Joann plans to close roughly half its stores after bankruptcy filing

Los Angeles Times

13-02-2025

After filing for bankruptcy protection twice in less than a year, the crafts and fabric retailer Joann is moving to close around 500 stores across the country, including nearly 60 in California.
Joann announced Wednesday that it is seeking the go-ahead from a bankruptcy judge to carry out the closures as part of an ongoing Chapter 11 process. The textile supplier declared bankruptcy in January and sought approval to sell assets while stores remained open.
The chain's footprint will be nearly cut in half by the closures, which will shutter locations in Huntington Beach, Glendale and Oxnard, among many others.
'This was a very difficult decision to make, given the major impact we know it will have on our team members, our customers and all of the communities we serve,' a Joann spokesperson said in a statement.
'Right-sizing our store footprint is a critical part of our efforts to ensure the best path forward for Joann,' they said.
The company selected locations for closure after an analysis of store performance and strategic fit, the statement said. Stores will close in nearly all 50 states. Joann did not release information on the number of employees that could be affected.
The Hudson, Ohio-based retailer emerged from a previous Chapter 11 bankruptcy in April 2024 after eliminating $505 million in debt. When it filed for the second time, the company said it had $615 million in liabilities and owed $133 million to suppliers. After going public in 2021, the company was delisted from the NASDAQ in 2024 as part of its first bankruptcy.
Joann has faced inventory shortages stemming from inconsistent deliveries of yarn and sewing supplies, according to court documents, leading to understocked shelves. Suppliers also discontinued some items popular among customers, the company said.
The chain is under pressure from inflation-wary consumers who have been pulling back on discretionary spending, which tends to include hobby-based goods like what Joann offers. It's further squeezed by competition from others in the space, including Etsy, Michael's and Hobby Lobby, as well as big-box and online retailers such as Amazon and Walmart.
'The last several years have presented significant and lasting challenges in the retail environment, which, coupled with our current financial position and constrained inventory levels, forced us to take this step,' said Joann interim Chief Executive Michael Prendergast in a statement after the January Chapter 11 filing.
Joann is not alone in its retail woes. The department store chain JCPenney has plans to close eight stores by midyear, including one in San Bruno, Calif., the company said in a statement to The Times this week. The chain closed around 200 stores after filing for Chapter 11 bankruptcy protection in 2020 and has since emerged from bankruptcy.
The party supply retailer Party City abruptly shut down operations in December after 40 years in business, laying off its employees and closing all locations, including several in Los Angeles. Big Lots, Kohl's and Macy's are also currently holding liquidation sales.