Business Model

Simply put, the Tim Hortons business model is broken.  Regardless the amount of monthly revenue the variable expenses expand to reduce and eventually eliminates the possible profit margin.  The following franchise posting forum illustrates the frustration between two Tim Hortons store owners:

” my store at one time was doing $700,000 per year. I had a franchisee about 5kms from me that was doing $1.2 million a year. He always thought I was doing great and I always thought he was crushing it. Once we began to compare scorecards, we found out that neither of us was making a dime. But of course that’s hard for you Tim Hortons guys to believe, but your failure rate is proof. You are always trying to change the subject Mr. House. How about you guys addressing the facts for a change: kickbacks, churning, your out of control legal department, excessive couponing, market saturation, high build out costs, etc.?”

This section looks at the details of the business model.  A closer look will show that the brain-trust at Tim Hortons (The TDL Group Corp.) have not evaluated the amount of monthly expenses – particularly labor, product costs and utility costs have pinched the owners past the point of no return – past the point of profitability.

See the sections below, beginning with the  ****insert break even from our store**** to see the break even proforma items along side the required number of creations that need to be sold.  From there see the details of each monthly expense items.

 

This will be an open forum to post which we can have updating on Facebook in realtime.

  1. Will
    December 9, 2012 at 12:01 am

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  2. December 13, 2012 at 11:04 pm
  3. January 5, 2013 at 1:13 am

    This reminds mee of somethingg I saw a whileee back. Good stuff!

  4. Kim
    January 9, 2013 at 7:17 pm

    Once again….no business is guaranteed to make money…all franchises are the same, you pay the same %of rent and royalties regardless of sales. risk of doing business people…if it is so bad, why is it virtually impossible to get a franchise due to owners wanting additional stores.

    • January 9, 2013 at 9:59 pm

      Sorry you must not have read the contract. Site doesn’t state all stores are low volume. If you are not pocketing some serious coin then what would you do when it’s time to sell. Countless owners including myself have recieved $1, in case your not reading that correctly that’s one dollar. Any store can be purchased if you have the money. Lots of stores in Western Canada have operator agreements and are not owned. District Managers are being moved to ‘store owner’ but it is false and only inflates their ‘owner operator’ numbers. Look at the operating agreements and see that someone can ‘own’ a store for $10,000 (yes ten thousand) while an owner perhaps just down the street invests nearly a half million. Does that sound like you cannot purchase a store?
      ONE STORE IN WINNIPEG HAS BEEN OWNED 18 DIFFERENT TIMES!!!

  5. January 10, 2013 at 1:23 am

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