Is Joann Going Out of Business

The question "Is Joann Going Out of Business?" has been a frequent concern for crafters and shoppers alike. Unfortunately, after navigating a complex financial period, the answer is definitive: Yes, Joann has gone out of business, and all of its retail locations have permanently closed. This marks the end of an era for the beloved fabric and craft retailer, which served the creative community for over 80 years.

This article will delve into the circumstances that led to Joann's closure, explaining its journey through bankruptcy, what Chapter 11 truly entails, and the final outcome for its stores and loyal customers.

The End of an Era: Joann's Final Chapter

After months of speculation and financial challenges, Joann announced in February 2025 that it would be liquidating all of its remaining stores. The last Joann stores officially closed their doors on May 30, 2025. This decision came after the company failed to find a buyer to keep its operations afloat following its second Chapter 11 bankruptcy filing.

Initially, Joann had announced the closure of approximately 500 of its 800 locations in an effort to "right-size" its footprint. However, the inability to secure a buyer for the remaining 300 stores ultimately led to the complete liquidation of the company's assets.

A Look Back: Joann's Journey Through Bankruptcy

The path to Joann's ultimate closure involved two Chapter 11 bankruptcy filings within a year.

The First Chapter 11 Filing (March 2024)

Joann first filed for Chapter 11 bankruptcy protection on March 18, 2024. At that time, the company aimed to reorganize its finances, reduce over $500 million in debt, and transition into a privately held company. This initial filing was intended to be a restructuring effort, with plans to keep all employees and stores operational. Joann successfully emerged from this first bankruptcy in April 2024 as a private entity, owned by its creditors.

The Second Chapter 11 Filing (January 2025)

Despite the initial restructuring, Joann continued to face significant financial pressures. On January 15, 2025, less than a year after its first filing, Joann filed for Chapter 11 bankruptcy protection for the second time.

What led to this second filing? The company cited "continued declining sales," "unanticipated inventory challenges," and a struggle to "adjust to a post-COVID economy" as contributing factors. While the COVID-19 pandemic initially provided a sales boom for Joann as people engaged in more at-home DIY projects, the company later saw a decline in sales exacerbated by increased competition from online retailers and rising merchandise costs.

This second bankruptcy filing was accompanied by a plan to sell substantially all of its assets.

Understanding Chapter 11: Reorganization vs. Liquidation

Chapter 11 bankruptcy is often referred to as "reorganization" bankruptcy. It allows businesses to continue operating while they restructure their debts under court supervision, aiming to return to profitability. A company in Chapter 11, known as a "debtor in possession," typically retains control of its assets and business operations. The goal is to propose a plan to repay creditors over time, often involving downsizing or other strategic changes.

However, as Joann's case illustrates, Chapter 11 doesn't always guarantee a successful reorganization. If a company cannot find a viable path forward, such as securing a buyer or implementing a successful restructuring plan, Chapter 11 can ultimately lead to liquidation. In such cases, the company's assets are sold off to pay creditors, and the business ceases operations. This is precisely the turn Joann's second Chapter 11 filing took.

The Liquidation Process and Store Closures

Following the second Chapter 11 filing, Joann entered into a process to sell its assets. After failing to find a buyer who would keep the business operating, the company's assets were acquired by GA Group, a financial services company. This acquisition initiated going-out-of-business sales across all remaining Joann locations.

The closure process was swift, with the initial announcement of 500 store closures in February 2025, followed by the confirmation that the remaining 300 locations would also be liquidated.

What About Gift Cards and Returns?

For customers, the news of the liquidation brought immediate questions about gift cards and returns. Joann announced that gift cards were valid only through Friday, February 28, 2025. After this date, gift cards were no longer accepted.

The Aftermath: What Happens to Joann's Legacy?

While Joann's physical stores have closed, its legacy in the crafting world won't entirely disappear. Arts and crafts retailer Michaels, a competitor, acquired Joann's intellectual property and private labels shortly after the final store closures. This means that some of the popular Joann-branded products and designs may eventually find their way onto Michaels' shelves and online platforms, expanding Michaels' product selection and offering a familiar touch for former Joann customers.

This acquisition highlights the ongoing consolidation within the retail landscape and the enduring demand for craft supplies, even as traditional brick-and-mortar models face challenges.

Conclusion

The journey of Joann, from a beloved crafting destination to its eventual liquidation, serves as a poignant reminder of the dynamic nature of the retail industry. Despite attempts at reorganization through Chapter 11 bankruptcy, persistent challenges led to the difficult decision to close all stores by May 30, 2025. While the physical presence of Joann stores is no more, the spirit of creativity it fostered will undoubtedly live on within the crafting community, perhaps even through the integration of its brands into other retailers like Michaels.

What are your fondest memories of shopping at Joann? How will these closures impact your crafting habits? Share your thoughts and experiences in the comments below.

Frequently Asked Questions

Q1: Did Joann close all its stores?

Yes, Joann announced the closure and liquidation of all its retail locations, with the last stores permanently closing by May 30, 2025.

Q2: What is Chapter 11 bankruptcy and how did it affect Joann?

Chapter 11 bankruptcy is a legal process that allows a business to reorganize its finances and debts while continuing to operate. Joann filed for Chapter 11 twice: first in March 2024 for reorganization, which it successfully emerged from. However, a second filing in January 2025, due to continued financial struggles, ultimately led to the company's liquidation after it failed to find a buyer.

Q3: Were Joann gift cards still valid?

No, Joann gift cards were valid only for a limited time during the liquidation process, with an expiration date of Friday, February 28, 2025. After this date, they were no longer accepted.

Q4: What happened to Joann's brands and products?

Arts and crafts retailer Michaels acquired Joann's intellectual property and private labels. This means that some of Joann's familiar product lines and brands may eventually be available through Michaels' stores and online platform.