Gap Inc Essay Example | Topics and Well Written Essays - 1750 words

Gap Inc - Essay Example Thirty-seven years ago, Gap Inc. started its humble beginnings with big dreams that spun into a golden international retail enterprise of highly-respected apparel lines. From a handful of employees at its historic California home, Gap Inc. has now hired over 160,000 employees all over the world that support the brand names it carries. With more than 4,250 stores, Gap Inc. boasts of its worldwide lead as a retailer for clothing, accessories and personal care products under the brand names of Gap, Banana Republic and Old Navy. By the year 21st century the complexity of the fashion industry has acknowledged the changing moods of dressing. Dressing down according to Kelly and Silverstein (2005) became an acceptable norm for the society whose rules for dressing became relaxed and interest in fashion waned. With home-based jobs sprouting people saw no need to buy fashionable clothes. Ordinary retail and clothing sales saw a disappointing decline as the millennium ushered in comfort dressin g. Gap Inc., whose target clients are teens and the middle market with its basic style should see a logical push compared to Banana Republic's affluent clientele and Old Navy's fashionable yet bargain minded customers.Gap Inc. however, suffered tremendous drawbacks against its gracious fashion profit enjoyment of the 90's that Brady attributed to its electronic retailing in 1997, as prevailing modes of expression sank the sales of summer 2001. Hea revealed how store sales showed a 12% dip compared to the previous year. Given the sales shortfall, shares of stocks remained on the defensive that Hea positively believed could pick up during the fall months. However August and September saw weak store traffic owing to the lack of buyers' enthusiasm for its apparel lines. The Old Navy division suffered the highest setback with the biggest sales drop that then CEO Millard Drexler acknowledged as its priority, "the need to find the right balance between key items and fashion". In its numero us attempts to survive the fashion crash, Drexler was later replaced in 2002 according to Brady(2003) that has brought in bolder colors that certainly help cut the inventory, squeezed out costs and helped Gap triple its earnings and stocks rose to more then $18 per share. The GAP strategies By redesigning a "look" to fit in with the season and the environment, Gap's strategies included highly focused surveys and research on consumer needs and fashion trends that high-lighted classifying its clientele from the "style-conscious, updated and classic" individuals according to Brady(2003). Gap, has also adapted the different mixes provided by Levy and Weitz (2004, Ch.2) that retailing systems should carefully observe with strong emphasis on the merchandise. According to them, much focus on its products centered on the ability to recognize versatility in style, assortment and variety without sacrificing its quality. Fit being an important factor in the clothing apparel line, assumed that its predictability should announce its availability that consumer research brings into its designs for must-have clothes. Although the millennium trend was to dress down and simplify, the smugness brought by the old Gap designs were too obtainable with other cheaper competition. A variety of choices for the shopper in style and a wider array of color definitely zeroed in the buying spree. Gap's predictability in the 1990's saw a gradual yet significant progress that has seen improvement on its credit rating and debt reduction in the 3rd quarter of 2003. Webb then announced its CEO Paul Pressler's move to repurchase its common stocks. Price Adjustment according to the law of supply and demand hammers specific changes to maximize profit and minimize markdowns according to Chorafas (2002). Prices change but are highly capricious in trying to match the demand. Gap, has however attached a stigma to dynamic pricing that the fashion industry equates with consumers flocking stores only