Going circular - Transition towards a circular economy

Decathlon has been working for several years on the design of its products to extend their lifespan. This approach aims to integrate sustainability issues (durability, reliability, performance over time with timeless design) and repairability starting at the product design phase.

Progress made with sustainability
Thanks to methodologies and the associated tests developed since 2020, sustainability criteria are now incorporated through specifications into the definition of Eco-design products. The database helps to make available a roadmap with clear criteria to product engineers. This test-based design methodology has produced a framework and sustainability standards by means, for example, of a choice of more durable components.

We established in 2022 a network of specialist engineers after organising training courses dedicated to this issue. These designers were in charge of creating frames of reference for all articles in their product range, along with identifying those that comply with the sustainability framework through four essential steps:
1. The diagnosis made by the specialist defining the causes of end-of-life, then deducing whether to treat the issue from a durability or repairability standpoint.
2. The test phases that confirm the diagnosis.
3. The interpretations help to put together the frames of reference.
4. The conclusions amassed in the collaborative design software, lead to sustainable design rules.

Thanks to this product sustainability perspective, sports design teams can make the necessary decisions when putting together their range and identify the products to stop or improve.This year, the frames of reference have been completed for the entire clothing range, shoes with studs, backpacks, water bladders, gym balls and jumping balls.

Decathlon shares its research and conclusions externally within the l’AFNOR (certification organisation) technical committee called DUR-HABI, intended to set up a standard that helps define durability criteria.

Advances made in repairability
Getting inspiration from the repairability index developed in France by the ADEME (French Environmental Transition agency), Decathlon established criteria setting out its products potential for repairability. For each family of items, the criteria to be met for a product to be considered repairable are:
📄 documentation is accessible;
🧩 spare parts are available;
🛠 the product can be disassembled
💶 the repair costs are a least 30 % less than the purchase price of the new product.

By following these four criteria, and thanks to a great deal of work done drawing up a list of the critical issues that arise within each product family, teams have been able to define, for each product type, the percentage of damage and failure covered by a repair solution. We consider a Decathlon product is Eco-designed, when 80% of failures associated with a product type are covered.

Please note that we distinguish between a high repairability potential, such as bikes, and Eco-design products that benefit from work put in at the design stage to make them more repairable than products on the market
As with the sustainability project, the main work done this year has been to define the frames of reference for each sport, in other words, set out the criteria and thresholds for each product family. Once these categorisation rules established, the network of trained specialist in the repairability concept could share these with
product engineers.

Since 2021, we have taken action for several products, such as Stand-Up paddles, scooters, and skateboards. Subsequently 300 product references have benefited from repairable Eco-design attributes in 2022 (6 % of all Eco-design products).
This article is available to find out more about repairability at DECATHLON.

Decathlon aims to take action at every stage of its value chain to reduce its products environmental impact. Subsequently, studies were conducted, better taking into consideration articles end-of-life, to improve their recyclability right from the design phase.

Several experiments have been carried out since 2021 with different recycling sector stakeholders (recyclers and environmental organisations) to co-create a method and an assessment tool for product recyclability.

The goal of this index is to define and check each product for:
▪️ the recycling potential and approve recyclability is backed by an industrial sector;
▪️ existing links with recycling sectors;
▪️ potential disruptors to recycling (presence of metallic elements or a wide variety of materials can, for example, downgrade the recyclability rating).
Tests validate this data. In 2022, teams tried and tested the recyclability of fins with an external partner.
This collaboration aims to check the feasibility of reproducing fins with the same component thanks to a material grinding and sorting line. The trial is continuing in 2023 with swimming goggles, skis and helmets.

Once this recyclability index defined for priority product families (footwear, clothing, tents, helmets), training was given to product engineers concerned, supported by the publication of recyclable product design help guide, and then accompanied by design rules to carry out concrete actions plans for certain types of products. Initially used by certain teams (helmets, footwear and mountain sports) in 2022 as a test, this guide will be introduced for all products in 2023.

To make these activities compatible with planetary boundaries while maintaining the company's financial viability, DECATHLON aims to transform its business model by accelerating the development of the product-service system.

▪️ Scaling up lower carbon emitting services (second life, product hire, product repair) will enable the Group to provide its customers with responsible and diverse sports services and encourage access to sport.

Opting to promote usage ahead of ownership involves considerable thought and experimentation to make it possible for products to be repaired, hired, resold, reused for as long as possible, and finally, recycled, if possible.A design distributor, therefore, needs to rethink its entire value chain to create sustainable value while reducing the company's impact on the environment.
We've done this transformation based on in depth analysis of users' needs and feedback.

The development of products' second life is gaining pace at DECATHLON thanks to the circular sales turnover being incorporated into financial reporting and in line with the transformation of the company's business model.

44 countries currently have a second life products offer with buy-back and new digital solutions helping to encourage the development of circular economy applying to more and more goods.This acceleration is taking place while meeting DECATHLON's requirements.

Articles put back on sale are inspected with the same standards applicable to new products, in particular, thanks to the detailed inspection sheets, gradually developed by design engineers and specific to each type of DECATHLON product.

The buy-back system allows users to directly resell their sports goods in France (in store and online) as well as in Belgium, Spain and Portugal (in store) (countries involved as of the 31st December 2022).

Initially available for bikes and skis, this service has rapidly grown from strength to strength in 2022, also covering fitness and weight training products, winter sports (ski and snowboard), water sports (canoeing, surfing, stand up paddle), urban mobility (bikes, scooters, skateboards, inline skates) along with hiking equipment (tents, backpacks, warm jackets and clothing equipment with sales prices over 50 €), golf and even fishing.

The key to encouraging the development of buy-back is keeping it simple. The customer can decide, in store, to trade-in their products in exchange for a voucher or an instant bank transfer to their bank account (in France since 2022). The products are then inspected and guaranteed (warranty period varies from country to country) while allowing the new purchaser to be satisfied or reimbursed.

In 2022, DECATHLON France tested a new digital buy-back system allowing a customer to search for their item online, describe its condition and get a buy-back purchase price without having to come to a store. We made this experience possible thanks to a dedicated website created in partnership with the CircularX company, a subsidiary of the Recommerce group

This online buy-back system has already let more than 3,000 items be traded-in and put back on sale in the Marketplace. It will be rolled out in Belgium, Spain, Italy and Netherlands in 2023 to further experiment with it.

Product hire has now established itself as a long term activity, enabling DECATHLON to rethink its business model through trials carried out by the company in different field tests, allowing it to make its mind up about the strategy through experimentation and innovation.

In 2022, DECATHLON now provides different product hire solutions:
1. Short term product hire with one-time payment letting customers use DECATHLON products for several hours, days or seasonally, especially for outdoor sports (winter sports, water sports, cycling, camping and trekking).
This service, available in ten countries in 2022, will be on offer elsewhere around the world in 2023. This model experienced this year
dynamic growth, generating 9 million euros in sales turnover (vs 5 in 2021).

2. Monthly product hire subscription favouring flexibility (generally at least one or three month), available in France for some categories of products (adult bikes, weight training equipment (weight benches and dumbbells), golf equipment and kids tennis rackets) and introduced in Spain at the end of 2022 for adult bikes. DECATHLON has identified this subscription model as a strategic priority for developing its product hire activity. It experienced strong growth in France, with 20,000 agreements signed this year (compared to 872 in 2021) and an average satisfaction review rating of 9.3/10* for kids bike hire.

3. Long term product hire with an extended commitment period (between 12 and 36 months), tested in France for bikes and, through an external intermediary, in charge of product hire agreements. This exploratory solution currently allows DECATHLON to thoroughly analyse customers needs and requirements along with externalising the risks linked to long term product liability (fraud, payment continuity), all while learning to master these.

We continue to analyse the offer, details of terms and conditions, customer experience, logistics, and customer risk management for each of these product hire models with a view to finding the format that is the most relevant and best matches users' needs.
The business performance results of product hire in 2022 confirm users' growing interest for these services.Thanks to encouraging growth
recorded in all countries offering these services, the sales turnover volume of product hire has doubled this year to reach 12 million Euros (vs 6 million Euros in 2021). DECATHLON eventually aims to offer its customers a complete product hire experience (choice of hire period, level of commitment, products).

*Survey carried out by e-mail in December 2022 with customers having subscribed to a subscription offer since March 2022 - 328 respondents.
9.3/10 review rating was given in response to the question: “How would you rate your overall level of satisfaction with this bike's product hire subscription?”.

While DECATHLON repaired this year, more products than the previous year (2,307,889 vs 2,064,295), with 66.5 % of products considered repairable having been repaired in 2022 compared to 77.1% in 2021. A result explained by the increase in the number of repairable products and the acceleration of demand for repair, combined with the difficulties of recruiting technicians and to a lesser extent, by the temporary unavailability of some spare parts.

We are accompanying this customer repair approach with a Customer Service website that redirects users towards compatible spare parts and making available how-to tutorials in 13 languages and 14 countries. Technical support is also set up in eleven countries enabling experts to guide users willing to do repairs (for bikes, table tennis tables, electronic products and fitness equipment) through messaging, phone or video conferencing, depending on the countries.