Thank you all for joining in on a very interesting conversation about the demise of JoAnn Fabrics. I felt a bit vindicated once I was reading your thoughtful comments. Also, I almost did bring up the decoration part of JoAnn's but ours in this area did less and less of that over the last 10 years. Ours truly became more of a Michael's with a bit more fabric.
That all said, I'm sure you heard by now but they decided to close 800 stores. How did that happen? So here is the nitty gritty I didn't get into last week. Here's how a bankruptcy goes (or at least the simplified version)
1. Bankruptcy is declared and a judge decides if the company has a good enough plan to become solvent.
2. If they don't, the court will put all the company's assets up for auction.
3. A stalking horse bidder is chosen to be the first bidder, getting incentives to buy the company at a set price.
4. If nobody bids against them. They get the company's assets.
5. But in JoAnn's case two companies came together to form a new liquidation company and placed a higher bid than the stalking horse bidder.
6. The new company specifically was formed to buy the assets cheaply and sell them at a profit.
It's a shame really. Sometimes a stalking horse bidder will get the company, reorganize it and make a profit. But not this time. The liquidation company was out to make a fast buck. A famous fictional character who did this was Richard Lewis of Pretty Women who was a corporate raider, buying companies only to break them up and sell their assets.
Anyways that's the scoop. I held out hope that it would survive but really it's just for sentimental value.
All stores are to be closed by May.
This just makes me sad.
4 comments:
so that's sad and who do they sell the merch to? not us. I often went online the last year to buy and they would say out of stock. then what I did find, and ordered would arrive in piecemeal fashion, one or two items at a time, and often switched too.
LeeAnna
Hi Nina-Marie, thanks for the information. It's too bad that such a large company didn't see the writing on the wall and start downsizing or making changes before it was too late. Consumers will get a quick deal on fabric and then nothing.
Great blog! Very informative and helpful!
Loreal Glycolic Bright Foam gently cleanses while brightening the skin for a fresh and radiant look.
Great article! Finding the perfect home décor can be challenging, but online shopping makes it so much easier. If you're looking for stylish and affordable options, check out
home accessories online shopping for a wide range of trendy décor items
Post a Comment