MIDDLEBURG HEIGHTS, Ohio — Joann began as a single store in Hudson and expanded to hundreds nationwide. Now, the fabric retailer will close all 800 locations.
After filing for bankruptcy twice, Joann initially said 300 stores would stay open, but that changed following an auction on Friday.
RELATED: Joann plans to close all stores, conduct going-out-of-business sales
Many customers, including Patti Crawford, thought the Middleburg Heights store would survive, but they were caught by surprise.
“So I was really looking to see what stores are in the open, which is why I’m up here in Middleburg and then now I just found out that they're all closing, so I have no idea where I’m going to shop,” said Patti.
Inside the store, signs of the going-out-of-business sales are already clear. Crawford doesn’t want to see her favorite store close.
“I go to Joann’s almost every other week. Very often,” Crawford said, “I’m retired. I have a little sewing business, so thread material, just all kinds of great stuff, and I’m just going to miss them so much,”
As for Michael Wilson, a local designer:
“I have a supplier that I don't have to buy as much, but when you're trying to match specific colors, you can't do that online,” said Wilson.
He would visit the store multiple times weekly to grab threads and fabrics for samples, but not anymore.
“There are ways around it, but it's going to cost you more money and in the end it's costing me more money. It's going to cost my client more money,” said Wilson.
Joann’s announcement surprised many when the company said all locations would close after originally telling customers that 300 of their 800 stores would stay open. This announcement followed the auction of the company’s assets on Friday, with GA Group emerging as the winning bidder.
Joann released the following statement:
“Following a comprehensive sale process and auction, GA Group together with the Prepetition Term Loan Agent, has been selected as the winning bidder to acquire substantially all of JOANN’s assets. In connection with this agreement, subject to Bankruptcy Court approval of the transaction, the winning bidders plan to begin winding down the Company's operations and conduct going-out-of-business sales at all store locations.
JOANN leadership, our Board, advisors and legal partners made every possible effort to pursue a more favorable outcome that would keep the company in business. We are committed to working constructively with the winning bidder to ensure an orderly wind-down of operations that minimizes the impact on all our stakeholders. We deeply appreciate our dedicated Team Members, our customers and communities across the nation for their unwavering support for more than 80 years."
“So they said, well, rather than continuing on where we have debts in excess of our revenues and of our of our assets, it makes more sense to just end things here,” said Jonathan Ernest, assistant professor of economics in the Weather head School of Management at Case Western Reserve University.
He said it’s common for businesses in Joann’s position to close. This also means employees will lose jobs, and cities like Hudson could be impacted.
“It has a larger impact, especially when it's a relatively small town that is centered around it in an economic sense, but that depends on how quickly things wind down and who's kept around to for their expert knowledge,” said Ernest.
Joann has not given a timeline for the closures, as a bankruptcy court judge still needs to approve the auction results. But Patti and Wilson are buying what they can while it's still available.
