Tim Hortons Franchise Startup Cost, Revenue and Profit Margin

Tim Hortons is an international coffee franchise with Canadian origin.

This franchise was founded by Tim Horton in 1964 and since then has grown into a global brand with over 4,846 locations and growing.

Here, we will attempt to provide you with information franchising in addition to the requirements franchisees must have to own a Tim Hortons franchise.

Its popular menu items include coffee, freshly prepared food and donuts. These are specially prepared and have won the franchise a dedicated following among a greater percentage of its clients.

Who is Tim Hortons Looking For?

There are basic characteristics a prospective franchisee must have to be considered for this opportunity. These include being its committed ambassador for the Hortons brand in your local market, must be experienced enough to operate a multi-site beverage and food unit as well as being passionate about its products as well as the brand.

An ideal candidate should be able to show and demonstrate strong communication and leadership skills. These and more are some of the characteristics you must possess to be seriously considered for this franchise opportunity.

Tim Hortons Franchise Cost

To become a Tim Hortons franchisee, you must meet up several cost obligations as contained in its franchise disclosure document. These include an initial franchise fee with a low and high of $15,000 and $50,000 respectively.

There are also real estate taxes, common area maintenance charges and property taxes ranging from $1,000 to $22,000.

Equipment costs starts from $75,000 to $415,000, while the cost for real estate varies. Planning, development & design costs ranges between $17,500 to $100,000 while site development costs starts at $0 to as high as $500,000. It will cost you anywhere from $150,000 to $800,000 for building your unit(s). Training cost ranges from $7,900 to $11,800.

Start-up supplies & initial inventory will range from $1,000 to $30,000. Professional & license fees has a low and high of $1,500 and $10,000 respectively. Insurance will cost from $150 to $21,500, initial advertising & promotion starts at $500 to $6,000, Security deposits at $0 to $15,000 while development assistance fees and addition funds start at $5,000 to $25,000 and $25,000 to $40,000 respectively.

All these come to an estimated total of $299,550 to $2,046,300. Other details on costs are contained in Tim Hortons FDD. This is available to prospective franchisees when the application process commences.

Other Fees

There are several other fees such as royalty of 4.5 to 6% of gross sales, transfer fee making 5% of the full purchase price, and a varying maintenance cost. There are advertising contributions too. Such fees make up 4% of gross sales.

These are just a few of the fees you’ll need to pay. To find out what does apply to your case, it will be necessary to contact the franchisor for further discussions.

What Franchise Models Are Available?

One of the first things prospective franchisees need to ask if what franchise models are available for investment at Tim Hortons.

To provide a ready answer, there are two main models. These include the Standard Shop as well as the Non-Standard or Tim Hortons Kiosks. Let’s briefly explain each of these.

  • Tim Hortons Standard Shops

As the name implies, this model is the regular type of coffee shop that not only sells coffee but also includes a rich menu. Such menu items consist of other types of beverages, different types of soups and sandwiches among others.

This could be an in-line shop or in many cases a drive-thru stand-alone facility.

Size matters here. A standard Tim Hortons shop is roughly about 1,000 to 2,300 square feet. This also has a sitting space for customers. Having provided you with a rough picture of what a standard Tim Hortons shop looks like, let’s consider the other model.

  • Non-Standard Tim Hortons Shops

Also known as kiosks, this model is typically smaller when compared to the standard model. The benefit of this model is that it can be installed in just about any location. In other words, it is quite versatile and won’t take up much space.

There are three types of kiosks that include a full-service cart, double drive-through, and a built-in kiosk.

This Tim Hortons shop model best fits certain locations. The franchisor locates these in high foot traffic areas such as malls, gas stations, campuses, airports and hospitals among others.

Franchise Term And Renewal

As with most franchises, the Tim Hortons franchise comes with franchise terms. Franchisees are allowed to own and operate their franchises for a term of 20 years.

However, at the expiration of the franchise term, it does not allow for franchise renewal.

Training

This is a critical part of your franchise operations. Without training, franchisees are unable to run their Tim Hortons franchises effectively. All franchisees (managers inclusive) must attend and complete the training program. This lasts 20 days where training is provided at the company’s corporate headquarters.

You don’t need to worry if you’re not close. Tim Hortons has you covered as there are alternative certified training locations where you get the best training available.

What Tim Hortons Franchise Offers

A large part of our discussion has been focused on the requirements you must abide by. However, there are several benefits to owning and operating a Tim Hortons franchise. Such benefits come by way of using or operating under the franchisor’s name.

Doing business under Tim Horton’s name and brand opens doors and creates huge opportunities for franchisees.

Why? Because it has built a solid brand name over the years, making it a customer favorite when it comes to coffee and other related beverage. You also benefit from support covering a wide range of areas. Some of these areas include site selection, preparing your franchise for a successful launch and marketing support among other things.

The Tim Hortons franchise is a great investment opportunity for anyone willing to become part of an international success story. While the information provided here is crucial in helping you get started. The details or specifics are provided by the franchisor upon application and discussion with its representatives.