Declining job listings, employee sentiments hinted at Starbucks' recent layoffs
Starbucks ($NASDAQ:SBUX) announced that it would be cutting 350 positions — or 5% of its staff — Tuesday, acting on rumors that it would shake up its corporate landscape and slim down in the face of a changing retail landscape.
Although executives hinted at major layoffs internally through memos, external job listing and employee sentiment data trended in line with a build-up to corporate firings.
On Starbucks' official job listing page, openings at its Starbucks Support Center, the very same place where the most layoffs happened, dropped from 139 listings on August 29 to 114 on August 31. That sharp decline continued until the day of the announced layoffs, where there were only 74 positions available for potential employees to apply to.
At the same time, the overall Business Outlook rating for Starbucks dropped one percentage point.
Focusing on their International Footprint
Trends for the Seattle-based coffee colossus aren't all heading South; they're heading overseas. According to a recent data pull of new Starbucks locations, over half of recently opened stores are outside the United States.
After the United States, China and the United Kingdom led all countries in new Starbucks locations, followed by Mexico and South Korea. The two cities with the most recently added stores were Seoul, South Korea and Shanghai, China.
|Country||New Stores (Updated on Nov. 3)|
This lines up with Starbucks' publicly-known focus in international markets this year, especially in China. Earlier this year, Starbucks' China CEO said they are opening a store "every 15 hours," and plans to have over 5,000 stores in the country by 2021.
A look at their competition
While Starbucks is restructuring, its main rival, Dunkin' Donuts ($NASDAQ:DNKN) exceeded analyst expectations with its recent Q3 earnings report. It also has gotten confident that its new espresso recipe will draw customers to its stores, with its Chief Marketing Officer Tony Weisman firing shots at Starbucks at a recent media day, saying that, "Our espresso is so good, you don't have to go to Starbucks."
At the same time, corporate hiring at Dunkin' trends are booming, as after a summer opening drought, there are as many listings as there were in late March.
Meanwhile, Starbucks faces pressure for the so called "third wave" of coffee houses, especially in its most coveted territory of New York City. With the rise of upstart artisanal coffee chains La Colombe ($LACOLOMBE) and Blue Bottle ($BLUEBOTTLECOFFEE) among others, Starbucks is adapting to a newly saturated market by looking outside of the U.S. and trimming down its corporate headcount.