Friday, August 12, 2022

Gap’s planning a comeback next year, starting with 175 store closures

Gap to close Oxford Street store
Signs in the store's window advertise heavy discounts available on stock.

Gap has announced a series of “strategic actions” to position the brand for improved business performance, including the closure of 175 underachieving stores in the US and some across Europe, as well as axing 250 jobs across its headquarter workforce . The American retailer described the move as a comprehensive effort to deliver more consistent and compelling product collections, and engage customers across all channels; the decision comes almost 6 months since it made Rebekka Bay‘s Creative Director role redundant.

“Our customers and employees want Gap to win,” said Jeff Kirwan, global president for Gap. “We‘re focused on offering consistent, on-brand product collections and enhancing the customer experience across all of our channels, including a smaller, more vibrant fleet of stores.”

 “Returning Gap brand to growth has been the top priority since my appointment four months ago – and Jeff and his team bring a sense of urgency to this work,” comments Art Peck, Gap Inc. CEO. “Customers are rapidly changing how they shop today, and these moves will help get Gap back to where we know it deserves to be in the eyes of consumers.”

Since Kirwan was appointed to lead Gap in December 2014, he‘s rebuilt the leadership team and implemented an aggressive agenda designed to strengthen the brand and successfully compete on the global stage. The team is driving towards a clear, on-brand product aesthetic framework focused on optimistic and elevated American style, while also rebuilding the brand‘s product operating model to increase speed, predictability and responsiveness, and enable greater competitiveness.

The company estimates an annualised sales loss of approximately $300m associated with the store closures but In contrast, could see annualised savings from these actions to value at around $25m, beginning in 2016.


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