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TIM HORTONS
Tim Hortons USA Inc. franchises restaurants specializing in coffee, non-alcoholic beverages, baked goods, soups, sandwiches, and related products under the Tim Hortons brand and system. They offer Franchise Agreements for Standard and Non-Standard Shops, Operator Agreements, Development Agreements, and limited Co-Branded options with Cold Stone Creamery, targeting quick-service consumers in various locations like standalone sites, drive-thrus, retail centers, and non-traditional venues. The business model involves initial franchise fees, ongoing royalties, and support for franchisees operating in compliance with brand standards in the competitive fast-food and coffee shop market.
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Franchise Costs
6% royalty + 4% ad fund + $450-$1,400/mo restaurant technology fee
Financial Performance
Item 19 Financial Performance
Data Based On: 585 franchised Standard Shops open as of December 31, 2025 that reported at least 10 months of sales for 2025.
* Average gross profit calculated as average monthly gross sales ($107,845) multiplied by (1 - average monthly COGS percentage (29%)). The document explicitly states that COGS and Labor expenses do not reflect all costs needed to determine net income or profit, so net income/profit and EBITDA cannot be calculated or estimated.
Extracted Item 19 Section
Avg. Revenue: $107,845
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Unlock financial performance dataTIM HORTONS Franchise Analysis
From its humble Canadian doughnut shop beginnings to a U.S. powerhouse under Restaurant Brands International, Tim Hortons beckons with drive-thru efficiency and coffee loyalty in the cutthroat fast-food arena. Item 19 financials paint a revenue picture that challenges assumptions about quick-service scale, while a trail of franchisee lawsuits whispers of operational friction. Can this 669-unit network deliver the returns to justify its steep entry, or does the data signal caution for expansion dreamers?
Item 7 lays out the hefty initial investment range of $988,000 to $3,312,500 for standard shops, covering buildouts from standalone sites to non-traditional venues, plus a $50,000 franchise fee. Ongoing costs bite with 6% royalties, 4% brand/ad fund, and $450-$1,400 monthly tech fees, fueling national marketing amid 669 franchised versus 24 corporate spots. Item 19 shines brightly here, disclosing average gross revenue of $107,845 and median $103,122 per unit—modest figures that underscore the grind for profitability in a saturated coffee market, especially with just 4 system transfers signaling low turnover.
Growth ambitions show 50 projected new units against 10 non-renewals, hinting at steady but selective expansion since franchising kicked off in 1984. SBA data bolsters credibility with 31 loans averaging $496,894, proving banks back committed operators. Yet litigation shadows loom from settled class actions over ad fund mismanagement and renewal disputes, per Item 20—flags for buyers to probe governance and support depth before diving into this Miami-headquartered behemoth's American push.
Analysis based on the 2026 Franchise Disclosure Document. All figures should be independently verified before making investment decisions.
How TIM HORTONS Compares
Key Insights
- Higher investment than 83% of Fast Food franchises
- Higher than average SBA loan default rate in Fast Food
| Franchise | Investment | Fee | Royalty | Locations |
|---|---|---|---|---|
TIM HORTONS Current | $988K – $3.3M | $50K | 6.0% | 669 |
| MCDONALD'S | $1.5M – $2.6M | $45K | N/A | 12,772 |
| LITTLE CAESARS | $377K – $1.8M | $20K | 6.0% | 3,788 |
| AFC | $45K – $151K | $6K | 9.5% | 3,572 |
| KFC (NON-TRADITIONAL) | $1.2M – $4.2M | $45K | N/A | 3,404 |
| SONIC DRIVE-IN | $1.5M – $2.5M | $15K | 5.0% | 3,120 |
Fast Food Average 132 franchises | $602K – $1.6M | $35K | 6.1% | – |
* Comparison based on latest FDD filings. Investment ranges from Item 7, fees from Item 5. Showing top 5 of 132 Fast Food franchises by location count.
SBA Loan History
Historical SBA 7(a) loan data for TIM HORTONS franchisees (2013 – 2025)
Loans by Year
SBA 7(a) loan activity over time
* Data sourced from SBA 7(a) FOIA loan records. Default rate calculated from charged-off loans.
31 SBA loans on record
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Unlock SBA loan historyFranchisee Contacts
284 franchisee contacts on file from official FDD filings.
284 Contacts Available
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Unlock contactsDue Diligence
Litigation (Item 3)
Primarily class actions by franchisees alleging breaches related to advertising fund mismanagement and interference with franchisee association rights (settled 2019), along with individual disputes over franchise terminations, non-renewals, failure to pay fees, and breaches of good faith, duty of assistance, pricing control, and retaliation on renewals/transfers.
Bankruptcy (Item 4)
System Health (Item 20)
Franchise system changes reported in the most recent fiscal year
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Unlock due diligence reportsFrequently Asked Questions
The total initial investment to open a TIM HORTONS franchise ranges from $988,000 to $3,312,500. This includes a franchise fee of $50,000. Ongoing royalty fees are 6.0% of gross sales.
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