Gap Inc. said Thursday that one of the companies will contain an old fleet. Another not-yet-named business will include Gap, Banana Republic and other brands, including Athleta.
"It's clear that the business model and customers of the Old Navy are increasingly deviating from our special brands," said Robert Fischer, chairman of the Gap Board. He said that each company "now requires a different strategy to prosper."
Gap said Thursday that Sonya Sinhal, CEO of Old Navy, will continue to operate this brand. The management of the other company will be conducted by Art Peck, General Manager of Gap.
is a story about two very different businesses: the old fleet flourished in recent years, and the sale in stores , opened for at least a year, grew by 3% in 2018. Analyst Jeffries described the retail network as a "car" last fall.
Meanwhile, Gap fought – its sales last year fell by 5%.
The rupture was the hottest brand in retail trade: he traveled to the mall in the second half of the 20th century, and his logo sweatshirts and turtlenecks won everyone from teens to moms and celebrities like Sharon Stone.
But the brand has failed with baby boomers that have grown to the brand, and it has failed to attract the Millennials that are leading the trend today.
The company talked a bit about how to make Gap a part of the business again. In November, Peck described the Gap shop as unprofitable. At the end of the last quarter, there were 1242 Gap stores in the world. 758 of them were in North America.
On Thursday, the company said it would close 230 Gap stores over the next two years as part of its plan to "revitalize" the Gap brand. The closure will affect the "specialized" Gap stores, which include shopping malls.
Most of these stores will be in North America, Peck told analysts on Thursday. Chief Financial Officer Terry Stoll added that the company focused on non-supplying stores were "in the wrong places" or were not "strategic devices."
About 130 such closures will take place this year, reports Gap. The company is also planning to open locations for Old Navy and Athleta. Athleta, which will become part of the new Gap company, is a network for women's leisure, which has been successful.
Gap believes that in the next two years he will be able to save from $ 250 to $ 300 million before paying taxes through closing plans, according to the presentation of securities. He expects to complete the split of companies in 2020.