The Gap brand is heading to South America

The Gap brand is heading to South America

Retail giant Gap Inc is continuing its global expansion after inking a franchise deal to introduce its Gap brand in South America.

The first Gap store is expected to open in Santiago, Chile in September 2011. The move means the retailer now has franchise agreements in place for a total of 25 countries on six continents.

Under the franchise agreement, Komax has been given exclusive rights to operate Gap brand stores in Chile, selling merchandise purchased from Gap.

The franchise business is a key part of Gap Inc's global business strategy. At the end of its third quarter, the company had 165 franchise stores in 23 countries throughout Asia, Eastern Europe, Latin America, the Middle East and Australia. And by 2015 it plans to grow its number of franchise stores to 400.

Since the start of its financial year the number of countries where its products are sold has risen from 25 to more than 80. This includes China, where the retailer has just opened its first wholly-owned stores.

The company projects that by fiscal 2013, international and online sales will account for more than a quarter of its total net sales.