In a development that underscores the challenges facing American retailers, Ohio-based crafts giant Joann Inc. has filed for Chapter 11 bankruptcy protection for the second time in less than a year. The iconic crafts and fabric retailer, beloved by hobbyists and small business owners nationwide, is now looking to sell itself in a last-ditch effort to salvage what remains of its 80-year legacy.
Interim CEO Michael Prendergast announced Tuesday that Joann’s declining sales, inventory shortages, and a turbulent retail environment have forced the company to seek bankruptcy protection once again. “After carefully reviewing all available strategic paths, we have determined that initiating a court-supervised sale process is the best course of action to maximize the value of the business,” Prendergast said.
This isn’t Joann’s first brush with bankruptcy. In March 2024, the company entered Chapter 11 after more than eight decades in business, becoming a private entity while managing to keep its 800-plus stores across 49 states open.
However, this time around, the future appears far less certain. The company has announced its intention to sell substantially all of its assets to Gordon Brothers Retail Partners LLC, a move that could spell the end of Joann as we know it. Gordon Brothers, serving as the “stalking horse” bidder, has indicated plans to liquidate the company, potentially initiating going-out-of-business sales at all locations.
Despite the bleak outlook, Joann’s leadership is actively soliciting alternate bids, holding out hope that another buyer might step in to save the stores and online business. Should qualified bids materialize, an auction will be held, with Gordon Brothers’ offer setting the baseline.
In the meantime, Joann is striving to maintain a sense of normalcy. The company has confirmed that its stores and online operations will remain open, and employees will continue to receive their pay and benefits.
Joann’s predicament reflects broader challenges in the retail sector. Rising inflation, supply chain disruptions, and declining consumer spending have left many retailers struggling to keep their doors open. For Joann, these issues were compounded by increased competition from big-box stores like Walmart and Target, as well as the convenience of online giants such as Amazon.
Still, some critics argue that Joann’s troubles stem from a lack of innovation and failure to adapt to changing consumer preferences. Instead of doubling down on their core strengths—offering a personal, hands-on shopping experience and fostering community through classes and events—Joann appears to have been outmaneuvered by competitors offering similar products at lower prices.
Joann’s potential closure would mark the loss of another cherished American brand, a reminder of the ongoing squeeze on traditional retail. It’s a cautionary tale for businesses nationwide: adapt or risk irrelevance in a rapidly changing marketplace.
For now, loyal customers can only hope that a new buyer will emerge, breathing life into Joann’s storied history and ensuring it remains a staple for America’s crafters and creators. But with liquidation looming, the fate of Joann Inc. hangs by a thread.
