Gap to focus on Old Navy, Athleta stores

Company to close 200 Gap, Banana Republic stores in next 3 years.

NEW YORK — Gap Inc. plans to shift its focus to its growing Old Navy and Athleta stores, and away from the Gap and Banana Republic brands.

The company said Wednesday it will close about 200 Gap and Banana Republic stores in the next three years and open about 270 Old Navy and Athleta locations during the same period.

Lower-priced Old Navy has been a bright spot for the clothing retailer, posting rising sales even as they fell at the Gap and Banana Republic.

The San Francisco-based company says Old Navy is on track to surpass $10 billion in sales in the next few years. And Athleta, which sells athletic clothing, is expected

to exceed $1 billion in sales. The company expects to reap about $500 million in savings over the next three years by better taking advantage of its scale.

“We continue to move with the customer and meet them where they are,” Gap CEO Art Peck told analysts Wednesday at a Goldman

Sachs Global Annual Retailing conference that was broadcast over the internet.

Gap’s moves are the latest to reinvent the chain and are being spearheaded by Peck, who took the helm in 2015. The company

faces the same problems as other fashion retailers, as shoppers buy less clothing in general and shop more at off-price chains or buy online when they do. That has resulted in sluggish traffic at the stores. But Gap Inc. also has long struggled with its own problems, mired in a sales slump as its clothes don’t stand out in an overcrowded landscape.

The company has been offering frequent discounts to get shoppers to buy, but recently it has been trying to pull back on price-cutting. It also has been working hard to improve fit — a problem that has long bedeviled the retailer— and has been trying to rework its fashions.

The company has been cutting its store numbers over the last decade. Since 2005, the chain has closed 650 stores and reduced its square footage by 5 million square feet, Peck said.

AP Gap Inc. says it will shift its focus to Old Navy and Athleta, and away from the Gap and Banana Republic. The company said it will open about 270 Old Navy and Athleta stores in the next three years.