Joann, the fabric and craft retailer, is closing over half of its 800 stores as part of its ongoing bankruptcy proceedings. Around 500 stores across the U.S. will be shuttered, with the company stating that reducing its store footprint is crucial for securing a successful future. A company spokesperson expressed regret over the impact these closures will have on employees, customers, and communities. While specific store locations weren’t disclosed, court filings indicate that closures will affect all 50 states, with California, Florida, Indiana, Michigan, New York, Pennsylvania, and Washington among the hardest hit.
This move follows Joann’s second bankruptcy filing in less than a year. The company initially filed for Chapter 11 in March 2024 but emerged soon after as a private entity, keeping all stores open. However, in its latest bankruptcy filing, Joann cited significant inventory issues, which were both unexpected and severe. The company also noted challenges in the production of key products. At the same time, Joann was actively searching for a potential buyer. New court documents show that as the sale process advanced, advisors identified several underperforming stores that were unlikely to be included in any potential acquisition bid.
Joann is part of a growing group of brick-and-mortar stores struggling to maintain financial stability in an evolving consumer landscape. Many Americans have reduced discretionary spending due to inflation.
In the broader retail sector, some brands that were already in decline before 2020 saw a surge in sales during the pandemic and post-pandemic period. However, as shopping habits return to normal, these brands are facing challenges again, with some heading toward bankruptcy.
In addition to Joann, other retailers like Kohl’s and Macy’s are closing stores this year. According to Coresight Research, over 15,000 stores are expected to shut down in 2025, more than double the number from the previous year.