Gap’s first franchise deal in Asia

US clothing chain Gap has announced it has embarked on its first-ever franchise deal in Asia. It has signed an agreement with leading Singaporean retailer FJ Benjamin Holdings, who will open the first Gap and Banana Republic stores in Singapore and Malaysia.

Chief executive Frank Benjamin said in a statement that the company was planning “to aggressively launch and grow these brands.” The first Gap store will open later this year in Singapore, followed by a Banana Republic store in 2007 and the further opening of approximately 30 stores by 2010.

Commenting on the agreement, Andrew Rolfe, the head of Gap’s international division, said that FJ Benjamin had “significant expertise in this market and we’re delighted to enter this collaboration with them.”

Benjamin Holdings also retails and distributes brands in Far East Asia and Australia that include Valentino, Guess, La Senza and Raoul, as well as watch brands Girard-Perregaux and Jean Richard. Meanwhile, $16.3 billion (£9.3 billion) Gap Inc. operates about 3,000 stores worldwide. Outside the US, the group operates 130 Gap stores in the UK, 30 in France, 100 in Canada and 90 in Japan, but in the US group sales have slipped. Chief executive Paul Pressler said last year that the group would open 50 more international stores by 2007, hoping to return to growth by halting its over-expansion in the US.

Gap Inc spokeswoman Kris Marubio told Women’s Wear Daily that in addition to Asia “we are definitely looking at the Middle East and other areas” for further franchising. Last year, the company also said that it was looking to possibly open stores in China, perhaps through franchises.

Last year the first five Banana Republic stores outside North America – Canada has its share of the more upmarket chain – were opened in Japan, and the franchising of this brand signifies a real expansion of its presence outside the US.

To facilitate the selection of merchandise for franchisees, Gap will open a 10,000 square foot showroom in New York.

Meanwhile Saks Fifth Avenue is also venturing into the Far East. The US department store is close to signing an agreement to open a licensed store in Shanghai, reports WWD.

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