Joann Fabric Retailer To Close All Stores Following Bankruptcy
Joann Inc., the well-known fabric and crafts retailer, is going out of business and shuttering all of its locations nationwide, marking the end of service for many dedicated customers across the United States. This closure follows the company's second Chapter 11 bankruptcy filing within just over a year, as it contends with severe financial difficulties exacerbated by sluggish consumer interest and supply chain issues.
Founded over 80 years ago, Joann has served as a beloved destination for quilters, knitters, and craft enthusiasts. It was previously planning to close roughly 500 of its approximately 850 stores. While there was initial hope for some locations—including stores in Loudoun County, Virginia—to remain operational, this latest announcement indicates no stores will escape closure.
On January 15, 2025, Joann confirmed the sweeping measure as the organization grapples with its financial woes. Having filed for bankruptcy protection, Joann claimed it was committed to keeping its stores open but later revised its approach after discovering no feasible path forward. The final decision came after financial services firm GA Group, joined by Joann's term lenders, won the auction to acquire the company’s assets. This development incited the announcement of going-out-of-business sales across all locations.
“Joann leadership, our board, advisors and legal partners made every possible effort to pursue a more favorable outcome,” the company stated on its website. “We deeply appreciate our dedicated team members, our customers, and communities across the nation for their unwavering support for more than 80 years.”
The bankruptcy saga began earlier this year when Joann filed for Chapter 11 protection for the second time, following challenges stemming from the COVID-19 pandemic and shifting consumer habits toward e-commerce. The pandemic had fundamentally altered the retail environment, leading many consumers to gravitate toward online shopping, which posed significant challenges for brick-and-mortar stores like Joann.
According to Joann's interim CEO Michael Prendergast, the retail chain undertook extensive reviews of its operations to strategize on cost management and bolster profitability prior to announcing its closure. “Since becoming a private company,” Prendergast said, “the board and management team have continued to execute on top and bottom-line initiatives to manage costs and drive value. Unfortunately, the last several years have presented significant and lasting challenges.”
The impending liquidation sales are expected to commence almost immediately at Joann locations nationwide, with details about specific discount percentages remaining unclear. Early indications suggest markdowns will vary from 10% to 20%, with seasonal items potentially discounted as much as 75%. It's important to note, as per company communications, returns will not be accepted during this time, and gift cards will remain valid until February 28, 2025.
Challenges for the company have been mounting for some time. Earlier reports noted high overdue bills from suppliers, which directly affected delivery schedules for craft supplies—an issue deepened by the pandemic. Joann noted previously, before its bankruptcy filings, nearly 30% of its outstanding bills were past their due dates, which fueled uncertainty among suppliers and complicated operational logistics.
The Joann chain operates more than 850 stores across 49 states, with employees and communities impacted by the closures expressing their sorrow over the loss of such a significant local resource. Joann has been instrumental for countless craft enthusiasts, providing necessary supplies and materials for various projects over decades.
The wind-down procedure is expected to continue over the ensuing weeks, with official closure dates to be announced as liquidation progresses. Local variations may apply, and shoppers are encouraged to monitor Joann's website and app for updates during the transition period.
Analysts of the retail industry indicate the situation facing Joann—marked by its substantial losses and market changes—could reflect broader trends affecting many retailers. Experts suggest this development serves as both caution and potential forecast for remaining brick-and-mortar establishments as they navigate economic uncertainties post-pandemic.
Overall, the closure of Joann stores signals not just the end of more than 80 years of crafting history but also raises questions about the future of retail and the enduring impact of shifting consumer behavior on physical stores. With retail landscapes rapidly changing, the story of Joann might serve as both case study and cautionary tale for similar companies facing the strains of modern commerce.