Tim Hortons a Flop in the US

[Bertuzzied]

Kinda surprised. Tim's is definitely better than Dunkin Donuts.

http://www.montrealgazette.com/busin...431/story.html

Activist investors say the $664-million-U.S. expansion over the last decade has been a waste. At stake may be a forced retreat from a market that promises the Oakville, Ont.-based company potential growth as it reaches saturation at home.
"They are meeting the point at which they won't be able to open any more stores in Canada," said Jim Danahy, chief executive officer of Customer LAB, a Toronto-based retail consulting firm. "They know long-term growth will have to come from the U.S."
Tim Hortons recently faced criticism of its U.S. strategy from activist investors Highfields Capital Management LP of Boston and New Yorkbased Scout Capital Management LLC, which hold four and five per cent of the company's shares, respectively. Both investment firms pressured the company to scale back the U.S. expansion, and instead direct capital to share buybacks.
"The company's consistent and long-standing underperformance should long ago have been a wake-up to Tim Hortons' board and management," Scout said in a letter on June 25. "We urge you to curtail the use of the company's cash flow to fund real estate or new store capex in the U.S."
With a U.S. market share of only 2.7 per cent, according to retail consulting firm Technomic Inc., Tim Hortons hasn't been able to replicate the institutional status that it enjoys in Canada. The chain was founded in Hamilton in 1964 by late National Hockey League player Tim Horton, the man credited with inventing the slap shot. The chain plays off its founder's hockey roots, sponsoring minor hockey development programs, and can be found in practically every city in the country. The company has 3,453 locations in Canada, more than McDonald's Corp.

[CaptainCrunch]

Mercan's want donuts with more sugar and fat exploding creams in them.

[polak]

Whats judged as a "flop"?

They never had a shot of building the same sort of brand in the States as they do in Canada.

[Bertuzzied]

Originally Posted by polak

Whats judged as a "flop"?

They never had a shot of building the same sort of brand in the States as they do in Canada.

Maybe this.

While it dominates in Canada, the company derives only 5.3 per cent of its revenue from its U.S. locations, which account for 18 per cent of its total stores, according to data compiled by Bloomberg. Canadian stores generated $182,000 in operating profit per store last year, whereas U.S. stores generated $20,000 per store, said Derek Dley, an analyst at Canaccord Genuity Corp.,

[Bill Bumface]

I saw a Tim Horton's dispenser inside a drug store in Ireland. That also seemed like a weird strategy to break into a market...

[sun]

I wonder if it flopped because it's terrible?

[FlamesAddiction]

Just my opinion, but I don't see what is so special about Tim's at all.

Their coffee is gross unless you add a tonne of cream and sugar. Their sandwiches are just average sandwiches and no cheaper than most other places (does anyone actually crave them, or is it just convenience). Donuts and bagels are the same everywhere.

I could never understand why people go completely whacky for Tim Horton's every morning when the greasy spoon diner at the corner probably has better coffee and maybe even food.

[nik-]

Originally Posted by sun

I wonder if it flopped because it's terrible?

Yes, everyone I've ever asked says that Dunkin' Donuts walks all over Timmies. Which is funny, because Dunkin' Donuts flopped here.

[nik-]

Originally Posted by FlamesAddiction

Just my opinion, but I don't see what is so special about Tim's at all.

Their coffee is gross unless you add a tonne of cream and sugar. Their sandwiches are just average sandwiches and no cheaper than most other places (does anyone actually crave them, or is it just convenience). Donuts and bagels are the same everywhere.

I could never understand why people go completely whacky for Tim Horton's every morning when the greasy spoon diner at the corner probably has better coffee and maybe even food.

faux nationalism.

[Displaced Flames fan]

$182K profit per store sure sounds horrible to me. I could be way off base, but I would think that is not a very good figure for the Canadian stores.

[blankall]

Bad coffee with few options. Compare the options at Blends or Starbucks.

Extremely poor food. It's basically all pre-cooked pieces of egg and chicken left in a heater.

Over sugary and hard donuts. Every donut I've ever had from there has been a hard seal of sugar with a dried out donut in the middle.

I'm not surprised at all. Americans will have no idea what a "double double" is or be caught up in the unexplainable hype around them, so why would they go there.

Tim Horton's is horrible. Americans clearly don't feel the need to some bizarre corporate loyalty to a company that continually stomps on small coffee shops. Just about every other major chain has gone to great lengths to up their game. Even McDonalds is serving higher quality coffee. For whatever reason, Tim Horton's gets a pass on their 80s throwback mediocre crap.

[burn_this_city]

Originally Posted by nik-

faux nationalism.

I don't think this can be overstated. I think a lot of people go to Tim's because it's a cheap slice of Canadiana.

[nik-]

Tim Horton's still doesn't even have the cup sleeves FFS. Plus their lids might as well be a piece of saran wrap.

[Northendzone]

i seem to recall reading an article about how americans enjoy a different type of donut (i.e. more of the krispy kreme style) than canadians do.

i doubt that TH is reaching saturation in Canada, there is room for 3 or 4 more in my neighborhood.

[RT14]

Only thing good at Tim Hortons is the Ice Caps. Never buy anything else there.

[valo403]

Originally Posted by blankall

Bad coffee with few options. Compare the options at Blends or Starbucks.

Extremely poor food. It's basically all pre-cooked pieces of egg and chicken left in a heater.

Over sugary and hard donuts. Every donut I've ever had from there has been a hard seal of sugar with a dried out donut in the middle.

I'm not surprised at all. Americans will have no idea what a "double double" is or be caught up in the unexplainable hype around them, so why would they go there.

Tim Horton's is horrible. Americans clearly don't feel the need to some bizarre corporate loyalty to a company that continually stomps on small coffee shops. Just about every other major chain has gone to great lengths to up their game. Even McDonalds is serving higher quality coffee. For whatever reason, Tim Horton's gets a pass on their 80s throwback mediocre crap.

Dunkin' Donuts begs to differ. It's a matter of ingrained taste, people go to Dunkin because they've always gone to Dunkin, no different than Canadians (and people in Buffalo or Detroit) and Tim's.

[blankall]

Originally Posted by CaptainCrunch

Mercan's want donuts with more sugar and fat exploding creams in them.

A double double has about as much sugar and fat as you can cram into a coffee. Starbucks is by far the biggest chain in the US and it offers all sorts of low calorie and healthy options.

[blankall]

Originally Posted by valo403

Dunkin' Donuts begs to differ. It's a matter of ingrained taste, people go to Dunkin because they've always gone to Dunkin, no different than Canadians (and people in Buffalo or Detroit) and Tim's.

People go to Dunkin, because, like all chains, they provide consistency in product.

People go to Tim Horton's, due to some bizarre sense of corproate nationalism. It's downright bizarre.

[Locke]

Originally Posted by burn_this_city

I don't think this can be overstated. I think a lot of people go to Tim's because it's a cheap slice of Canadiana.

Originally Posted by valo403

Dunkin' Donuts begs to differ. It's a matter of ingrained taste, people go to Dunkin because they've always gone to Dunkin, no different than Canadians (and people in Buffalo or Detroit) and Tim's.

This. And dont think they dont play it up at every opportunity.

[Senator Clay Davis]

Dunkin Donuts is most definitely better than Tim Hortons. Munchkins are way better than Timbits. DD was always more popular in Quebec growing up than Tim Hortons was, then all of a sudden Tim's exploded and that was that for Dunkin Donuts. I still think there are a few stores in Quebec.

I also agree about the nationalism arguments. 7-11 and McDonalds both have vastly superior coffee if you just want a plain black coffee, but people love their Timmies because its about as Canadiana as it gets.