Tim Hortons' U.S. Franchisees Form Alliance as Tensions BoilBy
Canadian group was formed in March to address parent issues
About half of U.S. franchisees have joined the new alliance
Tim Hortons’ U.S. franchisees are banding together to lobby for corporate-level changes at the coffee chain, which is owned by Restaurant Brands International Inc., the fast-food giant that also runs Burger King.
The move follows a similar Canadian alliance -- dubbed the Great White North Franchisee Association -- that formed in March. The Canadian franchisees filed a class-action suit earlier this month, arguing that Restaurant Brands executives have breached their obligations to local branch operators.
“The stores are lacking profitability and the franchisees feel that Tim Hortons is not helping them,” said Robert M. Einhorn, an attorney at Zarco Einhorn Salkowski & Brito in Miami who is representing the U.S. alliance.
Like its Canadian counterpart, the U.S. group says Restaurant Brands has diverted ad funding to other purposes, intimidated store owners and hiked costs for key products such as coffee and bacon, the Great White North Franchisee Association said in a statement on Monday.
The U.S. group also says that the parent company’s restaurant inspections are unfair and “harrassing.”
“They keep changing the rules,” Einhorn said. “They fail many of the stores, which serves to demoralize the franchisees.”
Restaurant Brands said its franchisees are “the foundation of its system” and pledged to work closely with them in the U.S.
“We are committed to continued collaboration with our franchise advisory board, the members of which are elected by our franchise owners, to ensure that the Tim Hortons brand is healthy for the long run by focusing on what will help us serve our guests and the iconic Tim Hortons brand now and in the future,” the company’s press office said in an emailed response to questions.
Restaurant Brands was created by 3G Capital Inc., the private equity firm that’s famous for boosting profit by trimming costs and overhead expenses.
The new U.S. alliance is backed by almost half of the country’s Tim Hortons franchisees, including owners in the chain’s key markets of Ohio, Michigan and New York. There are 4,600 Tim Hortons restaurants globally, including about 700 in the U.S.