Joann Fabric Stores Are Closing in 49 States — Here’s Why
The popular U.S. fabric and craft retailer is closing several locations, calling it a tough but necessary move and revealing plans to navigate the challenge.
Joann, the well-known fabric and craft retailer for eight decades, is reportedly closing hundreds of stores, affecting 49 states. The closures follow Joann’s second filing of bankruptcy in early 2025, after initially filing in early 2024 before going private.
Joann Fabrics and Crafts store | Source: Getty Images
Founded in Cleveland, Ohio, JOANN started as a single store and grew into a major player in the sewing, fabric, and craft industry with a strong online presence. However, the decision to close “approximately 500” of its 850 locations marks a significant downturn for the company.
In a statement to USA TODAY, the company seeks to “right-size its store footprint,” adding, “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.”
To decide which stores to close, Joann looked at performance and potential. “A careful analysis of store performance and future strategic fit for the Company determined which stores should remain operating as usual at this time,” the statement read.
A Joann Fabrics store with a price check scanner and stocked aisles | Source: Getty Images
Although the company didn’t release an official list to the public, it submitted the locations set to close to the court as part of its Chapter 11 bankruptcy proceedings. It reportedly shows 533 locations are set to close, with Hawaii as the only unaffected state.
California will lose 61 stores. Florida will see 36 closures, while Michigan, Ohio, and Pennsylvania will each lose 33 locations. Illinois will have 26 stores shut down, followed by New York with 24, Washington with 21, Indiana with 20, and Massachusetts with 19.
The closures are part of Joann’s Chapter 11 bankruptcy proceedings, which the company voluntarily initiated on January 15, 2025, in the U.S. Bankruptcy Court for the District of Delaware.
Joann stated that the filing is intended to “facilitate a sale process to maximize the value of its business.” Despite the bankruptcy, Joann stores and Joann.com remain open, and employees continue to receive wages and benefits.
As part of this process, Gordon Brothers Retail Partners, LLC has been designated as a “stalking horse” bidder, meaning it has set a baseline offer for Joann’s assets. However, the company is still actively soliciting higher and better bids, which could lead to an auction if qualified offers are submitted.
Interim CEO Michael Prendergast acknowledged the difficult decision, citing “significant and lasting challenges in the retail environment,” along with the company’s financial struggles and inventory constraints.
“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. “We hope that this process enables us to find a path that would allow JOANN to continue operating as a going concern.”
Prendergast acknowledged the dedication of Joann employees, recognizing their efforts in serving customers and supporting the company’s mission. He expressed gratitude for their commitment, especially amid the company’s challenges in recent years.
He reassured employees and customers, including sewists, quilters, crocheters, and crafters, that despite the restructuring, Joann remains committed to serving its creative community as it has for over eight decades.
To uphold this commitment, Joann has filed motions to continue paying employees’ wages and benefits while keeping operations running. The company is also seeking court approval to use cash collateral to maintain liquidity during restructuring.
Joann’s bankruptcy falls under Chapter 11 of the U.S. Bankruptcy Code. According to the Internal Revenue Service (IRS), Chapter 11, or “reorganization,” is primarily for businesses but also applies to individuals with debts exceeding the Chapter 13 limit.
Debtors must create a repayment plan, and if it is not approved, the case may convert to Chapter 7 liquidation. The IRS stresses the importance of avoiding additional debt. Businesses must meet financial obligations, including taxes, while individuals may need to adjust tax withholding or increase payments.
As part of its Chapter 11 restructuring, Joann has set up a dedicated site for further information. The company’s customers and creditors can find more details at JOANNRestructuring.com.
The court filings and claims information are also available at cases.ra.kroll.com/Joann2025, or by contacting Kroll at (844) 712-2239 (U.S. toll-free) and (646) 863-7121 (international), or emailing Joann2025Info@ra.kroll.com.
Guiding JOANN through the process are Kirkland & Ellis as legal counsel, Centerview Partners LLC as financial advisor, and Alvarez & Marsal North America, LLC as restructuring advisor.
