SAN FRANCISCO — In a bid to offset declining sales, Gap Inc. confirmed Tuesday it is cutting about 500 corporate jobs.
The embattled San Francisco-based clothing retailer has endured a series of recent setbacks, including issues with product assortment at its Old Navy brand, which accounted for more than half the company’s 2021 sales, CNBC reported.
Per MarketWatch: “Sales at Old Navy took a hit this year after an attempt to make inclusive clothing sizes backfired, leaving it with surplus goods.”
The latest blow came one week ago when entertainer Kanye West, who goes by Ye, announced he was ending his company Yeezy’s partnership with Gap after accusing the company of breach of contract. Specifically, Ye said Gap failed to distribute Yeezy products at its stores by the second half of 2021 and failed to create dedicated Yeezy Gap stores as per the contract, CNBC reported.
The job cuts, first reported by The Wall Street Journal, include open positions and will be heavily concentrated at Gap’s corporate offices in San Francisco and New York as well as in Asia.
According to MarketWatch, the cuts will impact various departments, and some employees have been notified of the layoffs in recent days.
Meanwhile, Gap continues its search for a new CEO after Sonia Syngal abruptly stepped down in July after only a two-year tenure, CNBC reported.
“We’ve let our operating costs increase at a faster rate than our sales, and in turn our profitability,” Bob Martin, Gap’s executive chairman and interim CEO, wrote in a Tuesday memo to employees, reviewed by the Journal, notifying them of the job cuts.
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