8/10/2019 and it was created in 1969 with the opening of the first Gap store. Gap is considered the parent member of Gap Inc., and it was the base for the success of

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and it was created in 1969 with the opening of the first Gap store. Gap is

considered the parent member of Gap Inc., and it was the base for the success of the other

segments, including Old Navy, Banana Republic, and Piperlime. Gap offers extensive

selections of classically styled, high quality, casual apparel at moderate price points.

Products range from wardrobe basics such denim, khakis and T-shirts to fashion apparel,

accessories, personal care products for men and women, ages teen through adult, and

maternity apparel. Regarding the price range of the brand in the company, Gap is located

between Old Navy and Banana Republic, with more expensive products than Old Navy,

and less expensive than Banana Republic. Although Gap has been criticized for

blandness and uniformity in its selling environments, the firm claims that it offers

products from appeal to unique markets by developing multiple formats and designs. Gap

Jeans, for example, offers a huge variety of jeans.

In 1986 and 1989, Gap entered the children's apparel market by introducing

GapKids and babyGap, respectively. The goal was to offer the Gap style and quality in

casual apparel and accessories to children, aged newborn through pre-teen. GapKids

clothing is known for style, durability, and value with products such as active-wear,

school uniforms, graphic Ts, hooded sweatshirts, polo shirts, pants, jeans, and more.

babyGap is an international specialty retailer offering clothing and gift sets for newborn,

infant, toddler girls and boys up to the age of five. Products include tops, pants/ jeans,

dresses/skirts, sweaters/outerwear, shorts/swimwear, shoes, and bedding, as well as

unisex newborn sets. In 1998, Gap launched GapBody which offered women's

underwear, sleepwear, loungewear, yoga wear, and personal care products. Gap also

operates Gap Outlet stores, which carry a similar line of products. Regarding its stores

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operations, Gap designs virtually all of its products, which are manufactured by

independent sources, and sells them with their brand name. The range of merchandise

displayed in each store varies depending on the selling season and the size and location of

the store. Gap stores generally are open seven days per week and most holidays. All sales

are tendered for cash, personal checks, debit cards, or credit cards. In order to attract

more customers, these stores redeem gift cards, and also have a private label credit card

program through which frequent customers receive benefits. Most of Gap stores'

suppliers are located outside the United States by offering lower costs. However, Gap has

to deal with issues such as child labor in some developing countries. In India, for

example, Gap is trying to rebuild its reputation after a child-labor scandal, where children

were hand-embroidering GapKids clothes. Gap said it would refine its procedures to

ensure that items made in textile workshops in India were not being produced by

children. The company announced the statement after an internal investigation made by a

British newspaper, The Observer, which printed pictures of children making clothes for

Gap in a sweatshop. According to the newspaper report, some children were as young as

ten years old, and they were working for up to sixteen hours a day to embroider clothes,

some of them bearing Gap labels and bar codes. This case is one of the issues that Gap

has to deal with regarding its store operations.

Through the years, Gap has earned the reputation of a brand with a variety of

high-quality products. Now, Gap is known throughout the world with more than 1800

Gap stores located in eighteen countries, and they comprise the majority of the stores

owned by Gap, Inc. So, Gap has used a vertical integration since virtually all aspects of

brand development from product design and distribution, to marketing, merchandising

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and shopping environments are controlled by Gap. One advantage of having a vertical

integration is that the company does not have to pay wholesalers and retailers in order to

sell its products. Also, by having a direct customer interaction, the company can acquire

valuable insights into their preferences. However, it has also made franchise agreements

in countries such as Bahrain, Indonesia, Kuwait, Malaysia, Philippines, Saudi Arabia,

Singapore, etc. Even though Gap stores can be found in eighteen countries, Gap operates

stores only in six countries, including the United States, Canada, the United Kingdom,

France, Ireland, and Japan. The remaining twelve countries include the franchise

agreements.

Currently Gap is not bringing as much profit to the company as expected. Even

though the number of Gap stores is almost twice as the number of Old Navy stores, it is

still less profitable with net sales of $6,523 in 2007 compared to $6,665 for Old Navy.

During 2007, net sales from Gap consisted of 39 percent of total sales for Gap, Inc., with

a decline of 4 percent in net sales from last year. The company focuses more on sales

from physical locations rather than online stores. But, with its current position, it has the

ability to increase online sales since Gap spends in average more than its competitors in

online marketing. Currently, it is its second most profitable segment after Old Navy.

Even though Gap stores are located in eighteen countries, there is not a lot of diversity,

since most of the stores are mainly located in the United States. Being centralized in the

United States, Gap is more vulnerable to changes in the U.S. market. So, a suggestion to

have a more stable performance is to become more globally decentralized.

One reason that Gap is not performing as well as expected is because it has somewhatlost its brand identity. In the past years, Gap shelves have displayed different kinds ofclothing from classic casual to trendy to professional too many times, causing consumersto wonder what the brand even stands for. The other brands of Gap, Inc. are also playing

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a role in destroying the Gaps core offering and leaving with little room to maneuver.

During the last decade, Gap was considered to be a great example for other brands tolook at. Cool and understated, the brand defined hip, with great TV ads directed bydirectors du jour such as Spike Jonze, complete with catchy soundtracks from on-the-risebands such as French duo Daft Punk. Hipster Hollywood types infused the brand with a

sense of down