Fabric and craft retailer Joann to go out of business, close all of its stores

But what if you don't need 100 resistors? If I want an oddball resistor size, it may be for just one project/experiment. Now I have to store the remaining 99 somewhere or throw them away. I'd rather pay $1 for one resistor than $15 for 100.

I live in a midwestern city of 50k. The only alternative we have is Hobby Lobby. I can't say I loved the selection available at Joann's, but at least we had something.

Unfortunately not all of us live in dense urban centers that can support boutique craft stores.

My husband crochets, and the problem with most of the local yarn stores is that a lot of them cater to more "boutique" yarn. It's hard to find cheap, standard yarn in a variety of colors for him.

I really miss our local Fry's: my electronics knowledge is basically zero, and it was educational to explore the hardware aisles and look at the individual components.

A lot of places online you can order "samples" for a few bucks. If you like the sample, order a few yards.

But just in general, this suggests to me more of a sign of the public increasingly turning toward passive or, if you will, packaged entertainment. Does anyone still build plastic models, fly RC airplanes, get together for card games, or bowl?

Maybe though someone in my neighborhood will start up a doom-scrolling league that the wife and I can join. And there's always the watercooler where we can suggest to others that they watch some streaming shows we saw that they've never heard of.

I was recently working on an upholstery project and I agree, Joann's selection was excellent.

But I think part of the reality is that most customers, even sewing customers, don't stop and consider the "feel" of fabric. If you look at what the median sewing machine user is doing, it's probably cranking out a tacky quilt made from cheap polyester fabrics. (Certainly seems to be a favorite activity in my extended family).

And honestly, for all the floorspace dedicated to sewing and crafting materials, I wouldn't be surprised if the bulk of their sales these days was coming from decorations and art supplies for kids.

Yes, please charge me $6 shipping for my 10 cent resistor.

Joann was owned (and killed) by private equity.

Going on a rampage against in-store inventory is a classic PE retail move.

In-store inventory is expensive, subject to shrinkage, etc. So by the spreadsheet, less inventory looks good. But of course, if it's not in-stock when your customer shows up, that's a wasted trip. Only has to happen a few times before your customers quit showing up altogether.

Actually selling physical goods? That's so last-century...

You could own an NFT of the yarn instead! Oh wait, that's no longer in vogue? I'll show myself out now.

Business School 101: Whether you finance your inventory or pay cash doesn't actually make much difference if it doesn't move. Costco or Walmart or any other retailer that is successful right now also uses credit to acquire inventory. (Costco has $10 billion in rolling debt and Walmart has $60 billion, btw. Both seem to be doing fine.)

And again, the businesses that compete with the internet right now are doing it by keeping their inventory costs in check. They have either moved most of their "selection" to online-only, or they have done away with consistent inventory across stores.

TBF Joann’s didn’t fail because of their business model. They failed because they were looted by private equity.

Better tell Michaels and Hobby Lobby then, because I don't think they got your memo.

Joann's won the industry consolidation phase in the 80s-90s, but took on a lot of debt to buy out House of Fabrics, So-Fro and others. They had almost completely retired that debt by the mid 2000s and would be sitting pretty today, but sold out to private equity in 2010. The PE did the usual LBO shit of borrowing a the purchase money and then transferring the debt to the company. Boom, one billion in the hole, buyers strip anything of value, no coming back from that.

I'll miss them because touching fabric is important. fabric ain't like resistors, one 100ohm feels pretty much like the next, and Joanns covered quilters, apparel sewers and upholstery/decor sewers pretty well.

Call me old-fashioned, but maybe craft stores don't need infinite double-digit growth.

> The economics of a single dedicated store for hobbyists a la Joann's doesn't work anymore.

Why is that? I still see stores for board games and the likelihood of making a profit from a board game is abysmal. Blick Art seems to be doing well enough. Even Barnes and Nobles had a turnaround.

I just went to a JoAnn’s a few months ago. If you told me that they were getting a PE makeover I wouldn’t have known.

> The economics of a single dedicated store for hobbyists a la Joann's doesn't work anymore.

More's the pity then.

Maybe a bit of a chicken or egg problem? I don’t know enough about Joann, but I remember when borders closed and B&N went almost too. At the time, these stores had become a bore. Only peddling bill O’Reilly and Hillary Clinton’s books. But now bookstores are thriving too, and so is B&N in large part because each store is managed independently, and not driven by corporate and their large contracts with large publishers.

So maybe when you stop being customer centric and become corporate profit centric you end up losing customers first and profits later.

PE firms in these cases are just the bottom feeders that processes these corporate carcasses, not the cause of their deaths.

It’s different when PE firms go after resources that people need, like health care or elderly care. Here they are acting as sociopaths. They know people will pay as much as they have to, as the other options are death and suffering. Despicable.

I want this to make sense... But that doesn't make sense.

Wouldn't the chinese dropshippers be hit with Tariffs

Every time PE wrecks a company their excuse is "it was doomed anyway." That's not a falsifiable statement, except then you look at competitors that weren't wrecked by PE and they're doing fine.

The entire original "retailpocalypse" was an orgy of PE in retail. If you wanted to know which retailers were going to survive all you had to do is look at the ownership.

If you are the kind of person who is entertained by making your own clothing, you're probably also entertained by seeing and selecting the materials that go into your projects.

It's no more an obsolete business model than something like a Bass Pro Shop. It's just a different hobby.

Well let's see, without PE they wouldn't have been loaded with absurd debt. So... Yeah, this bankruptcy is absolutely fair to blame pe on.

Yeah, selling goods at a store is so 2006. Everyone knows the only real businesses left are memecoins, SaaS, and consulting. Everyone else should get a real job.