Casualwear giant Gap is to close 200 of its 900 stores worldwide by 2013, and has admitted it has not invested heavily enough into attracting ethnic minority customers in the US.
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Chairman and chief executive officer Glenn Murphy said Gap’s market share among African-, Asian- and Hispanic-Americans was too low, during a presentation at the Bank of America Merrill Lynch 2011 Consumer Conference, according to reports.
He has also vowed to develop Gap’s product offer, building categories such as jewellery and increasing the amount of trend-led product.
He said there was “a huge opportunity…to fill in with trend-right product and chase products that make sense to us…and focus on new category development.”
Banana Republic, which is also owned by Gap, will also “skinny down” its store portfolio from 456 to 425 unit over the period, Murphy said.
He added that the group’s margins were coming under pressure from cotton price increases, but that it was taking a cautious approach to passing the hikes on to customers.
“We will do everything we can … to use our leverage as best as we can, but we have to be careful. We are not going to take the price increase and spread it mindlessly,” he said.
Gap, which turns over $14.66bn (£9.1bn) a year, added that it plans to grow the company through global expansion, etail and Gap outlets. It said its international and online operations would account for 30% of total revenues by 2013, from 22% last year.