Joann Inc. to Close All Stores After Second Bankruptcy Filing: What This Means for the Craft Industry

 

Joann Inc. to Close All Stores After Second Bankruptcy Filing: What This Means for the Craft Industry

Joann Inc., a well-known U.S. retailer for fabric and craft supplies, has announced that it will close all of its stores. This comes after the company filed for Chapter 11 bankruptcy for the second time. Joann has been a popular place for DIY enthusiasts and crafters for over 80 years, but it is now shutting down due to ongoing financial struggles.

Founded in 1943, Joann’s success came from offering a wide variety of fabric, sewing tools, and crafting materials. At its peak, the company had over 800 stores in the U.S. It became a favorite destination for people looking to start a sewing project or pick up supplies for crafting hobbies. But recently, Joann faced many challenges, leading to its decision to close all stores.

This blog explains why Joann is shutting down, what will happen next, and what it means for the crafting world.

Why Did Joann File for Bankruptcy?

Joann first filed for Chapter 11 bankruptcy protection in late 2024. This filing gave the company time to reorganize and try to fix its financial issues. However, despite its best efforts, Joann continued to face problems, and by early 2025, it was clear that it could not recover.

Several things led to Joann’s downfall:

• Shifting to Online Shopping: Like many other stores, Joann struggled to compete with the growing trend of online shopping. While DIY and crafting became popular during the pandemic, Joann was slow to fully embrace e-commerce. By the time it invested in online sales, other online platforms were already dominant in the market.

• Inventory and Supply Issues: Joann had trouble managing its inventory, especially during the pandemic when shipping delays and supply chain issues were common. This made it hard for customers to get the products they needed and hurt Joann’s reputation.

• Economic Pressures: Rising costs and inflation made it harder for Joann to stay profitable. These challenges made it difficult for Joann to compete with lower prices from larger retailers and online marketplaces.

• Competition: Other stores like Michaels, Hobby Lobby, and even Amazon made it difficult for Joann to maintain its market share. These competitors offered similar products and had strong online presences.

What Happens Next for Joann?

Joann has now entered the liquidation process. This means the company will close all its stores, and all its assets will be sold off. Going-out-of-business sales will begin soon at all locations, where customers can buy discounted products.

This closure will also affect Joann’s employees. Thousands of workers will lose their jobs as the company shuts down its operations. Joann has thanked its employees and customers for their support over the years, but it’s still unclear what the future holds for the people who worked there.

How Will Joann’s Closure Affect the Craft Industry?

Joann’s closing is a big loss for the craft industry. The company has been a top choice for people buying fabric, knitting supplies, sewing machines, and other crafting tools. Without Joann, many customers will need to find new places to shop for their supplies.

Here’s how the closure might affect the market:

1. Michaels May Gain Customers: Michaels, Joann’s biggest competitor, will likely see more customers as Joann closes its stores. Michaels already has a strong presence in the craft supply market, and it’s in a good position to take over Joann’s share of customers.

2. Small, Local Craft Shops Could Benefit: Some smaller, local craft stores may also gain customers as Joann shuts down. These independent businesses could see more people coming to them for supplies, especially if they offer unique products or a more personal shopping experience. However, it may be hard for these small stores to meet the demand left by Joann.

3. Online Shopping Will Continue to Grow: Many people already shop for craft supplies online, and the trend is likely to continue. Platforms like Amazon, Etsy, and other specialized craft websites may fill the gap left by Joann’s closure. People will likely continue to buy products online, finding convenience and variety without having to visit a physical store.

What Led to Joann’s Decline?

There were several key reasons behind Joann’s financial struggles:

1. Difficulty Adapting to Online Shopping: Joann didn’t fully embrace e-commerce until later. While online shopping became more popular, Joann’s efforts to build a strong online presence came too late to compete with large online platforms like Amazon and Walmart.

2. Problems with Inventory: Joann had trouble keeping up with inventory. During the pandemic, the company faced delays in getting stock, and that affected its ability to meet customer demand.

3. Rising Costs: The increased costs of materials and shipping made it harder for Joann to stay profitable. This affected their ability to compete on price with larger chains.

4. Strong Competition: Michaels, Hobby Lobby, and even stores like Target offered similar products, which made it harder for Joann to stand out. The rise of online retailers also took away a large portion of their customers.

What’s Next for Crafting in the U.S.?

Even though Joann is closing, crafting is not going away. People still enjoy DIY projects and will continue to need supplies. Here’s what might happen in the future:

1. Growth of Online Craft Stores: More people will continue to shop for craft supplies online. Websites like Amazon, Etsy, and other specialty craft shops will likely see more business as customers look for alternatives to Joann. These online platforms can offer convenience and a wide variety of products.

2. Rise of Small, Local Craft Stores: As Joann shuts down, smaller, independent craft stores may find new customers. These businesses could grow by offering unique products or personalized services. However, they will need to work hard to compete with online stores and larger chains.

3. Michaels Could Take the Lead: Michaels is already a big player in the craft supply market and will likely become even more dominant now that Joann is closing. Michaels will need to keep offering quality products and stay ahead of its competition, especially online.

4. Changing Consumer Preferences: Trends in the crafting world, like eco-friendly products and sustainability, may shape the future of craft retail. Retailers that can offer green or unique crafting products will likely do well in this evolving market.

Conclusion: Saying Goodbye to Joann

Joann’s decision to close all of its stores marks the end of a significant chapter in the retail world. The company has been a leader in the crafting industry for decades, but its struggles with e-commerce, inventory management, and competition ultimately led to its downfall. While Joann’s closure is a big loss, the future of crafting remains bright.

Other retailers, both online and offline, will continue to provide crafting supplies for DIY enthusiasts. Whether it’s larger chains like Michaels or smaller local shops, the creativity of crafters will continue to thrive. The industry is changing, but it will always have a place in people’s lives.