Gap to close stores in US and expand in ChinaTuesday, 18 October 2011
"Over the next 26 months, we'll look store by store at our specialty fleet and determine which stores meet the standards we've set for our brand," Art Peck, president of Gap North America, told the Associated Press. "This is a continuation of our work since 2007."
While closing stores in the U.S., the struggling retailer, which also operates Old Navy and Banana Republic, plans to expand the number of stores in China to roughly 45 from its current 15 locations. As explained by the company´s executives, the moves are related to the company's previously stated goal of reducing its overall square footage in the U.S. by 10 percent from 2007 to the end of 2013, while roughly doubling revenue from outside of the U.S. to 30 percent by the end of the same year.
"The combination of our global strategy and formidable growth platform puts us in a strong position to expand our reach into the top 10 apparel markets worldwide," said Glenn Murphy, Gap's CEO, in a statement. "In North America, we're taking a number of steps to improve sales in the near-term, and I'm confident that with a strong management team in place, we're well positioned for sustained growth across the business."
Just to place in context Gap´s decision, it is worth to remember that its sales in the U.S. have eroded considerably since it drove America's love of khakis and all things business casual in the 1990s because of growing competition from specialty retailers like Abercrombie & Fitch and tougher competitors from Europe, as Zara or H&M.