Tim Horton’s. which has been embroiled in a spat with its franchisees over budget cuts and other financial issues since early last year, is – perhaps incongruously – planning to massively renovate every one of its stores in an attempt to become more relevant to customers who are not flocking to it.
Tim’s Canada has been in a bitter dispute with its franchisees since shortly after Restaurant Brands International (RBI) took over head office management following the big buyout.
The dispute has to do with profit skims by the head office, higher costs for franchisees, and alleged misspending of pooled marketing funds.
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The new Espresso machines at Tim’s likely won’t look like this Modern facsimile of a grand old Belle Époque dual Espresso!
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Nevertheless, the chain has announced it will spend something like (C)$700 million to upgrade and update its Premium Coffee in an attempt to compete more effectively with upscale Coffee purveyors like Starbucks and McDonald’s McCafé. That’s where the Coffee Shop sector’s growth is, these days. The plain ‘Sugar and Cream’ Coffee market is stagnant. And the latter is where Tim’s has traditionally focused its efforts.
Notable among the upgrades will be the replacement of the stores’ current Espresso machines with new ones costing an estimated (C)$12,000 each. And I’ve been agonizing over whether to spend a couple of hundred on a new Breville! Anyway, the idea, Tim’s says, is to attract discerning young Coffee devotées – Espresso/Latté lovers who aren’t impressed with the current Tim’s offerings which are made with powdered mixes rather than freshly ground Beans.
The chain is already testing new beverage recipes using freshly ground Coffee and freshly steamed milk.
Franchisees won’t be happy
Apparently, head office has ‘instructed’ Tim’s franchisees to buy the fancy, new (C)$12,000 Espresso machines, downloading the main cost of this head office decision to the little guys who are already strapped for cash. Of course, this is just what you’d expect given Tim’s head office’s record of pressing the front-line folks fore greater and greater profits.
Everyone’s getting on the bandwagon
Most of you will have been following McDonald’s trend-setting upgrade of its regular Coffee a few years back and its more recent launch of McCafé shops in direct competition with Starbucks, Second Cup and other premium Coffee chains.
But McCafé has apparently not been sufficiently successful in challenging the leading premium joints, so it, too, is launching an upgrade. And, not to be left behind, Burger King is also getting a Coffee upgrade.
I wonder where the take-out Coffee market will go next?
~ Maggie J.