Gap's same store sales down after distribution center set ablaze last month
Gap reported a drop in comparable sales in September for its namesake label and Banana Republic, while Old Navy increased 4%. An intentional fire set at Gap’s Fishkill distribution center negatively impacted the company’s sales and increased logistics costs.
Gap global and Banana Republic comparable sales fell 10% and 9%, respectively, and the company’s comparable sales as a whole fell 3% compared to a 1% decrease in the prior September.
Net sales decreased 2% to $1.43 billion from $1.46 billion in the prior year.
As a result of the fire, Gap expects a negative impact of 3 percentage points for its October 2016 comparable sales and a negative impact to comparable sales results in the fourth quarter of 2016.
In September, the New York State Police said that the fire that broke out at Gap’s Fishkill distribution center in August was “incendiary in nature” meaning intentionally set. The fire came a few days before the company released its August sales report, which included positive results from Old Navy and a continued poor performance from Gap and Banana Republic.
Sabrina Simmons, Chief Financial Officer, Gap Inc., said that the company is pleased with Old Navy’s continued positive performance. "While we remain focused on performance across the portfolio, we are pleased to see a strong customer response to Old Navy’s product assortment, which continues to drive positive momentum at our largest brand.”
In addition, Gap in October announced a partnership with Arvind Group for fashion portal NNNow.com to sell Gap products online exclusively in India.
Copyright © 2023 FashionNetwork.com All rights reserved.