Major fabric and craft retailer Joann announced it is filing for bankruptcy as Americans suffer the consequences of “Bidenomics” and pull back on “creature comforts” spending.
According to a recent announcement from Joann, the retailer reached an agreement with most of its financial stakeholders, giving it around $132 million in new financing while reducing its debt by around $505 million.
The news comes as retail sales continue to slump, growing just 0.6% in February and declining in January as consumers pull back on non-essentials.
Chris DiTullio, Chief Customer Officer, said in the release:
“Over the past several months, Joann has made meaningful business improvements through the execution of our Focus, Simplify and Grow cost reduction initiative.”
“We appreciate the support from our financial and industry stakeholders in this agreement, and their confidence in our ability to continue driving positive business change.”
“There is no other retailer with the same ability to serve sewists, quilters, crocheters, crafters and other creative enthusiasts as we have for the past 80 years, and we take great pride in seeing the passion and engagement of our millions of customers and our team members.”
The Daily Caller reported:
Joann currently operates over 800 stores in the U.S. and describes 95% of them as cash flow positive, according to the announcement. The company will continue to operate stores and its e-commerce website despite the filings, but is expected to become a private company at the completion of the deal, owned by certain lenders, and will no longer be listed on the stock exchange.
The company’s net sales fell 4.1% in the third quarter year-over-year to $539.8 million, equating to a net loss of $21.6 million in the quarter, according to Joann’s earnings report. Joann’s long-term debt was around $1.15 billion as of October 28, 2023.”
Inflation cotninues to soar as e consumer price index rose to a 3.2% year-over-year in February, higher than the Federal Reserve’s 2% target following an increase of 3.1% in January.
In a desperate attempt to lwoer inflation, the Fed has placed its federal funds rate in a range of 5.25% and 5.50%, the highest in ver two decades.
As we highlighted earlier this month, the plight Americans face under Biden’s economy was underscored by Kellogg CEO Gary Pilnick touting his company’s “cereal for dinner” campaign.
Pilnick boasted that his over-processed excuse for real food was a good option for struggling Americans.
“The cereal category has always been quite affordable, and it tends to be a great destination when consumers are under pressure,” Pilnick said.
“If you think about the cost of cereal for a family versus what they might otherwise do, that’s going to be much more affordable,” the CEO added.
According to the Wall Street Journal, spending on food amounts to 11.3 percent of Americans’ disposable income, the highest in 30 years.
One X user wrote:
“She told everyone to just eat cake. The Wall Street Journal is advising that we just don’t eat breakfast times are hard financially. And then here comes the cereal king the CEO of Kellogg’s telling you to eat frosted flakes for dinner because of the high cost of living,” the post read with a photo of the ill-fated queen.”
READ: RETAIL APOCALYPSE: Over 800 Retail Stores Set to Collapse Due to Inflation, Interest Rates, Crime
