E-commerce continues to wreck the brick-and-mortar retail business. Amazon’s extraordinary success takes its toll on failed retailers like Sears and J.C. Penney and chips away at even highly successful chains like Best Buy. One struggling, decades-old retailer continues to suffer, and it just closed over 100 stores.
The Gap was an extremely successful retailer three decades ago. It spun out stores for two of its other brands: Old Navy and the Banana Republic. However, the rise of competitors like Abercrombie & Fitch and J.Crew made its life even more difficult. Over the past decade, it has closed hundreds of stores.
Wednesday, the company put out a press release titled “An Update on our Gap European Business: Partner to Amplify Strategy.” The news could hardly have been more depressing. It read, in part:
[D]ue to market dynamics in the United Kingdom and the Republic of Ireland, we shared with our team today that we are proposing to close all company-operated Gap Specialty and Gap Outlet stores in the United Kingdom and Republic of Ireland in a phased manner from the end of August through the end of September 2021.
The New York Times puts the figure for England and Ireland at 81. It reported that France and Italy have 32 locations. This means hundreds of Gap workers may lose their jobs.
The jury is still out on whether other more Gap, Banana Republic or Old Navy stores will need to be closed. Gap made only $166 million in the most recently reported quarter on $4 billion in sales. However, the retailer is moving online rapidly. According to Gap CEO Sonia Syngal, “As stores traffic came back, we sustained our digital dominance with 82% online growth versus 2019.”
Perhaps it is, indeed, too late for Gap to turn around. Not only does it face Amazon, but it is up against other retailers with similar products. The Gap, like J.C. Penney and Sears, may not make it.