Michaels Puts Fabric in 90% of Its Stores After Joann's Collapse

Quick Facts

Fabric is now available in nearly 90% of Michaels stores, up from a limited assortment before Joann’s 2025 liquidation.
Michaels acquired Joann’s intellectual property and private labels in June 2025, adding more than 600 fabric, sewing, and yarn products.
The retailer has added over 1,600 new products across fabric, yarn, sewing, and needlecraft since launching its in-store Knit & Sew Shop concept.

Michaels has put fabric in nearly 90% of its stores, the company announced during National Sewing Month in September 2026. The expansion follows the full liquidation of Joann’s 790 stores by May 30, 2025, which eliminated the dominant specialty fabric retailer from the U.S. market and left roughly 19,000 workers without jobs.

Michaels operates more than 1,200 stores across the U.S. and Canada. The company has added over 1,600 new products across fabric, yarn, sewing, and needlecraft since beginning its push into the category.

How Michaels Moved In

Joann filed for Chapter 11 bankruptcy twice. The first filing came in March 2024 and resolved within a month. The second filing, in January 2025, ended with a full liquidation. No buyer stepped in to keep the business operating. The last stores closed May 30, 2025.

Michaels acquired Joann’s intellectual property and private labels in June 2025. The deal included the Big Twist yarn brand and gave Michaels access to Joann’s private label catalog. Michaels did not acquire any of Joann’s physical store locations, though it picked up leases on three sites in Arkansas, Texas, and California and reopened them as Michaels stores.

Tim Hynes, head of credit research for Debtwire, told CNN the deal was a low-cost move. “Purchasing the Joann intellectual property and private label brands is an inexpensive way for Michaels to expand its product line, as there were probably not many other buyers interested in those assets,” he said.

Demand Drove the Decision

Search data from Michaels.com backed the bet. Searches for “fabric” on the site rose 77% over the prior year. Searches for “sewing” climbed 39%. The company responded by expanding fabric assortments in over 680 stores initially, with plans to reach 280 more.

CEO David Boone framed the move as a direct response to market disruption. At the ICR Conference in January 2026, he said: “The first thing that we concluded was there was tremendous disruption in the marketplace with the exit of Joann Fabric and the exit of Party City, and that job one was to go after that.”

The Knit & Sew Shop

Michaels launched its Knit & Sew Shop in-store concept in fall 2025, co-branded with Michaels and Joann logos. At launch, fabric was available in over 840 stores. Michaels increased dedicated floor space for fabric by nearly 25% and offered more than 95,000 options online, including licensed prints.

Fabric cutting tables were in more than 650 stores by mid-October 2025. The company also expanded its yarn selection by 25%, adding hundreds of new skeins including Joann private label favorites.

By September 2026, the Knit & Sew Shop had expanded to over 1,200 stores. Michaels introduced more than 400 new fabric products in quilting, cosplay, and special occasion categories. New offerings included refreshed Joann prints from the Keepsake Calico collection.

Chief Merchandising Officer Stacey Shively said the company is investing in the shop “to give today’s shoppers more of what they love, while making these crafts more approachable for anyone who wants to learn.”

What It Means for the Market

With the Knit & Sew Shop now in more than 1,200 locations, Michaels has positioned itself as the largest specialty fabric retailer in North America. No other national chain has moved to fill the gap left by Joann’s exit at scale.

For operators watching category expansion plays, the Michaels move is a clear example of using a competitor’s collapse as a growth signal. Search data identified the demand. An IP acquisition gave the brand credibility. Rapid store rollout captured the displaced customer base before any rival could respond.