Gap could close more US stores among 350 announced: analysts
- Retail analysts fear Gap may be forced to close even more stores in North America.
- Gap announced on Wednesday it was closing all of its 81 stores in the UK and Ireland.
- An analyst also said Gap’s new Yeezy and Walmart lines smacked of “desperation.”
New York, Paris, Milan, London: the fashion capitals of the world. The four cities are home to the flagship stores of each clothing retailer with designs in the global market.
Yet Gap, the international retail icon famous for his laid-back American style, will soon have left London: he said this week that it is closing all of its 81 stores in the UK and Ireland. And in Paris and Milan, the future of Gap is uncertain: he is in talks discharge all or part of its French and Italian activities.
It’s no secret that Gap has been closing stores in North America for years amid declining sales. There were 552 Gap stores in the area at the end of May this year – exactly half the number there were a decade earlier, company figures show. In October of last year, it announced plans to close 350 Gap and Banana Republic stores in North America by 2023.
However, retail analysts polled by Insider said Gap’s drastic action in Europe this week signaled that even more stores will need to be closed in North America. They also said the company needs to completely rethink what it does in the United States.
“I don’t see them closing all of their stores in the United States,” said Natalie Berg, independent retail analyst. “But I think we’re in for a drastic resizing. The uncomfortable truth is that they still have way too many stores.”
Berg said the Gap stores were “no longer fit for purpose”.
“They can no longer just sell clothes,” she said. “You have to give buyers a reason to ditch their screens; give them an experience they can’t get online. “
Insider has contacted Gap for comment.
From September, Gap will be online only in the UK and Ireland. Berg said, “A lot of clothing retailers are doing the same thing, so now you have all this competition online. You have to ask yourself: is the line becoming a digital graveyard for struggling brands?”
Maureen Hinton, analyst at GlobalData, agreed that there was “probably more to do” for Gap’s store closure program in North America.
She said: “Gap is really struggling to find her own identity – and has been for a long time.”
Hinton said Gap needed “a much stronger strategy” for the United States, focusing on “what its brand identity is – who it is targeting and how it is going to do it.”
“There’s Yeezy on one end and it does things with Walmart on the other,” she said. “It sounds like desperation.”
Gap is banking on a collaboration with Yeezy, Kanye West’s fashion brand, to revitalize its fortune. The first Yeezy Gap product came out last month: a limited edition bright blue recycled nylon puffer jacket with a price tag of $ 200.
Gap’s new partnership with Walmart is less flashy. The new Gap Home line, sold exclusively at Walmart stores, includes a $ 43 stoneware table set and a $ 20 tie-dye shower curtain.
Buyers in London won’t buy any of these things.
Around noon on Thursday, only a few dozen shoppers were browsing hoodies, jeans, baby clothes and other clothing on the four floors of the UK’s Gap flagship store on Oxford Street, in the heart of the shopping district of London.
Amanda, 24, who does her shopping at the store every few weeks for herself and her three-year-old daughter, said she had not heard of its closure. “I wore Gap stuff when I was a kid – my mom put me on it,” she said. “She used to come here too. It’s really sad.”