Tim Hortons breakfast menu price hikes not enough for franchisees: source

By
Canadian Press
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39

Tim Hortons franchisees knew price increases on some menu items were coming, but the slight bump on breakfast menus the company confirmed Friday falls short of the 10 per cent across-the-menu hike those grappling with Ontario’s minimum wage hike feel they need, according to a franchisee association source.

“Some restaurants in select markets have slightly increased prices for some breakfast menu items,” parent company Restaurant Brands International (TSX:QSR) said on Friday.

“Regular adjustments to menu prices are a normal part of the restaurant business,” the Oakville, Ont.-based company said in a brief statement, making no connection between the move and the minimum wage controversy that’s landed the chain in hot water.

A source from the Great White North Franchisee Association, a group not sanctioned by the company that aims to voice the concerns of the roughly half of Canadian franchisees it represents, confirmed RBI announced the price adjustment to franchisees weeks prior.

The adjustments vary by area, the source said, but were added to a handful of items — mostly breakfast combos — and prices went up about 20 cents in many regions.

The timing of RBI’s internal announcement indicates it has not bowed to mounting pressure from some franchisees, an industry group and the public to resolve how some store owners handled a 21 per cent jump in Ontario’s minimum wage, which kicked in Jan. 1.

Some Tim Hortons franchisees in the province eliminated paid breaks, fully-covered health and dental plans, and other perks for their workers. The changes came to light after a letter from the owners of two Cobourg, Ont., franchisees circulated on social media.

Those franchisees and the GWNFA partly blame RBI, which controls pricing, for refusing to help franchisees stomach the $2.40 jump in minimum hourly wages by boosting what they can charge for food and beverages, among other requests.

The GWNFA source says franchisees want menu prices to go up by about 10 per cent across the board in Canada.

The association estimates the minimum wage hike and other changes to the province’s labour laws will cost the average franchisee $243,889 a year. The calculation assumes an extra $3.35 hourly per employee, which also includes costs such as increased vacation pay.

RBI denounced the actions taken by some franchisees and has said it’s committed to helping restaurant owners work through the changes. The company has declined to answer questions on how it intends to do that. Tim Hortons media relations declined to comment further Friday evening.

Tim Hortons maintains individual franchisees are responsible for setting employee wages and benefits, while complying with applicable laws.

Angry consumers have targeted both the parent company and the franchisees, taking to social media and encouraging others to #BoycottTimHortons in an effort to put pressure on either group to reverse the changes. Protesters also gathered outside Tim Hortons locations across Ontario this week.

The Ontario Federation of Labour, an umbrella group for workers and their unions in Ontario, called on RBI’s chief executive Daniel Schwartz to take immediate steps to ensure his franchisees comply with and respect the spirit of the province’s labour laws.

The dispute over employee wages and price hikes is the latest round of finger-pointing in an ongoing blame game between some franchisees and their corporate parent. They have publicly sparred over alleged mismanagement and filed several lawsuits against each other in recent months.

Tim Hortons appears to have last adjusted prices Aug. 2, 2017 when it boosted what it charges for hot beverages and breakfast items.

The last known prior price increase was in 2014.

Follow @AleksSagan on Twitter.

Aleksandra Sagan, The Canadian Press



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39 COMMENTS

  1. All of these argurments are valud when talking about a local small business. Not when you are the largest coffee shop in all of canada with coffee being a 100 percent profit and selling more coffee then real food. No one like loosing money but when your a billion dollar franchise it is not an argument. They could have easily absorbed the increase without negative loss

  5. By the time we’re done focusing on Tim Hortons, all the rest of the fallout from this minimum wage fiasco will be starting to kick in … anybody here think businesses will be able to absorb this? Of course it’ll be passed on to the consumer.
    Concerns about Tim Horton’s profits should be redirected to the Liberals, you don’t have to buy a Timmies but you’re stuck with this government.

  7. Did anyone in their right minds believe any business was going to just absorb this pay increase?? It does not matter how much you make…NOBODY wants to have $$$ taken out of their pocket. Just because someone is making more than you does not make it ok for them to lose money. People say financial greed…i say what if your boss came to you today and said we are cutting $2 an hour off your wage?? Do not blame Timmies…blame your government.

    • THE LIBERAL GOVERMENT TOLD ALL BUSINESSES TO RAISE PRICES TO OFFSET THE PAY RAISE. IN OTHER WORDS THE LIBERALS GAVE A PAY RAISE TO MINIMUM WAGE EARNERS THEN TOLD BUSINESSES TO RAISE THE COST OF LIVING THEREBY LEAVING MINIMUM WAGE EARNERS RIGHT WHERE THEY STARTED FROM, AND GIVING THOSE ON A FIXED INCOME A MUCH HARDER TIME. lIBERALS ARE ALWAYS BAD NEWS.

    • Wynne was told by every single business organization that increasing minimum wage was going to hurt minimum wage workers – she didn’t listen and wanted to buy votes. If minimum wage increases actually worked then it would have worked the last time it went up.

    • The reality is that each franchise owner needs to pony up $2 million to get a franchise – they won’t lose, they will get out before too much financial loss happens – people with that kind of money have really smart people making sure they keep their money. Boycotting will only hurt those minimum wage workers as they will now be jobless.

    • maybe these big businesses are taking too much profit out of the business and its time for them to put back … stop being so f’en greedy,, don’t you think people like Trump can lose some millions of profit without interfering their wasteful life style,, .Revenue in 2015 for RBI was US$4.0522 billion[5] with a rise to $4.15 billion in 2016.[57] Tim Hortons had 683 U.S. locations by the end of 2016, and total annual revenue of US $3.00 billion.[4],,, just the states alone now add the exchange for this Canadain business,, .. not one investor would still be able to afford their multiple homes and gas for their yachts .. think hard about it I stop going to Timmies .. boo hoo for the rich .. they been raking us for to long . and ” THATS AT Fact Jack”

  8. Lol businesses are there strictly to make a profit. I don’t blame them a damn bit, the blame should go to Wynne for this stupid minimum wage hike that everyone knew would cost jobs and raise the price of everything.

    • Nah, blame should go to previous governments for the min wage freezes that have made a jump like this necessary when it would normally be a minimal increase. “Price of everything” is a bit much hahaha, I’ve yet to see much increase personally, and “everything” won’t be going up in price.

    • In the real world you work your way out of an entry level job to get a better job with more money. Minimum wage jobs aren’t meant for adults to raise a family on for christ sake. And if you actually think prices aren’t going to go up everywhere you aren’t very intelligent.

  10. It’s has finally come to fruition how sheepish we consumers really are. We get up every morning and go to our tummies drive threw on the way to our jobs. Now that the min wage is up to a level to try and pull the many of their staff out of poverty they cancelled paid breaks and benefits. This is corporate greed and proof that these owners don’t care for their staff or community at all. So yes stop buying from them. Find a local mom and pop place and make the effort to support your local small business. Let the big corporations bleed a slow death.

    • You don’t think every union out there isn’t going to go after increases based on this, that commodities will have to increase in price to suit, immediately nullifying the so-called intent? Speaking of sheepish consumers …

  12. The prices were too high to start with, especially for their ‘nothing special coffee’ so they will definitely be driving more customers away now. Prices have also gone up at Subway and all others I would imagine. Just how much profit is enough profit?
    Wynne really screwed up on this one, I hope she doesn’t think THIS is going to get her re-elected, quite the opposite I would wager.

  14. The say that it will cost them $243,889 more a year, which breaks down to there being 8.3 min wage staff on the job 24/7. when was the last time you saw that many employees working at once in a timmies?

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