Home » Uncategorized » Tim Hortons: Environmental and competitive landscapes

In order to analyze the environmental and competitive landscapes for Tim Hortons, it is necessary consider the restaurant’s strengths, weaknesses, opportunities and threats. To begin with, the major environmental strength of Tim Hortons is the large network of restaurants across Canada and the United States (Craves, 2007). Currently, it is the largest fast food restaurant in North America. Second, the restaurant is located in diverse locations that are quite strategic to attract customers. Tim Hortons offers variety of fast foods and blends of coffee. Hence, it is in a position to meet the broad tastes and preferences of customers. It is one of the most progressing restaurant chains within the current environmental landscape. The restaurant has also recorded excellent customer satisfaction level due to its fast service.

In spite of the above strengths in its environmental landscape, Tim Hortons also struggles in quite a number of areas in order to attain its goals and objectives. For instance, Dunkin Donuts outwitted Tim Hortons in terms of market competition. In other words, Tim Hortons failed to put in place vibrant strategies that could diffuse Dunkin Donuts from the market. It is also vital to mention that Tim Hortons does not generate significant profits among the chains located in the United States as compared to those in Canada. For a long time, the stiff market competition in the United States has impeded the growth of Tim Hortons chains. Worse still, it has proven to be quite cumbersome to sustain quality franchises. As a result, the expected long term growth prospects in revenue are yet to be achieved by Tim Hortons.

The external environment for Tim Hortons is also laced with broad opportunities that the restaurant can grasp and thereafter optimize its operations. The potential advantages at Tim Hortons include expansion into the international markets and the option of developing new services or products. For example, Tim Hortons has the opportunity to geographically extend its operations to Asia, Africa and the Middle East regions. Besides, the restaurant may begin to produce iced coffee of different varieties. Sales can also be improved through the development of new varieties. In markets such as the United States and United Kingdom, Tim Hortons can reorient itself by offering fast foods that directly compete with those of the competitors. The restaurant chain may also boost the interests of customers by undertaking an adequate market research before injecting additional capital (Hutchinson, Singh, Svensson & Mysen, 2013). Such measures can indeed be effective in an attempt to curtail competition.

There are also other potential disadvantages in form of threats that Tim Hortons faces in its restaurant chains. The threats are external environmental factors that may negatively affect the overall profitability of the restaurant. One of the most serious threats being encountered by Tim Hortons is the stiff competition in the American and Canadian fast food markets. Although the restaurant chain has firmly established itself in several locations across the globe over the years, there are other equally competitive restaurants such as Dunkin Donuts and Starbucks. The same market rivals are also spreading very fast to locations that have been traditionally dominated by Tim Hortons (Craves, 2007). If this trend continues, the Tim Hortons restaurant chain might end up losing out its current marketing platform and clientele base.

The rising cost of labor and other vital resources required in the process of production have been major issues of concern especially since the year 2007 when global economic recession began to bite.  However, same-store sales growth is a major reputation for Tim Hortons. The restaurant chain is still in a position to make decent profits in spite of recording fewer transactions. The panini sandwiches have also registered a major boom in sales over the recent years. As a matter of fact, the current customers at Tim Hortons do not merely buy coffee. They also diversify in other variety of products available in the restaurant’s menu (Hutchinson, Singh & Walker, 2012).

The single cup coffee is yet another area of interest for Tim Hortons. In 2012, the restaurant made a business deal with Kraft. The main purpose of the agreement was to produce T-Discs. The discs are used for the Tassimo. The latter was an interesting growth opportunity for Tim Hortons. The current operating platform is indeed excellent and as such, the restaurant may continue to reap further benefits.

Most of the Tim Hortons restaurants are operating within their respective capacities. Hence, it can be argued that the restaurant chain is making optimum profit even though there is need for the enterprise to seek other alternative measures to boost profitability. The management at Tim Hortons is supposed to devise other viable strategies to attract additional customers to its chains. The present operating landscape calls for the fast food company to open more chains especially in geographical locations that are profitable (Craves, 2007).  In any case, Tim Hortons can maximize the available opportunities instead of seeking new growth ideas. Finally, the front office department at Tim Hortons is strategically positioned to bridge the gap among various economic landscapes.

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