GAP is closing more than 200 stores worldwide amid plunging sales in a bid to save the brand.
The fashion chain’s parent firm is splitting into two independent companies – one of which will consist of the iconic Gap brand, Athleta and Banana Republic.
Gap is closing more than 200 stores worldwide amid plunging sales[/caption]
A second company will solely house its low-priced Old Navy brand, which has been out-performing the others.
Gap Inc said it was carrying out the restructuring in an effort to “revitalise brand health”.
The company has not said where shops will shut or how many jobs will be affected, although all 230 closures over the next two years will be of Gap stores.
At the end of 2018 there were 1,242 company-operated Gap shops worldwide with 152 in Europe, the majority of which were in the UK.
Art Peck, president and chief executive of Gap Inc, said the company knows “what we need to do to win”.
He added: “Combined with the separation we announced today, we will be well positioned to leverage the power of our brands and the talented teams that lead them to accelerate the pace of change, improve execution and deliver profitable growth.”
Gap Inc closed all eight of its Banana Republic stores in the UK in 2016.
High street shops have been battered in recent years by a challenging sales environment caused by rising costs and changing consumer habits.
MOST READ IN NEWS
The new company will be based in Gap Inc.’s current headquarters and Old Navy will remain at its current headquarters, both located in San Francisco.
The split, which followed a board review, comes as Old Navy has been thriving, while Gap still hasn’t been able to regain its footing despite numerous attempts to fix the business.
Once the go-to place for casual clothing, Gap has been hit by years of poor sales following increasing competition from Target and Amazon.