First Serbia Store Opening Marks Milestone of Company's 200th Franchise Store
MOSCOW, Sep 08, 2011 (BUSINESS WIRE) -- Continuing with its global expansion strategy, Gap Inc. GPS +3.76% today announced the opening of the first Banana Republic store in Russia through its franchise channel. The company also announced that it will open its first Gap store in Serbia on Friday. This store will represent the company's 200th franchise store globally.
"We are very proud to not only be introducing Banana Republic to Russia, but also opening our 200th franchise store," said Stephen Sunnucks, president, international, Gap Inc. "This is a significant landmark for our goal of growing our franchise store base to 400 by 2014."
Gap Inc. is focused on growing its share of the $1.4 trillion global apparel market. Over the last five years, the company has grown its franchise store base to 200 and expanded to 27 countries throughout Asia, Europe, Latin America, the Middle East, Australia and Africa. The company has franchise agreements in place to bring its brands to 32 countries, including Chile, Vietnam and Morocco in fiscal year 2011.
The first Banana Republic store in Russia is located in Moscow's AfiMall City, the largest shopping and entertainment complex in the city. Gap Inc. first made its products available to Russian consumers in 2008 with its first Gap store. Since then, the company has expanded its store base to 11 franchise stores in the market, including 9 in Moscow. In 2010, the company began offering Russian consumers both Gap and Banana Republic products online through its international online shipping provider. The new store will be managed under Gap's existing franchise agreement with Fiba Holding, which also manages the brand's franchise locations in Turkey and the Ukraine.
"Russia's consumer base has nearly double the amount of disposable income compared with the average western consumer," said Stefan Laban, managing director of strategic alliances for Gap Inc. "Given Russia's high demand for retail consumption, the market presents an ideal opportunity to introduce Banana Republic's affordable luxury offering."
The first Russian Banana Republic store is part of Gap Inc.'s ongoing strategy to bring Banana Republic's affordable luxury offering to new markets worldwide. Since its founding in 1978, Banana Republic has established itself as a brand offering a range of stylish, versatile wardrobe solutions delivering elevated design and luxurious fabrications at approachable prices. The Moscow store will offer the brand's covetable, uncomplicated style that works from day to night and will house the women's and men's ready-to-wear collections, accessories and personal care products.
The first Gap store in Serbia is located in the capital city of Belgrade on Knez Mihailova Street. Serbia is the sixth country to be managed under Gap Inc.'s franchise agreement with The Marinopoulos Group, one of Greece's leading retail, commercial and industrial firms. The group also manages the company's franchise locations for Gap brand in Greece, Bulgaria, Croatia, Cyprus and Romania.
"The city's central location, at the crossroads of Southeast Europe, and modern urban plans provide a perfect platform to introduce Gap to the market," said Laban.
The Belgrade store will house products from the Gap, GapKids and babyGap collections. The styles include simple, easy to wear pieces that form the foundation of any wardrobe, especially, Gap's 1969 Premium Jeans. Building on more than 40 years of denim experience, the jeans offer superior fit, finishes and detail at a truly affordable price point.
Moscow Store Address AFIMALL City 2 Prenenskaya emb Moscow, Russia
Belgrade Store Address Knez Mihailova Knez Mihailova 14-16, 11000 Belgrade, Serbia
This press release contains forward-looking statements within the "safe harbor" provisions of the Private Securities Litigation Reform Act of 1995. All statements other than those that are purely historical are forward-looking statements. Words such as "expect," "anticipate," "believe," "estimate," "intend," "plan," "project," and similar expressions also identify forward-looking statements. Forward-looking statements include statements regarding the following:
-- Expected franchise store openings, including in Vietnam, Serbia, Chile, and Morocco;
-- Global expansion strategies, including franchise growth;
-- Bringing Banana Republic to new markets worldwide;
-- Gaining a larger share of the global apparel market;
-- Number of future franchise stores.
Because these forward-looking statements involve risks and uncertainties, there are important factors that could cause the company's actual results to differ materially from those in the forward-looking statements. These factors include, without limitation, the following:
-- The risk that changes in general economic conditions or consumer spending patterns will have a negative impact on the company's strategies;
-- The highly competitive nature of the company's business internationally;
-- The risk that the company or its franchisees will be unsuccessful in gauging fashion trends and changing consumer preferences;
-- The risk that the company's efforts to expand internationally may not be successful and could impair the value of its brands;
-- The risk that the company's franchisees will be unable to successfully open, operate, and grow the company's franchised stores;
-- The risk that the company or its franchisees will be unsuccessful in identifying, negotiating, and securing new store locations effectively;
-- The risk that the company will be unsuccessful in implementing its strategic, operating and people initiatives;
-- The risk that changes in the company's credit profile or deterioration in market conditions may limit its access to the capital markets;
-- The risk that updates or changes to the company's information technology ("IT") systems may disrupt its operations;
-- The risk that acts or omissions by the company's third-party vendors, including a failure to comply with the company's code of vendor conduct, could have a negative impact on its reputation or operations;
-- The risk that the company will not be successful in defending various proceedings, lawsuits, disputes, claims, and audits; and
-- The risk that changes in the regulatory or administrative landscape could adversely affect the company's financial condition, strategies, and results of operations.
Additional information regarding factors that could cause results to differ can be found in the company's Annual Report on Form 10-K for the fiscal year ended January 29, 2011, as well as the company's most recent Quarterly Report on Form 10-Q.
These forward-looking statements are based on information as of September 8, 2011. The company assumes no obligation to publicly update or revise its forward-looking statements even if experience or future changes make it clear that any projected results expressed or implied therein will not be realized.