News Article #3 -Tim Horton’s’ sales
Date: February 10, 2020 (written by: Jake Edmiston)
Summary: Last year at Tim Horton’s, the sales fell $150 million (US) compared to the previous year. José Cil is the chief executive at Tim Horton’s parent company Restaurant Brands International. Cil states that the Tims Reward program was somewhat to blame after it had brought in 7.5 million members, who were all routinely receiving free baked goods or coffee after every seventh purchase. During this month, Tims Rewards will switch over to a point-based program. Customers are supposed to earn 10 points for every purchase which they can, in the end, use to redeem free baked goods or coffee. This change is an attempt to pull out more value out of the program and shows to be testing the patience of customers. The Alliance of Canadian Franchisees, a short time ago, protested that the new program hasn’t provided any major benefits expect the big number of giveaways. The Alliance said, the new program was affecting food cost percentages.
Video: https://www.youtube.com/watch?v=HNeifRcPS-A
Stakeholders: & how different people/organizations can be effected
- Tim Horton’s- (-) Sales have fallen $150 million (US).
- Costumers- (+/-) They are able to earn points to receive baked goods or coffee but only earn 10 points per purchase.
- Co-workers at Tim Horton’s- (-) They will need more of them to maintain the shops which means more people would be needed to get paid
- Competing businesses- (+) After Tim Horton’s fall of sales, they would be ahead of them in terms of business and will be more successful until Tim Horton’s re-earns their sales.
- Suppliers of goods- (+) The industries that supply Tim Horton’s with their supplies will get a raise ($) because Tim Horton’s will need more supplies
Opinion:
I personally think that Tim Horton’s fall is going be a big impact on them for a while. Considering that it’s a shop that’s loved by many Canadians, they will be able to make up the sales. I also think that the Rewards program is to blame. It did attract a lot of attention but the amount of baked goods or drinks that were given away were the cause of the downfall of the sales. Business-wise, it was a good strategy at first but it quickly started to have the opposite effect of what Tim Horton’s hoped to happen. The new point based program would be better and more effective then the last because it will attract costumers but also earn a lot of money out of it. I go to Tim Horton’s at least once a month but only my mom uses the points program and it’s been all right for both sides. Both sides are gaining in some way. My mom goes to Tim Horton’s at least three times a week. She is able to get her points and a free coffee or a baked good when she reaches the certain limit.
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