US fashion chain Old Navy is coming to Israel. Sources inform ''Globes'' that Gottex Brands, headed by Joey Shoval and Hanan Elitov, is in advanced talks to open Old Navy stores in Israel. Sources also said that representatives from Old Navy visited Israel a month ago to this end, and that Gottex has even reserved a spot for the store in the Ikea North center.
Currently, the primary bone of contention between the parties has to do with pricing the brand. Gottex Group would like the price difference between Israel and the US to be between 10% and 12%, at most, excluding VAT. The group believes that Old Navy would have great success in Israel, as such a price difference would present attractive prices, in light of the broad product offering and low prices that typify the brand.
Should an agreement be reached, Gottex Brands intends to open 5-7 branches at first, each of which will be between 1,000 and 1,200 square meters large. They plan to open stores in Rehovot, Petah Tikva, Haifa, Jerusalem, and more, and to avoid opening stores in upscale malls.
Old Navy, which was founded in 1994, is a part of Gap Group. The brand was establish as Gap Corporation’s response to Target’s decision in the early 1990s to establish a fashion department that was branded as a cheaper version of the Gap brand. At first, the company opened Gap Outlet stores, but later rebranded them Old Navy, which then became an independent fashion brand, characterized by its low prices.
Success came quickly and, within four years, Old Navy’s sales reached $1 billion. By 2000, there were already 500 Old Navy stores, and, a year later, the company began opening shops outside the US, starting in Canada, and continuing to other countries as well.
Old Navy operates mega-stores that offer fashion for the whole family - infant to adult. Old Navy offers basic, casual clothes, as well as more formal attire, for infants, children, young adults, men, and women. In addition to clothing, Old Navy sells a wide variety of accessories as well.
Gottex Brands is one of the two largest fashion groups in Israel, along with Fox-Wizel Ltd. (TASE: FOX). Gottex currently holds Zara, Pull and Bear, Massimo Dutti, Bershka, and Gap, and its annual sales total more than NIS 1 billion.
Published by Globes [online], Israel business news - www.globes-online.com - on July 3, 2014
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