Michales will close down Darice, its wholesale division, at the end of November. The arts and crafts retailer will layoff 146 employees from the Darice distribution and support center in Strongsville, Ohio effective July 18 with more layoffs to come later in 2020. Michaels already laid off 77 Darice employees in early February.
Michaels acquired Darice when it purchased Lamrite West in 2016 for $150 million. At that time Lamrite owned 36 Pat Catan art and craft stores. Michaels subsequently rebranded some of those stores to be Michaels and closed others. Darice will be the last of the Lamrite West assets to be wound down.
Darice had over a 60-year history and was a family-owned business before the Michaels acquisition. Headquartered in Strongsville, Ohio, Darice’s origins date back to 1954 when founder, Pat Catanzarite, returned home from the Air Force and opened Lamrite, a display and props shop serving Cleveland department stores. That business grew into a craft store, Pat Catan, and subsequently expanded to include Pat Catan stores all over Ohio, Pennsylvania, Michigan, West Virginia, and Indiana. In the mid-1970s Lamrite added a wholesale crafts division that Catan named Darice, a combination of his children’s names.
Darice had an extensive catalog of over 50,000 craft products including beads, jewelry supplies, pompoms, glitter, embroidery hoops, feathers, paint, and nearly every other art or craft supply imaginable. Small businesses, clubs, and other groups could get wholesale prices with a minimum order of only $75. In the past year, Darice made ordering even easier by not requiring a business license in order to open an account. Customers included independent retail stores, grocery stores, and hardware stores as well as non-profits, teachers, and makers.
In the first quarter earnings call last week CEO Ashley Buchanan said, “We took a strategic view of it and in the long-term plans, we decided to close the wholesale business. Over the years they had lost some large clients.”
“We reviewed it going forward and we saw no viable path to profitability long term. We didn’t see how it fit in our long-term strategic approach.”
Buchanan said Michaels will be keeping the Darice sourcing offices in China in order to continue to create private-label craft supplies for its stores.