Strong business position in specialty apparel; Geographic diversity; Strong cash flow; Focus on debt reduction; and The company's excellent liquidity. Difficulties in regaining customer loyalty after a protracted period of decline; The company's participation in the competitive retail industry; The company's need to reposition all three brands; and Financial and credit protection measures remain below historical levels. The ratings on San Francisco, Ca.-based The Gap Inc. reflect management's challenge to improve the business fundamentals of its three brands in an industry that will continue to experience intense competition, and to improve weakened credit protection measures. These factors are offset in part by the company's strong business position in casual apparel, geographic diversity, and strong cash flow. The Gap's operating trends
