Gap Inc.
| Company type | Public (NYSE: GPS) |
|---|---|
| Industry | Clothing store [1] |
| Founded | San Francisco, CA (1969) |
| Headquarters | San Francisco, CA |
Key people | Robert J. Fisher, Chairman Paul S. Pressler, CEO |
| Products | Clothing |
| Revenue |  $16.27 billion (2005) |
Number of employees | 152,000 (2005) |
| Website | www.gapinc.com |
Gap Inc. NYSE: GPS is the largest specialty retailer in the United States. Their headquarters are located in San Francisco, California. Its namesake chain, Gap (originally The Gap), operates in the U.S. as well as in Canada, United Kingdom, France, and Japan. Gap Inc. also owns and runs the Old Navy, Banana Republic, and Forth & Towne clothing store chains.
History
Gap was founded in 1969 by Donald Fisher and Doris Fisher. The name came from the growing differences between children and adults, called "the generation gap", which reached its peak with the hippie movement. (The notion that Gap is an acronym for "Gay And Proud" is an urban myth.) [2]) The Fishers had been frustrated with the lack of decent customer service and fashionable styles at other retailers. One of the original mottos of the company was "Levi's for Guys and Gals." Around 1982 Gap began focusing on its own private label clothing and by 1991–1992 the company had stopped carrying Levi's. [3]
As of April 2, 2005, Gap Inc. had approximately 150,000 employees and operated 3,005 stores worldwide.
Donald Fisher retired as Chairman of the Board in 2004 and was replaced by his son, Robert Fisher. The Fisher family collectively owns about 25% of the company. The current CEO of Gap is Paul Pressler, who previously ran the Disney theme parks.
Banana Republic, formerly a catalog retailer selling safari themed clothing, was purchased by the company in 1983, and eventually was rebranded as an upscale clothing retailer. Old Navy was launched in 1994, as a value chain with a specialty flair.
In December of 1995 Gap became the first major North American retailer to accept independent monitoring of the working conditions in a contract factory producing its garments. This acceptance came after an international campaign of media criticism and consumer pressure that was organized in Canada by the Maquila Solidarity Network and the Ontario District Council of the Union of Needletrades, Industrial and Textile Employees (UNITE). In the United States the campaign was coordinated by the National Labor Committee.
In 2004, Gap sold all of its German operations to the Swedish H&M, its main competitor in Europe.
In September 2004, Gap announced the launch of a new chain called Forth & Towne; its first location opened on August 24, 2005, in the Palisades Center in West Nyack, New York. The chain's selection will be targeted at women older than 35. (More Information)
Corporate governance
Current members of the board of directors of Gap Inc. are: Howard Behar, Adrian Bellamy, Domenico De Sole, Donald Fisher, Doris F. Fisher, Robert J. Fisher, Penelope Hughes, Bob L. Martin, Jorge Montoya, Paul Pressler, James Schneider, Mayo Shattuck, and Margaret Whitman.
Criticisms
Gap has received mounting criticism over working conditions in its factories. During the spring of 2003 Gap, along with 21 other companies, was involved in a class action lawsuit filed by sweatshop workers in Saipan. The allegations included "off the clock" hours, where workers were not paid for working overtime, unsafe working conditions, and forced abortion policies. A settlement of 20 million dollars was reached, but Gap contends that the allegations were without merit, saying that lumping the companies together in one lawsuit was unfair. See also: statements on social responsibility from Gap.
Specialty Gap Shops
- Gap
- GapKids
- babyGap
- GapBody
- Gapmaternity
- GapAccessories
- The Gap Warehouse (forerunner to Old Navy, which opened in 1994)
- GapMen
Commercials
In 1998, Gap commissioned music video director Mike Mills to make a set of visually striking ads to promote their khakis. They introduced the white letterbox format that has become the signature style of their commercials to date. In addition to the unique visual elements and the use of popular music, the commercials are also notable for introducing the American public to time slice photography, more commonly known as "bullet-time" in their commercial "Khakis Swing" (a year before the technology would become popularized by The Matrix).
Phantom Planet frontman Alex Greenwald became the popular face of many television commercials for Gap.
Recently, Gap has begun to use celebrity spokesmodels in their television advertisements, including Daft Punk, Madonna, JC Chasez, Missy Elliot, Lenny Kravitz, Sarah Jessica Parker, Tweet, Mary J Blige, Joss Stone and Michelle Williams (singer).
Product Red
Product Red is an initiative begun by rock singer Bono and Bobby Shriver of DATA (Debt AIDS Trade in Africa) to raise money for the Global Fund to Fight AIDS, Tuberculosis and Malaria. Shriver is CEO of Product Red. The initiative was announced at the World Economic Forum in Davos, Switzerland on January 26, 2006.
Product Red is a brand which is licensed to Gap as well as other companies such as American Express, Converse, and Giorgio Armani. Each company will create a product with the Product Red logo, and 1%-50% of the money paid for each item will go to the Global Fund depending on the company and the item in question.
The Gap product will be a line of T shirts made in the African country of Lesotho from African-grown cotton. Gap Inc. have described the new initiative: "How we do business is as important as what we do. Gap (RED) takes what we do best—creating great products that people love—and channels it into positive change. In addition to sharing Gap (RED) profits with the Global Fund, we're also investing in Africa by making some of our products there."
In support of Product RED, Gap is creating a special RED collection, starting with the iconic Gap T-shirt entirely made in Africa with 50% of profits going to the Global Fund. The vintage-style shirt is being made for both men and women and will come in red and a range of other colors. The Red T will be available in the US and UK in Spring 2006.
An enhanced collection of classic Gap items featuring RED-inspired details will be launched in the US and UK in Fall 2006.