Tim Hortons
The Tim Hortons chain was founded in 1964 in Hamilton, Ontario. The chain’s focus on top quality, always fresh product, value, great service and community leadership has allowed it to grow into the largest quick service restaurant chain in Canada specializing in always fresh coffee, baked goods and homestyle lunches. Today there are more than 3,000 restaurants across Canada and over 600 locations in the United States, where Tim Hortons plans to continue responsible expansion.
The first Tim Hortons restaurants offered only two products—coffee and donuts, including two original Tim Hortons creations, the Apple Fritter and the Dutchie. But as consumer tastes grew, so did the choices at Tim Hortons. Today consumers can find a wide variety of products including 35 different varieties of the Timbit (bite-sized donut hole), muffins, cakes, pies, croissants, cookies, bagels, cinnamon rolls, soups and chilis, six varieties of sandwiches called “Tim’s Own,” wraps, breakfast sandwiches, and cappuccino and espresso drinks. However the chain's biggest drawing card remains its legendary Tim Hortons coffee.
| |
Operating Units |
12/31/2008 |
12/31/2009 |
12/31/2010 |
|---|
| | Franchised |
501 |
558 |
598 |
| | % Change | -- |
11.4% |
7.2% |
| | Company-Owned |
19 |
5 |
4 |
| | % Change | -- |
-73.7% |
-20.0% |
| | Total |
520 |
563 |
602 |
| | % Change | -- |
8.3% |
6.9% |
| | Franchised as % of Total |
96.4% |
99.1% |
99.3% |
Investment Required
The initial investment fee for a Tim Hortons franchise is $35,000. Franchisees can choose to open either a Standard Shop, a Kiosk, or a Drive-Thru. Tim Hortons also has an option for an Operator Program.
Tim Hortons provides the following range of investments required to open your initial Standard Shop franchise. The range assumes that all items are paid for in cash. To the extent that you choose to finance any of these expense items, your front-end investment could be substantially reduced. The figures below reflect Standard Shop fees. The Total Initial Investment for a Kiosk is $97,400 – $665,095, and the Total Initial Investment for a Drive-Thru is $330,500 – $653,400.
| |
Item | Established Low Range | Established High Range |
| |
Initial Franchise Fee |
$35,000 |
$35,000 |
| |
Real Estate and Personal Property Taxes |
$2,400 |
$38,000 |
| |
Equipment |
$340,000 |
$476,000 |
| |
Expenses While Training |
$4,800 |
$6,400 |
| |
Start-up Supplies and Initial Inventory |
$15,000 |
$22,000 |
| |
Professional and License Fees |
$1,500 |
$6,000 |
| |
Insurance |
$3,200 |
$21,500 |
| |
Initial Advertising and Promotional Deposit |
$2,500 |
$2,500 |
| |
Security Deposits and Bonds |
$0 |
$100,000 |
| |
Additional/Special Shop Development Expense |
$0 |
$100,000 |
| |
Additional Funds (3 Months) |
$20,000 |
$20,000 |
| |
Total Initial Investment |
$424,400 |
$827,400 |
Ongoing Expenses
Tim Hortons franchise owners pay a weekly royalty fee that ranges from 4.5% to 6% of gross sales or more under limited circumstances and a monthly advertising contributions fee of 4% of gross sales. Additional fees include a Star Card fee, which is currently up to 2% of sales processed through the Star Card.
What You Get—Training and Support
New franchisees participate in an intensive seven to eight week training program at the Tim Hortons Training Centre in Oakville, Ontario. The facility includes classrooms and a fully operational restaurant, providing trainees with intensive hands-on experience in the preparation of all Tim Hortons products. Additionally, upon successfully completing the initial training program, franchisees spend up to 10 shifts doing “on-the-job training” in a fully-operational Tim Hortons, located in the same market as their planned franchise. Other pre-opening support includes assistance with acquisition and development of the restaurant real estate as well as the equipment, furniture, and signage for the restaurant.
Tim Hortons maintains a team of skilled and dedicated professionals at the Dublin, Ohio office who provide operations, training, real estate development, construction, accounting, human resources, information technology, franchising and marketing support. District Managers are the direct link to franchisees through frequent on-site visits, and they provide feedback and guidance as well as ensuring product and service standards.
Territory
Tim Hortons does not grant exclusive territories.
Note: The tables and information regarding the number of operating units, investment required, on-going expenses, training and territory grants were taken from the company’s 2011 FDD. The 2011 write-ups will be incorporated into the 2011 Edition of Bond’s Top 100 Franchises publication.
|
