BruntWork

Joann Fabrics and Crafts, a well-known name in American retail, is closing nearly 500 of its 800 stores. This decision is part of its Chapter 11 bankruptcy process—its second filing in under a year.

Thousands of employees will be affected, and communities that have long relied on Joann for crafting supplies will feel the impact. Traditional retailers are struggling, and some experts believe outsourcing certain operations might have helped Joann Fabrics and Crafts avoid financial trouble.

A Retailer Facing Tough Times

Joann Fabrics and Crafts has been a go-to store for hobbyists, crafters, and sewing fans since 1943. Shopping habits have changed, costs have increased, and online competitors have taken a larger share of the industry. These closures reflect deeper financial problems, raising questions about whether different business decisions could have led to a better outcome.

Brick-and-mortar stores are dealing with similar issues. Some have turned to technology and e-commerce outsourcing to lower expenses and improve efficiency. While Joann Fabrics and Crafts stayed with traditional methods, others found ways to meet new consumer demands.

Could Outsourcing Have Helped?

Winston Ong, CEO of BruntWork, an outsourcing company, believes outsourcing could have taken some financial pressure off Joann Fabrics and Crafts. 'Retailers like Joann Fabrics and Crafts could have lowered expenses by outsourcing certain tasks, allowing them to focus more on customer service and product development,' Ong says. He points to customer support, inventory handling, and administrative work as areas where outsourcing could have made a difference.

A 2024 industry report shows that businesses using outsourcing typically see a 20-30% drop in costs, with 68% reporting better efficiency. For example, hiring a virtual marketing assistant could have improved Joann Fabrics and Crafts' online presence, helping them attract more e-commerce customers while reducing the cost of in-house marketing teams.

Some experts caution against treating outsourcing as a perfect fix.

An anonymous industry expert explains that it saves money but can also lead to job losses and quality control concerns. 'Businesses must balance reducing expenses and maintaining strong customer service and brand reputation.'

Weighing the Pros and Cons

BruntWork provides outsourcing services for retailers facing similar financial struggles. Ong believes outsourcing allows companies to focus on their strengths—serving customers and improving products—without getting caught up in costly back-end operations.

It offers services like customer support, data analysis, and supply chain coordination, all designed to help stores lower costs and respond more quickly to industry changes. Its data shows that businesses using its services see an average 15% increase in profitability within a year.

Inventory handling is one area where Joann Fabrics and Crafts could have seen real benefits. With more people shopping online and demand constantly shifting, maintaining the right stock levels has become harder. BruntWork's data tools have helped retailers cut excess inventory by 25%, leading to better financial performance.

Similarly, outsourcing financial management through a bookkeeping virtual assistant could have helped Joann Fabrics and Crafts keep better track of expenses, reduce accounting errors, and maintain better financial forecasting—potentially preventing the financial distress that led to bankruptcy.

Retailers Adapting to Stay Afloat

Traditional stores are working harder to keep up with online sellers, and more businesses are outsourcing to stay flexible. Experts predict the global retail outsourcing business will expand by 5.3% annually from 2025 to 2030, showing that more companies see value in handing off certain tasks to outside providers.

Outsourcing has advantages, but it also comes with risks. Retailers must weigh cost savings against losing control over customer interactions and the ethical concerns of moving jobs to lower-wage regions. Joann Fabrics and Crafts' situation is a warning: businesses that fail to adjust to new realities face major losses.

Outsourcing could have been one of several options for Joann Fabrics and Crafts, but survival in retail requires more than one fix. Companies must stay flexible—whether by outsourcing, upgrading technology, or trying new business models—to stay in business.