- Gap is closing all its UK and Ireland stores by the end of September, but said it would still sell clothes online.
- The retailer has been struggling amid rising e-commerce competition.
- Falling sales for its Gap brand have been offset by the success of its Old Navy and Athleta lines.
- See more stories on Insider’s business page.
Gap is closing all stores in the UK and the Republic of Ireland as sales fall globally for the fashion brand.
It will close all 81 stores by the end of September, but continue selling clothes online, it said Wednesday.
Gap attributed the move to “market dynamics.”
“The e-commerce business continues to grow and we want to meet our customers where they are shopping,” the company said in a statement. “We’re becoming a digital first business and we’re looking for a partner to help drive our online business.”
Gap said that it would shut the stores between late August and late September. It opened its first UK store in 1987 and its first in the Republic of Ireland in 2006.
In October, Parent Gap Inc. announced the closure of 350 Gap and Banana Republic stores in North America.
Gap Inc. posted first quarter global net sales of $4 billion, up 8% compared to 2019 – but the success of its Old Navy and Athleta brands drove this increase.
First quarter revenues for its Gap brand fell 16% compared to 2019. In comparison, net sales grew 25% for Old Navy and 56% for Athleta.
“Gap was decades ahead in offering the athleisure styles which have become so popular during the pandemic,” Susannah Streeter, senior investment and markets analyst at Hargreaves Lansdown, said in a statement shared with Insider.
“But even though revenues have surged at Gap over the past year, its own brand ranges haven’t set sales alight.”
The 52-year-old brand, which is still “rooted in its heyday heritage,” has “suffered from a kind of benign neglect,” Danni Hewson, financial analyst at AJ Bell, said.
Gap said that it had started a review of its company-operated business in Europe last year to find ways to make it more cost-effective. The company said that it was in talks with Hermione People and Brands, the retail branch of FIB Group, about taking over its stores in France, and was in discussions with another partner for the potential acquisition of its Italian stores.
Online fashion giants have posted soaring revenues during the pandemic
“In this changing retail landscape and with so much shopping shifting to online, shedding expensive rents makes sense for the company, particularly given the success of online-only fashion rivals,” Streeter said.
More Brits have been buying clothes online during waves of government-mandated store closures – leading to soaring revenues for online fast-fashion giants. In the year to February, Boohoo posted sales of £1.75 billion, a 41% growth year-over-year. And in the six months to February, Asos posted sales of £1.98 billion, a jump of nearly a quarter compared to the same period a year before.
Online isn’t the only way for fashion brands to be successful, Hewson said. British giant Primark is topping its pre-pandemic sales despite shunning e-commerce, she said.