Gap will shutter its doors in Australia within the next six months. The announcement came from local franchisee Oroton Group saying it had decided to discontinue its relationship with the American fashion retailer.
The Australian fashion and accessories firm revealed it expected to close its six Gap stores by the end of January next year, allowing it to focus on its core Oroton handbag business and limit future financial losses.
“The board and I thank the entire Gap Australia and Gap Inc team for their dedication and substantial efforts to develop the Gap business in Australia over recent years,” Oroton chief executive Ross Lane said in a statement to the media.
“OrotonGroup also acknowledges the support and co-operation that it has received from Gap Inc in amending existing arrangements.”
Gap has four stores in Sydney and two in Melbourne. The shutters will affect some 50 fulltime Gap employees and 150 casual staff members, with Oroton saying that redundancies are expected but redeployment is the ultimate goal.
Back in May, Oroton said it expected Gap’s earnings for last financial year to be down $3.5 million compared to the year prior.