Walk into any Joann store right now, and the vibe is... different. It’s not just the smell of eucalyptus wreaths and bolts of cotton anymore. It’s the yellow "Going Out of Business" signs taped to the windows. Honestly, for anyone who grew up wandering those aisles for school projects or Halloween costumes, it’s a bit of a gut punch.
The news that Joann is closing 500 stores across the country felt like it happened overnight, but the cracks have been showing for a long time.
Basically, the craft giant hit a wall. Hard. After years of fighting off mounting debt and trying to keep up with the digital world, the company finally buckled. If you've been wondering why your local spot is suddenly clearing out its inventory at 70% off, you aren't alone. It’s a messy situation involving two bankruptcies in a single year and a liquidation process that eventually swallowed the whole company.
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Why Joann is closing 500 stores (and then some)
You might remember hearing back in early 2024 that Joann had filed for Chapter 11. At the time, they told everyone not to panic. They said they’d "right-size" the ship, cut some debt, and keep the lights on. It didn't work. By January 2025, they were back in bankruptcy court for the second time in ten months.
That second filing was the beginning of the end.
The initial plan was to shut down about 500 of their roughly 800 locations. The idea was to prune the "underperforming" branches to save the healthy ones. But the auction didn't go the way the board hoped. Instead of a buyer coming in to save the brand and keep it running, the winning bid came from a group—GA Group and lenders—who decided to wind down the whole operation.
So, while the headlines originally focused on Joann closing 500 stores, the reality turned out to be much more final. By May 31, 2025, the last of the physical stores officially shut their doors.
What went wrong?
It's easy to blame Amazon, but it’s more complicated than that.
- The "Pandemic Hangover": During 2020 and 2021, everyone was making masks and knitting sweaters. Sales went through the roof. Joann thought that was the new normal. It wasn't. When people went back to work and stopped DIY-ing every Saturday, sales plummeted.
- Inventory Nightmares: They literally couldn't get products on the shelves. Shipping costs from overseas spiked, and at one point, their in-stock levels dropped by over 10%. You can't sell fabric if you don't have it.
- The Debt Trap: They were carrying over $1 billion in debt. Even when they managed to shave half a billion off during the first bankruptcy, the interest payments and "sluggish retail economy" made it impossible to stay afloat.
- Hobby Lobby and Michaels: While Joann was struggling with debt, its rivals were pivoting. Michaels even ended up buying some of Joann’s private-label brands and intellectual property after the liquidation.
The human cost of the closures
It's not just about where you'll buy your zippers now. We’re talking about 18,000 employees who lost their jobs. These were folks who knew exactly which interfacing you needed for a blazer or how much yarn it takes to make a king-sized blanket. That kind of specialized knowledge is hard to replace.
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The closures hit states like California, New York, Florida, and Texas the hardest. In California alone, nearly 60 locations were on that initial hit list of 500 stores. For small-town crafters, a Joann closing isn't just a business failing; it’s the loss of the only place within a 50-mile radius that sells specialized quilting tools or upholstery fabric.
Where do we go from here?
If you're sitting on a pile of unfinished projects, the world looks a little different now. You've probably noticed that Michaels has suddenly expanded its fabric section. That’s not an accident. They saw the vacuum left by Joann and jumped in, adding over 600 new products, specifically focusing on sewing and fiber arts.
But let’s be real: Michaels was never really a "fabric store" first. It was always more about the crafts. Hobby Lobby has the selection, but their corporate policies and lack of a robust online presence for certain types of garment sewing leave a gap for many.
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Actionable steps for former Joann shoppers:
- Check Michaels for Joann brands: Since Michaels bought the intellectual property, you might start seeing some of your favorite old Joann-exclusive brands popping up on their shelves or website.
- Support the locals: This is the perfect time to look for independent quilt shops or "LYS" (Local Yarn Stores). They’re usually more expensive, but the quality is often higher, and they need the support more than ever.
- Pivot to specialty online retailers: For garment sewers, sites like Mood Fabrics or https://www.google.com/search?q=Fabric.com (owned by Amazon) are the new go-to. If you're a quilter, Fat Quarter Shop has become a massive player in the space.
- Use your gift cards (if you still have them): Honestly, if you still have a Joann gift card in your junk drawer in 2026, it’s likely a plastic coaster now. The deadline for using those passed during the liquidation sales in early 2025.
The era of the "big box" fabric store might be shrinking, but the community isn't going anywhere. It’s just moving into smaller, more specialized corners of the internet and local communities.
If you’re still mourning the loss of your local shop, the best thing you can do is find a new home for your craft. Whether that’s an indie shop down the street or a dedicated online community, the "maker" movement is still alive—it just doesn't have a giant green sign on the front of the building anymore.