Gap franchisee in Moscow received $5.2 million worth of clothes
In March, clothing retailer Gap Inc joined numerous Western companies in announcing a halt to shipments to Russia in protest of its invasion of Ukraine.
“As a company driven by values and proud to have done the right thing over the past 53 years in business, we have also currently suspended shipments to Russia, where we have a small franchise presence,” San Francisco said. the company announced in a message to its employees dated March 10.
But Russian customs records seen by Reuters show that between March 11 and July 16, a Gap franchisee in Moscow received 1,585 shipments of clothing with a reported value of $5.2 million. More than three-quarters of supplies are supplied by Gap Europe Ltd, the London division of Gap Inc.
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Russian customs records are obtained from several commercial trade data providers and are valid until 30 September. They provide detailed information about Russian imports from customs forms, including suppliers, importers, product descriptions, and declared values.
Gap’s shipments included everything from “knitted baby socks” and “baby pajamas” to “textile blouses for women” and “textile shorts for men.”
Clothing, except for luxury items, does not fall under the recent Western sanctions against Russia at all, so as not to punish ordinary citizens. But deliveries after March 10 seem to contradict Gap’s statements to its employees.
A spokesman for Gap Inc in San Francisco told Reuters in an October 19 email that “we have stopped deliveries to Russia as we announced in March and have not resumed them.”
Reuters later provided Gap with Russian customs data showing 1,585 deliveries since March 10 to Gap Retail LLC, a Gap franchisee in Moscow. It is operated by Fiba Perakende Grubu, an Istanbul-based retailer that owns all Gap stores in Russia, Turkey and Ukraine.
On October 28, Gap admitted to Reuters that it continued to facilitate clothing shipments to Russia until April, a month after it told employees it was suspending all shipments.
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“Because orders are placed months in advance, our franchise partner picked up their last order from our distribution center in April. Gap has not shipped or sold any items to our Russian franchise partner since their last order was processed,” a Gap spokesperson said in response. to questions posed by Reuters.
Gap did not respond to questions about exactly when the orders were placed, when they were completed, or why they didn’t cancel outstanding orders after the March 10 announcement.
Asked why clothing shipments to Russia continued until July, Fiba manager Perakende said in a statement: “These shipments have been delayed due to longer transit times through Turkey as well as additional processing time at Russian customs.”
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But according to Russian customs data seen by Reuters, the vast majority of clothing shipments do not list Turkey as a transit point. FIBA did not respond to a question about the discrepancy. “SOME ITEMS ARE MISSING”
Fiba Perakende added in a statement that “due to the decision of Gap Inc. suspend shipments of Gap products to Russia indefinitely, Fiba is in the process of winding down its Gap franchise business in Russia after running out of any remaining stock in Russia.”
Along with its e-commerce website gap.ru, Fiba Perakende said in a statement that it operates 23 stores in three major Russian cities.
Gap Europe reported US$9.6 million in annual franchise sales in Russia for its most recent fiscal year ended January 30, 2021, up from US$11.5 million in the prior year, according to its annual report and financial statements. Gap Europe’s business is struggling, and the company closed dozens of its own stores in the UK and Ireland last year. The Gap Europe director did not respond to a request for comment on Russian deliveries.
The woman who answered the phone this week at the Gap store in central Moscow said it remains open. When asked about her choice of clothes, she replied: “Yes, we have a choice. Of course, it depends on what you are looking for. Some things are missing.”
Russian customs records show more than 1,200 shipments of Gap clothing to Russia between March 11 — the day after Gap Inc announced it would cut off shipments — through June 21. country and Russia as a destination – without mentioning Turkey as a transit point. In its latest annual report, Gap Europe announced that it is changing its distribution center for its franchise business from the United Kingdom to the Netherlands.
Other shipments to Russia in June and July list the supplier as either “Ankara Customs” or another Istanbul-based company associated with Fiba Perakende, suggesting the clothing may have passed through Turkey.
After July 16, customs records show no shipments to Gap Retail in Moscow, indicating that the flow of clothes to Russia has stopped.
Gap’s March statement to suspend shipments to Russia also said it would donate $1 million worth of clothing to Ukrainian refugees. In his latest statement to Reuters, Gap said: “We stand in solidarity with the people of Ukraine.”
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