JoAnn-"restructuring"
Posted: September 16th, 2023, 4:58 am
They've had lots of ups and downs and seem to have plenty of problems now: https://www.retaildive.com/news/joann-c ... fs/693684/
They're already owned by private equity and have been since 2010. I grew-up near their original store and have seen how their original chain grew and changed over time---they started out with rather small stores (probably a couple thousand square feet) and the stores grew a bit bigger as they became a staple of Midwestern malls. They didn't take over 1950s supermarkets like Cloth World and other chains (as well as Michaels), but the stores got much bigger as they moved to off-mall locations. They've shed tons of locations over time and gone through cycles of openings. A few stores are near their early locations, but are nothing like them.ClownLoach wrote: ↑September 16th, 2023, 10:13 pm This is the kind of company where a wise private equity firm should buy them with the purpose of investing in the chain then flipping it later.
Their brand new stores opened in 2022 and on are absolutely stunning. Not only far superior to anyone else in their industry like the boring, stale Michaels and ethically questionable Hobby Lobby, but quite possibly one of the best looking big box retail stores period.
Here's the problem: they only have a couple dozen of the new ones and no capital to revamp the entire chain.
The rest of the chain are moldy old dumps that never got much remodeling when they tried to consolidate the fabric industry, merging House of Fabrics, Joann, Cloth World and others.
There has never been such a good opportunity to fix the chain's problems than right now while there are hundreds of nice BB&B and other empty boxes available plus Michaels seems to have canceled their initiative to have fabric departments in every store (and they are in really bad shape since their leveraged buyout, clearly Apollo has slashed everything to the bone with 100% self checkout and filthy stores plus boxes of freight everywhere like a broken Walmart).
Hopefully someone with good intentions buys this chain and fast to help transform them.
So I'm going to agree and disagree on Joann and their real estate problem. They had many old stores that were small and dumpy. But then they tried to go way too big, Hobby Lobby size, and that didn't work either.buckguy wrote: ↑September 17th, 2023, 7:18 amThey're already owned by private equity and have been since 2010. I grew-up near their original store and have seen how their original chain grew and changed over time---they started out with rather small stores (probably a couple thousand square feet) and the stores grew a bit bigger as they became a staple of Midwestern malls. They didn't take over 1950s supermarkets like Cloth World and other chains (as well as Michaels), but the stores got much bigger as they moved to off-mall locations. They've shed tons of locations over time and gone through cycles of openings. A few stores are near their early locations, but are nothing like them.ClownLoach wrote: ↑September 16th, 2023, 10:13 pm This is the kind of company where a wise private equity firm should buy them with the purpose of investing in the chain then flipping it later.
Their brand new stores opened in 2022 and on are absolutely stunning. Not only far superior to anyone else in their industry like the boring, stale Michaels and ethically questionable Hobby Lobby, but quite possibly one of the best looking big box retail stores period.
Here's the problem: they only have a couple dozen of the new ones and no capital to revamp the entire chain.
The rest of the chain are moldy old dumps that never got much remodeling when they tried to consolidate the fabric industry, merging House of Fabrics, Joann, Cloth World and others.
There has never been such a good opportunity to fix the chain's problems than right now while there are hundreds of nice BB&B and other empty boxes available plus Michaels seems to have canceled their initiative to have fabric departments in every store (and they are in really bad shape since their leveraged buyout, clearly Apollo has slashed everything to the bone with 100% self checkout and filthy stores plus boxes of freight everywhere like a broken Walmart).
Hopefully someone with good intentions buys this chain and fast to help transform them.
The consolidation of fabrics, which used to be sold in many places, might help them in the short run, but few people make their own clothing anymore. I think the boomer cohort was probably the end of that. Ditto, their sales of sewing machines. They have quite a few small tow locations--I wonder how those do compared with their more typical suburban ones. They've also gone into a few urban locations, which they'd never done in the past (they shed their early, neighborhood stores in Cleveland decades ago)--mostly gentrifying places, but still odd enough that I wonder how those have done.
The few times I went to Micheal's, the salespeople seemed really unhelpful and not very knowledgeable about crafts---their own or any other ones. Most of the store stock reminded me of the cheap stuff that was sold by variety chains like Woolworths----given the amount of space they had, it seemed like they should have had a broader range. I'm surprised they're still around.
Incidently in Citrus Heights,a new/relocated Jo~Ann store shares Sunrise Village with a NOT-closing Rite Aid(closure probability is still significantly lower than that of the proposed Amazon Fresh ever seeing light of day).The new Jo~Ann store is nice looking and gets decent traffic.You wouldn't suspect that this chain was in trouble(I realistically wish it was Hobby Lobby that was financially endangered).storewanderer wrote: ↑September 17th, 2023, 11:52 pm My view of Jo Ann is they are a dead chain walking. I know they have some nice stores, and even their poor stores, I see foot traffic in, but they just seem to limp along. They remind me sort of Rite Aid in this regard. They keep going, but it is clear that the trouble never stops for the finances and any surprise or miscalculation will be the end for them.
For instance in Reno the Jo Ann sits in a former Kmart Food in a lousy area. It was there when Kmart was there. Kmart was since divided into Dollar Tree, Grocery Outlet, Harbor Freight, and Savers. Despite this the Jo Ann does get traffic, quite a bit of traffic actually. This is a large store. It could look better but it doesn't look bad.
Then in Carson City is a Jo Ann that is an old House of Fabrics. It is at the back of a dead mall along a side street. If you didn't know it was there, you wouldn't notice it driving by on the main street or even out in the main front parking lot. Again this store, it has traffic, but... just lacking.
There used to be a Jo Ann in Sparks (also an old House of Fabrics) but for some reason it closed about 15 years ago. Not really sure why it closed. It did well.
From time to time I notice other questionably located Jo Ann Stores. Last week I noticed another one. I walked a basically dead mall in Peru, IL. Jo Ann was one of the few things still open in that mall.
The fabric business has gotten stronger. I see more traffic at Jo Ann than ever before in Reno and most of the people there are buying fabric. A counter that used to not have enough traffic to be staffed all the time, now has enough traffic to need as many as 4 employees at once and even at the slowest times of evening still needs 1 employee. Also Wal Mart basically quit selling fabric (I mean they have a department but there is no staffing, customers have long given up on them) so that pushed more customers to Jo Ann.
At least in this case the Amazon Fresh enabled Jo-Ann to get a new store... otherwise I don't think they would have done that.norcalriteaidclerk wrote: ↑October 4th, 2023, 5:06 pm
Incidently in Citrus Heights,a new/relocated Jo~Ann store shares Sunrise Village with a NOT-closing Rite Aid(closure probability is still significantly lower than that of the proposed Amazon Fresh ever seeing light of day).The new Jo~Ann store is nice looking and gets decent traffic.You wouldn't suspect that this chain was in trouble(I realistically wish it was Hobby Lobby that was financially endangered).
Like I said, their new stores are fabulous. Problem is moldy, old stores and even moderately recent, badly designed stores outnumber the new concept 30 to 1. Even stores as young as 5 years old aren't really viable formats. They actually need a bankruptcy reorganization, mass store cull, and a **productive** PE firm to take over and actually invest in growth.norcalriteaidclerk wrote: ↑October 4th, 2023, 5:06 pmIncidently in Citrus Heights,a new/relocated Jo~Ann store shares Sunrise Village with a NOT-closing Rite Aid(closure probability is still significantly lower than that of the proposed Amazon Fresh ever seeing light of day).The new Jo~Ann store is nice looking and gets decent traffic.You wouldn't suspect that this chain was in trouble(I realistically wish it was Hobby Lobby that was financially endangered).storewanderer wrote: ↑September 17th, 2023, 11:52 pm My view of Jo Ann is they are a dead chain walking. I know they have some nice stores, and even their poor stores, I see foot traffic in, but they just seem to limp along. They remind me sort of Rite Aid in this regard. They keep going, but it is clear that the trouble never stops for the finances and any surprise or miscalculation will be the end for them.
For instance in Reno the Jo Ann sits in a former Kmart Food in a lousy area. It was there when Kmart was there. Kmart was since divided into Dollar Tree, Grocery Outlet, Harbor Freight, and Savers. Despite this the Jo Ann does get traffic, quite a bit of traffic actually. This is a large store. It could look better but it doesn't look bad.
Then in Carson City is a Jo Ann that is an old House of Fabrics. It is at the back of a dead mall along a side street. If you didn't know it was there, you wouldn't notice it driving by on the main street or even out in the main front parking lot. Again this store, it has traffic, but... just lacking.
There used to be a Jo Ann in Sparks (also an old House of Fabrics) but for some reason it closed about 15 years ago. Not really sure why it closed. It did well.
From time to time I notice other questionably located Jo Ann Stores. Last week I noticed another one. I walked a basically dead mall in Peru, IL. Jo Ann was one of the few things still open in that mall.
The fabric business has gotten stronger. I see more traffic at Jo Ann than ever before in Reno and most of the people there are buying fabric. A counter that used to not have enough traffic to be staffed all the time, now has enough traffic to need as many as 4 employees at once and even at the slowest times of evening still needs 1 employee. Also Wal Mart basically quit selling fabric (I mean they have a department but there is no staffing, customers have long given up on them) so that pushed more customers to Jo Ann.