According to a report from the tail-end of November, Gap Inc., parent company to multiple clothing stores including Old Navy, Banana Republic, and, of course, Gap, suffered notably flat sales at the end of the last quarter. It seems the culprit for these siphoned sales is none other than Gap itself; Gap’s sales were down by 7% in the third quarter. Despite being the bedrock from which Gap Inc. is supposed to operate, Gap can’t seem to keep consistent business compared to its sister brands.
According to reports from Business Insider, the vast majority of any given Gap store’s stock is marked down by at least 40%. This rampant discounting is cutting into the store’s overall margins and making customers far less willing to pay market price for any item in the store. Gap also offers many of the same brands as its sister stores, Old Navy especially, but even with the discounts, it tends to charge more than what Old Navy charges at market value. In the official earnings release last Tuesday, Gap Inc.’s CEO Art Peck expressed his disappointment.
“We are clearly not satisfied with the performance of Gap brand. We know this iconic brand is important to customers, and we are committed to taking the bold and necessary steps to ensure that it delivers value to shareholders.”
