It looks like yet another favorite brand might be heading towards bankruptcy. Delia*s, the fashion hub for teenage fashions circa 90’s and 2000s recently closed its doors, and it seems like Gap might not be far behind.
According to The Wall Street Journal, Gap plans to close a quarter of its stores in North America. This is bad news considering this is the second round of huge cuts in the past four years. This major change will ultimately save Gap around $25 million a year in losses.
Between 175-180 stores in North America and an unnamed number of European stores will soon shut their doors. While no Gap Outlet stores will be affected, these store closing mean trouble for thousands of workers.
In a time where most would rather spend $5 on a t-shirt than $50 on one from Gap, Gap’s fashion rivals like Forever 21 and H&M have been prospering while this timeless brand struggles to rehabilitate and keep up. With such tough competitors and changes in trends, it’s no wonder Gap is trying to revive their brand.
Yahoo Finance mentions that Art Peck, Gap’s Chief Executive, claimed that the label’s women’s clothing business had been a challenge for several seasons due to quality and fit issues and because it was not trendy enough.
“These decisions are very difficult, knowing they will affect a number of our valued employees, but we are confident they are necessary to help create a winning future for our employees, our customers and our shareholders,” Gap CEO Jeff Kirwan added to WWD.
Although these major store cuts won’t really negatively impact Gap shoppers (online shopping, anyone?), it’s eye-opening to see such a timeless brand that’s been around since 1969 slowly inch towards shutting its doors.