Joann, the once-thriving fabrics and craft supplies retailer, has announced that it will be closing all its stores. This decision follows the company's earlier bankruptcy filing and plans to shut down 500 locations. Despite efforts to revive the business, all attempts have been unsuccessful, leading to this complete shutdown.
The company has assured that its physical and online stores, including its mobile app, will remain operational during the shutdown period. Customers can still take advantage of the going-out-of-business sale. While Joann has not specified an exact closure date for all its stores, additional updates will be provided on its website.
Joann recently held a bankruptcy auction where GA Group emerged as the leading bidder, working in conjunction with the company's term lenders. Together, they are managing the store closures and organizing the going-out-of-business sales.
The past few years have been challenging for Joann, as demand for its niche products has dwindled. This decline resulted in a bankruptcy filing last year, leading the company to go private. Despite initial hopes for a turnaround, Joann's leadership delayed critical operational cuts, culminating in another bankruptcy filing in January 2025.
The closure of Joann stores highlights the risks faced by specialty retailers in today's market. These stores cater to a specific customer base, and while demand exists, brick-and-mortar locations struggle as consumers increasingly shop online. Additionally, inflation's impact on the economy is causing customers to reduce spending on hobbies and luxuries.
For investors, this scenario suggests considering stakes in department stores that appeal to a broader consumer base. Notably, companies like Walmart (WMT) and TJX Companies (TJX) are recommended, both holding Strong Buy ratings. WMT stock offers a projected 17.96% upside, compared to TJX's 14.06% potential growth.
