Joann Fabrics to Close 500 Stores Nationwide Amid Second Bankruptcy Filing*
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Writer AndyKim
Hit 1,094 Hit
Date 25-02-13 17:36
Content
**Joann Fabrics to Close 500 Stores Nationwide Amid Second Bankruptcy Filing**
In a move that has sent shockwaves through the crafting community, Joann Fabrics and Crafts—the beloved go-to for DIY enthusiasts—has announced plans to shutter 500 of its 800 U.S. locations. The decision comes as part of the company’s ongoing Chapter 11 bankruptcy proceedings, marking its second filing in less than a year.
**A Difficult Decision in Tough Times**
Interim CEO Michael Prendergast explained that “right-sizing our store footprint is a critical part of our efforts to ensure the best path forward.” Facing a staggering $615 million in debt and grappling with persistent inventory shortages and declining consumer demand, Joann has had no choice but to drastically cut costs and streamline operations. The closures will hit key markets hard—with California set to lose 61 stores, Florida 36, and states like Michigan, Ohio, and Pennsylvania each losing 33 locations.
**A Retail Icon Under Pressure**
Once a thriving chain with roots dating back to 1943, Joann’s story has been one of both growth and struggle. After its initial bankruptcy filing in March 2024—when the company secured $132 million in new financing to reduce debt—the retailer emerged as a private entity. However, the post-pandemic retail landscape, combined with fierce competition from online giants and shifting consumer habits, has proven insurmountable this time around.
Industry insiders note that while many shoppers once flocked to Joann for its extensive selection of fabrics, craft supplies, and home décor, the brand’s struggles have left a significant gap in the market. “I used to visit Joann every week for my quilting supplies,” says one loyal customer. “Now, I have to travel over an hour to find a similar selection—it’s really going to hurt local crafters.”
**What’s Next for Joann?**
As the company seeks court approval to liquidate assets under Section 363 of the U.S. Bankruptcy Code, a stalking horse bid from Gordon Brothers Retail Partners is already on the table. Prendergast remains hopeful that a higher bid could help salvage parts of the business, but the outlook is uncertain. While most stores will remain open during the bankruptcy process, the eventual fate of hundreds of locations hangs in the balance.
For many, Joann’s closures symbolize a broader trend in the retail apocalypse—a sector where even long-established, once-reliable names are succumbing to the pressures of a challenging economic environment. With competitors like Hobby Lobby and big-box retailers stepping up their game, the fabric and craft supply market is undergoing a dramatic transformation.
**A Community Mourns a Favorite**
For the nation’s 19,000 employees and countless crafting aficionados, the news is bittersweet. While some see it as a necessary step in a turbulent market, others worry about the loss of a cultural touchstone—a place where creativity was once nurtured with every spool of thread and bolt of fabric.
In a move that has sent shockwaves through the crafting community, Joann Fabrics and Crafts—the beloved go-to for DIY enthusiasts—has announced plans to shutter 500 of its 800 U.S. locations. The decision comes as part of the company’s ongoing Chapter 11 bankruptcy proceedings, marking its second filing in less than a year.
**A Difficult Decision in Tough Times**
Interim CEO Michael Prendergast explained that “right-sizing our store footprint is a critical part of our efforts to ensure the best path forward.” Facing a staggering $615 million in debt and grappling with persistent inventory shortages and declining consumer demand, Joann has had no choice but to drastically cut costs and streamline operations. The closures will hit key markets hard—with California set to lose 61 stores, Florida 36, and states like Michigan, Ohio, and Pennsylvania each losing 33 locations.
**A Retail Icon Under Pressure**
Once a thriving chain with roots dating back to 1943, Joann’s story has been one of both growth and struggle. After its initial bankruptcy filing in March 2024—when the company secured $132 million in new financing to reduce debt—the retailer emerged as a private entity. However, the post-pandemic retail landscape, combined with fierce competition from online giants and shifting consumer habits, has proven insurmountable this time around.
Industry insiders note that while many shoppers once flocked to Joann for its extensive selection of fabrics, craft supplies, and home décor, the brand’s struggles have left a significant gap in the market. “I used to visit Joann every week for my quilting supplies,” says one loyal customer. “Now, I have to travel over an hour to find a similar selection—it’s really going to hurt local crafters.”
**What’s Next for Joann?**
As the company seeks court approval to liquidate assets under Section 363 of the U.S. Bankruptcy Code, a stalking horse bid from Gordon Brothers Retail Partners is already on the table. Prendergast remains hopeful that a higher bid could help salvage parts of the business, but the outlook is uncertain. While most stores will remain open during the bankruptcy process, the eventual fate of hundreds of locations hangs in the balance.
For many, Joann’s closures symbolize a broader trend in the retail apocalypse—a sector where even long-established, once-reliable names are succumbing to the pressures of a challenging economic environment. With competitors like Hobby Lobby and big-box retailers stepping up their game, the fabric and craft supply market is undergoing a dramatic transformation.
**A Community Mourns a Favorite**
For the nation’s 19,000 employees and countless crafting aficionados, the news is bittersweet. While some see it as a necessary step in a turbulent market, others worry about the loss of a cultural touchstone—a place where creativity was once nurtured with every spool of thread and bolt of fabric.