Shake Shack got itself into, and perhaps out of, hot water during the global pandemic, at a time when perception is critical to brands that will need to rebound from the shutdown.
The last time we wrote about Shake Shack ($SHAK) was a month ago, for its earnings call. We highlighted some social media metrics, showed the data on job listings, and everything looked really good considering the state of the world back then. Well, things have changed dramatically since March, and it all kicked off with a small business loan.
Today, Shake Shack officially returned $10 million dollars to the PPP, or Paycheck Protection Program. The rules are written in such a way that the PPP covers any business with less than 500 employees at any one location, instead of having one employee at 500 locations (which Shake Shack does have). The CEO of Shake Shack called the entire process "extremely confusing."
"It's inexcusable to leave restaurants out because no one told them to get in line by the time the funding dried up. Too many restaurants have been left out of the program simply because they lacked a pre-existing banking or loan relationship." - Randy Garutti, CEO of Shake Shack
But you can read about this odd story in any newspaper or on any news website. What we wanted to focus on is Shake Shack's hiring, which has collapsed to basically nothing in the last month.
The job listings for Shake Shack fell 95% from the start of March to now, and with the number of people choosing to not go outside for fast food/fast casual, that means there isn't a reason to hire more in-store workers. Many Shake Shacks remain open, with social distancing policies in place.
We have a map of every Shake Shack in the world, zoomed in on the U.S., and which allow online orders and which don't. Thankfully, most locations do some combination of delivery or takeout, using an app or the website. But with self-quarantine guidelines in place, there isn't any way to generate the revenue Shake Shack is looking for only with online orders. Peak foot traffic during lunchtime on a weekday will always outdo online ordering during a global pandemic.
You can read Randy Garutti's full statement here, which contains a lot of interesting nuggets about the business he runs and the PPP. The article is on LinkedIn, which is also the site we use to track employee count. Shake Shack has almost 8,000 employees in its workforce, but a large majority of them aren't listed on LinkedIn. Out of the 189 locations in America, there are never more than 45 works at any one location, which is why they got the $10 million in the first place.
About the Data:
Thinknum tracks companies using the information they post online - jobs, social and web traffic, product sales and app ratings - and creates data sets that measure factors like hiring, revenue and foot traffic. Data sets may not be fully comprehensive (they only account for what is available on the web), but they can be used to gauge performance factors like staffing and sales.