Gap to close all its stores in the UK and Ireland

(CNN Business) – Gap will close all 81 stores in the UK and Ireland at the end of September and will open them entirely on the Internet, as the brand adapts to the changes in shopping habits behind the pandemic.
The American clothing retailer, owner of Old Navy and Banana Republic, said in a statement Thursday that the closures will affect the stores operated by the company. He added that there are also plans to sell his establishments in France and Italy.

The withdrawal comes after a strategic review of its business in Europe that began last year “with the aim of finding new and more profitable ways” to serve customers in the region, the company said.

Gap announced in October a three-year plan to close hundreds of stores in North America, accounting for almost a third of its presence in the retail market. Like its rivals, the company has had to adapt to the shift to e-commerce, accelerated by the coronavirus pandemic, which has put brick-and-mortar retailers in check and contributed to the bankruptcy of established brands like Brooks Brothers.

This Thursday, Gap attributed to the “dynamics of the market” its decision to close stores in the United Kingdom and Ireland, which, it said, will be carried out “gradually” until the end of September. He declined to comment on how many jobs will be affected.

“We are undergoing a consultation process with our European team, and we will offer support and assistance in the transition to our colleagues in the process of closing the stores,” added the company.

The company has said it is in talks with a “potential partner” in Italy and negotiating with Hermione People and Brands, the retail arm of property developer FIB Group, to take over Gap’s stores in France.

Gap opened its doors in London in 1987, marking its first expansion outside the United States. It has been present in Ireland since 2006.

“Gap was decades ahead in offering the athleisure styles that have become so popular during the pandemic,” said Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown.

But the brand has struggled to compete with a growing number of rivals in the ‘casual space’, especially given the ‘decreased influx’ in shopping malls and on the shopping streets where many of its stores are located. it added in a research note Thursday.

The physical exit of the brand will mean a new blow to British shopping streets, already impacted after the Debenhams closure, the largest department store chain in the country.