The Gap Inc Essays -- Business and Management Studies

The Gap Inc 1. Case Summary The Gap, Inc is a chain of retail stores that sell casual apparel, shoes, and accessories for men, woman and children. Headquarter in San Francisco; the stores operate under a variety of names including: Gap, Banana Republic, Old Navy Clothing Company, Gap Kids, and baby Gap. All merchandise sold by chain is private label. The Gap was founded in 1969 when Donald Fisher and his wife, Doris opened a small clothing store near San Francisco State University. By 1971 they were operating six Gap stores. In 1995, Fisher retired as CEO and Drexler, now age 50, took over the title. The Gap contracted with over 500 manufacturers around the world that made the companies private label apparel according to Gap specifications. Gap, Inc purchased about 30 % of its cloth from manufacturer located in United State and 70% from vendor located in 46 foreign countries. No single supplier provided more than 5 % of its merchandise. In the wake of concern over third world working conditions, the Gap also adopted a set of sourcing principle and guideline. This provide standard that the vendors had to meet including: engage in no form of discrimination, used no forced or prison labor, employee no children under 14 years of age, provide a safe working environment for employees, pay the legal minimum weight of the local industry standard- whichever is greater. The Gap’s supplier should also meet all applicable local environmental regulation, and comply with the Gap own more stringent environmental standards, neither threaten nor penalize employees for their efforts to organize or bargain collectively and uphold local custom laws. To ensure compliance with its standards, the Gap sends a Gap Field Representative to conduct in-depth interview with a prospective supplier prior to the initiation of a business relationship. The Gap supplier in Salvador, run by Mandarin International, Taiwanese-owned Company that operated apparel assembly plants around the world. The Gap had begun contracting with Mandarin plants in El Salvador in 1992. A worker there was paid approximately 12 cents for assembling a Gap three-quarter sleeves t-shirt or turtle neck, which retailed at about $20 in the United States. Wages at the Mandarin plants averaged 56 cents an hour-a level that was claimed to provide only 80% of the amount neede... ...arin employee who make Gap product. - The Gap should make sure the entire supplier fulfills its sourcing principle and guidelines. The supplier which doesn’t implemented the entire Gap standard and the local government standard, the Gap should avoid doing business with them. - Mandarin International done unethical business by not allowing their employee to make union (fired all the union members) and all the unethical behavior toward the employee. Recommendation - The Gap should choose their supplier carefully and maximize the Gap field representative by put an eyes and do the regular inspection not only when they start the business but always monitoring the working and social condition of the supplier to comply with the Gap code of conduct and also the local government laws. - The Gap representative officer should do the interview without being known by the Mandarin International, so the employee would be freely to speak about what really happened in the factory. - The Gap should give more effort to increase the quality of live their supplier employee which usually in the third world by giving education or other benefit.