Your local shopping areas probably look a little different now than they did earlier in the year. Some major national retailers have gone bankrupt in 2023, closing all of their brick and mortar locations. Bed, Bath & Beyond, Tuesday Morning and Christmas Tree Shop are among the biggest chains to succumb to the economic climate and another one might soon join their ranks.
Data from financial information publisher Credit Risk Monitor suggests that JOANN Fabric and Crafts is in jeopardy of going bankrupt. Credit Risk Monitor uses in depth analysis to assign a FRISK Score to a company, which represents its probability of going bankrupt. JOANN's got the publisher's worst score of 1, which means there is between a 10% and 50% chance that they will declare bankruptcy in the next 12 months. The score has had a 96% accuracy rate in predicting bankruptcies, so it is pretty credible.
Joann's has had a bit of a roller coaster ride over the past few years. They actually fared well during the pandemic, as people stuck inside picked up hobbies that the store caters to. Unfortunately, the momentum didn't last and sales dropped. Last month, the company had to lay off employees. A spokesperson explained the move to RetailDive.com explaining that Joann's "has been exploring every opportunity to improve profitability, drive top-line growth and operate the business more efficiently." Making things more challenging for the company is that their chief executive officer, Wade Miquelon, retired in May and hasn't yet been replaced.
While the chain was able to save some money by getting price concessions from suppliers, there's no word yet if they also plan to implement any large-scale cost-saving measures, like shuttering some of their locations. That's what the like Sears, Pizza Hut, CVS, Rite Aid, Walgreens and Boston Market have done while facing their own financial woes. Hopefully Joann's will be able to turn things around in the coming months.