Tim Hortons Case Study

In Canada, The coffee retail industry has developed in the previous five years. The franchises is major factor in any business to expand their business for future growth. Actually Starbucks coffee is not a franchises. So they are company owned stores. They offer a different types of flexible coffee, tea program and stores for rang of various markets, and Markets include healthcare, universities & colleges resorts & hotels and existing restaurant. They additionally can take into account qualified high volume or high traffic retail locations.

Tim Hortons is much more involved in making a true difference for individuals, communities and the around the globe daily than just serving a coffee.

Depending on the execution and implementation of an expansion and its success rates, shares could go up or down in value accordingly, which then effects the companies’ shareholders.

Firstly, Tim Hortons coffee begins its value chain journey in Central and South America. Coffee beans are extracted from

Tim Hortons is currently recognized as the largest fast food restaurant chain in Canada. It provides a variety of products that are appealing to a broad range of costumer choices and the prices are relatively attractive for most of the consumer range. They prices are priced low and that’s why they are often favored by people. The company’s product line consists of premium coffee, espresso-based hot and cold specialty drinks (including lattes, 3 cappuccinos and espresso shots, specialty teas, fruit smoothies), home-style soups, fresh sandwiches, wraps, hot breakfast sandwiches and fresh baked goods.

With Ron Joyce’s strategy, Tim Hortons expanded quickly in both geography and product selection. In 1981, it already had successfully opened almost 150 outlets in Canada, and became the leading chain in Canada. It even resulted in the major changes to the coffee and donut restaurant market in Canada. Tim Hortons thus confidently believed that the expanding strategy could fit well even in the US market, where the geographical distance was close and the culture seemed to be quite similar to that of Canada.

Tim Hortons though is different, coffee isn’t produced in Canada like it is in places such as Brazil. Which begs the question how did Tim Hortons manage to become a staple of Canadian heritage? Well the answer lies in how it marketed itself to the regular everyday Canadian. A key part of the Canadian identity is the that of being hard working and being low key. When you look inside a Tim Hortons you see exactly that, mostly brown cups, and a brown aesthetic that seems like it is minding its own business.

As stated above, we learned that Canadians were not only big time coffee drinkers, but they also enjoyed the specialty type of coffee that Biggby provides. According to the Five Tasks of Foreign Market Attractiveness Assessment, we were able to clearly deduce the strengths and weaknesses entering into the Canadian market. Using this, we first screened Canada’s readiness for foreign entry and decided Biggby had a large market potential due to the large coffee consumption and growth rate. Additionally, we evaluated the industry with Porter’s Five Forces and established our competitive advantages between our competitors and new entrants. Based off of these facts, we recommend that Biggby continues to use franchising because it allows the business to emerge themselves into the culture and uses the same business strategy that Biggby currently employs in the United States. Lastly, Biggby has a high sales potential in Canada because of their competitive advantages and industry growth rates. Therefore, we recommend that Biggby enters the Canadian market with a large selection of specialty coffee, green products, and through

Canadians drink coffee every day and with 67% of the adult population coffee drinkers, the demand is there if a business can capitalize on it.

Kathy Kudler has shown to be a strong business woman in the face of the gourmet grocer industry. To maintain that reputation Kathy has decided to expand services by both location and offerings. Kathy has researched the growing gourmet grocer market and has found a need in Canada. By researching the market Kathy found the one key product lacking is gourmet coffee. Ms. Kudler as well as other stakeholders of Kudler Fine Foods must enlist the marketing department for the expansion to Canada with new gourmet coffee product to be successful. The marketing department will show the market needs, product description, growth potential and competition in

* Of the 6 major urban areas in Canada – Toronto, Montreal, Vancouver, Ottawa, Gatineau, Calgary and Edmonton every single one of these demographics has an appropriate saturation of stores to meet supply and demand. In the last few years many suburban areas have developed at rapid paces which has led Tim Horton to strategically place more locations in these areas where once there may have been only one store, now

They cannot rely on their name alone to have customers choose them. The previous report had already noted that Tim Hortons had dominated the market in coffee sales in Canada, and according to coffee experts that is despite being a worse coffee than McDonald’s and Wendy’s. (http://www.theglobeandmail.com/life/food-and-wine/food-trends/mcdonalds-tim-hortons-who-makes-the-best-brew/article4183891/) In order to grow an international presence they will need to improve their in store model to offer extras like their competition has. When they are already competing against the market prevalence of Starbucks in the United States (http://www.usatoday.com/story/money/business/2016/12/07/starbucks-stores-coffee-howard-schulz/95086206/) they will need a superior product as customers will need to go out of their way to get to a Tim Hortons over a

Coffee, Tim Hortons most significant source of income, is produced in more than fifty developing countries, including Latin America, Africa, and Asia. Understanding the importance of keeping costs low, Tim Hortons has strategically chosen to develop their coffee in these regions. Keeping costs low means an increase in profitability, appealing stakeholders. However, The roasting and branding of coffee is more capital intensive, subsequently relocating that aspect of their business to northern industrialized countries ( COFFEE VALUE CHAIN & P3G ANALYSIS, n.d).

Many multinational corporations in the coffee industry have succeeded tremendously such as Starbucks. Each of these corporations has strategies that helped them continue to expand to nations of different cultures, ethnicities, governmental practices, and locations.

The context change in form that Starbucks found itself competing with smaller chains that resembled its former pre-expansion model with competitors focusing in creating symbolic-expressive value and fast food restaurants that had started to offer specialty coffee with more aggressive advertisement at a lower cost. The competitive context changed for Starbucks because it’s focus in mass distribution channels and its retail footprint strategy stated its product within a standard performance product value; this affected the value perception of the product.