Strategic Plan for Gap Inc

Questions/issues of the case:

Gap Inc. is a leading global apparel retail company, which has been underperforming in recent years. The global apparel retail industry is highly competitive. Gap faces significant competition on a local, national, and global apparel retail level. In this highly competitive environment, Gap faces numerous challenges, the greatest being; how to sustain short-term profit levels. As well as having a clear strategic plan, for how to increase the obtained market share of the competitive, changing market of the apparel retain industry.

It can be argued why Gap Inc. have landed in this situation, of diminishing returns – however there are indicators of a lack of understanding of the competitive environment in which they operate. Looking at the recent history of the company, it is rather difficult to get a sense of what direction the company is planning to go.

Potential threats for Gap Inc:

A highly competitive landscape in all geographical regions (too many clothing shops in short proximity) creates demand for highly differentiated products. Gap needs to remain dynamic, in order to specialize for the needs of different markets. Furthermore, the increased competitive nature of the industry, as well as the trends towards online shopping, have created a more competitive landscape of pricing. This is a significant factor, as there are potential significant competitive advantages to be made. This also further highlights the importance of an increased overseas presence. Moreover, the currency exchanges between countries can also hurt the profits of Gap, providing a significant risk, however it is possible for Gap to somewhat hedge against these currency fluctuations.

Another significant threat for the future of Gap Inc is the low presence of retail shops in Asia. When looking at the international level of competition, Gap has the smallest number of retail locations in Asia. This can be recognized as a threat, as it acts as a significant proportion of the competitions profits. Furthermore, at this point in time, it can be viewed as more or