Fashion retailer Gap saw sales fall in all of its global regions in August, with its international operations experiencing the biggest slump in trading.
Figures published late yesterday showed that sales in its markets outside of North America, including the UK, were down nine per cent year-on-year during the month compared to annual growth of five per cent for the same period in 2010.
Mid-market retailers in the UK such as Gap, which also owns the Banana Republic and Old Navy brands, have been battling for sales since the turn of the year, with many struggling to cope with increases in the price of cotton and low consumer confidence.
Summer promotional activity started much earlier than last year, with Gap among the fashion specialists trying to attract customers with a high number of half-price deals and, in some instances, even greater discounts.
Gap’s management team acknowledged earlier this summer that it is trying to find a solution to the decline in trading at the business, and has already let go a number of senior executives since the turn of the year, including Executive Vice President of Gap Global Design for Adult & Body Patrick Robinson.
In April the retailer also revealed that it was combining its international arms into one division, bringing together its company-operated and franchise stores across Europe, the Middle East, North Africa, Asia Pacific and South America, led by Stephen Sunnucks.
Commenting on August’s trading figures, which revealed that net sales across all areas of the business totalled $1.1 billion (£679 million), Chairman & CEO of Gap Inc Glenn Murphy said: “As we said on our recent earnings call with investors, we’re determined to make the necessary adjustments to women’s product and marketing to improve our overall performance and drive top-line growth going forward.”
Gap North America sales for the month were down eight per cent year-on-year, while the region’s Banana Republic and Old Navy brands each saw trading fall four per cent compared to the same month in 2010.
Year-to-date net sales at the end of August stool at $7.78 billion, while like-for-like trading for the same 30-week period, including online sales, was down three per cent.