Gap will be closing nearly 200 stores in North America. The downsizing will take place over the next two years. The company has 889 stores, according to the Wall Street Journal.
The company said on Thursday that they would reduce the amount of store’s across North America while focusing more on its expansion internationally. While they expect the 889 stores her to be down to 700 by the end of 2013 they plan to open 30 new stores in China by the end of the year.
Gap with the inclusion of its Banana Republic and Old Navy stores is one of the largest clothing retailers in the US. The company has no plans to shutdown any Old Navy stores but they do plan on reducing the square footage of the stores by 1 million square feet in all.
“In North America, sales are expected to grow modestly on its smaller, healthier specialty store fleet supplemented by sales growth in its online and outlet channels,” the company said in a statement.
Gap has been struggling recently with domestic sales. Gapâ€™s domestic profits dropped 19% in the second quarter this year. One reason for the loss of business, according to the WSJ, is that Gap is a middle of the line clothing store. Consumers today are shopping for either cheap clothes, or luxury items.
A Gap Inc. spokeswoman said the company wouldn’t reveal which stores would close. “We’ve been in some malls for a really long time; in some instances the demographics may have changed, so it may not make sense for a Gap brand store to be there anymore,” spokeswoman Louise Callagy said. “The goal overall is to return the brand to health, and part of a healthy brand is a high-performing fleet” of stores.