You drive into a Canadian town (or city) of just about any size, and you’re as likely to see a Tim Hortons as you are a church.
And a recent Canadian court filing by the country’s largest food-service company shows why. The filing, stemming from a nasty $1.95 billion class-action lawsuit filed against it last fall, details franchisees’ healthy bottom lines, and probably strengthens the company’s legal defense. Profits work out to an average $265,000 per outlet. Will this put local franchise owners in a bad light? That’s what some of them fear.
Ironically, the big lawsuit was filed by a group of disgruntled Hortons franchise owners located in the chain’s home base of Ontario. The bitter, high-stakes case has pitted store owners against senior executives and store owners versus each other in a fight over how new business practices — specifically the decision to switch to frozen doughnuts — has affected franchisees’ wallets.