Gap Holiday

PARIS —  Retrenching in Europe, Gap Inc. has told employees that it may close its Gap store network on the continent and signalled interest in striking up external partnerships to maintain a presence in the region.

A source said the company will likely maintain, and even expand its e-commerce offer in Europe.

Gap officials were not immediately available for further comment. The company posted a statement on its web site from Gap president and ceo Mark Breitbard, dated Tuesday, saying the label told employees in Europe that it is “starting a strategic review of options” for its European business, including the possible closure of company-operated stores in the U.K., France, Ireland and Italy in the second quarter, as well as reviewing of the brand, warehouse and distribution model, and Gap and Banana Republic e-commerce operations in Europe. It also cited the closure of its European distribution center in Rugby as a “possible outcome.”

“We will look at transferring elements of the business to interested third parties as part of a proposed partnership model expansion,” the company said, noting that franchise partnerships are a “strong and cost-effective way to amplify the brand.”

The Gap brand counts franchises in 35 markets, with more than 400 stores and 14 e-commerce sites.

The group in June said it expected to close 225 Gap and Banana Republic stores worldwide this year, with further closures possible next year. The European region accounted for 2 percent of the group’s sales in the first half of the year.

Last month, Gap Inc.’s chief executive officer Sonia Syngal lauded Breitbard‘s repositioning of the label. It is a leaner business, she said, highlighting the partnership with Kanye West’s Yeezy brand.

Gap, which has been bulking up the numbers of online consumers as the coronavirus has reduced the numbers of in-store shoppers, reported a $62 million loss in the second quarter. The brand plans to launch an upbeat holiday campaign with a dance challenge on social media.

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