Gap signs up Reliance Retail as new 'India franchise'
14th October 2021, Mumbai:
US fashion brand Gap has roped in Reliance Retail as its new franchise partner in India to replace Arvind Fashions. As per the deal, Reliance will manufacture 100 percent of all Gap products to be sold in India as against Arvind Fashions, which manufactured 70 percent of Gap’s products sold in India.
Arvind and Gap called off for their partnership as Arvind Fashions failed to turn Gap's business in India profitable even after closing and pruning store sizes and increasing local sourcing. Gap’s contribution remained limited to about 4.7 percent of Arvind Fashions' consolidated turnover, or Rs182 crore in the fiscal year ended March 2020.
The brand incurred a loss of Rs 34 crore before taxes. Reliance Retail-owned online fashion platform Ajio already sells almost the entire collection for men, women, and kids from Gap and is one of the largest stockiest on Ajio.