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Gap to cut 500 corporate jobs as it strives for profitability

Gap store

Gap will cut 500 corporates jobs as it strives for profitability

Clothing giant Gap has announced 500 global layoffs to become more efficient and profitable.

A source in the company said the current cuts would be bigger than the near 500 corporate layoffs it announced in September.

However, the exact number of layoffs remains undisclosed.

Read More: Disney starts second round of layoffs in $5.5 billion cost-cutting plan

Bob Martin, Gap’s Chairman and interim CEO, said: “Our goal is to flatten the organization, increase spans of control to create more robust roles and individual empowerment, and decrease layers to remove bottlenecks and make better, faster decisions.”

During a March earnings call, he told investors employees have been “dampened by a complicated organizational structure, bureaucracy, and outdated processes.”

He stressed Gap intends to reduce management layers to "improve the quality and speed of decision-making." 

Read More: 3M to cut 6,000 jobs to save $700 million

The changes are designed to save $300 million, the first half of which will be realized in the fiscal year 2023.

One position going is the chief growth officer, formerly served by Asheesh Saksena.

Athleta's CEO, Mary Beth Laughton, has also left, while Chief People Officer Sheila Peters plans to leave at the end of 2023.

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The source said staff in the firm's international sourcing unit were told about the latest layoffs on April 18.

Staff at its San Francisco headquarters will be notified this week, and finance team members losing their jobs will be told in late May.

The San Francisco company had a tough year as it grapples with a sales slump, excessive inventory stocks, and a hunt for a permanent CEO. 

Source: CNBC

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