Gap to close 75 stores worldwide to focus on North American market

22 May 2016 (Last Updated May 22nd, 2016 18:30)

Apparel retailer Gap has plans to shut down 75 Old Navy and Banana Republic stores worldwide, as part of its plan to focus more on North American market and restore profitability.

Apparel retailer Gap has plans to shut down 75 Old Navy and Banana Republic stores worldwide, as part of its plan to focus more on North American market and restore profitability.

The company is intending to concentrate on markets that have potential for short-term growth.

This plan will lead to the closure of all 53 Old Navy stores in Japan this year, reported Straitstimes.com.

"Old Navy's near-term growth ambitions will be anchored in North America."

Just as many of its rivals, Gap has also been affected by the shift in consumer buying patterns, who are preferring online retailers.

In a statement, the company has said: "Old Navy's near-term growth ambitions will be anchored in North America, including its most recent debut of company-operated stores in Mexico, as well as China and its global franchise operations."

As of 30 April, the chain had nearly 1,030 Old Navy stores in North America and nearly 70 Old Navy in Asia, as well as roughly 610 Banana Republic stores in North America, and 60 in Asia and Europe.

The closures of outlets will lead to annualised sales loss of about $250m. However, it will be able to save $275m on pre-tax basis.