NEW YORK – Gap Inc. will close 200 underperforming Gap and Banana Republic stores in the next three years, the US clothing company announced on Wednesday.
The move is part of the retailer’s strategy to shift its focus to its growth brands, namely Old Navy and Athleta.
The company expects Old Navy to exceed US$10 billion and Athleta to exceed US$1 billion in net sales in the next few years, driven by growth in online and mobile channels.
While it plans to cut Gap and Banana Republic locations, the retailer expects to add about 70 net new stores in the next three years, with the addition of about 270 Old Navy and Athleta stores.
“Over the past two years, we’ve made significant progress evolving how we operate,” said Art Peck, president and chief executive officer, Gap Inc, in a statement. “With much of this foundation in place, we’ re now shifting our focus to growth.”
Analysts said store closures have been common among traditional retailers as more and more consumers choose to shop online.
Shares of Gap Inc. soared over 7% after the news on Wednesday.
– Nampa-Xinhua
