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"Mind The GAP" 25% of Specialty Stores to be Closed

heezsafe
edited June 2015 in Off-Topic
Apparently as a contrarian play, in the midst of our "economic recovery," GAP has decided to go with a new product operating model.

"Moments ago, one of the biggest clothing retailers in the US confirmed the worst nightmares about the state of US consumer spending, when it reported that it would shut down over 25% of all of its specialty stores in the US, or about 175 (of which 140 will be shut in the current year), leaving the firm just 500 specialty locations and 300 outlet stores. And, in addition to the thousands of job terminations these closures would entail, the company will further fire another 250 in its headquarters."
"The company estimates an annualized sales loss of approximately $300 million associated with the store closures. Additionally, the company estimates one-time costs primarily associated with these actions to be in the range of approximately $140 million to $160 million, of which about $55 million to $75 million is non-cash. These costs are expected to be recognized primarily in the second quarter of fiscal year 2015 and include lease buyouts, asset impairments primarily related to the Gap fleet, inventory and fabric write-offs, and employee related costs associated with organizational changes." [my emphasis]

http://www.zerohedge.com/news/2015-06-15/gap-fire-thousands-close-quarter-all-specialty-locations

Hey, time for more "seasonal adjustments" to the BLS employment numbers., I guess.

Comments

  • Dex
    heezsafe said:

    GAP has decided to go with a new product operating model.

    Do you know what the model is?

    It just looks like closing of stores to me.
  • heezsafe
    @Dex With retailers--- esp. national chain store retailers--- one never knows. They come and go, seemingly with the passing of the tides. But given my strange fondness for corporate-speak, and how invariably disingenuous it is, I really should have emboldened the phrase. To consider just how much time and creative energy must go in to coming up with their precise phrasings.... there is no end to the amusement! But maybe that's just me.
  • clacy
    Hard to know if it's due to lack of overall consumer spending, or just that shoppers tastes come and go, and Gap has fallen out of favor a bit.

    Probably some of both.
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