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Craft Retailer Joann Files for Chapter 11 Bankruptcy

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In an expected move, craft store chain Joann has filed for bankruptcy to help the company deal with debt problems.

According a news release issued by the company, Joann has “received commitments for approximately $132 million in new financing and related financial accommodations and expects to reduce funded debt on its balance sheet by approximately $505 million.”

“This agreement is a significant step forward in addressing JOANN’s capital structure needs, and it will provide us with the financial resources and flexibility necessary to continue to deliver best-in-class product assortments and enhance the customer experience wherever they are shopping with us,” chief financial officer Scott Sekella said in the release.

According to a story in The Washington Post (link is free to read), Joann will become a private company after the bankruptcy proceedings, which could be complete as early as next month. The company says it currently has no plans to close stores or make any changes to its website. The release says the company, which was founded in 1943, has 829 stores in 49 states and “95 percent of which are cash flow positive.” And I literally got an email from them while I was writing this post.

(As an aside, the headline on that Post story suggests Joann’s problem is they have lost sales as people “pull back on essentials,” but if they’d ever met a crafter they would know craft supplies are always essential, we just might be buying them from different places, or buying less that we used to.)

Joann has set up a website, Joann Forward, with more details on their restructuring, including FAQs for customers, suppliers, landlords and team members. According to those pages, “this agreement is a significant step forward in addressing JOANN’s capital structure needs. It will provide us with the financial resources and flexibility necessary to deliver best-in-class product assortments and enhance the customer experience wherever they are shopping with us.”

You can also find case filings and information for claimants here.

As someone who does most of her in-person craft shopping at Joann, I’m certainly wishing them well and will update as needed with more information on the Joann bankruptcy filing.

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Golden Peak Media Acquires CreativeBug

Throughout the saga of the closing of Joann, I’ve been wondering what would happen to CreativeBug, the subscription-based online craft learning platform that Joann acquired in 2017. 

Golden Peak Media has announced its acquisition of the company in a media release. 

Golden Peak is “one of the largest media and education companies serving art and craft enthusiasts in the United States,” according the release, and includes in its portfolio brands like Interweave, Sew Daily, and nine print magazines including Love of Quilting and Interweave Knits. They have daily newsletters, magazines, digital patterns, on-demand classes and host live events.

David Saabye, CEO of Golden Peak, calls the purchase a “very natural fit” supporting crafters in their lifelong learning journeys. 

CreativeBug general manager Liana Allday will stay on and the company will retain its headquarters in Berkeley, Calif. 

Abby Glassenberg of the Craft Industry Alliance collected reactions from some CreativeBug instructors and others with a history at the company, and heard lots of optimism about the news. Ursula Morgan, who was CEO of CreativeBug when the company was acquired by Joann, said Golden Peak is a “perfect home” for CreativeBug as they’re getting an owner that “deeply understands the craft consumer.” 

I, too, am relieved to see that this platform will be able to continue. I’ve been a subscriber for years and I love that it has solid instruction in a wide range of crafts (including knitting, of course!) and is always adding new content to keep the platform interesting. It’s also a great service that CreativeBug is available to many for free through their local libraries, so be sure to check on that where you live if you don’t already subscribe. 

This feels like the last piece of the puzzle in the story of Joann that’s going on all year, along with the announcement that Michaels had purchased Joann’s intellectual property so its private label brands can live on, but of course I’ll keep watching to see if there’s more to come.