RIP JOANN | The Demise of an American Icon

RIP JOANN | The Demise of an American Icon

For over 80 years, Joann Fabrics has been the cornerstone of America's crafting community, providing essential materials and inspiration to hobbyists and small businesses alike. In this video, we’ll dive into the rapid decline of this beloved institution and its profound impact on communities nationwide.

For generations, Joann Fabrics has been more than just a store—it’s been a haven for crafters, a cornerstone of small businesses, and a creative hub for communities across the country. Whether you were sewing your first quilt, picking out yarn for a handmade gift, or running a handmade business, Joann’s was always there, stocked with everything you needed.

But now, the unthinkable has happened. Joann Fabrics is shutting down—permanently. Just weeks after announcing its second Chapter 11 bankruptcy restructuring, which I discuss a bit about in my previous video on Joann as well as the full history of Joann -so definitely make sure to check that out for even more context, the company has now confirmed that every single Joann store across the U.S. will be closing its doors. 

How did this sudden collapse happen? It’s been fast, messy, and devastating—not just for customers, but for employees, suppliers, and small business owners who have all relied on Joann to survive.

So, what went wrong? How did an American craft empire crumble so quickly? And what does this mean for the future of crafting businesses? Let’s dive into the shocking downfall and demise of Joann Fabrics, an iconic brand that crafters once trusted—and what we can do in the crafting community in order to move forward. 

 

 

Section One: What Happened?

When Joann first filed for Chapter 11 bankruptcy in early 2025, the company made one thing very clear: They weren’t going anywhere. In fact, their restructuring plan specifically stated that no major store closures were expected, and they were working on a ‘path forward’ with their lenders to keep the business running as usual.

But sadly that reassurance didn’t last long. Just weeks later, Joann confirmed that more than 500 stores nationwide would be shutting down. (Craft Alliance)  And within days, that announcement escalated to something even more shocking—every single Joann store in the country is now set to close.

For longtime customers, this felt like a total blindside. How did we go from ‘business as usual’ to a full liquidation? The truth is, Joann’s financial troubles ran much deeper than they let on. Their debts weren’t just weighing them down—they were sinking the entire company. And when their restructuring deal failed to secure the money they needed to keep stores open, the only option left was to liquidate everything.

The closure announcements will leave thousands of employees without jobs, customers scrambling for alternatives, and small businesses questioning where they’ll now source their supplies. And this abrupt shutdown is only the beginning of the chaos.

 

Section Two: How Joann Ended Up Here—A History of Its Financial Collapse

To understand how Joann went from being a crafting empire to filing for bankruptcy, we have to rewind a bit. The company’s financial troubles didn’t start overnight—they’ve been building for years. I touched on this in more detail in the last video, but let’s discuss it briefly here.

Back in 2011, Joann was bought out by private equity firm Leonard Green & Partners for a staggering $1.6 billion. This meant that, instead of reinvesting in the business, Joann was now loaded with debt, while the firm extracted profits. This is a classic private equity move—one we’ve seen sink other companies before.

Under private equity ownership, Joann struggled to balance its growing debt with its need to stay competitive. While crafting saw a surge during the pandemic (BBC, Modern Revival, Smithsonian Mag). Joann didn’t invest in long-term sustainability. And when inflation hit and consumer spending tightened, things spiraled fast.

By 2023, Joann was drowning in debt. Store sales were down, vendor relationships were strained, and the company was facing an uphill battle. So in March of 2024, Joann filed for Chapter 11 bankruptcy protection amid a reorganizing of finances. At the time Joann said in a press release that it had secured approximately $132 million in “new financing and related financial accommodations and expects to reduce funded debt on its balance sheet by approximately $505 million.

The company, which at one point was the largest fabrics retailer in the U.S., added that it expected to emerge from the bankruptcy process as early as April 2024 when it would become a private company “owned by certain of its lenders and industry parties.”

And it did! At first, so things seemed promising. 

“There is no other retailer with the same ability to serve sewists, quilters, crocheters, crafters and other creative enthusiasts as we have for the past 80 years, and we take great pride in seeing the passion and engagement of our millions of customers and our Team Members," Chris DiTullio, chief customer officer and co-lead of the interim office of the CEO, said at the time. (Today)

However less than a year later in January of 2025, Joann filed for a second Chapter 11 bankruptcy protection filing. At first, they claimed this was just a financial reset—that stores would stay open, employees would keep their jobs, and customers wouldn’t be affected. It would be similar to the last bankruptcy they promised, But as we’ve all seen… that promise was broken. 

At that time Joann had mainly remained quiet about all of its financial troubles mounting behind the scenes, which we’ll definitely be addressing their social media response or more like silence in more detail a bit later in this video but, this second bankruptcy filing prompted them to launch a new “restructuring” website for Joann which included a customer FAQ section. 

By the way - I’m not a lawyer and this is not legal advice - I am an artist and business owner so everything I am saying is from that perspective.

I listened to the publicly available court hearing on Joann’s bankruptcy proceedings, so you don’t have to—but if you're curious, you can check it out yourself. Most of it is pretty standard, dry legal proceedings, but one part stood out to me.

At the January 16th court hearing—the first hearing of Joann’s second bankruptcy proceedings—this was well before the bidding process even began, when Joann started auctioning off its assets.

During this hearing, a partner from Kirkland & Ellis LLP, the law firm representing Joann in this bankruptcy filing, gave a general explanation of why the company was entering into a second bankruptcy so soon after the first. She also stated that they expected no trouble securing a “going concern bid” during the process.

So in the context of this hearing - the  “going concern bid” is when a buyer offers to purchase a company with the intention of keeping it operating as an active business. So this partner at Kirkland and Ellis is vying for the fact that there is a lot of demand in the market for Joann’s, and it has a lot of value - so they should have no trouble being able to find a seller who will want to keep Joann’s open. 

She said that the last bankruptcy led to a drop in production, and when the company successfully emerged the production levels picked back up but it took longer than they anticipated for those goods to hit the shelves. They didn’t really hit the shelves into November and so sales didn’t pick up until December and January and as a result the damage was done. So because they didn’t have the inventory they needed from April to November it prevented them from hitting the sales that they needed. Then she goes on to explain in that audio that this caused the domino effect which led to their second bankruptcy.

So let’s talk more about what happened with the vendors. 

 

Section Three: The Vendor Fallout—Why Suppliers Cut Ties with Joann

Joann’s financial struggles didn’t just hurt customers and employees—they also burned bridges with the very suppliers that kept their shelves stocked. In the months leading up to the second bankruptcy, Joann reportedly stopped paying several of its vendors, leaving suppliers in the dark and forcing some to cut ties altogether.

Many of Joann’s suppliers, from fabric distributors to yarn manufacturers, rely on large orders to keep their own businesses running. But when Joann wasn’t able to make payments, these vendors were left with massive unpaid invoices and no way to recover their losses. Some smaller suppliers were hit especially hard—losing thousands of dollars in unpaid orders that they’ll likely never see a dime from.

As I touched on in the previous video, according to Jill Soltau - Joann’s CEO from February 2015 to October 2018 said that two-thirds of Joann’s products are from Chinese manufacturers but many of the products are also sourced from USA based vendors who are also really getting the short end of the stick.

According to this spreadsheet which was created by Grace from the Craft Industry Alliance, we can see that the top 10 creditors for both bankruptcy filings are listed here, and this data is pulled from the Kroll website. 

As we can see in 2025 that six of the top ten creditors are actually in the United States. The top creditor is Low Tech Top Club LLC which is Woobles -the company that sells the cute little crochet kits and is based out of North Carolina, Joann owes them $7.4 Million dollars, which is insane! 

And with their previous bankruptcy filing in 2024 - only one of the companies is not US based which is this company, and it’s based in Türkiye - the rest of the companies are all based in the states. And the top creditor here is Spinrite Corp which is the parent company of so many yarn brands we all love and Joann owed them $12.2 million. The second top is Lion Brand Yarn Co, another brand that we all know and love and Joann owes them $7.4 million. This is wild! 

So, Joann’s financial problems impacted independent vendors, major manufacturers and many US based businesses as well. As we discussed earlier, many suppliers ceased deliveries after Joann's initial bankruptcy filing in April 2024, leading to inventory levels not meeting expectations until November 2024.

This vendor fallout only made Joann’s situation worse. Stores that were already struggling with low foot traffic suddenly had empty shelves, frustrated customers, and even fewer sales. And when customers can't find what they need, they are forced to shop more online or go elsewhere —driving even more business away from Joann.

So, while Joann’s leadership tried to frame this as an unavoidable financial setback, the reality is that they lost the trust of their suppliers long before they ever announced the second bankruptcy. And without those relationships, Joann simply couldn’t survive.

But Joann wasn’t only burning bridges with vendors but with their landlords too.

 

Section Four: Looming Landlord Problems

Joann's recent bankruptcy filing has sent ripples through the retail real estate sector, leaving landlords in a precarious position. With the company's plans to close numerous stores nationwide, property owners are now grappling with the challenges of vacant spaces and the financial implications that follow. (How Will Retail Landlords Fare If Craft Retailer Joann Inc. Liquidates in Bankruptcy? Substack)

In March 2024, when Joann Inc. filed for Chapter 11 bankruptcy protection the first time.

The company presented a prepackaged bankruptcy plan, aiming to keep existing retail locations operational and assure landlords of continued lease payments. Joann's Chief Financial Officer stated that, upon plan confirmation, all stores would remain open, and all amounts owed to landlords would be paid in full.  

However, the retail landscape is fraught with uncertainties. Despite initial assurances, as reports began to come out that indicated Joann may proceed with store closures, this particularly affected landlords. Such closures could leave property owners needing to seek new tenants in a challenging market.

And let’s unpack how complicated this would be for Joann as they had 800 locations at the time - Each landlord would need to proactively review their lease agreements. Especially co-tenancy clauses that might be triggered by anchor tenant closures. 
An anchor tenant is a larger store in a shopping center that draws in the crowds to help other smaller stores in that center. Additionally, it's crucial to examine existing loan documents for any notice requirements activated by a tenant's bankruptcy filing. Staying vigilant about these details helps landlords navigate the complexities arising from such significant tenant upheavals.

This situation with Joann really made me think about the broader challenges landlords face when major tenants undergo financial distress. 

Kevin Thompson, a finance expert and the founder and CEO of 9i Capital Group, told Newsweek: "The pandemic was the first blow—falling revenue and rising debt put Joann in a tough spot. When you hear the word 'leverage; just know that is synonymous with increased risk. When a company is acquired using borrowed money and interest rates start rising, debt becomes harder to service."

Alex Beene, a financial literacy instructor for the University of Tennessee at Martin, told Newsweek: "When it comes to the several store chains that are currently planning to or have filed for bankruptcy, the paths that are taken will largely depend on how each entity plans to handle struggling stores and future performance. In the case of Joann's, a new ownership group has decided based on the data available they would be best to just go ahead and close the remaining retail outlets." And this was said when it was announced that Joann’s would be closing 500 of its stores. (Newsweek)

I know that a beloved location in my hometown that had been there for over 30 years shutdown overnight because Joann’s couldn’t keep up with its payments. This prompted me to look into this more - what are Joann’s bills with its landlords and the results were quite shocking to me. 

Joann does not own any of their retail space, they rent all of them! That’s right, they pay rent on all 865 stores across 49 states, so that’s a lot of overhead that has to be paid in order for the stores to be profitable. The highest monthly rent is the Riverfront Plaza store in Chicago Illinois for $105,880/month. (Craft Industry Alliance)

And the oldest one here was the Steven Corners store in Falls Church VA and it has been there since 1960.

In summary, Joann's bankruptcy serves as a stark reminder of the vulnerabilities inherent in retail real estate investments. The ripple effects of Joann’s collapse will impact shopping centers, landlords, and the communities that have depended on these stores for generations.

 

Section Five: The Human Cost

The closure of Joann Fabrics and Crafts marks a significant upheaval in the retail sector, leading to substantial job losses across the United States. As the company shutters all 800 of its stores following its second Chapter 11 bankruptcy filing within a year, approximately 19,000 employees are set to lose their jobs. This workforce includes around 15,600 part-time positions, highlighting the extensive impact on both full-time and part-time staff nationwide.

In Ohio, where Joann is headquartered, the ramifications are particularly severe. The company has indicated that over 1,000 jobs are at risk in the state, encompassing 662 positions at the Hudson corporate headquarters, 359 roles at the Hudson distribution center, and 116 jobs in West Jefferson.  wkyc.com

@possum.gawd

disclaimer i made this on my 15 min break

♬ You can do this girl - Bottito
@digital_lily With the start of liquidation then the past two years I’ve been with the company. So much has happened an us employees are trying our best #retailworker #craftstore #herewego #fyp #joannfabrics #fabric #joanns ♬ original sound - Lil
@miss_crafty_pants Yes, it’s great to save money. You can spend your money however you want. But read the room. Thousands of Joann employees are losing their jobs, and they still have to show up every day, smiling through the stress of shutting down their stores. Half of them found out their store was closing on tiktok and not from their managers. So while you're celebrating that amazing deal you scored at a liquidation sale, remember—there’s a single mom in that same store, scanning your fabric, wondering how she’s going to buy groceries next week. There's a 70 year old woman who was 1 year away from her retirement. These are real people. And please, be kind to the staff. They have no control over whether your gift cards work, if the app glitches, or if coupons are accepted. They’re doing their best under impossible circumstances. The least we can do is treat them with kindness and respect. #joannfabrics #SewingCommunity #sewingmom #sewingforyoupage #sewingtiktok #sew #sewing ♬ My Blue Heaven - Django Reinhardt
@stinggraycrochet i just had a lady spam the store line for 30 minutes straight to ask how to place an online order while i (singular) had a 50+person line #joannfabrics #crafts #joann #liquidation #crochet #sewing #fyp ♬ original sound - MemeHub

Similarly, the closure of the Visalia distribution center in California will result in 209 layoffs, as detailed in the company's notice to the state Employment Development Department. (The Business Journal) 

These widespread layoffs not only affect the livelihoods of Joann's employees but also pose challenges to local economies and communities that have relied on the retailer for decades. The loss of jobs extends beyond retail positions, impacting supply chains, distribution networks, and ancillary services connected to Joann's operations.

As Joann initiates going-out-of-business sales and prepares to wind down operations, the company has announced that gift cards will be accepted until February 28, 2025.  However, reports have surfaced of customers encountering difficulties redeeming gift cards at certain locations, leading to frustration and dissatisfaction among loyal patrons. 

It’s really unfortunate that many purchased Joann gift cards over the holidays for loved ones and have tried to use them but had no luck or will not be able to use them before that deadline and now will lose money. (Reddit)

The closure of Joann Fabrics and Crafts signifies the end of an era for a retailer that has been a staple in the crafting community for over eight decades. The resulting job losses underscore the broader challenges facing the retail industry in a rapidly evolving economic landscape.

 

Section Six: The Ripple Wave Impact

Joann’s closure of all 800 stores nationwide has sent shockwaves through the crafting community and small businesses alike. For over 80 years, Joann has been a cornerstone for hobbyists and entrepreneurs, providing essential materials and a communal space for creative exchange. Losing Joann signifies not only the loss of a retail giant but also disrupts the fabric of local crafting ecosystems.

Small business owners and independent crafters heavily rely on Joann for accessible and affordable supplies. The closure means these entrepreneurs must now seek alternative sources, which may not offer the same convenience or pricing. This report by 3News Now Omaha speaks directly to artists in their local area to see how they will be impacted.

As Michael, the creator featured in the video, explained, Joann has been the largest supplier for her business, and she’s concerned that other retailers won’t be able to match what Joann offered.

Craft vendor Jodene also highlights an important issue—the prices at Joann’s competitors aren’t the same, making it harder for makers to source affordable materials.

With the cost of everything rising, many creators and artists are feeling the squeeze. They don’t want to raise the prices of their handmade pieces, but with fewer affordable supply options, they may have no choice. In some cases, the closure of Joann could make certain items too expensive to produce, forcing makers to stop offering them altogether.

This story by WXYZ Detroit explains it so well as well, as fiber artists it’s so important to feeling the fabrics so that you can know what you want to work with and know the quality of it. 

As I shared in my last video on Joann’s, it’s really important to touch and feel the yarns before working with them - especially if you haven’t worked with that yarn before or if you are new to your craft. When I first began crocheting, Joann’s was so helpful for me because I could go in and touch the yarn and see it as well, and there are also many affordable options which is important when you are learning. Crochet is so great because they don’t cost too much money when you are just learning, you just need a hook and some yarn. So it’s really devastating that so many are losing an affordable option. 

This has caused so many to start to panic buying and sharing their hauls online, which I completely understand especially if you use one of the brands that are specific to Joann because it’s very likely that they will be discontinued after they close for good. Brands like Fabany, which is its new sewing notions brand that they launched last year as well as Happy Value which offers crafting, paint and yarn at low prices. Another beloved brand of yarn owned by Joann is Big Twist, a favorite of so many.

@_jenna.d_ So sad they are going out of business because their scrapbooking paper selection is elite🥲 #joanns #joannfabrics #joannsfabrics #scrapbooking #scrapbookingsupplies #scrapbookingpaper #junkjournal #junkjournaling #craftsupplies ♬ Peekaboo x Paper Planes by Altégo - ALTÉGO
@thetancat yes, I did panic buy a ton of yarn at Joanns yesterday. I don't know what we're going to do if we lose Joanns?! Where are we going to buy yarn?! #yarnhaul #creatorsearchinsights #joann #joannfabrics #crochetersoftiktok ♬ original sound - Sizzling Reads
@dbhandmades I gave into the panic and ran to Joanns!!! (I also had Gift cards burning a hole in my pocket) Here's the full video of my experience, lol: https://youtu.be/7m-1WObUASM?si=kP9e8dq6w5mygMJ_ #dbhandmades #joanns #shopwithme #shopping #haul #yarnhaul #giftcards #crochet #knitting #yarn #yarntok ♬ Memories - Maroon 5
@krochet.with.krista Actually both of my local Joann stores will be closing. Did I panic buy before the Feb 12th court date? Yes. Am I still panic buying? Again Yes. #joann #bigtwistyarn #yarn #joannfabrics #crochet #crochetersoftiktok #crochettok #crochettiktok #yarnaddict #bigtwistposh ♬ Awkward Moments - AstroMusic

So It’s definitely understandable why many would panic buy right now. I probably won’t be right now, and definitely don’t encourage anyone to spend more than what is their budget for sure. I went to my local Joann last week and the sales at mine were definitely not really good. 

Even though the liquidation sale was supposed to really start happening in mid February, I couldn’t really tell. The Christmas items were 70% off which is a pretty good deal but I think it should be a bit higher than that considering everything, also all of the yarn was only 25% off which when you did the math it wasn’t much more off than what you could get online or with coupons before the store closing sales so that was interesting. I did notice that the woobles kits were also 25% off which they are never on sale typically so that would be a good deal for some. I did grab a couple of skeins of yarn that I thought looked cool, one of which I reviewed recently, and I did notice that the receipt and all of the signs in the shop had the foreboding “all sales are final” notice which really made all of this sink in. 

In summary, Joann's shutdown represents a significant upheaval in the crafting world, affecting small businesses, individual artisans, and local communities. As the industry adapts to this change, the resilience and innovation of the crafting community will be crucial in navigating the challenges ahead.

 

 

Section Seven: The Future is Bright

Joann's closure leaves a huge hole in the crafting community, and for many of us, it’s the end of an era. But if there’s one thing I know about crafters, it’s that we are resourceful, creative, and resilient. While this chapter might be officially closing, a new one is already beginning.

In the last few years, we’ve seen an exciting shift toward independent craft supply stores, thrift shops carrying fabrics and yarn, and creative reuse centers where people can donate and find materials at a fraction of the cost. While it will take time to fill the void left by Joann’s, these small businesses and initiatives have the potential to become the new go-to spaces for our community

This shop owner of Marie’s Sewing center in Upstate New York for example says that business has been booming at her store since the Joann closure has been announced, which is really great to hear.


As I was researching for this video, I even found a reuse shop not too far from me that operates on a pay-what-you-can basis! Can you imagine how game-changing that is for crafters and artists on a budget? I truly believe that we’re going to see more of these initiatives and businesses pop up as makers and entrepreneurs step in to fill the gaps.


 

The crafting community has always been built on sharing, innovation, and creativity. Whether it's supporting small businesses, upcycling materials, or finding new ways to connect, we will make a way. And honestly, I’m excited to see what comes next.

 

In my next video, I’ll be sharing a list of affordable yarn shops, indie fabric stores, and some creative reuse options to help you find supplies without breaking the bank. So stay tuned, subscribe and click that bell to be notified of when I share that video and if you’ve discovered a great local resource especially, let me know in the comments—I’d love to share it with our community here.

I want to give a special thanks to my members, your support really means more than you know for allowing these deep dives to be possible so thanks so much. Also a massive thanks to everyone who supports my online shop at cactusladycreation.com. If you want to help support this channel please consider supporting my shop or becoming a member. Make sure to sign up for my newsletter to also get occasional updates on the online shop and new blog posts! 

Well thank you for reading and I hope you join me in the next one! 

 

Sources:

New York Post – "Joann to Close 500 Stores After Filing for Second Bankruptcy" https://nypost.com/2025/02/12/business/joann-to-close-500-stores-after-filing-for-second-bankruptcy/

Axios – "Joann Fabrics Closing All Stores After Bankruptcy Filing"
Retrieved from: https://www.axios.com/2025/02/24/joann-fabrics-closing-all-stores-bankruptcy

General Joann Bankruptcy and Closure Coverage

Historical Background of Joann’s Financial Decline

The Vendor Fallout

Landlord Issues and Retail Property Fallout

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