Joann Fabrics and Crafts, a prominent name in the arts and crafts retail industry for over 80 years, has filed for Chapter 11 bankruptcy and announced the closure of all its 800 stores across the United States. This decision comes after a series of financial challenges and restructuring attempts.
The company first filed for Chapter 11 bankruptcy protection on March 18, 2024, aiming to reduce over $500 million in debt and restructure as a privately held entity. At that time, Joann planned to keep all stores operational during the reorganization process. However, continued declining sales led to a second bankruptcy filing on January 15, 2025. Initially, the company announced plans to close approximately 500 of its 800 locations to “right-size” its footprint. Subsequently, on February 24, 2025, Joann declared the closure of all remaining stores after failing to find a buyer for the remaining locations.
The sudden closure has left many customers concerned about the fate of their gift cards. Reports indicate that Joann ceased accepting gift cards after February 28, 2025, leading to frustration among shoppers who feel they have been deprived of their card’s value. Consumer experts advise using gift cards promptly during such situations to avoid potential losses, as companies undergoing bankruptcy may set cutoff dates after which gift cards are no longer honored.
Emergence of Scams
In the wake of Joann’s bankruptcy announcement, scammers have exploited the situation by creating fake “going-out-of-business” sales online. These fraudulent websites mimic Joann’s official site, offering substantial discounts to lure unsuspecting customers. The Better Business Bureau (BBB) has issued warnings about these scams, advising consumers to be cautious of overly attractive discounts and to verify the authenticity of websites before making purchases.
Retail Apocalypse
Joann’s closure is part of a broader trend in the retail industry, often referred to as the “retail apocalypse,” where several retailers have filed for bankruptcy and closed numerous stores in recent years. Factors contributing to this trend include increased competition from online retailers, changing consumer preferences, and economic challenges.
The closure of Joann Fabrics and Crafts marks the end of an era for a retailer that has been a staple for crafters and hobbyists nationwide. Customers are advised to redeem any remaining gift cards promptly and stay vigilant against potential scams during this transitional period.
