by Joshua Wong 4 years ago
931
Tim Hortons
by Joshua Wong 4 years ago
931
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As of 2016, 3,665 Tim Hortons restaurants can be located around the world (Hunter, 2018). The company also merged with Wendy's, from 2006 to 2014, then merged with Burger King after 2014 (Hunter, 2018).
In order to create and own a Tim Hortons franchise, the qualifier needs to have a net worth of $1.5 million and $500,000 liquid assets (Tim Hortons, 2020). Depending of the transaction type, the financial requirements may vary on net worth and liquid assets (Tim Hortons, 2020).
Tim Hortons, like many fast-food restaurants, has a reward app dedicated to their company. In addition, the app uses a point system to win rewards. When someone downloads the Tims Rewards app and enters a Tim Hortons café, they instantly earn 10 points (Tim Hortons, 2020). When someone purchases an item, they earn points (Tim Hortons, 2020). If it is someone's birthday and they have the app, they get a free reward (Tim Hortons, 2020).
Although the company does not export goods, they instead branch out their company to another country and consider that as an export (P, 2014). The company's CEO, Paul House, said that when Tim Hortons exported their franchise to Dubai, Saudi Arabia, it represented the first true export of the brand (P, 2014).
Canada is able to grow coffee beans but the plant will not produce or harvest any beans because our of cold climate. In order to solve this issue, Canada imports coffee beans from Central and South American countries, as well as the Middle East, for brewing (P, 2014).
In order for Tim Hortons to promote their products, they advertise their products on a variety of media such as: posters, billboard pictures, social media posts, and television commercials. To boost up their coffee sales, Tim Horton introduced the "Roll Up the Rim to Win" contests in 2007, in which customers are able to win rewards items relating to food, drinks, prizes and money. The reason why the contest exists is because the goods were a bottomless pit back then, and hosting a give-away contest can get rid of some items and earn some money (Thompson, 2020). As the years passed, the competition became more popular due to their bigger prizes such as luxurious goods.
Each of the Tim Hortons' menus are grouped into categories and can be broken down into more subcategories to fit into people preferences. For example, if someone wants a beverage, they have the option to choose hot or cold. If they choose hot, then they have the option to pick either coffee or tea. If they choose coffee, they have a variety of specialty coffees to choose from. The people can customize their coffee with three different cup sizes: small, medium, large.
In downtown Toronto, there are 26 Tim Hortons cafés. In my residential area, there is a Tim Hortons café by the intersection of Major Mackenzie and Kennedy Road. If I were to walk to the café from home, it would take about 20 to 30 minutes. If I were to bike, it would take about 10 minutes and even less time if I were to drive there.
The prices at Tim Hortons can vary based on the item's category. For instance, the average hot beverages cost less than $5, while baked goods can cost between 5$ to 10$.
Tim Hortons' menu includes a variety of food and beverages. Some food examples are doughnuts, soups, salads and sandwiches. The beverages includes regular and specialty coffees and slushies. The cafés also sell some merchandise such as mugs.
When expanding a company to a foreign country, people would recognize it more due to being exposed to it (Pun, 2016). In addition, the company would gain more money because of opening a new café (Pun, 2016). However, Tim Hortons also competed against fast-food companies for recognition such as McDonalds, Dunkin Donuts and Starbucks, in a foreign country (Pun, 2016). Also, Tim Hortons heavily relies on their coffee for profit which may not be popular in certain foreign country, such as China, India, and Southeast Asia (Pun, 2016).
In 2005, Tim Hortons partnered with several coffee-based communities across South America, most of which were from Brazil, Colombia, Guatemala, and Honduras (Tim Hortons, 2020). Today, the company is in partnership with the Hanns R. Neumann Stiftung (HRNS) Foundation, the Tri-National Commission of the Trifinio Plan, and the Control Union Certifications (CUC) (Tim Hortons, 2020).
Tim Hortons was the sole proprietorship from 1964 to 1067 (Guo, 2015). After being the sole proprietor for three years, Tim Hortons shared the company with Roy Joyce until his death in 1974 (Guo, 2015). After the death of Tim Horton, Roy Joyce became the new sole owner of the company (Guo, 2015).
As of 2014, Tim Hortons has over 100,000 employees across the world (Regagui, 2014). The training they offer explores the many skills needed in the company such as creativity and communication, as well as training on certain topics including cultural/ethnic awareness, safety, ethics, and team building (Regagui, 2014).
According to the Tim Hortons website, the company selected plots of land in Central and South America to grow their coffee beans (Tim Hortons, 2020). Depending on the location of growth and harvest, the taste of the coffee will vary (Tim Hortons, 2020).
Tim Hortons is also considered as a want because they also sell non-essential products such as mugs and coffee grounds.
Tim Hortons is considered as a need because it provides essential goods for consumers such as food and drinks. For travelling, Tim Hortons can be located on highways for truck drivers or travellers, so they can eat or drink something before going on the road again.
In 2014, Tim Hortons helped the communities around them and the planet at the same time. In order for them to help individuals with their health needs, Tim Hortons reduced the amount of sodium in their muffins in 2010 by 33% to keep the customers healthy (Tim Hortons, 2014). When the company helped the struggling communities, they raised about $5.3 million for local charities by selling the "Smile Cookie" across the U.S. and Canada (Tim Hortons, 2014). Lastly, Tim Hortons helped the planet's progress of recovery by supporting 650 local community clean-ups across Canada (Tim Hortons, 2014).
Over the past 50 years, the company invented iconic fast-food treats. Examples of such were Timbits, the Apple Fritter doughnut, and the Dutchie (P, 2014). In addition, the company invented and coined the phrase "double double" (P, 2014), in which the barista will fill your coffee up with 2 creams and 2 sugars (P, 2014).
Tim Hortons opened their first "innovation café" (Carlberg, 2019) in the financial district in downtown Toronto. The café's appearance was heavily inspired by hockey because of the company's founder, and the café included the standard menu with a twist to it (Carlberg, 2019). An example of such would be a standard glazed donut pounded with sugar, candy, and syrup. Today, the café is limited to only for take-out due to the COVID-19 pandemic; delivery and dine-in are still not an option.
Some examples Tim Horton possessed during his ownership at Tim Hortons were:
Annual Income Statement:
as of 29/12/2013
Total Revenue - 3255.53
Revenue - 3255.53
Other Revenue, Total - N/A
Cost of Revenue, Total - 2135.7
Gross Profit - 1119.83
Total Operating Expenses - 2634.44 Selling/General/Admin. Expenses, Total - 173.41
Research & Development - N/A Depreciation / Amortization - N/A
Interest Expense (Income) - Net Operating - -29.25
Unusual Expense (Income) - 33.67
Other Operating Expenses, Total - 320.91
Operating Income - 621.1 Interest Income (Expense), Net Non-Operating- -35.47
Gain (Loss) on Sale of Assets - N/A
Other, Net - N/A
Net Income Before Taxes - 585.63 Provision for Income Taxes - 156.98
Net Income After Taxes - 428.65 Minority Interest - -4.28
Equity In Affiliates - N/A
U.S GAAP Adjustment - N/A
Net Income Before Extraordinary Items - 424.37
Total Extraordinary Items N/A
Net Income - 424.37
Total Adjustments to Net Income - N/A Income Available to Common Excluding Extraordinary Items - 424.37
Dilution Adjustment -N/A
Diluted Net Income - 424.37
Diluted Weighted Average Shares - 150.62
Diluted EPS Excluding Extraordinary Items - 2.82
DPS - Common Stock Primary Issue - 1.04
Diluted Normalized EPS - 2.98
Annual Balance Sheet:
as of 28/09/2014
Total Current Assets - 602.52
Cash and Short Term Investments - 109.08
Cash - N/A
Cash & Equivalents - 109.08
Short Term Investments - N/A
Total Receivables, Net - 221.27
Accounts Receivables - Trade, Net - 214.79
Total Inventory - 111.07
Prepaid Expenses - 30.06
Other Current Assets, Total - 131.03
Total Assets - 2504.45 Property/Plant/Equipment, Total - Net - 1718.19
Property/Plant/Equipment, Total - Gross - N/A
Accumulated Depreciation, Total - N/A Goodwill, Net - N/A
Intangibles, Net - N/A
Long Term Investments - 40.25
Note Receivable - Long Term - 0.57
Other Long Term Assets, Total - 142.92 Other Assets, Total - N/A
Total Current Liabilities - 505.88 Accounts Payable - 143.87 Payable/Accrued - N/A
Accrued Expenses - 138.8
Notes Payable/Short Term Debt - N/A Current Port. of LT Debt/Capital Leases - 18.24
Other Current liabilities, Total - 204.97
Total Liabilities - 2074.28
Total Long Term Debt - 1420.35
Long Term Debt - 1294.88
Capital Lease Obligations - 125.47
Deferred Income Tax - 7.38
Minority Interest - 0.91
Other Liabilities, Total - 139.77
Total Equity - 430.17
Redeemable Preferred Stock, Total - N/A Preferred Stock - Non Redeemable, Net - N/A
Common Stock, Total - 375.88
Additional Paid-In Capital - 12.15 Retained Earnings (Accumulated Deficit) - 154.57
Treasury Stock - Common - -14.81
ESOP Debt Guarantee - N/A
Unrealized Gain (Loss) - N/A
Other Equity, Total - -97.62
Total Liabilities & Shareholders' Equity - 2504.45
Total Common Shares Outstanding - 132.58
Total Preferred Shares Outstanding - N/A
Like many fast-food franchises, Tim Hortons advertises their products on social media, television, and their website. As of June 5 2020, Tim Hortons had 656K followers on Twitter, 394K followers on Instagram, and 25.6K subscribers on YouTube. In addition, the company sponsored several sport leagues, such as the National Hockey League. Canadian celebrities also endorsed the company through commercials and the celebrity's social media accounts. Some celebrities were Shawn Mendes (singer), Sidney Crosby (pro-hockey player), Micheal Cera (actor), and Tessa Virtue and Scott Moir (2018 Winter Olympics gold medalists).
Over the past few years, Tim Hortons had gained several competitors in the fast-food industry in Canada. Some competitors include McDonald's, Wendy's, Starbucks, and Dunkin' Donuts (Song, et al., 2012).
Tim Hortons, over the century, gained the reputation of affordable, traditional, and healthy home-cooked meals (Song, et al., 2012), therefore appealed people to purchase their goods for quick and easy meals. The franchise also sells coffee and tea to appeal the customers, much like other fast food chains, resulting them to compete with other companies such as McDonalds and Starbucks (Song, et al., 2012).
When Tim Hortons grew popularity, American fast-food chain Wendy's purchased a partnership with Tim Hortons in 1995, which then lasted until 2006 (Hunter, 2018). In 2014, Tim Hortons' partnership was purchased by a Brazilian company known as 3G Capital, and are the ownership of Burger King (Hunter, 2018).
Tim Hortons was founded by Toronto Maple Leafs defensemen Tim Horton (1930-1974) and Montréal businessman Jim Charade (Hunter, 2018). When they started the franchise, they first opened the café in Hamilton, Ontario in 1964 (Hunter, 2018). As of 2016, there were 3,665 Tim Hortons cafés operating in Canada and found other shops can be found in 14 other countries (Hunter, 2018).
In order for Tim Hortons to promote their products, they advertise their products on a variety of media such as: posters, billboard pictures, social media posts, and television commercials. To boost up their coffee sales, Tim Horton introduced the "Roll Up the Rim to Win" contests in 2007, in which customers are able to win rewards items relating to food, drinks, prizes and money. The reason why the contest exists is because the goods were a bottomless pit back then, and hosting a give-away contest can get rid of some items and earn money (Thompson, 2020). As the years passed, the competition became more popular due to their bigger prizes such as luxurious goods.
The prices at Tim Hortons depends on the order. For instance, hot beverages are charged less than $5, meanwhile baked goods are charged over $5 but less than 10$.
Tim Hortons' menu includes a variety of food and beverages, like all fast food cafés. The foods include doughnuts, soups, salads and sandwiches. The beverages include coffees and slushies. The cafés also sell merchandise such as mugs.
In order to make a cup of coffee, the beans need to grow in the Central-South American region because of the warm climate and humidity. After harvesting, the beans gets exported to a roasting factory that belongs to Tim Hortons. After roasting, the beans can either be sent to a nearby café or can be grounded to be sold at a grocery store. Either way, the consumer consumes the finishing product after the beans/grounds brew in water.
