American clothing company Gap fired its CEOSonia Singhal, who took office two and a half years ago. Singal has failed to revive the brand, which comes from years of declining sales and various attempts to regain the success it had in the 1990s, with several CEO changes. Specifically, Syngal is responsible for some of the company’s poor choices during the pandemic, as well as the problems of the Old Navy chain, which is controlled by Gap and accounts for more than half of its total revenue (prior to Gap, Syngal had been at the helm of the Old Navy for 4 years).
From the start of his tenure, Syngal tried to cut costs and raise new capital to stabilize the company, but Gap was nonetheless affected by the pandemic-related crisis, which began shortly after his appointment. Syngal will be temporarily replaced by the company’s president, Bob Martin, while waiting to find a new CEO. Since the start of the year, shares of Gap (which also owns the Banana Republic and Athleta brands) have lost more than half their value, more than 70 percent when looking at the past 12 months.
Among the companies that failed to adequately manage their supply chain after various changes due to the pandemic, Gap found itself with an excess inventory of unsold clothing: it closed the first three months of the year with 34% more inventory than in the same period last year. According to some analysts, Syngal’s decision to increase women’s sizes in Old Navy to make the brand more inclusive, which did not have the desired effects, also contributed to this. Another highly criticized choice for Syngal was to start a collaboration with rapper Kanye West to design a new collection of sweaters, which would not lead to a certain increase in sales.
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