Joann, a once-thriving crafts and fabrics retailer, is now grappling with its second bankruptcy filing, casting a shadow over its future. The company’s decision to close 500 out of its 829 stores across the United States is a direct response to the mounting financial, economic, and industry challenges that have beset it in recent years. In an effort to maximize its business value despite these adversities, Joann has opted for a court-supervised sale. Store closures will be rolled out over the next few months, though the exact timing may vary for some locations. Throughout this period, the company’s remaining stores and online platform will continue to serve customers.
Financial Strain Leads to Bankruptcy
Gearing Up for the Sales Process
Upon receiving court approval, Joann promptly commenced its going-out-of-business sales, offering customers discounted prices on the inventory available at the closing locations. These sales include various crafting essentials, from fabrics to yarn, but only items that are in stock at the affected stores. The company’s acceptance of gift cards will extend until February 28, but it has paused discounts for various groups and will not accept returns at stores that are closing. This strategy highlights the company’s immediate need to liquidate assets and accumulate funds swiftly. The revenue decline that Joann had been suffering for several years became more pronounced with the end of the lockdown-fueled sales surge brought on by the COVID-19 pandemic. Consequently, Joann’s debt increased significantly, necessitating drastic measures to rectify its financial state.
Attempts at Restructuring and Delisting
In March 2024, Joann initially filed for Chapter 11 bankruptcy, hoping to secure a restructuring agreement with its financial stakeholders. This deal promised $132 million in new funding to aid in reducing its debt by $505 million. As part of this effort, Joann opted to delist from the stock market, transitioning to a privately-operated entity. This move was intended to allow the company more flexibility and reduce the pressures from public market scrutiny. However, despite these efforts, Joann found itself unable to stabilize financially, leading to another bankruptcy filing in January 2025. Consequently, the company began untangling its assets, with Gordon Brothers Retail Partners, LLC leading the initial bid in the sale proceedings.
Future Uncertainty and Auction Date
Auction and Prospective Outcomes
The auction date, set for February 21, will play a pivotal role in determining Joann’s fate. The final approval for the sale is scheduled for February 26. If Gordon Brothers succeeds in acquiring Joann, they plan to completely liquidate the company’s operations, a move that could mark the end of Joann’s storied history. Conversely, Joann remains hopeful that a buyer with intentions to continue its operations will emerge, preserving its legacy in American crafting culture. The high-stakes nature of this situation underscores the precarious position Joann finds itself in and its uncertain future.
Historical Significance and Cultural Impact
Joann, once a booming retailer for crafts and fabrics, is now facing its second bankruptcy filing, raising concerns about its future. The retailer has decided to shutter 500 of its 829 stores across the United States in response to significant financial, economic, and industry hurdles that have plagued the company over the past few years. In a move to salvage its business value amid these challenges, Joann has chosen a court-supervised sale. These store closures will be staggered over the coming months, although specific timelines could differ for some locations. Despite these drastic changes, Joann’s remaining stores and online platform will remain operational and continue to serve its customers. The company’s decision underscores the intense pressure traditional retail faces in a rapidly changing market. Customers will still be able to purchase their favorite crafting supplies online, ensuring there remains a touch of continuity during this tumultuous period.
