Department Store Downsizing: JCPenney, Joann, and Others Shutter Stores in 2025
The retail landscape continues to shift, with several major department stores announcing plans to close numerous locations in the coming year. JCPenney, Joann Fabric and Crafts, Macy’s, Kohl’s, and Party City have all indicated their intentions to downsize their physical presence in the face of changing consumer behaviors and economic challenges.
JCPenney
Number of Stores Closing: A handful by mid-2025
Reason: Economic impacts of the COVID-19 pandemic and the rise of online shopping
Despite plans to close an unspecified number of stores, JCPenney has emphasized that it does not intend to significantly reduce its overall store count. The company recently formed a partnership with Forever 21 to create a new holding company called Catalyst Brands, which includes several other retail brands. However, the store closures are reportedly unrelated to this merger.
Joann Fabric and Crafts
Number of Stores Closing: Approximately 500 out of 850
Reason: Bankruptcy filing in January 2023
After filing for bankruptcy protection twice in less than a year, Joann Fabric and Crafts has announced the closure of nearly 60% of its locations. The company plans to implement clearance sales at these stores, with the closures expected to be completed by the end of the year.
Macy’s
Number of Stores Closing: 66 out of 150 by 2026
Reason: Underperforming locations
Macy’s has identified 66 stores across the United States that it plans to close by 2026. The company has cited low productivity as the reason for the closures. Clearance sales have already begun at these locations, with the closures expected to be gradual over the next few years.
Big Lots
Number of Stores Closing: 460+
Reason: Bankruptcy filing
Gordon Brothers Retail Partners, the company assisting Big Lots through bankruptcy, is selling the leases for over 460 Big Lots stores across the country. This suggests that these stores are likely to close in the near future.
Kohl’s
Number of Stores Closing: 27 out of 1,120
Reason: Underperforming locations
Kohl’s plans to close 27 stores in 15 states by April 2023. The company has identified these stores as "underperforming" and plans to focus on its remaining locations. Kohl’s also announced plans to cut 10% of its corporate workforce, which will partially coincide with the store closures.
Party City
Number of Stores Closing: Over 600 corporate-owned stores
Reason: Bankruptcy filing
Party City, which filed for bankruptcy in December 2022, plans to close all of its corporate-owned stores this year. However, 29 franchise-owned locations will remain open.
Factors Driving the Trend
The closures announced by JCPenney, Joann Fabric and Crafts, Macy’s, Kohl’s, and Party City are part of a larger nationwide trend in which department stores are being forced to downsize. This trend has been driven by several factors, including:
- The economic impacts of the COVID-19 pandemic, which led to a decline in in-store shopping
- The continued rise of online shopping, which has lured customers away from traditional brick-and-mortar stores
- Increased competition from discount retailers and fast-fashion brands
Department stores are struggling to adapt to these changing dynamics, and many are finding it difficult to compete with the convenience and affordability of online shopping. As a result, they are being forced to close underperforming stores and focus on their more profitable locations.
The closures announced by these retailers are expected to have a significant impact on the retail landscape, leaving many communities without access to their favorite department stores. It remains to be seen how these companies will adjust to the changing consumer landscape and whether they can adapt to the challenges of the modern retail environment.
