Murphy will try his hand at Gap

Chain Drug Review, August 20, 2007

SAN FRANCISCO -- Former Shoppers Drug Mart (SDM) head Glenn Murphy has been named the new chief executive officer of The Gap Inc.

Murphy, who spent six years as chairman and chief executive of SDM, Canada's largest drug chain, has a reputation as an executive with solid retail turnaround skills.

At SDM he is credited with taking an already strong company and making it better. He leveraged the chain's leadership position in pharmacy, introduced a new store concept and added innovative new products and services.

During Murphy's tenure SDM strengthened its offerings in cosmetics, for example, and expanded its seasonal and convenience food departments. Murphy is also credited with delivering innovative marketing strategies, while bringing new products and improved operations to the chain.

On the financial front, Murphy took SDM public and launched a dividend paying policy. Earnings per share increased from 12 cents in 2001 to $1.72 in 2005.

Murphy joined SDM in 2001 and left in March of 2007. Prior to his stint at SDM he served as president and chief executive officer of Chapters, which is Canada's leading book retailer.

Murphy is credited with improving margins at the 300-unit chain, in part by re-positioning the stores and fine-tuning the company's merchandising strategy.

Before that he spent 14 years with Loblaw Cos., Canada's largest food distributor and supermarket operator. During his career there he held positions of increasing responsibility in category management, marketing, procurement and operations.

He is credited with leading a successful resurgence of Loblaw's business in Canada's Atlantic region, and was then named executive vice president of the Loblaws Supermarkets division in 1997.

Under his leadership the division introduced new store concepts and also expanded its focus on private label. Murphy is also credited with successfully restructuring and integrating Provigo, a food retailing business with $6 billion (Canadian) in annual sales, into the Loblaw holding company. Murphy started his career with A.C. Nielsen, where he worked with a number of consumer products companies and retailers.

He says he is thrilled with the opportunity to lead The Gap, which he describes as an iconic company with a heritage of innovation and creativity.

"Alongside some of the most talented people in the apparel industry," he said, "we'll work to establish each brand's leadership position and set the company along a path of sustained earnings performance."

Murphy succeeds Robert Fisher, the current chairman of Gap, who has served as interim chief executive officer of the company since January.

"[Murphy] is known for being a decisive leader with great retail instincts," Fisher said. "He has revitalized major retail brands by offering new products and significantly improving the store experience. He's well qualified to return Gap Inc. to the level of sustained performance we all expect."

Gap is a $16 billion company, with three chains (Gap, Old Navy and Banana Republic) and about 3,100 stores.

The fashion retailer is in need of a turnaround, with sales that have been flat for five years and brands that have lost sales and customers to such rivals as American Eagle Outfitters, Abercrombie & Fitch and Target Corp.