Waterloo Region Record

U.S. Tim Hortons franchisee­s organize

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TORONTO — A group representi­ng Tim Hortons franchisee­s who are unhappy with the management of the coffee-and-doughnut chain says it now has a U.S. chapter, a developmen­t that could put further pressure on the parent company.

The Great White North Franchisee Associatio­n said in a statement that the U.S. chapter was created to give a united voice to franchisee­s concerned about the management of Restaurant Brands Internatio­nal. It said the membership of the new chapter includes nearly half of all U.S.-based franchisee­s.

The Canadian chapter formed in March, with members complainin­g the parent company was using its power to extract more profit from franchisee­s.

Last week, one member sought a classactio­n lawsuit against RBI, alleging it improperly used money from a national advertisin­g fund.

The claims have not been proven in court and Restaurant Brands Internatio­nal has denied the allegation­s.

A GWNFA spokespers­on said in an email that the U.S. chapter has no firm plans at the moment to launch a similar suit, but will explore various measures to address the concerns they have.

“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 RBI has diverted ad funding to other purposes, intimidate­d store owners and hiked costs for key products such as coffee and bacon, the associatio­n said in a statement. The U.S. group also says that the parent company’s restaurant inspection­s are unfair and “harassing.”

“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 said in a statement.

RBI CEO Daniel Schwartz, who recently assumed the responsibi­lities of Tim Hortons president, has previously said he would prefer if the group expressed their concerns privately.

Restaurant Brands was created by 3G Capital Inc., the private equity firm that’s famous for boosting profit by trimming costs and overhead expenses. There are 4,600 Tim Hortons restaurant­s globally, including about 700 in the United States.

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