.
3. PL Tech always gives his opinion and suggests solutions to reduce the cost or
improve the product. It is his added value.
4. Leather consumption: bring another way of calculation to the suppliers and be
competitive with other DPP / suppliers.
5. Control all components consumption during the mass production in order increase our
experience and master the consumption for further developments.

 Feature of product: Sportive and Fashionable Shoes.

* Price:

As mention above, this shoes will come to market with unbeatable price (about 24.76
EUR) and acceptable margin parallels with high quality and protect your feet.

* Promotion:

At that time, the success was presented with capacity, order management, on time
delivery...We "crossed the finger" to see if the sales could reach the ambitious forecasted
quantity.
Now, it is realizing. The initial sales of the NEOFEEL are very strong (15 000 pairs per
week) above our previsions, even without advertising.
We intend launching the advertising program on TV shows, the sales are expected more.

* Place:

Due to the specification of this shoe, it will be allocated for Pouyuen- the factory is in
charge for hi-tech shoes. We propose a lot of self quality control and traceability projects
at Pouyuen to manage them strictly for this issue.

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We hope that it will contribute more success for DECATHLON Vietnam family.

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