China News Service, August 14th (Xie Yiguan, a reporter from China-Singapore Finance and Economics) "GAP closes the store to clear the warehouse, quickly go to pick up leaks", "GAP withdraws the cabinet and clears the goods, the price is quite 'cabbage'"... Recently, many netizens have released GAP stores Information on store closings.

Screenshot from a social e-commerce platform.

  Entering the Chinese market for 12 years, GAP stores have been distributed in shopping malls in many cities. Now some stores may want to say "goodbye" to everyone.

Multiple GAP stores in different cities will be closed

  On the 3rd floor of Link Plaza, No. 1, Danling Street, Haidian District, Beijing, the GAP store here is undergoing the final withdrawal and clearance activity.

  "August 27 is the last business hour." The store clerk told a reporter from Zhongxin Finance and Economics.

  According to her, the store's withdrawal and clearance activities have been going on for some time.

"Now members are 40% off regular-priced items and an extra 50% off discounted items."

  But the customer flow in the store did not increase significantly because of the clearance activities.

"It's still a normal passenger flow, and there may be a little more people on weekends," the clerk said.

  Although it has entered the countdown to closing the store, the clerk told reporters, "Because it is still in business hours, it will be replenished from time to time, and the supply is still sufficient."

  In addition, the GAP store of Beijing Rainbow Department Store also confirmed to the media that it will officially withdraw from the store on August 15.

At the same time, the reporter noticed that GAP's stores in Shanghai, Nanjing and other places are also withdrawing and clearing their warehouses.

  Regarding the reason for the closure, the above-mentioned clerk said that it is not very clear.

When the reporter asked the GAP official about the reason for the closure, the official customer service said, "I have not received relevant information."

  GAP China headquarters recently responded to the media, saying, "The clothing and fashion industry is changing rapidly, especially in Greater China." Therefore, GAP will regularly review its own business strategies and models, including store portfolios, and make corresponding adjustments according to the situation. " It is also a very important business practice in the industry to best adapt to the new environment and ensure that customers are provided with the best products and services through the right channels, including the right stores in the right places.”

  However, the closing of GAP’s store this time has also brought attention to the previous rumors of selling its Chinese business.

In March 2021, foreign media quoted sources as saying that GAP was considering potential options, including the sale of its Chinese business, to adjust its operations in China.

  Before that, Old Navy, a fast fashion brand under GAP Group, which has been in China for 6 years, has announced its withdrawal from China.

Data map: GAP classic blue logo.

Photo by Xie Yiguan, a reporter from China-Singapore Finance and Economics

Now there are only more than 150 stores left in the mainland

  In recent years, the number of GAP offline stores has shrunk significantly.

In the Beijing area, in 2020 alone, GAP has closed a number of stores such as Wangfujing APM Store, Xidan Joy City, and Indigo Store. Among them, the APM store is the first Chinese flagship store opened by GAP in 2010.

  On the 11th, the reporter inquired on the GAP mall applet, and the search results showed that there are only more than 150 stores left in the mainland.

  Along with the reduction in the number of stores, there is also GAP sales.

GAP Group’s financial report for the first quarter of 2022 shows that the company’s sales fell 13% year-on-year to $3.5 billion, with a net loss of $162 million.

  "GAP Group still has problems such as declining store traffic, lagging e-commerce business growth, declining brand influence, clothing price deflation and declining profit margins, and it urgently needs a major transformation." Morgan Stanley's previous report pointed out.

International fast fashion brands have "

broken down

" in China

  According to public information, GAP was established in the United States in 1969 and is the largest clothing retailer in the United States alongside Zara and H&M.

  GAP has repeatedly closed its stores in China, and the other two have had a hard time in China.

  Previously, H&M, which had caused the anger of netizens and was consciously boycotted by the boycott of Xinjiang cotton, closed the first store in China and rushed to Weibo hot search. As of the end of 2021, H&M has closed 60 stores in China, accounting for 12% of the total number of stores.

H&M's low-cost fast fashion brand Monki Tmall flagship store also officially closed on April 1.

  Not long after H&M closed its first store in China, on July 31, Zara's three sister brands, Bershka, Pull&Bear and Stradivarus, closed their Tmall flagship stores and bid farewell to the Chinese market.

In early 2021, Inditex Group, the parent company of Zara, announced that it would completely close all offline physical stores in China of its three brands, and only retain online channels.

  According to the Inditex Group's financial report, from April 30, 2021 to April 30, 2022, the stores of almost all Inditex brands showed a shrinking trend, and the total number of stores in the group was reduced from 6,758 to 6,423.

  There is also Uniqlo who chooses to reduce the number of stores.

According to its parent company, Japan’s Fast Retailing Group’s 2022 interim report, Uniqlo’s sales revenue and operating profit in the Chinese market have both declined, and the company has temporarily closed 133 stores in Greater China.

Data map: A shopping mall in Chongqing.

Photo by Zhang Yan

Young people don't love international fast fashion brands anymore?

  In the past, the Chinese market was a "strife" for international fast fashion brands, and they opened stores in China.

In recent years, why did the collective choose to reduce the number of stores?

  In this regard, Jiang Zezhong, a professor at Capital University of Economics and Business, believes that on the one hand, it is related to the spread of the epidemic in many places; on the other hand, there is a loss of the main consumer groups of these fast fashion brands.

  "Some fast fashion brands need to ensure the quantity of goods, reduce costs, and manage prices. The investment in business operations has increased, and the investment in design, whether it is the sophistication of products or the meticulousness of processing. weakened, and the appeal to consumers decreased." Jiang Zezhong pointed out.

  The reporter combed and found that Zara, H&M, GAP and other fast fashion brands have been fined many times for product quality problems.

  "In addition, in recent years, domestic young consumers' recognition of foreign brands has begun to weaken, which has brought opportunities to domestic brands, and domestic brands have taken advantage of the trend." Jiang Zezhong added, at the same time, consumption styles are also changing now. If fast fashion If the brand does not adjust accordingly, it will naturally lose the market.

  The "2021 Spring/Summer New Fashion Report" has shown that from the perspective of consumer preferences, IP co-branded models, national trendy products and other special categories are more popular with Generation Z.

  "The back waves of the Yangtze River push the front waves. If the style of 'front waves' is not recognized by the market or not supported by the current environment, withdrawal is a regular phenomenon." Jiang Zezhong said that whether it is an international or domestic fast fashion brand, it is necessary to grasp the consumption trend. .