TODAY'S PAPER
39° Good Afternoon
39° Good Afternoon
Business

Retail Roundup: Old Navy opens new LI store as parent company shifts focus

Gap Inc. said it is shuttering underperforming Banana Republic and Gap stores, while adding Old Navy, Athleta, Gap Factory and Banana Republic Factory locations.

A new Old Navy store in Oceanside is

A new Old Navy store in Oceanside is among more than 70 stores in the chain that will have opened by the end of 2018. Photo Credit: Debbie Egan-Chin

A new Old Navy in Oceanside is among more than 70 stores in the chain that will have opened by the end of 2018, as its parent company focuses more on lower-priced brands.

Changing consumer preferences are behind the shift by the clothing chain’s owner, San Francisco-based Gap Inc., according to industry analysts.

The new Old Navy, which opened Nov. 14 in The Sands shopping center at 3555 Long Beach Rd., is in a 12,652-square-foot freestanding building.  (It was built on the site of a former Joe’s Crab Shack, which closed in September 2016 and was torn down in December 2017.

The Sands did not respond to a request for comment.

There are now 15 Old Navy stores on Long Island.

Gap Inc. has been losing market share to competition from fast-fashion retailers, such as H&M and Zara, as consumers increasingly seek value over brand in general apparel retail, Jaime Katz, an equity analyst at Morningstar Investment Service in Chicago, wrote in a research note in November.

The Gap and Old Navy brands account for about 80 percent of Gap Inc.’s revenue, but Old Navy is more family- and value-oriented.

Gap Inc. has been expanding its online presence and has cut about 4 percent of its store square footage since 2014 as it attempts to right-size its brick-and-mortar base, Katz wrote.

In September 2017 Gap Inc. said it would close 200 underperforming Banana Republic and Gap stores over a three-year period, while adding 270 stores under Old Navy; Athleta, which sells activewear for women and girls; and Gap Factory and Banana Republic Factory, which are apparel discounters.

In November Gap Inc. said that with 11 more stores to go, it was on track to open more than 70 Old Navy stores in 2018.

As of Nov. 3, the company had 3,688 stores among its chains in North America, Asia and Europe, including 1,117 Old Navy stores in North America, according to its third-quarter earnings report.

The Old Navy expansion, however, might be problematic.

“Although we believe there is sufficient room for more Athleta stores, we are concerned that Old Navy could become overstored,” Katz wrote.

Retail Roundup is a column about major retail news on Long Island — store openings, closings, expansions, acquisitions, etc. — that is published online and in the Monday paper. To read more of these columns, click here. If you have news to share, please send an email to Newsday reporter Tory N. Parrish at tory.parrish@newsday.com.

More news