GAP Group Sales Performance Is Low Is Nothing New.

stay GAP After the group posted a 3% decline in sales in September, NYSE:GPS's share price rose by 15.28% in October 7th.

Subdivision, the GAP group's sales in September and its share price surged mainly on the group's relatively lower price Old Navy. In September, sales of Old Navy increased by 4% compared to the same period last year, while the group's two other ones. brand The same store sales of GAP and Banana Republic remain unoptimistic, both of which have fallen by about 10%. The data in June this year showed that Old Navy grew by 5% compared with the same period last year, while GAP declined by 1%, while Banana Republic fell 4%. The rise in stock prices on Friday did not reflect the rise in GAP group's revenue.

With regard to the 3% decline in sales in September, the group's explanation is that in August 29th, the group had a fire in the cargo transfer center of Fisher, New York, which affected about 120 thousand square meters of warehouse, which lost about 12 million stocks and increased the replenishment cost. Without the impact of this fire, the decline in sales in September this year will not be so serious. It will probably be the same as last year's 1% decline in September.

Storefront of Old Navy

But in fact, the low sales performance of GAP group is nothing new. The GAP group was founded in California in 1969. Its name comes from the generation gap between the rebellious hippy young people and the old parents in the United States. In English, "Gap" has the meaning of "gap and separation". clothing It's just a bridge built on this generation gap - casual jeans with no age limit and jackets with huge Logo. These landmark designs made it a well-known brand in the US in the 90s of last century. But it is precisely the ambiguous positioning of GAP, which has no targeted consumer groups, which makes GAP do not give consumers the impression that they can not buy, so they are gradually being replaced in more and more fashion brands.

At the same time, fast fashion brands such as H&M, ZARA and Forever 21 have also seriously partitioned the GAP market, with a conservative estimate. The brands are keeping up with the fashion trend of the whole market at 15 full speed series each year, and new products emerge in an endless stream with low prices, and are deeply loved by young people who like to try new products. GAP, which is also a fast fashion, still maintains the speed of one or two updates in one season. The style of the product changes little. As a result, GAP has been badly hit by fierce competition, and its stock price has dropped by 29.45% in the past three years.

Nearly three years, GAP group share price chart

Today, the performance of Old Navy has given rise to GAP group and investor confidence, and consumers have shown a fond attitude towards product classification and clothing style of Old Navy.