Gap considers closing all its UK stores

US retailer Gap could close all of its own UK stores, putting thousands of jobs at risk, as it mulls shifting its operations to franchise-only in Europe.

It may close all of its shops in the UK, France, Ireland and Italy next summer, the retailer said.

Gap could also close its European distribution centre in Rugby.

The retailer, whose sales have been falling in recent years, reported a £740m loss in the three months to May due to coronavirus disruption.

Instead of operating its own stores, Gap said it was looking at whether to move to a franchise model.

The retailer had 129 Gap branded stores in Europe at the end of July.

“As we conduct the review, we will look at transferring elements of the business to interested third parties as part of a proposed partnership model expansion,” said Mark Breitbard, head of Gap brand global.

Clothing retailers have been hit hard by the coronavirus crisis. As well as temporary shop closures during lockdown, they have had to contend with lower footfall and an accelerated shift to online shopping which has been capitalised on by specialists such as Asos and Boohoo.

Even before the pandemic, Gap was fighting to revitalise itself after losing younger shoppers to cheaper fast fashion brands such as Zara, H&M and Forever 21 over a number of years.

Earlier this year, Gap said it planned to close over 225 unprofitable Gap and Banana Republic stores globally as a part of a restructuring plan.