The biggest issue was storage. The closet just had boxes stacked on top of each other and so much space was being wasted.
I decided to add some Closet Maid Adjustable Shelving (from Home Depot). We removed the wooden shelf and hanging bar since this wasn't being used. I used 4 of the adjustable brackets along the back wall. Then I hung a 12" x 8ft Wire shelf across the top. We purchased two 16" x 6ft wire shelves and cut them in half, creating four 3ft shelves that could be adjusted as needed.
The end result is Perfect! There is so much more storage space, and you can easily access everything.
With the closet looking so great, I had to clean up and rearrange the rest of the room. I think I have found the optimal crafting set up!
My Crafting Room is definitively my happy place now!