US apparel retailer GAP plans to open stores in China next year

Gap, one of the world's largest apparel retailers, will open its first store in China next year to boost international business growth. The company will also develop online sales operations in the European Union and Canada.

Gap chief executive Glenn Murphy said that after two years of trying to improve performance, the company is currently interested in "increase" investment to regain market share while expanding its international business.

China will be the first new market that Gap has entered directly for more than a decade. Since the franchise model was introduced in 2007, the company has adopted this model in the Middle East, other parts of Asia, and Eastern Europe.

“The chance is great... Chinese consumers love American brands.” At the Gap annual investor conference, Murphy said. He believes that the US clothing brand does not fully exploit the Chinese market.

Gap also plans to enter India and Brazil, but no decision has yet been made on which type of store ownership to adopt. The company announced plans for franchising in Russia this year.

Murphy compared the new expansion strategy with Gap’s initial international expansion in the 1990s, when Gap tried to implement a standardized American store style rather than adapting to the local market. In 2004, Gap closed 10 stores in Germany.

Toby Lenk, head of Gap’s online business, said the company will open websites for Gap and Banana Republic in the United Kingdom, use the same payment platform, and start selling products next fall.

The UK website will also serve as a base for selling products and shipping to other EU countries. Gap is also considering developing e-commerce business in Japan.