Joann, the popular fabric and craft retailer, is closing over half of its stores nationwide after filing for bankruptcy for the second time in less than a year.
The company, which currently operates around 800 stores, will shut down about 500 locations as part of its ongoing effort to reorganize and find a new path forward.
In a statement, Joann said the decision was necessary to "right-size" its store footprint. While the move is a difficult one, the company acknowledged the significant impact it would have on employees, customers, and communities.
Joann's spokesperson emphasized that the closures are a critical part of ensuring the company's future viability.
The store closures will affect all 50 states, with California, New York, Florida, and several others seeing the most significant number of closures.
According to the NY Post, Joann's bankruptcy proceedings, which started in March 2024, marked the company's first Chapter 11 filing.
After emerging as a private company a few weeks later, the retailer continued to face financial struggles, leading to a second filing in January 2025.
Interim CEO Michael Prendergast explained that the second bankruptcy was driven by a combination of factors, including a challenging retail environment, inflation, and declining consumer demand.
Joann Faces Financial Crisis, Seeks New Buyer Amid Store Closures and Inventory Woes
Joann faced unexpected inventory issues that worsened the company's financial situation. Prendergast also mentioned that Joann is currently looking for a new buyer to help stabilize the business.
"After carefully reviewing all available strategic paths, we have determined that initiating a court-supervised sale process is the best course of action to maximize the value of the business," Prendergast stated.
The company hopes this process will allow Joann to continue operating in the long term, AP News said.
Joann's closure of these underperforming stores is part of the ongoing restructuring process, which has been further complicated by a sluggish retail market.
Other department stores have also been affected by the ongoing inflationary pressures, with major retailers like Kohl's and Macy's also closing locations this year.
Founded in 1943 in Cleveland, Ohio, Joann has grown into a national chain, but it has struggled in recent years as competition has increased.
Rivals such as Hobby Lobby, as well as larger retailers like Target, have expanded their craft sections, further challenging Joann's position in the market.
Despite these difficulties, Joann remains hopeful that a new buyer can help guide the company through this turbulent period.
As the store closures begin, the full scope of how many employees will be affected has not yet been revealed. The company is currently awaiting court approval to proceed with the closures.
Join the Conversation