Are you planning to declutter your closet this spring? It might be wise to check if your favorite clothing store is still in business before updating your wardrobe. Several retailers, including Walmart, Best Buy, and CVS, have downsized by closing their stores across the United States. Even major clothing chains like Gap are joining the downsizing trend, with more than 150 locations set to close this year.
During a March 9 earnings call, Gap Inc.'s Chief Financial Officer Katrina O'Connell announced that the company plans to close 50 to 55 Gap and Banana Republic stores in 2023. However, O'Connell did not provide details about which locations would close or when.
This announcement isn't a surprise, as Gap Inc. revealed in October 2020 that it would close approximately 350 Gap and Banana Republic stores in North America over the next three years. O'Connell confirmed during the earnings call that the 50 to 55 closures this year are part of that plan. According to Gap's website, the company is aiming to end 2023 with a "smaller and healthier fleet of stores" to meet the increase in online demand.
The Children's Place is also planning to close around 100 stores this year, according to President and CEO Jane Elfers during a March 16 earnings call. However, Elfers did not provide details about the locations or the closure dates.
The Children's Place has been undergoing a "fleet optimization initiative" to shift towards a digital-first business model. Since 2019, the company has closed 315 of its stores, or 34 percent of its entire fleet, and plans to enter 2024 with a fleet of approximately 500 stores.
Both Gap Inc. and The Children's Place are adapting to market conditions and customer preferences to remain competitive in the retail industry.
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