GAP India story
Gap formally entered India in May 2015 when they opened their first flagship store at New Delhi’s Select Citywalk Mall. It signed a franchise agreement with Arvind Lifestyle Brands Ltd, a unit of Arvind Limited - India’s largest integrated textile and apparel company, to enter India. While the agreement between the two companies took place in 2015, Arvind has had a long and successful association with Gap as their vendor partner, the former being a supplier of denim to Gap. Globally, Gap is known for its denims and 25% of the apparel in Gap stores in India consists of denims.
India, for long, had been on the radar of Gap as a strong contender for potential business. It offered to Gap an emerging, vibrant market and foretold of an important phase in its global expansion strategy. As the world’s second most populous country with more than 1.2 billion people, India represented an important platform to bring American casual style to consumers. Besides the favourable GDP growth rate, there was an increasing band of young buyers with the propensity to spend in the price bracket offered by Gap. India was also leapfrogging into the technology bandwagon, being ranked the world’s third largest market in terms of the number of internet subscribers.
While the retail markets in most western countries had become somewhat saturated for Gap, including the home turf of US, India presented a vast scope of growth and expansion. Not surprisingly, it was announced on Gap’s entry in 2015 that Arvind envisaged a potential revenue opportunity of INR 10 billion by 2020.
The brand today has 11 stores that have come up within a span of 18 months – two each in New Delhi, Mumbai and Bengaluru, and one each in Gurgaon, Noida, Pune, Chennai and Indore. The average size of stores here are in the range of 8,000–10,000 sq ft. Going forward, there are plans ot launching stores in other cities such as Kolkata, Hyderabad, Chandigarh, Lucknow, Ludhiana and Kochi. Although currently Gap stores are present only in malls, owing largely to the convenience of being located in a mall with high footfalls, they are open to being located on high streets as well, if the proposition seemed attractive.