Starbucks Coffee Company announced on Oct. 18 its decision to fully license its European operations to its Mexican business partner of 16 years, Alsea.

Alsea is a Mexican multi-brand restaurant operator headquartered in Mexico which has an operating portfolio of fast food, casual dining, and restaurants across the country, in South America and Spain. In its official announcement, Starbucks described the company as the largest independent chain restaurant operator in Latin America.

Under the turnover, Starbucks is giving full operational license of its 83 stores in France, the Netherlands, Belgium, and Luxemburg to Alsea. The restaurant operator would be in charge of full store operations, remodeling, and employment. It would also oversee the supply chain for other 179 locations in these four markets that are licensed by other operators.

John Culver, group president for Starbucks International, Channel Development and Global Coffee & Tea, acknowledged the company's long-term strategic partner with Alsea. The turnover would enable Starbucks to further accelerate its growth in these four European markets, bringing the whole company towards long-term success, Culver said in a statement.

While Starbucks was particularly upbeat about the business move, market observers noted that its sales in the region have been declining for the last two years.

Bloomberg noted that the company described its European markets as economically challenging and highly competitive during its most recent earnings call.

Indeed, in line with turning over the license to Alsea, Starbucks is also closing a support center in Amsterdam according to Bloomberg. This decision would rub its 190 employees off of jobs. The company would also restructure its London office.

Starbucks has also been having difficulty sustaining favorable sales worldwide due to declining preference of Frappuccinos. Customers' taste is said to be shifting towards more authentic and high-end coffee experience.

Now with Alsea overseeing European operations, Starbucks Chief Executive Officer Kevin Johnson could focus on improving sales in the company's most important markets, the United States and China, Bloomberg stated.

On Oct. 19, Alibaba said additional nine cities would gain access to door-to-door coffee delivery from Alibaba's Ele.me beginning Oct. 22. Belinda Wong, chief executive of Starbucks China, added that the service is expected to extend to more than 2,000 stores across 30 cities before 2018 ends.

Starbucks started the delivery services in September initially in Beijing and Shanghai. The company's partnership with Alibaba was announced in August.

Starbucks faces a tough competition for Chinese consumers with Tencent-backed beverage startup, Luckin Coffee.