Essay The Gap Inc

2555 Words 11 Pages
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
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The troubles erupted at the Mandarin plan, which was located in one of free trade zones, in early February 1995, when worker notified the company of their intent to formed a union, a right authorized by the
Salvadoran labor code. The ministry of labor granted the union legal status, the first union to recognize in a free trade zone of El
Salvador.

The Mandarin Company was notified of the legal status of the union on
February 7. It responded by closing down the plants on February 8. The workers have demonstration outside the company and a few days later,
Mandarin fired over 150 union members and supporters.

In late March 1995, managers at the Gap became aware of claim that the management of the Mandarin factory was resisting union efforts to organize, in violation of the Gap guideline. A Gap executive, Stan
Raggio, went to El Salvador to investigate the situation. At the conclusion of his visit, he reported that he had found no human right abused or other violation of the company’s corporate sourcing policies. On May, 15 when the union worker called for protest the continued firing of union people, the company guard attacked and beat union leader. Mandarin again closed the plant and fired all the union leadership. Stan Raggio, again went to El Salvador to

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