Gap CEO Sonia Syngal engineers boost in online sales
Last week, San Francisco-based Gap Inc. announced that online sales surged by 61% during the third quarter of fiscal year 2020, accounting for 40% of its $4 billion quarterly revenue. This shielded the apparel retailer from the COVID-19 lockdown’s impact on its physical stores.
Gap was founded in 1969 with a simple idea — make it easier to find a pair of jeans that fit. Since then, from a single store in downtown San Francisco, it has grown into seven brands, including Old Navy, Gap, Banana Republic and Athleta. It has a market value of $8 billion.
The company operates about 3,200 owned stores and about 600 franchised stores, mostly in the U.S. and Canada, employing over 130,000. In 2019, it earned net profits of $343 million on $16.4 billion in revenues. The profits were down from $920 million in 2015, when revenues were $15.8 billion.
During the third quarter of 2020, the company focused on sales growth and raising profitability in a dislocated market by engaging customers looking “to trusted brands to provide easy and safe shopping options,” said Sonia Syngal, chief executive of Gap.
Due to the surge in online sales, the apparel vendor’s revenues for the quarter were flat, compared to the 2019 third quarter. Also, since online sales require lesser overhead costs than its physical stores, Gap’s gross profit was 41% in third quarter 2020, 1.6% higher than in the year ago quarter.
Syngal, 50, took over as Gap CEO in March, just as the COVID-19 lockdown began in New York, San Francisco, Chicago and its other major retail markets in the U.S. Each year, as CEO, she will receive a salary of $1.3 million, be eligible for a bonus of $2.3 million and could receive $9 million in mostly performance-based stock.
In 2019, Syngal earned $4.8 million including $3.7 million in stock and option grants. The Gap shares she owned, as of March, is currently valued at $14 million.
Given her training and early career as an engineer, Syngal evidently has a unique edge in the current retailing climate where digital sales, branding and marketing tools, and efficient logistical and production operations, are as important as apparel design.
In fact, earlier from 2016, she was CEO of Gap’s Old Navy business. “Imagine that the world runs right and there’s a place that offers clothing for the whole family and everything it sells has great style and quality at a price you can’t believe. This is Old Navy,” Syngal wrote in a blog on LinkedIn..
She expanded Old Navy’s sales from $7 billion to $8 billion in three years, grew its presence to more than 1,200 stores in the U.S. and Canada, scaled digital operations to make it the fourth largest online apparel retailer in the U.S. and integrated online and in-store sales capabilities.
Syngal joined Gap in 2004, serving in several senior positions: Executive Vice President, managing the company’s global supply chain; Managing Director of the Europe business and Senior Vice President of the International division.
Prior to joining Gap, Syngal worked at Fortune 500 companies, including Sun Microsystems where she led manufacturing operations, logistics and supply chain management, and at Ford Motor where she held roles in product design, quality and manufacturing engineering.
Sonia holds a master's degree in Manufacturing Systems Engineering from Stanford University and a bachelor’s degree in Mechanical Engineering from Kettering University, in Flint, Michigan. She delivered the Commencement Address at Kettering’s graduation ceremony in June 2019.
Syngal emigrated to the U.S. from Canada. She was born in India and moved to Canada with her parents, Sushma and Satya Syngal. She and her husband Joe McGrath, have a son and daughter.
In 2018, Syngal told Working Mother, phrases like ‘Yes she can.’ on Old Navy T-shirts remind “our customers, our employees, and the women of our future, that equality is their right.”
