Gap considers closing entire European store estate

Gap is considering closing its entire European store estate next year, placing hundreds of jobs at risk.

The US clothing retailer has more than 70 stores in the UK and four in Ireland, with 158 franchise stores across Europe. It is also looking to close a distribution centre in Rugby next year.

A statement explained that it wants to operate in the region through partnerships, both online and in stores.

“As we conduct a review, we will look at transferring elements of the business to interested third parties as part of a proposed partnership model expansion,” explained Mark Breitbard, head of global operations at Gap.

Gap’s parent group closed all its Banana Republic stores in the UK two years ago, with more than 200 of its main brand and Banana Republic stores to shut around the world this year.

Overall sales fell 18 per cent in the three months to the end of August, leading to pre-tax losses of $41 million and a desire to make savings across the business.

GlobalData apparel analyst Gemma Boothroyd commented that the news comes as no surprise, given its undistinguishable product offering and failure to capitalise on growing demand for casualwear.

"Although globally Gap managed to practically double its e-commerce business to account for nearly 50 per cent of total sales amidst the COVID-19 pandemic, this success did not translate to Europe, where second quarter total sales ending August 2020 plummeted by 47 per cent."

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