Gap Inc. announces that Athleta and Janie & Jack brands will be open to franchise outside of the US.
The company has previously licensed its Gap brands, Old Navy and Banana Republic to third-party partners in 40 countries around the world. The very first Gap franchise store was launched in Singapore in 2006, after which the network began to actively expand. In the last three years alone, 100 franchise points have been opened. In the United States, all stores are still owned by the company.
The franchise model has traditionally been very common in the fast food industry, with companies such as McDonald's and Subway actively using it. This approach contributes to the very rapid growth of networks. That's what he's going to play Gap Inc., hoping to start actively promoting Athleta and Janie & Jack internationally.
The company has special plans for the countries of Central America and the Caribbean, where its products are not yet represented. This region, like some others around the world, has its own nuances of corporate culture and interaction with government bodies that are not always clear to foreigners. So for Gap, the franchise model is the easiest and most direct way to expand into these markets.
Also, according to the company, it has "tremendous opportunities" for the development of franchising business in the European and Asian markets.
For the last quarter of the sale of Gap Inc. decreased by 2%, and the value of its shares fell by 25%. The company is now facing strong competition from Zara and H&M, which have seen very rapid growth lately.