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Is Tim Hortons Franchise Is Better Than Starbucks ?

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Tim Hortons, a Canadian coffee franchise chain, is one of the most prominent quick service restaurants in the United States. Tim Hortons is a coffee and doughnut shop. Hamilton, Ontario was founded in 1964 by Toronto Maple Leafs defenseman Tim Horton and Montréal businessman Jim Charade. Tim Hortons has since expanded to thousands of locations across the country. 

Tim Hortons’ menu of premium coffee, flavoured cappuccinos, specialty teas, home-style soups, fresh sandwiches, and fresh baked goods has captured the attention of customers. By can service, they specialise in hot chocolates, English Toffee, and French Vanilla cappuccinos. The restaurant’s main focus was on high-quality, absolutely fresh products, values, excellent quality service, and community leadership, which helped them become Canada’s largest quick-service chain. Here we will discuss the Canadian culturally based restaurant Tim Hortons, franchise details, opportunities, sales costs, and much more.

tim hortons franchise

What is the Tim Hortons franchise?

Tim Hortons USA Inc. is well-known for its community connection and Canadian identity. The brand began franchising in 1964, the year it was founded. Being a Tim Horton’s franchisee entails committing to full-time efforts and a long-term commitment to its operating restaurants. With many years of experience in operation, the company indicates that a spousal team or a team of two or more immediate family members can successfully manage a 24-hour operation, and 95% of the company’s franchise owners operate a family enterprise. 

Tim Horton’s franchise owners are not chosen moderately,  applicants must go through a rigorous interview process. In today’s competitive market, the company ensures that all franchise owners have the basic entrepreneur skills, management skills, required financial means, and dedication to the business.

The company highlights those owners who live up to their values and standards on a daily basis. Also, keep in mind that the brand has stores in various locations such as shopping malls, highway outlets, universities, and hospitals, providing great visibility for this chain that offers 24-Hour services and caters to consumers, and they get both Tim Hortons and Wendy’s restaurant under one roof.

Tim Hortons Franchise Opportunity 

Tim Hortons is one of Canada’s largest fast-food corporations. The company is also one of the top 100 most popular brands in the world. There are over 5,000 units in Canada and 900 in the United States. The company is currently focusing on expanding into Canadian markets. Because the company believes that the qualification of franchise owners creates the opportunity for growth, they only offer franchising opportunities to good, qualified candidates.

They have a great opportunity to grow because the franchise supports a flexible territory as well as all-day meals. Tim Horton’s is currently looking for new markets in Texas, Illinois, Florida, California, and other states across the United States. It is a once-in-a-lifetime opportunity for an interested owner to establish units in the Midwest. Those interested should consider this a one-of-a-kind opportunity for a well-known fast-food franchise system in the US territory.

Tim Hortons offers these franchise business models to franchises to select and the franchise cost and franchise fees are as per these formats. 

The Tim Hortons restaurant formats are 

  1. Standard Shop
  2. Standard Shop within Gas station
  3. Non-standard Shop 

tim hortons franchise

Know About Tim Horton Franchise

Tim Hortons also offers support to its franchisees, including a training program, marketing, and sales resources, and financial assistance. Franchises are responsible for the day-to-day running of their stores. They must be reliable, committed to their customers, and have a passion for coffee. 

Tim Hortons Franchise Information
Industry TypeFood & beverages 
Sub CategoryCafe and QSR
Year Established1964
Company NameTim Hortons USA Inc. 
Founder/Management HeadTim Horton and Ron Joyce
Franchising Started1964
Employees at Company H.OMore than 500
Franchise Expansion PlanUnited States,Canada,United Kingdom,India,Middle East,Thailand,China
Number of Units5291 Worldwide
Number of Franchise UnitsMore than 5100
Social Media HandlesFacebook
Twitter
Youtube
Instagram
Company Office LocationToronto, Ontario, Canada

Tim Hortons Franchise Requirements

Tim Horton’s believes in strong ownership with full-time access, so that the brand does not grant access to all applicants. They have a thorough interview process in place to finalise the franchise opportunity for the applicant. 

Here are the fundamental requirements for owning a this opportunity.

1. Restaurant, coffee shop, retail, and multi-unit management experience is preferred.

2. Must be enthusiastic about business or community leadership.

3. The ability to change the drive is required.

4. The ability to build a high-performing organisation is required.

5. Willing to make a full-time commitment to ownership

6. Interested in acquiring a multi-unit opportunity

7. The minimum net worth financial resource is $1,500,000, with a minimum liquid asset of $500,000

tim hortons franchise

How much does a Tim Hortons franchise cost

The initial investment range for franchise owners is $680,900 – $1,906,300. This rage varies depending on real estate, business, markets, and so on. Franchises must have a minimum initial net worth of $1,500,000 and a minimum liquid worth of $500,000. 

The Tim Hortons franchise fee will be $50,000 for standard shops and $25,000 for non-standard shops. The royalty will vary depending on sales, with real estate leases ranging from 4.5% to 6.0% of gross sales and marketing royalties ranging from 4% to 6% of gross sales.

Tim Hortons franchise Cost in the United States

Format Franchise CostFranchise Fees
Standard Shop$ 1,000,000 to $ 1,500,000$ 50,000
Standard Shop within gas station$ 2,50,000 to $ 650,000$ 50,000
Non-Standard Shop$ 1,00,000 to $ 300,000$ 25,000

tim hortons franchise

Tim Horton Franchise Training & Support Offered

Franchise owners and operators must have completed a seven-week training program at The TDL Group’s offices in Oakville, Ontario, at their own Tim Hortons University. The training will be a combination of classroom and hands-on training, with the hands-on being on a fully operational machine for the trainee. Food handling, hygiene procedures, team member relations, equipment maintenance, in-restaurant security systems, and other topics will be covered in the training. 

Following that initial training program, franchisees will receive 10 days of on-the-job training in fully operational Tim Hortons. In exceptional circumstances, the franchisor may waive franchisee training based on prior experience.

Tim Hortons Operations & Franchise support

Tim Hortons will not give up after the initial training. They will provide continuous support to franchisees 24 hours a day, seven days a week. They will provide all of the basic ongoing operational support, such as quality maintenance, franchise care, newsletters, and so on. They also provide excellent marketing and advertising support to both the national and local communities.

The franchises of Time Hortons should abide by the franchise operations manual and terms mentioned in the franchise agreement with respect to the operations.

How is Tim Hortons Franchise Territory Granted

A franchise can only operate in one location. The option of the exclusive territory is not available to franchise owners. Other franchisees, franchisor outlets, or other business channels may compete for your business. 

Franchisees are not granted a maximum or minimum territory in which to operate. If a franchisee performs well in a specific area, they are permitted to serve from their designated location.

What is Tim Hortons Franchise Term of Agreement and Renewal?

For standard shops, the initial term length of the Tim Horton franchisee is 20 years. Depending on the circumstances, nonstandard shop terms can range from 10 to 15 years. 

If franchisees are performing as expected, they are eligible for renewal. Existing franchise owners have the option of renewing for an additional year during the renewal process.

Does Tim Hortons provide Financial Assistance to franchises?

Tim Hortons does not provide direct financing or franchise loans to franchises. The company franchisor cannot provide any lease or note obligation for franchisee guarantee. 

As long as the company has a relationship with the investor, it can provide third-party financing to cover start-up costs, inventory, equipment, payroll, and accounts receivable. SBA financing may be available to assist with the purchase of a franchise.

I advise all my clients and readers of  franchise deck, to buy franchise insurance. in the case of Tim Hortons the franchise cost is very high, do buy insurance to hedge losses in business.

tim hortons franchise

Pros & Cons of Tim Hortons Franchise

When considering a Tim Hortons franchise, there are a few things to keep in mind. First and foremost, Tim Hortons franchises are some of the most successful businesses in the world. With over 5,500 locations worldwide, there is a franchise for you!

However, there are also some potential downsides to considering a Tim Hortons franchise. First, franchisees are required to adhere to a set of strict guidelines and rules, which can be a bit of a burden. Additionally, the competition is fierce, so it takes a lot of hard work and dedication to be a successful Tim Hortons franchisee.

Overall, though, a Tim Hortons will make money for you, you need to abide by the terms in franchise operations manual and franchise agreement.

Advantages of owning a Tim Hortons franchise 

1. Rapidly expanding QSR in the US and internationally 

2. The brand offers extensive training and gain access to learning about all aspects of the business

3. The brand incorporates support for ongoing operational activity.

4. Make available a variety of readily available funding sources.

5. Collaborate with more than 100 existing strong community franchisees.

6. Have international restaurant brands on your side.

Disadvantages of owning a Tim Hortons franchise 

1. The franchise fee of Standard shop is expensive to its peers.

2. The royalty fee is increasing and fluctuating.

3. There is also a high marketing fee.

4. Tim Hortons is not offering exclusive franchise territories, but for a brand like Tim Hortons, it should be fine for you.

tim hortons franchise

How much do Tim Hortons franchise owners make?

According to the latest FDD 2021, The Tim Hortons franchise owners of Standard shop make monthly gross sales in a range of $ 87,858 to 90,431. Hence, the average annual sales of Tim Hortons franchise owners is $ 1,054,256.

On buying a Tim Hortons franchise , you can expect to make $ 1,054,256.as gross sales every year.

What is Tim Hortons franchise profit?

Tim Hortons franchises are profitable. The average franchise generates a gross revenues of $1.05 million. Their restaurants did well in Covid 19 and they opened franchises during these difficult times too.

On the other hand, the Starbucks franchise closed down during the Covid-19 times. This indicated the Tim Hortons franchises are making good profit and can survive tough times as well.

Let us look at Tim Hortons franchise profit, as per the food franchise industry, the average profit margin is 15 to 20%.

On a profit margin of 15%, the franchises of Tim Hortons can expect a average annual profit of $ 155,000.The franchises of the Standard format can expect to recoup their investment within 8 to 10 years.

Tim Hortons Franchise Reviews

Tim Hortons is a Canadian coffee and doughnut chain with over 3,500 stores across Canada. The company is well-known for its coffee, doughnuts, and other baked goods. The company was founded in 1964 by Tim Horton and Ron Joyce.

The company has a strong international presence, with over 800 restaurants in the United States and over 1000 restaurants in other countries. The company has also expanded its menu to include items such as sandwiches, salads, and breakfast items.

tim hortons franchise

Tim Hortons Franchise Rankings

Tim Hortons is a Canadian coffee and doughnut chain. The company was founded in 1964 by Canadian hockey player Tim Horton and his friend Arnold “Pat” Burns. The company has over 3,500 stores across Canada and over 1000 stores in the United States. 

The Tim Hortons was ranked as the fifth largest restaurant chain in the world by revenue.

In 2012, Tim Hortons was ranked in Forbes list of Canada’s top employers. The company has a strong commitment to employee well-being.

Tim Hortons Franchise Rankings

As per Franchise Direct Canada,Tim Hortons ranked # 1 in Top largest Franchises in Canada in 2020.

tim hortons franchise

Franchise Deck Analysis and Overview

Overall, I believe that QSR restaurants are on the rise in both the domestic and international markets. Tim Hortons has grown significantly in this market over the last 55 years, becoming one of the massive restaurant chains in the QSR category. They not only serve its popular doughnuts and coffees, but also sandwiches and bakery products in a variety of locations, demonstrating their broad business expansion plans. 

Though there are prerequisites for a franchise opportunity, candidates must go through a comprehensive interview as the brand believes that brand owners must value their mission and have a great relationship with the people as great leaders and interested in opening multiple franchisees in the future.

Tim Hortons offers extensive training as well as ongoing and multiple support to franchise owners after they open their doors. So, if you want to be a part of a business that is built on strong ownership and is internationally recognised as one of the largest and fastest growing QSRs, then the Tim Hortons franchise is for you.

I would buy the Tim Hortons franchise, if I get decent real estate property for sale at a good price. You can develop a Tim Hortons location by buying land and building a Tim Hortons. Later on, you can exit the real estate in great multiple options.

On the contrary, Tim Hortons is facing challenges in the United States. In 2020, U.S. Tim Hortons franchises filed a lawsuit in federal court , accusing it of price gouging and disguising the franchise system as a supply chain business.

You also see this video from CNBC on a journey of Tim Hortons in the United States.

The Franchise Deck rating for the Tim Hortons franchise is 4.0/5.0.

tim hortons franchise

Conclusion 

The fastest growing QSR Tim Hortons has been the market leader in the United States and Canada since 1964, according to Canadians. Thousands of franchises are already in place and looking for available markets in the Midwest of the United States and elsewhere. 

The brand Tim Hortons is built by strong entrepreneurs and founded in 1964 by Tim Horton and Ron Joyce. who is heavily backed by such an international brand? So, all I can say is that the brand is a strong and proven business prototype model with plenty of room for growth. Tim Hortons is a perfect example of How to build a franchise brand. It will overcome the challenges faced in new markets and recommend them to control the fees charged to its franchises.

Entrepreneurs who want to open a franchise can look at these coffee franchises .

Frequently Asked Questions (FAQs)

  1. Is the Tim Hortons franchise profitable?

Yes, despite the high initial investment, the Tim Hortons franchise is profitable because it is an international brand with a rapidly growing opportunity. Their profitability can be measured by the number of stores only in Canada.

  1. Can you make money owning a Tim Hortons?

Yes, you can make a lot of money with the brand, but only after a few years of successfully running the Tim Horton franchise business.

  1. Is Tim Hortons a franchise?

As a consumer, you may be wondering if Tim Hortons is a franchise. The quick answer is that Tim Hortons is a Canada-based coffee and doughnut franchise chain that is owned by Restaurant Brands International Inc. (RBI). What this means for you is that you will find a franchise version of Tim Hortons in your local area.

While Tim Hortons is a franchise, it is still a popular destination for coffee and doughnuts. In fact, it is the second-largest coffee and doughnut chain in the world, with over 5,500 locations worldwide.

  1. How do Tim Hortons franchises make money?

Tim Hortons franchises make money in a few ways. The most common way is through the sale of coffee and tea. The company also makes money through the sale of doughnuts, sandwiches, and other food items. 

The franchises of Tim hortons also earn money through the rental of space in its restaurants, and through the sale of advertising space.

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