Name: Why Tim Hortons Struggles In The United States
Uploaded: 2019-09-26T18:05:24.000Z
Duration: 7 min 8 s
Description: Thousands of YouTube videos with English-Chinese subtitles! Now you can learn to understand native speakers, expand your vocabulary, and improve your pronunciation...

You know that old joke that there's a Starbucks on every corner in the United States.

In that Dunkin' Donuts slogan, America runs on Dunkin'.

Well, there's a Canadian coffee chain that makes those look like quaint

Meet Tim Hortons, Canada's one stop shop for coffee, breakfast, lunch and doughnuts.

In 2018, it supplied over 60 percent of the revenue of its parent company,

Restaurant Brands International; which also owns Burger King Popeye's.

More importantly, it's been a company darling among Canadians.

It's all the stereotypes that Canadians, you know, love that they have.

It's every bit as Canadian and even more so than Coca-Cola is American.

In 2015, the last year that Tim Hortons made its store count publicly

available, there was one Tim Hortons location for every nine thousand

These are the same figures for Dunkin' in Starbucks in the United States.

But this success is quickly becoming a problem.

They have probably definitely reached a saturation point with in Canada.

And the U.S. has long been a target, but they've struggled here for decades.

Which raises the question, why can't this Canadian icon win over its southern neighbors?

The first ever Tim Hortons opened in 1964 right here.

And the first successful location in the U.S.

opened just across this border 20 years later.

A few years earlier, Tim Hortons opened two locations in these two Florida

beach towns, hoping that vacationing Canadians would both support the

But these struggled because of production issues and because Floridians

lacked the brand awareness that Americans closer to the Canadian border have.

Bottom line is this the closer the geographical proximity of an American

city to the Canadian border, the better off Tim Hortons does.

Both of the Florida Tim's close in 1995 and the brand has stuck close to

The company expanded rapidly across these states using a franchise model

Tim Horton's kind of just jumped into the franchise, opened up a couple

Using data from their subsequent public filings, we can see that 98

The closer you are to the Canadian border, the theory would would say that

you are going to be more likely to cross the Canadian border for a weekend shopping.

There's a Tim Hortons on every on every block.

It's not bad stuff. They like it, you know, go back across the border and

if Tim Hortons is there, you know, the more likely be a consumer.

But even these border states couldn't cushion Tim Hortons against their

If you're the 15th company that's entering an American market offering

coffee and doughnuts, you've you're so far back in terms of mindshare.

And Tim Hortons does not have huge dollars in comparison to some of the

other competitors or the entrenched regional players that maybe there or

national players like Starbucks, for example.

Anyone can name their near Starbucks or maybe their nearest Dunkin' Donuts.

For Canadians, Tim Hortons is a go to spot for many food items, hot and

cold, coffee, drinks, breakfast sandwiches, lunch wraps and soups, fruit

Dunkin' and Starbucks, of course, but also Panera Bread, Jamba Juice,

McDonalds or one of the other estimated 58 thousand coffee and snack shops in the U.S..

And these all have far better brand recognition among Americans.

If you have an option between a Starbucks, Dunkin' Donuts and a Tim

Hortons, you're probably going to go to Dunkin' Donuts because you know that product.

You know what your order is; it's familiar.

In 2010, Tim Hortons closed 36 locations throughout New England after

their poor performance cost the business 4.4

This included a complete retreat from Connecticut, Rhode Island, and Massachusetts.

Burger King bought Tim Hortons in 2014 for 11 billion dollars and the

combined company, Restaurant Brands International established its

Analysts told CNBC as part of the agreement to locate the company Canada,

the Tim Hortons segment promised to continue expanding in the U.S.

They had to prove that they were going to expand internationally,

and get their brand to grow further and not just be concentrated and

But in 2015, the very next year, RBI closed 234 locations in the U.S.,

telling CNBC in an emailed statement that the closures were part of

building a foundation for future growth in the United States.

Starting in 2016, they've stopped breaking out the Tim Hortons growth,

as focused just because of the heat they've been getting in terms of

performance of Tim Hortons in the United States.

RBI did not respond to CNBC requests for comments or an interview.

So no word on exactly what their plan is.

But analysts point to a few trends or strategies the brand could use going forward.

Like premium coffee and dormant options or healthier breakfast sandwiches.

RBI has been at the forefront of the plant based meal trend, including

Impossible burgers at Burger King and Beyond Meat sausages at Tim Hortons

It also struck a deal in July 2019 to test just brand plant based eggs at

But some think RBI is waiting too long to launch these items in the U.S.

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Why Tim Hortons Struggles In The United States

struggle

infrastructure

revenue

strike