Gap Expands Franchises in Saudia Arabia, Turkey

The first Gap stores will open in each country by the end of this year, and the first Banana Republic stores are expected to open in each country by spring 2008. All stores are expected to be open by 2012.

Ron Young, senior vice president of international strategic alliances for Gap Inc., says that the company sees potential in both of the countries because each has a "strong, steadily growing economy" combined with consumers who "have a great interest in iconic apparel brands such as ours."

Gap Inc. directly operates Gap brand stores in six countries and Banana Republic stores in three countries. Today's announcement follows previously announced franchise agreements to open Gap and Banana Republic stores in Bahrain, Indonesia, Kuwait, Malaysia, Oman, Qatar, Singapore, South Korea and the United Arab Emirates.

Gap's foray into the two new countries comes at a time when the San Francisco-based retailer is attempting a turnaround after a lengthy period of disappointing results in which it has opened and closed stores by the dozens in an effort to regain its footing.For example, the company recently said that it would close 200 stores, mostly Gap units, and open 230 stores, mostly Old Navy units, as part of its efforts to refocus on its core brands.

The company said those numbers were tentative, however, as new leadership continues to reassess units. Former CEO Paul Pressler departed the company in late January and former Banana Republic president Marka Hansen was named president of Gap Brand, with Michael Cape as the new executive vice president of marketing for Old Navy.

The turnaround efforts included the launch of a short-lived brand called Forth & Towne, but Gap earlier this year announced the closing of all 19 Forth & Towne stores.Gap Inc. operates more than 3,100 stores in the US, the UK, Canada, France, Ireland and Japan.