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Retailer Profile: Gap


Posted At: 11 August 2008 15:41 PM
Related Categories: Retailers


Welcome to the first of what will hopefully become a new bi-weekly feature on the SnapShop blog!
In these Retailer Profiles, I hope to give you an overview of some of the worlds biggest and best retailers. If you have an idea of who you’d like to see featured next, please email me or post a comment below!
This week, we look at Gap.

Company Overview

Gap is an international retailer of menswear, womenswear and childrenswear with over 100 stores in the UK. It is positioned in the mass sector of the clothing/footwear market, with focus on individual fashion.
Gap UK is a subsidiary of Gap Inc., which operates a variety of brands such as Old Navy, Banana Republic and Forth and Towne across various territories.

Company History

1969: Gap established in San Fransisco
1970: Second store in California opens
1974: Own label merchandise launched
1975: Discount stores launched. You & You acquired.
1976: Company goes public on New York and Pacific stock exchanges
1977: Gap launches “Fashion Pioneers”, “Eaton Hill” and “Foxtails” labels and sub-brands “Brands” and “Logo”
1980: “Brands” and “Pants %ff” chains incorporated into “Tagg’s” chain.
2004: Gap founder Donald Fisher retires as Chairman and is replaced by Sebastion Gravano.

Launches, Failures and Successes

Over the years, Gap have tried and tested a number of different concepts and formats, some of which have been a resounding success and some of which, well, fell dead in the water!

Failures (to date)

Gap Warehouse
Pants %ff
Pottery Barn (sold off)
You & You

Forth & Towne

In August 2005, it was reported that Gap was to target the over 35’s with the launch of new chain Forth & Towne. The first of the new stores opened in the suburbs of New York, with around 20 stores following in the coming months. 18 months after its launch, however, Gap announced it had decided to close the chain to focus on its other brands. Some attribute the failure to the departure of Gap Inc. chief executive Paul Pressler, however sales continued to fall and the official story said the company was not "demonstrating enough potential" as a long-term investment

Successes (to date)

Gap Outlet
Love Me Gap
Banana Republic

Old Navy

Starting life in around 1994, Old Navy is the more price conscious, fashion driven chain from Gap. Expansion and new launches including online exclusive collections have continued since the beginning, and online sales at the end of 2007 were particularly good. More recently, Old Navy has suffered along with its parent company, seeing sales plummet by 27% YOY (07-08), however there are no signs of another Gap chain biting the dust just yet with overseas expansion continuing.

Sales figures

Following the recent trand for negativity, Gap saw like-for-like sales fall back 11% in July 2008. Gap's net sales were down 5% to $998 million (£517.5m) for the four weeks ended August 2. Gap's international comparable sales, which include its UK stores, fell by 9% over the period against an 11% uplift in July 2007. Gap chief financial officer Sabrina Simmons said: "In July, we focused on clearing through remaining summer product and preparing our stores for fall deliveries. We're pleased that we delivered merchandise margins significantly above last year." Gap's second quarter sales for the 13 weeks ended August 2 also fell 5% to $3.5 billion (£1.8bn), with like-for-like sales down 10%. International comparable sales in the second quarter were down 6%.


Most of the large name clothing retailers have, at one time of another, been accused of using child labour in their overseas production factories and Gap are no exception. In 2007, a British newspaper reported discovery of children as young as 10 sewing clothes for clothing retailer Gap Inc. in a factory in New Delhi.
Gap responded quickly, saying the factory was being run by a subcontractor who was hired in violation of Gap's policies, and none of the products made there will be sold in its stores.

"We appreciate that the media identified this subcontractor, and we acted swiftly in this situation," Gap spokesman Bill Chandler told The Associated Press on Sunday. "Under no circumstances is it acceptable for children to produce or work on garments."

Gap are known for its campaigns for social justice, so it appears that no one is safe from the claws of the British press – don’t worry Primark, you’re not the only ones!

Other, more ridiculous news stories, include;

Gap being sued by a 16 year old over “back to school adverts” in 2003*; A mother suing after her sons pants (which happened to be from Gap) set fire on a camping trip and Gap Inc settling a class action suit charging the retail clothing company with violating California labor laws by requiring employees to buy and wear Gap brand clothing and accessories while on the job (I wonder if those well-dressed folks at Dorothy Perkins get a clothing allowance...).

*After watching a Gap advert depicting children at school twirling around, jumping up and down, and generally enjoying themselves to a funky beat in the background, the prosecutor went to school full of high hopes for much new-style free soul dancing, community spirit, and trendy clothing in the new year. Unfortunately, his hopes were not realised and his efforts to start said joviality resulted in him receiving a punch in the face from an older student. The prosecutor is quotes as saying “When I got to school, there was no music in the playground coming from a mysterious source, and no-one was dancing. It was a shambles. I mean, what is this? And look at this uniform? My granny wears cooler stuff than this, dawg!";

For more information about Gap or any of its brands, visit SnapShop or the Gap website.

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The opinions expressed herein are the personal opinion of the author and are not intended as statements of fact and do not represent the view of SnapShop or Pragma in any way.


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