Joann Inc., the 82-year-old chain of fabric and crafts, said it will close all of its U.S. stores after it filed its second Chapter 11 bankruptcy in a year. The action is a massive shift in the American retail landscape, particularly affecting the crafting community that has relied on Joann’s extensive selection of products for decades.
Joann reported $615.7 million of debt in its Chapter 11 bankruptcy filing on January 20, 2025, of which it owes more than $133 million to suppliers. It had more than 800 United States stores and about 19,000 employees. In early plans, the company would shut down about 500 stores in a bid to slim down, but the recent result of an auction of assets prompted the company to close down the rest.
The successful bid in the auction was submitted by GA Joann Retail Partnership, a group formed by the financial services company GA Group and term lenders of Joann. This group has decided to sell the assets of the company, beginning going-out-of-business sales in all of its stores. These sales will start immediately, and the company’s website and mobile app will stay open throughout the wind-down period.
Joann’s financial woes have been caused by various reasons, such as a sharp decline in sales after the pandemic-driven crafting craze, ongoing supply chain disruptions, and rising operational expenses. Court filings indicated that the company struggled with suppliers dropping specific items and having erratic delivery of key materials such as yarn and sewing supplies. These problems eroded the reputation of Joann as an omnibus source of crafting supplies.
The closing of the Joanns will have a far-reaching impact on employees, customers, and the numerous communities that have played host to these store locations. In California alone, about 60 stores will be closed, while states like Florida, Michigan, Ohio, and Pennsylvania will see a significant dip in store numbers.
The further closure feeds into the trend of difficulties faced by brick-and-mortar shops in the present economic climate. The southeast side of blurring consumer habits has put added pressure on online shops, adding to the chaos that includes major bankruptcies and retail closures across the country.
Joann’s decision to shut down points to the general struggles traditional retailers have in catching up with changing market dynamics.
As Joann Fabrics winds down its business, customers are invited to shop the liquidation sales in-store and online. The company has thanked its loyal customers and hardworking employees who have been part of its business for the last eight decades. The last closing dates for specific stores have not been announced, but the process is anticipated to take place over the next few weeks.
The crafting world is then left to grapple with the need to seek new suppliers of their materials and resources, now that the shutting down of Joann Fabrics creates a noticeable gap in the market. This might lead customers to turn to alternative retailers or online stores in the future in order to meet their crafting needs.
