U.S. Tim Hortons franchisees organize
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.