Over the next three years, Gap Inc. will shift its retail portfolio by closing about 200 underperforming Gap and Banana Republic stores while opening about 270 Old Navy, Athleta and other stores.
The San Francisco-based retailer did not indicate where the closings or new stores are located. The company made the announcements at an investment conference in New York.
The company has Banana Republic and Gap stores at Valencia Town Center and an Old Navy at Valencia Marketplace on The Old Road. The nearest Athleta to Santa Clarita is in Sherman Oaks. As of July 29, 2017, the company operated 3,642 stores worldwide across its brands, down by 109 stores from two years earlier.
In a statement, the company said it “will be shifting its focus to where customers are shopping, simultaneously increasing its presence in its more profitable value and online channels, while continuing to shed square footage in lower productivity specialty locations.”
The company said it expects Old Navy to exceed $10 billion and Athleta to exceed $1 billion in net sales in the next few years, driven by growth in online and mobile channels, U.S. store expansion, and continued market share leadership in loyalty categories.
“Over the past two years, we’ve made significant progress evolving how we operate – starting with getting great product into the hands of our customers, more consistently and faster than ever before,” said Art Peck, president and chief executive officer, Gap Inc. “With much of this foundation in place, we’re now shifting our focus to growth. We will leverage our iconic brands and significant scale to deliver growth by shifting to where our customers are shopping – online, value and active.”
It said it will shed $500 million in expenses over the next three years “by better leveraging its size and scale, cross-brand synergies and streamlining operations and processes,” and will reinvest some of those savings in its growth initiatives.