SAN FRANCISCO, June 15 (UPI) — Gap Inc. announced Monday it is shuttering 175 locations throughout the United States and eliminating 250 jobs at its San Francisco headquarters.
The clothing retail store said it will close 140 stores in the current fiscal year, leaving a total of 800 locations in operation.
New Gap CEO Art Peck said growth at the company has been his top priority since his appointment four months ago.
“Customers are rapidly changing how they shop today, and these moves will help get Gap back to where we know it deserves to be in the eyes of consumers,” he said.
The closures are expected to cost the company $300 million in sales annually and onetime costs of between $140 million and $160 million. The estimated annual savings will be $25 million, expected to start in 2016.
The largely mall-based Gap’s sales have struggled in recent years as it competes with online clothing stores. Sales fell 10 percent in the first quarter, and there was a 5 percent drop in the first quarter in 2014.
“Our customers and employees want Gap to win,” said Jeff Kirwan, global president for Gap. “We’re focused on offering consistent, on-brand product collections and enhancing the customer experience across all of our channels, including a smaller, more vibrant fleet of stores.”
Gap’s shares closed down .21 percent Monday after the news.
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