The death of JOANN Fabric and Crafts sent shockwaves through the crafting community.
But one major retailer just threw desperate customers a lifeline.
And Michaels made one move that left JOANN fans stunned into silence.
JOANN crumbled under financial pressure after 82 years
The beloved craft store JOANN shuttered its final location on May 31, 2025, ending an 82-year run that made it a household name for generations of sewers, quilters, and crafters.
What started as the Cleveland Fabric Shop in 1943 grew into a nationwide empire with nearly 800 stores across 49 states before financial troubles brought it all crashing down.
JOANN filed for bankruptcy twice in less than a year, with the second filing in January 2025 ultimately leading to the liquidation of all stores.
The company blamed a perfect storm of problems including sluggish consumer demand, inventory shortages, and supply chain disruptions that left shelves bare when customers needed products most.
"Unanticipated inventory challenges post-emergence, coupled with the prolonged impact of an excessively sluggish retail economy, put (JOANN) back into an untenable debt position," interim CEO Michael Prendergast explained in court documents.
The retailer was crushed by $615.7 million in debt and owed over $133 million to suppliers while spending $26 million per month just on rent.
When the final auction hammer fell, GA Group and the company’s term lenders won the bid to liquidate all of JOANN’s assets, sending 19,000 employees to the unemployment line.
Michaels swoops in to rescue devastated customers
But just as crafters thought they’d lost their beloved brands forever, Michaels pulled off a stunning rescue mission.
The Michaels Companies dropped a bombshell announcement on June 5, 2025, revealing they had swooped in to buy JOANN’s intellectual property and private label brands, rescuing the beloved Big Twist® yarn lines that customers thought were gone forever.
The move caught everyone by surprise, but it makes perfect business sense for Michaels.
"Searches for ‘fabric’ on Michaels.com have increased by 77% over the past year" while "searches for ‘sewing’ have increased by 39% on Michaels.com since last year".
Michaels CEO David Boone saw the writing on the wall and acted fast to capture JOANN’s displaced customer base.
"We’re honored to have the opportunity to welcome JOANN customers into our creative community and are committed to delivering the selection, value, and inspiration they are looking for at Michaels," said David Boone, Chief Executive Officer at Michaels. "This acquisition allows us to better serve both new and existing customers, respond to rising demand across categories, and build on our momentum as the destination for creating and celebrating in North America."
Michaels isn’t stopping there – they’re launching a massive expansion that will bring more than 600 new craft products to their stores and website.
Big Twist brands return from the dead
The crown jewel of the acquisition is bringing back JOANN’s fan-favorite Big Twist yarn brands that customers feared were gone forever.
Big Twist Value Plus, Big Twist Twinkle, Big Twist Posh and Big Twist Baby Bear "which are now being developed as part of Michaels portfolio of brands and will be available in-stores and online later this year".
Michaels isn’t just rescuing existing brands – they’re going all-in on expanding their craft offerings to fill the void left by JOANN’s collapse.
The retailer is adding new Brother and Singer sewing machines, adding 50+ new needle crafting kits from DMC and Loops & Threads, and welcoming the best-selling Oliso Smart Iron.
Michaels is also dramatically increasing their yarn selection by a whopping 25% this year and "releasing over 60 new Loops & Threads offerings in-stores and online".
The company is also making major moves in fabric, boosting their selection in more than 680 stores with plans to expand the fabric departments in 280 additional locations this year.
Michaels capitalizes on competitor failures
This isn’t the first time Michaels has pounced on a competitor’s demise to expand its market share.
After Party City went belly-up and closed its nearly 700 stores during bankruptcy, Michaels quickly moved to expand their balloon and party supply sections to capture those abandoned customers.
The strategy of swooping in to capture abandoned market segments has proven highly effective for Michaels, which operates over 1,300 stores across 49 states and Canada.
Research shows that "eight in ten" JOANN customers "were upset by JOANN’s closures" and that "JOANN’s customers are more likely to turn to Hobby Lobby or Michaels as stores close".
Michaels clearly won the race to capture those displaced customers.
A dedicated welcome for heartbroken JOANN fans
Recognizing that former JOANN shoppers needed a new home for their creative projects, Michaels created a special welcome page just for them.
"JOANN was a beloved destination for creators for generations, and Michaels is honored to serve this community with a dedicated landing page featuring the latest updates and a curated assortment of products".
When customers try to visit JOANN’s old website, they’re now redirected to Michaels with a "Welcome JOANN Customers" message.
The thoughtful approach shows Michaels recognizes they’re not just acquiring brands – they’re inheriting a community of passionate crafters who lost their creative home.
The retail apocalypse continues
JOANN’s collapse is part of a broader retail meltdown that shows no signs of slowing down.
Experts predict "approximately 15,000 store closures are expected this year, more than double the 7,325 that closed in 2024".
Big names like Big Lots, Party City, Kohl’s, Macy’s and JCPenney are all holding liquidation sales as the retail apocalypse devours once-mighty chains.
Rising costs, changing consumer habits, and the continued dominance of online shopping have created a perfect storm that’s destroying traditional brick-and-mortar retailers.
But Michaels’ quick action to rescue JOANN’s most beloved brands shows that smart retailers can still find opportunities amid the chaos.
By giving displaced crafters a new home for their favorite products, Michaels turned tragedy into triumph.
The acquisition proves that in today’s brutal retail environment, the winners are those who move fast to capture the customers and brands left behind by the losers.
